EXHIBIT 10.20

 

AGREEMENT

 

between

 

FISERV SOLUTIONS, INC.

20660 Bahama Street

Chatsworth, CA. 91311

 

and

 

COMMUNITY NATIONAL BANK

900 Canterbury Place, Suite 300

Escondido, CA 92025

 

Date: July 22, 2003

 

FISERV

 

© Copyright 2000 by Fiserv Solutions, Inc.

All Rights Reserved

 

This document contains proprietary and confidential information of Fiserv
Solutions, Inc. and may not be copied, published, disclosed or distributed
without the express written consent of Fiserv Solutions, Inc. The material in
this document, including terms, procedures, fees and other conditions, comprise
an agreement to consider which will remain valid for ninety (90) days from July
22, 2003.

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AGREEMENT dated as of July 22, 2003 (“Agreement”) between FISERV SOLUTIONS,
INC., a Wisconsin corporation (“Fiserv”), and COMMUNITY NATIONAL BANK,
(“Client”).

 

Fiserv and Client hereby agree as follows:

 

1. Term. The initial term of this Agreement shall end sixty two (62) Months
following the date Fiserv Services (as defined below) are first used by Client
and, unless written notice of non-renewal is provided by either party at least
210 days prior to expiration of the first thirty six (36) months of the initial
term or any renewal term or one hundred eighty days (180) during the final
twenty six (26) months. This Agreement shall automatically renew for additional
term(s) of five (5) years. This Agreement shall be effective on the day services
are first provided to Client by Fiserv (“Effective Date”).

 

2. Services. (a) Services Generally. Fiserv, itself and through its affiliates,
agrees to provide Client, and Client agrees to obtain from Fiserv services
(“Services”) and products (“Products”) (collectively, “Fiserv Services”)
described in the attached Exhibits:

 

Exhibit A – Account Processing Services

Exhibit B – Item Processing Services

Exhibit C – EFT Services

Exhibit D – Mortgage Processing Services

Exhibit E – BankLink Products and Services

Exhibit F – Wire Transfer Services

Exhibit G – ACH Services

Exhibit H – Development Services

Exhibit I – Implementation Services

Exhibit J – HRIS Services

Exhibit K – Card and Fulfillment Services

Exhibit L – Material Purchased Through Fiserv

Exhibit M – Software Products

Exhibit N – Support Services

Exhibit O – Internet and Remote Banking Services

Exhibit P – Credit Processing Services

Exhibit Q – Professional Services

Exhibit R – Insurance Processing Services

Exhibit S – Stored Value Transaction Processing Services

Exhibit T – Lease Processing Services

 

The Exhibits set forth specific terms and conditions applicable to the Services
and/or Products, and, where applicable, the Fiserv affiliate so performing.
Client may select additional services and products from time to time by
incorporating an appropriate Exhibit to this Agreement.

 

(b) Implementation Services. Fiserv will provide services (i) to convert
Client’s existing applicable data and/or information to the Fiserv Services;
and/or (ii) to implement the Fiserv Services. These activities are referred to
as “Implementation Services”. Client agrees to cooperate with Fiserv in
connection with Fiserv’s provision of Implementation Services and to provide all
necessary information and assistance to facilitate the conversion. Client is
responsible for all out-of-pocket expenses associated with Implementation
Services. Fiserv will provide Implementation Services as required in connection
with Fiserv Services.

 

(c) Training Services. Fiserv shall provide training, training aids, user
manuals, and other documentation for Client’s use as Fiserv finds necessary to
enable Client personnel to become familiar with Fiserv Services. If requested by
Client, classroom training in the use and operation of Fiserv Services will be
provided at a training facility designated by Fiserv. All such training aids and
manuals remain Fiserv’s property.

 

3. Fees for Fiserv Services. (a) General. Client agrees to pay Fiserv:

 

(i) Fees for Fiserv Services for the month as specified in the Exhibits;

 

(ii) out-of-pocket charges for the month payable by Fiserv for the account of
Client; and

 

(iii) Taxes (as defined below) thereon (collectively, “Fees”).

 

Fiserv shall timely reconcile Fees paid by Client for the Fiserv Services for
the month and the fees and charges actually due Fiserv based on Client’s actual
use of Fiserv Services for such month. Fiserv shall either issue a credit to
Client or provide Client with an invoice for any additional fees or other
charges owed. Fiserv may change the amount of Fees billed to reflect appropriate
changes in actual use of Fiserv Services. Fees may be increased from time to
time as set forth in the Exhibits A(2), and B(3) respectively. Upon 60 days
written notification to and acceptance by Client, Fiserv may increase its fees
in excess of amounts listed in the Exhibits only in the event that Fiserv is
required to implement major system enhancements to comply with changes in law,
government regulation, or industry practices.

 

(b) Additional Charges. Fees for out-of-pocket expenses, such as telephone,
microfiche, courier, and other charges incurred by Fiserv for goods or services
obtained by Fiserv on

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Client’s behalf shall be billed to Client at cost plus the applicable Fiserv
administrative fee as set forth in the Exhibits. Such out-of-pocket expenses may
be changed from time to time upon notification of a fee change from a
vendor/provider.

 

(c) Taxes. Fiserv shall add to each invoice any sales, use, excise, value added,
and other taxes and duties however designated that are levied by any taxing
authority relating to the Fiserv Services (“Taxes”). In no event shall “Taxes”
include taxes based upon Fiserv’s net income. The Fees do not include, and
Client shall be responsible for, furnishing transportation or transmission of
information between Fiserv’s service center(s), Client’s site(s), and any
applicable clearing house, regulatory agency, or Federal Reserve Bank.

 

(d) Payment Terms. Estimated Fees are due and payable monthly upon receipt of
invoice. Client shall pay Fiserv through the Automated Clearing House. In the
event any amounts due remain unpaid beyond the 30th day after payment is due,
Client shall pay a late charge of 1.5% per month. Client agrees that it shall
neither make nor assert any right of deduction or set-off from Fees on invoices
submitted by Fiserv for Fiserv Services.

 

4. Access to Fiserv Services. (a) Procedures. Client agrees to comply with
applicable regulatory requirements and procedures for use of Services
established by Fiserv.

 

(b) Changes. Fiserv continually reviews and modifies Fiserv systems used in the
delivery of Services (the “Fiserv System”) to improve service and comply with
government regulations, if any, applicable to the data and information utilized
in providing Services. Fiserv reserves the right to make changes in Services,
including but not limited to operating procedures, type of equipment or software
resident at, and the location of Fiserv’s service center(s). Fiserv will notify
Client 60 days in advance of any material change that affects Client’s normal
operating procedures, reporting, or service costs prior to implementation of
such change. Should Client deem that such change significantly affects its
normal operating procedures, reporting or service costs to the extent that
Client cannot accept the change, then Client may invoke its right terminate this
Agreement for Convenience in accordance with the termination fee schedule
designated in 11(h).

 

(c) Communications Lines. Fiserv shall order the installation of appropriate
communication lines and equipment to facilitate Client’s access to Services.
Client understands and agrees to pay charges relating to the installation and
use of such lines and equipment as set forth in the Exhibits.

 

(d) Terminals and Related Equipment. Client shall obtain necessary and
sufficient terminals and other equipment, approved by Fiserv and compatible with
the Fiserv System, to transmit and receive data and information between Client’s
location(s), Fiserv’s service center(s), and/or other necessary location(s).
Fiserv and Client may mutually agree to change the type(s) of terminal and
equipment used by Client.

 

5. Client Obligations. (a) Input. Client shall be solely responsible for the
input, transmission, or delivery to and from Fiserv of all information and data
required by Fiserv to perform Services unless Client has retained Fiserv to
handle such responsibilities, as specifically set forth in the Exhibits. The
information and data shall be provided in a format and manner approved by
Fiserv. Client will provide at its own expense or procure from Fiserv all
equipment, computer software, communication lines, and interface devices
required to access the Fiserv System. If Client has elected to provide such
items itself, Fiserv shall provide Client with a list of compatible equipment
and software; Client agrees to pay Fiserv’s standard fee for recertification of
the Fiserv System resulting therefrom.

 

(b) Client Personnel. Client shall designate appropriate Client personnel for
training in the use of the Fiserv System, shall supply Fiserv with reasonable
access to Client’s site during normal business hours for Implementation Services
and shall cooperate with Fiserv personnel in their performance of Services.

 

(c) Use of Fiserv System. Client shall (i) comply with any operating
instructions on the use of the Fiserv System provided by Fiserv; (ii) review all
reports furnished by Fiserv for accuracy; and (iii) work with Fiserv to
reconcile any out of balance conditions. Client shall determine and be
responsible for the authenticity and accuracy of all information and data
submitted to Fiserv.

 

(d) Client’s Systems. Client shall be responsible for ensuring that its systems
are Year 2000 compliant and otherwise capable of passing and/or accepting data
from and/or to the Fiserv System.

 

6. Ownership and Confidentiality. (a) Definition.

 

(i) Client Information. “Client Information” means: (A) confidential plans,
customer lists, information, and other proprietary material of Client that is
marked with a restrictive legend, or if not so marked with such legend or is
disclosed orally, is identified as confidential at the time of disclosure (and
written confirmation thereof is promptly provided to Fiserv); and (B) any
information and data concerning the business and financial records of Client’s
customers prepared by or for Fiserv, or used in any way by Fiserv in connection
with the provision of Fiserv Services (whether or not any such information is
marked with a restrictive legend). Fiserv will be responsible for data and other
information, including equipment or

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software on Fiserv premises for the benefit of the client , from the time such
is received by Fiserv until it is, in the case of data, processed and files
based thereon are transmitted to Client. With a minimum of fifteen (15) days
notice, Client will have access to any and all records at anytime they are in
possession of Fiserv.

 

(ii) Fiserv Information. “Fiserv Information” means: (A) confidential plans,
information, research, development, trade secrets, business affairs (including
that of any Fiserv client, supplier, or affiliate), and other proprietary
material of Fiserv that is marked with a restrictive legend, or if not so marked
with such legend or is disclosed orally, is identified as confidential at the
time of disclosure (and written confirmation thereof is promptly provided to
Client); and (B) Fiserv’s proprietary computer programs, including custom
software modifications, software documentation and training aids, and all data,
code, techniques, algorithms, methods, logic, architecture, and designs embodied
or incorporated therein (whether or not any such information is marked with a
restrictive legend).

 

(iii) Information. “Information” means Client Information and Fiserv
Information. No obligation of confidentiality applies to any Information that
the receiving party (“Recipient”) (A) already possesses without obligation of
confidentiality; (B) develops independently; or (C) rightfully receives without
obligation of confidentiality from a third party. No obligation of
confidentiality applies to any Information that is, or becomes, publicly
available without breach of this Agreement.

 

(b) Information Security: Fiserv shall implement and maintain appropriate
measures designed to meet the objectives of the guidelines establishing
standards for safeguarding non-public Client customer information as adopted by
any federal regulatory agencies having jurisdiction over Client’s affairs.
Fiserv shall disclose to Customer any breaches in security, which results in
unauthorized intrusions to Fiserv’s systems, the effect upon the Customer, and
the corrective action Fiserv has taken to respond to the intrusion or breach in
security. Fiserv performs periodic security assessments, including penetration
testing, through an independent third party. Fiserv shall provide Client with
evidence of its most recent security audit certification upon Client’s request.

 

(c) Obligations. Recipient agrees to hold as confidential all Information it
receives from the disclosing party (“Discloser”). All Information shall remain
the property of Discloser or its suppliers and licensors. Information will be
returned to Discloser at the termination or expiration of this Agreement.
Recipient will use the same care and discretion to avoid disclosure of
Information as it uses with its own similar information that it does not wish
disclosed, but in no event less than a reasonable standard of care. Recipient
may use Information for any purpose that does not violate such obligation of
confidentiality. Recipient may disclose Information to (i) employees and
employees of affiliates who have a need to know; and (ii) any other party with
Discloser’s written consent. Before disclosure to any of the above parties,
Recipient will have a written agreement with such party sufficient to require
that party to treat Information in accordance with this Agreement. Recipient may
disclose Information to the extent required by law. However, Recipient agrees to
give Discloser prompt notice so that it may seek a protective order. The
provisions of this sub-section survive any termination or expiration of this
Agreement.

 

(d) Residuals. Nothing contained in this Agreement shall restrict Recipient from
the use of any ideas, concepts, know-how, or techniques contained in Information
that are related to Recipient’s business activities (“Residuals”), provided that
in so doing, Recipient does not breach its obligations under this Section.
However, this does not give Recipient the right to disclose the Residuals except
as set forth elsewhere in this Agreement.

 

(e) Fiserv System. The Fiserv System contains information and computer software
that are proprietary and confidential information of Fiserv, its suppliers, and
licensors. Client agrees not to attempt to circumvent the devices employed by
Fiserv to prevent unauthorized access to the Fiserv System, including, but not
limited to, alterations, decompiling, disassembling, modifications, and reverse
engineering thereof.

 

(f) Confidentiality of this Agreement. Fiserv and Client agree to keep
confidential the prices, terms and conditions of this Agreement, without
disclosure to third parties except for Federal, State, or other governmental
regulatory agencies as may have jurisdiction over Client’s business.

 

7. Regulatory Agencies, Regulations and Legal Requirements. (a) Client Files.
Records maintained and produced for Client (“Client Files”) may be subject to
examination by such Federal, State, or other governmental regulatory agencies as
may have jurisdiction over Client’s business to the same extent as such records
would be subject if maintained by Client on its own premises. Client agrees that
Fiserv is authorized to give all reports, summaries, or information contained in
or derived from the data or information in Fiserv’s possession relating to
Client when formally requested to do so by an authorized regulatory or
government agency.

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(b) Compliance with Regulatory Requirements. Client agrees to comply with
applicable regulatory and legal requirements, including without limitation:

 

(i) submitting a copy of this Agreement to the appropriate regulatory agencies
prior to the date Services commence;

 

(ii) providing adequate notice to the appropriate regulatory agencies of the
termination of this Agreement or any material changes in Services;

 

(iii) retaining records of its accounts as required by regulatory authorities;

 

(iv) obtaining and maintaining, at its own expense, any Fidelity Bond required
by any regulatory or governmental agency; and

 

(v) maintaining, at its own expense, such casualty and business interruption
insurance coverage for loss of records from fire, disaster, or other causes, and
taking such precautions regarding the same, as may be required by regulatory
authorities.

 

8. Warranties. (a) Fiserv Warranties. Fiserv represents and warrants that:

 

(i)(A) Services will conform to the specifications set forth in the Exhibits;
(B) Fiserv will perform Client’s work accurately provided that Client supplies
accurate data and information, and follows the procedures described in all
Fiserv documentation, notices, and advices; (C) Fiserv personnel will exercise
due care in provision of Services; (D) the Fiserv System will comply in all
material respects with all applicable Federal regulations governing Services;
and (E) the Fiserv System is Year 2000 compliant. In the event of an error or
other default caused by Fiserv personnel, systems, or equipment, Fiserv shall
correct the data or information and/or reprocess the affected item or report at
no additional cost to Client. Client agrees to supply Fiserv with a written
request for correction of the error within 7 days after Client’s receipt of the
work containing the error. Work reprocessed due to errors in data supplied by
Client, on Client’s behalf by a third party, or by Client’s failure to follow
procedures set forth by Fiserv shall be billed to Client at Fiserv’s then
current time and material rates; and

 

(ii) it owns or has a license to furnish all equipment or software comprising
the Fiserv System. Fiserv shall indemnify Client and hold it harmless against
any claim or action that alleges that the Fiserv System use infringes a United
States patent, copyright, or other proprietary right of a third party. Client
agrees to notify Fiserv promptly of any such claim and grants Fiserv the sole
right to control the defense and disposition of all such claims. Client shall
provide Fiserv with reasonable cooperation and assistance in the defense of any
such claim.

 

THE WARRANTIES STATED HEREIN ARE LIMITED WARRANTIES AND ARE THE ONLY WARRANTIES
MADE BY FISERV. FISERV DOES NOT MAKE, AND CLIENT HEREBY EXPRESSLY WAIVES, ALL
OTHER WARRANTIES, INCLUDING WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A
PARTICULAR PURPOSE. THE STATED EXPRESS WARRANTIES ARE IN LIEU OF ALL LIABILITIES
OR OBLIGATIONS OF FISERV FOR DAMAGES ARISING OUT OF OR IN CONNECTION WITH THE
DELIVERY, USE, OR PERFORMANCE OF FISERV SERVICES.

 

(b) Client Warranties. Client represents and warrants that: (A) no contractual
obligations exist that would prevent Client from entering into this Agreement;
(B) it has complied with all applicable regulatory requirements; and (C) Client
has requisite authority to execute, deliver, and perform this Agreement. Client
shall indemnify and hold harmless Fiserv, its officers, directors, employees,
and affiliates against any claims or actions arising out of (X) the use by
Client of the Fiserv System in a manner other than that provided in this
Agreement; and (Y) any and all claims by third parties through Client arising
out of the performance and non-performance of Fiserv Services by Fiserv,
provided that the indemnity listed in clause (Y) hereof shall not preclude
Client’s recovery of direct damages pursuant to the terms and subject to the
limitations of this Agreement.

 

9. Limitation of Liability. (a) General. IN NO EVENT SHALL FISERV BE LIABLE FOR
LOSS OF GOODWILL, OR FOR SPECIAL, INDIRECT, INCIDENTAL, OR CONSEQUENTIAL DAMAGES
ARISING FROM CLIENT’S USE OF FISERV SERVICES, OR FISERV’S SUPPLY OF EQUIPMENT OR
SOFTWARE, REGARDLESS OF WHETHER SUCH CLAIM ARISES IN TORT OR IN CONTRACT. CLIENT
MAY NOT ASSERT ANY CLAIM AGAINST FISERV MORE THAN 2 YEARS AFTER SUCH CLAIM
ACCRUED. FISERV’S AGGREGATE LIABILITY FOR ANY AND ALL CAUSES OF ACTION RELATING
TO SERVICES SHALL BE LIMITED TO THE TOTAL FEES PAID BY CLIENT TO FISERV FOR
SERVICES RESULTING IN SUCH LIABILITY IN THE 2 MONTH PERIOD PRECEDING THE DATE
THE CLAIM ACCRUED. FISERV’S AGGREGATE LIABILITY FOR A DEFAULT RELATING TO
EQUIPMENT OR SOFTWARE SHALL BE LIMITED TO THE AMOUNT PAID BY CLIENT FOR THE
EQUIPMENT OR SOFTWARE.

 

(b) Lost Records. If Client’s records or other data submitted for processing are
lost or damaged as a result of any failure by Fiserv, its employees, or agents
to exercise reasonable care to prevent such loss or damage, Fiserv’s liability
on account of such loss or damages shall not exceed the reasonable cost of
reproducing such records or data from exact duplicates thereof in Client’s
possession.

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10. Disaster Recovery. (a) General. Fiserv maintains a disaster recovery plan
(“Disaster Recovery Plan”) for each Service. A “Disaster” shall mean any
unplanned interruption of the operations of or inaccessibility to Fiserv’s
service center in which Fiserv, using reasonable judgment, requires relocation
of processing to a recovery location. Fiserv shall notify Client as soon as
possible after Fiserv deems a service outage to be a Disaster. Fiserv shall move
the processing of Client’s Account and Item Processing Services to a recovery
location as expeditiously as possible, not to exceed 48 hours, and shall
coordinate the cut-over to back-up telecommunication facilities with the
appropriate carriers. Fiserv shall use its best efforts to resume operations.

 

Client shall maintain adequate records of all transactions during the period of
service interruption and shall have personnel available to assist Fiserv in
implementing the switchover to the recovery location. During a Disaster,
optional or on-request services shall be provided by Fiserv only to the extent
adequate capacity exists at the recovery location and only after stabilizing the
provision of base services.

 

(b) Communications. Fiserv shall work with Client to establish a plan for
alternative communications in the event of a Disaster.

 

(c) Disaster Recovery Test. Fiserv shall test the Disaster Recovery Plan
periodically. Client agrees to participate in and assist Fiserv with such test,
if requested by Fiserv. Upon Client request, test results will be made available
to Client’s management, regulators, auditors, and insurance underwriters.

 

(d) Client Plans. Fiserv agrees to release information necessary to allow
Client’s development of a disaster recovery plan that operates in concert with
the Disaster Recovery Plan.

 

(e) No Warranty. Client understands and agrees that the Disaster Recovery Plan
is designed to minimize, but not eliminate, risks associated with a Disaster
affecting Fiserv’s service center(s). Fiserv does not warrant that Fiserv
Services will be uninterrupted or error free in the event of a Disaster; no
performance standards shall be applicable for the duration of a Disaster. Client
maintains responsibility for adopting a disaster recovery plan relating to
disasters affecting Client’s facilities and for securing business interruption
insurance or other insurance necessary for Client’s protection.

 

11. Termination. (a) Material Breach. Except as provided elsewhere in this
Section 11, either party may terminate this Agreement in the event of a material
breach by the other party not cured within 90 days following written notice
stating, with particularity and in reasonable detail, the nature of the claimed
breach.

 

(a1). Failure by Fiserv to meet a Performance Standard shall be deemed an
“occurrence”. When reasonably possible, Customer must report incidents suspected
to be performance Standard Occurrences to Fiserv within seventy- two (72) hours,
or immediately becoming aware of the incident after the seventy-two (72) hour
deadline.

 

(a2). Remedy for occurrences: In the event that four (4) occurrences take place
during any six month period with respect to the same Performance Standard, then
for a period of thirty (30) days after receipt by Client of a report from Fiserv
reflecting the fourth occurrence, Client will have the right to terminate this
agreement, through delivery of written notice to Fiserv, provided the effective
date of termination will not be less than ninety (90) days after receipt by
Fiserv of such notice. Upon written notice received by Fiserv, Fiserv will have
a period of ninety (90) days to cure the performance standard.

 

(a3). Fiserv will provide client with a report reflecting the prior month’s
actual performance against the performance standard. This report will be
provided by the 15th of the following month.

 

(b) Failure to Pay. In the event any invoice remains unpaid by Client 30 days
after due, or Client deconverts any data or information from the Fiserv System
without prior written consent of Fiserv, Fiserv, at its sole option, may
terminate this Agreement and/or Client’s access to and use of Fiserv Services.
Any invoice submitted by Fiserv shall be deemed correct unless Client provides
written notice to Fiserv within 15 days of the invoice date specifying the
nature of the disagreement.

 

(c) Remedies. Remedies contained in this Section 11 are cumulative and are in
addition to the other rights and remedies available to Fiserv under this
Agreement, by law or otherwise.

 

(d) Defaults. If Client:

 

(i) defaults in the payment of any sum of money due in Section 11(b);

 

(ii) breaches this Agreement in any material respect or otherwise defaults in
any material respect in the performance of any of its obligations in Section
11(a); or

 

(iii) commits an act of bankruptcy or becomes the subject of any proceeding
under the Bankruptcy Code or becomes insolvent or if any substantial part of
Client’s property becomes subject to any levy, seizure, assignment, application,
or sale for or by any creditor or governmental agency;

 

then, in any such event, Fiserv may, upon written notice, terminate this
Agreement and be entitled to recover from Client as liquidated damages an amount
equal to the present value of all payments remaining to be made hereunder for
the

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remainder of the initial term or any renewal term of this Agreement. For
purposes of the preceding sentence, present value shall be computed using the
“prime” rate (as published in The Wall Street Journal) in effect at the date of
termination and “all payments remaining to be made” shall be calculated based on
the average bills for the 3 months immediately preceding the date of
termination. Client agrees to reimburse Fiserv for any expenses Fiserv may
incur, including reasonable attorneys’ fees, in taking any of the foregoing
actions.

 

(e) Convenience. Client may terminate this Agreement by paying a termination fee
based on the remaining unused term of this Agreement, the amount to be
determined by multiplying Client’s largest monthly invoice for each Fiserv
Service received by Client during the term (or if no monthly invoice has been
received, the sum of the estimated monthly billing for each Fiserv Service to be
received hereunder) by 80% times the remaining months of the term, plus any
unamortized conversion fees or third party costs existing on Fiserv’s books on
the date of termination. Client understands and agrees that Fiserv losses
incurred as a result of early termination of the Agreement would be difficult or
impossible to calculate as of the effective date of termination since they will
vary based on, among other things, the number of clients using the Fiserv System
on the date the Agreement terminates. Accordingly, the amount set forth in the
first sentence of this subsection represents Client’s agreement to pay and
Fiserv’s agreement to accept as liquidated damages (and not as a penalty) such
amount for any such Client termination.

 

(f) Merger or Acquisition of Fiserv Client. The acquired Fiserv client may
terminate their Fiserv agreement without penalty by providing Fiserv 90 days
written notice, providing the acquired client remains a Fiserv client under this
agreement.

 

(g) Merger or Acquisition by Fiserv client. Client may terminate this agreement
without penalty by providing Fiserv 90 days written notice, providing client
remains a Fiserv client under the acquiring Fiserv client agreement.

 

(h) Merger or Acquisition by non-Fiserv client. Client may terminate this
agreement by providing written notification as required in paragraph (1) of this
agreement, and paying Fiserv the following termination fees plus any unamortized
conversion fees, third party costs, or other costs existing on Fiserv’s books on
the date of termination. Client understands and agrees that Fiserv losses
incurred as a result of early termination of the Agreement would be difficult or
impossible to calculate as of the effective date of termination since they will
vary based on, among other things, the number of clients using the Fiserv System
on the date the Agreement terminates.

 

  (a) During the first twelve months of this agreement, the fee will be equal to
the total of the AP, and IP invoice amount, less pass through charges times 19,
plus the exact amount of credit Fiserv provided client during the first two
months of this agreement.

 

  (b) During the second twelve months of the agreement, the fee will be equal to
the total of the AP, and IP invoice amount, less pass through charges times 16.

 

  (c) During the third twelve months of this agreement, the fee will be equal to
the total of the AP, and IP invoice amount, less pass through charges times 12.

 

  (d) During the fourth twelve months of this agreement, the fee will be equal
to the total of the AP, and IP invoice amount, less pass through charges times
9.

 

  (e) During the next eight months of this agreement, the fee will be equal to
the total of the AP, and IP invoice amount, less pass through charges times 6.

 

  (f) During the remaining months of this agreement, the fee will be an amount
to be determined by taking the actual monthly AP, and IP invoice amount, less
any pass thru charges at the time of termination, and multiplying it by the
number of months remaining on this agreement.

 

(i) Return of Data Files. Upon expiration or termination of this Agreement,
Fiserv shall furnish to Client such copies of Client Files as Client may request
in a Fiserv standard format along with such information and assistance as is
reasonable and customary to enable Client to deconvert from the Fiserv System,
provided, however, that Client consents and agrees and authorizes Fiserv to
retain Client Files until (i) Fiserv is paid in full for (A) all Services
provided through the date such Client Files are returned to Client; and (B) any
and all other amounts that are due or will become due under this Agreement; (ii)
Fiserv is paid its then standard rates for the services necessary to return such
Client Files; (iii) if this Agreement is being terminated, Fiserv is paid any
applicable termination fee pursuant to subsection (d), (e) or (f) above; and
(iv) Client has returned to Fiserv all Fiserv Information. Unless directed by
Client in writing to the contrary, Fiserv shall be permitted to destroy Client
Files any time after 30 days from the final use of Client Files for processing.

 

(j) Miscellaneous. Client understands and agrees that Client is responsible for
the deinstallation and return shipping of any Fiserv-owned equipment located on
Client’s premises.

 

12. Dispute Resolution. (a) General. Except with respect to disputes arising
from a misappropriation or misuse

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of either party’s proprietary rights, any dispute or controversy arising out of
this Agreement, or its interpretation, shall be submitted to and resolved
exclusively by arbitration under the rules then prevailing of the American
Arbitration Association, upon written notice of demand for arbitration by the
party seeking arbitration, setting forth the specifics of the matter in
controversy or the claim being made. The arbitration shall be heard before an
arbitrator mutually agreeable to the parties; provided, that if the parties
cannot agree on the choice of arbitrator within 10 days after the first party
seeking arbitration has given written notice, then the arbitration shall be
heard by 3 arbitrators, 1 chosen by each party, and the third chosen by those 2
arbitrators. The arbitrators will be selected from a panel of persons having
experience with and knowledge of information technology and at least 1 of the
arbitrators selected will be an attorney. A hearing on the merits of all claims
for which arbitration is sought by either party shall be commenced not later
than 60 days from the date demand for arbitration is made by the first party
seeking arbitration. The arbitrator(s) must render a decision within 10 days
after the conclusion of such hearing. Any award in such arbitration shall be
final and binding upon the parties and the judgment thereon may be entered in
any court of competent jurisdiction.

 

(b) Applicable Law. The arbitration shall be governed by the United States
Arbitration Act, 9 U.S.C. 1-16. The arbitrators shall apply the substantive law
of the State of California, without reference to provisions relating to conflict
of laws. The arbitrators shall not have the power to alter, modify, amend, add
to, or subtract from any term or provision of this Agreement, nor to rule upon
or grant any extension, renewal, or continuance of this Agreement. The
arbitrators shall have the authority to grant any legal remedy available had the
parties submitted the dispute to a judicial proceeding.

 

(c) Situs. If arbitration is required to resolve any disputes between the
parties, the proceedings to resolve any such disputes shall be held in San
Diego, California.

 

13. Insurance. Fiserv carries the following types of insurance policies:

 

(i) Comprehensive General Liability in an amount not less than $1 million per
occurrence for claims arising out of bodily injury and property damage;

 

(ii) Commercial Crime covering employee dishonesty in an amount not less than $5
million;

 

(iii) All-risk property coverage including Extra Expense and Business Income
coverage; and

 

(iv) Workers Compensation as mandated or allowed by the laws of the state in
which Services are being performed, including $1,000,000 coverage for Employer’s
Liability.

 

14. Audit. Fiserv employs an internal auditor responsible for ensuring the
integrity of its processing environments and internal controls. In addition,
Fiserv provides for periodic independent audits of its operations. Fiserv shall
provide Client with a copy of the audit of the Fiserv service center providing
Services within a reasonable time after its completion and shall charge each
client a fee based on the pro rata cost of such audit. Fiserv shall also provide
a copy of such audit to the appropriate regulatory agencies, if any, having
jurisdiction over Fiserv’s provision of Services.

 

15. General. (a) Binding Agreement. This Agreement is binding upon the parties
and their respective successors and permitted assigns. Neither this Agreement
nor any interest may be sold, assigned, transferred, pledged, or otherwise
disposed of by Client, whether pursuant to change of control or otherwise,
without Fiserv’s prior written consent. Client agrees that Fiserv may
subcontract any Services to be performed hereunder. Fiserv will notify client at
least 60 days prior to the assignment of any services to be performed under this
agreement. Any such subcontractors shall be required to comply with all
applicable terms and conditions.

 

(b) Entire Agreement. This Agreement, including its Exhibits, which are
expressly incorporated herein by reference, constitutes the complete and
exclusive statement of the agreement between the parties as to the subject
matter hereof and supersedes all previous agreements with respect thereto.
Modifications of this Agreement must be in writing and signed by duly authorized
representatives of the parties. Each party hereby acknowledges that it has not
entered into this Agreement in reliance upon any representation made by the
other party not embodied herein. In the event any of the provisions of any
Exhibit are in conflict with any of the provisions of this Agreement, the terms
and provisions of this Agreement shall control unless the Exhibit in question
expressly provides that its terms and provisions shall control.

 

(c) Severability. If any provision of this Agreement is held to be unenforceable
or invalid, the other provisions shall continue in full force and effect.

 

(d) Governing Law. This Agreement will be governed by the substantive laws of
the State of California, without reference to provisions relating to conflict of
laws. The United Nations Convention of Contracts for the International Sale of
Goods shall not apply to this Agreement.

 

(e) Force Majeure. Neither party shall be responsible for delays or failures in
performance resulting from acts reasonably beyond the control of that party.

 

(f) Notices. Any written notice required or permitted to be given hereunder
shall be given by: (i) Registered or Certified Mail, Return Receipt Requested,
postage prepaid; (ii)

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confirmed facsimile; or (iii) nationally recognized courier service to the other
party at the addresses listed on the cover page or to such other address or
person as a party may designate in writing. All such notices shall be effective
upon receipt.

 

(g) No Waiver. The failure of either party to insist on strict performance of
any of the provisions hereunder shall not be construed as the waiver of any
subsequent default of a similar nature.

 

(h) Financial Statements. Fiserv shall provide Client and the appropriate
regulatory agencies so requiring a copy of Fiserv, Inc.’s audited consolidated
financial statements.

 

(i) Prevailing Party. The prevailing party in any arbitration, suit, or action
brought against the other party to enforce the terms of this Agreement or any
rights or obligations hereunder, shall be entitled to receive its reasonable
costs, expenses, and attorneys’ fees of bringing such arbitration, suit, or
action.

 

(j) Survival. All rights and obligations of the parties under this Agreement
that, by their nature, do not terminate with the expiration or termination of
this Agreement shall survive the expiration or termination of this Agreement.

 

(k) Exclusivity. Client agrees that Fiserv shall be the sole and exclusive
provider of the services that are the subject matter of this Agreement. For
purposes of the foregoing, the term “Client” shall include Client affiliates.
During the term of this Agreement, Client agrees not to enter into an agreement
with any other entity to provide specific services provided to client by Fiserv
as identified in Exhibit’s A, and B of this agreement without Fiserv’s prior
written consent. If Client acquires another entity, the exclusivity provided to
Fiserv hereunder shall take effect with respect to such acquired entity as soon
as practicable after termination of such acquired entity’s previously existing
arrangement for these services. If Client is acquired by another entity, the
exclusivity provided to Fiserv hereunder shall apply with respect to the level
or volume of these services provided immediately prior to the signing of the
definitive acquisition agreement relating to such acquisition and shall continue
with respect to the level or volume of these services until any termination or
expiration of this Agreement.

 

(l) Recruitment of Employees. Client agrees not to hire Fiserv’s employees
during the term of this Agreement and for a period of 6 months after any
termination or expiration thereof, except with Fiserv’s prior written consent.

 

(m) Publicity. The parties shall mutually agree on a press release relating to
the execution of this Agreement. Each party shall mutually agree with the other
regarding any media release, public announcement, or similar disclosure relating
to this Agreement or its subject matter and shall give the other party a
reasonable opportunity to review and comment on the content of such release,
announcement, or disclosure prior to its release. Such agreement shall not be
unreasonably withheld. Notwithstanding the foregoing, Fiserv shall have the
right to make general references to Client and the type of services being
provided by Fiserv to Client under this Agreement in Fiserv’s oral and visual
presentations to Fiserv clients, prospective Fiserv clients, and financial
analysts, provided that such references shall be consistent with any such
mutually agreed press release.

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IN WITNESS WHEREOF, the parties have caused this Agreement to be executed by
their duly authorized representatives as of the date indicated below.

 

For Client:

 

For Fiserv:

COMMUNITY NATIONAL BANK

 

Fiserv Solutions, Inc.

By:

 

/s/ L. Bruce Mills, Jr.

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By:

 

/s/ Sam Langham

--------------------------------------------------------------------------------

Name:

 

L. Bruce Mills, Jr.

 

Name:

 

Sam Langham

Title:

 

Senior Vice President - CFO

 

Title:

 

Executive Vice President, LA Center Manager

Date:

 

July 27, 2003

 

Date: August 12, 2003