EXHIBIT 10.19

EMPLOYMENT AGREEMENT

     This Employment Agreement (the “Agreement”) is entered into effective
March 1, 2004, by and between IndyMac Bank, F.S.B. (“Employer”) and Raymond
Matsumoto (“Officer”).

     1.     Term. Employer agrees to employ Officer and Officer agrees to serve
Employer and its affiliates, in accordance with the terms and conditions of this
Agreement, for a period of three (3) years, commencing on the date first set
forth above, unless Officer’s employment is earlier terminated as herein
provided.

     2.     Position, Duties and Responsibilities. Officer shall serve as an
Executive Vice President of Employer, or of one of Employer’s affiliated
companies, as determined by Employer. Officer agrees to devote Officer’s
full-time best efforts to the business and affairs of Employer and its
affiliates, to perform such executive and managerial duties as may be assigned
to Officer, and to diligently promote the business, affairs and interests of
Employer and its affiliates. If so requested by Employer, Officer agrees to
serve concurrently, and without additional compensation, as an officer of both
Employer and of one or more of Employer’s affiliates, including its
subsidiaries.

     3.     Outside Affiliations. During the term of this Agreement, Officer
shall not compete, either directly or indirectly, with the business of Employer
or its affiliates. Except as otherwise provided in this Agreement, Officer may
make and manage personal business investments of Officer’s choice and may serve
in any capacity with any civic, educational or charitable organization, or with
any governmental entity or trade association, provided that such activities do
not interfere with or conflict with Officer’s duties under this Agreement.
Officer may not sit on the board of directors of any civic, educational or
charitable organization without first obtaining Employer’s written consent.

     4.     Compensation and Benefits. In consideration of the performance of
Officer’s duties under this Agreement, Employer or its affiliates shall provide
to Officer the compensation set forth below. All compensation paid to Officer by
Employer or by any of its affiliates shall be aggregated in determining whether
Officer has received the benefits described herein, but without prejudice to the
allocation of costs among the entities to which Officer renders services under
this Agreement.

          4.1 Base Salary. Employer shall pay to Officer a base salary at the
annual rate set forth in Appendix A. Officer’s base salary shall be payable in
equal installments no less frequently than every month. Employer may, in its
sole discretion, increase Officer’s base salary during the term of this
Agreement, but Employer will not decrease Officer’s base salary below the amount
set forth in Appendix A.

          4.2 Incentive Compensation. For each calendar year during the term of
this Agreement, Employer shall pay to Officer an incentive compensation award in
an amount to be determined pursuant to the then-applicable Annual Incentive Plan
set forth in Appendix A. The terms of the Annual Incentive Plan shall be agreed
upon by Employer and Officer during the first

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quarter of each new calendar year during the term of this Agreement. Any
incentive compensation award payable to Officer pursuant to the Annual Incentive
Plan shall be paid no later than thirty (30) days after completion and
publication of the applicable audited financial statements for the relevant
calendar year. Except as otherwise provided herein, any incentive compensation
award described in the Annual Incentive Plan, and Officer’s base salary to the
extent that the incentive compensation award is a percentage of Officer’s base
salary, shall be prorated to the extent that Officer is employed for less than
twelve (12) full months during the relevant calendar year.

          4.3 Stock Options and Restricted Stock. During the term of this
Agreement, Employer’s public company affiliate, IndyMac Bancorp, Inc., or any
successor public company (“Public Company”), may grant to Officer stock options
and/or restricted stock for such number of shares of the Public Company’s common
stock as the Compensation Committee of the Board of Directors of the Public
Company (“Compensation Committee”) in its sole discretion determines, taking
into account Officer’s and the Public Company’s performance and the competitive
practices then prevailing regarding the granting of stock options. Subject to
the foregoing, it is anticipated that the number of shares in respect of each
annual stock option and/or restricted stock grant, if any, shall be comparable
to the number of shares granted to officers of Employer at a level similar to
Officer’s level. The stock options and/or restricted stock herein described
shall be granted at the same time as the Public Company grants stock options
and/or restricted stock to its other officers.

          All stock options and restricted stock granted herein: (i) shall be
granted pursuant to the Public Company’s current stock option plan, or such
other stock option plan or plans as may come into effect during the term of this
Agreement, (ii) shall be priced and shall vest in accordance with the terms set
by the Compensation Committee or as otherwise set forth in this Agreement, and
(iii) shall be subject to such other reasonable terms and conditions as may be
determined by the Compensation Committee and set forth in the agreement or other
document evidencing the award.

          The effect of Officer’s termination on the vesting of any stock
options or restricted stock granted under this Agreement is described in
Section 5.2. In the event that vested options held by Officer immediately after
such termination represent shares of common stock in an amount equal to or
greater than 500,000, then the maximum period for the exercise of any options
shall be twelve (12) months. In the event that vested options held by Officer
immediately after such termination represent shares of common stock in an amount
equal to or greater than 100,000 but less than 500,000, then the maximum period
for the exercise of any options shall be six (6) months. In the event that
vested options held by Officer immediately after such termination represent
shares of common stock in an amount less than 100,000, then the maximum period
for their exercise shall be three (3) months.

          4.4 Additional Benefits. Officer shall be entitled to paid vacation,
subject to Employer’s vacation policies in effect from time to time. Officer
shall also be entitled to participate in Employer’s life and medical insurance
plans, and in any stock purchase, executive compensation, pension,
profit-sharing, deferred compensation, or other benefit or bonus plans that are
offered to Employer’s employees generally, or to officers of Employer at a level
similar to Officer’s level, subject to the terms and conditions, including any
applicable eligibility

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requirements, of any such plan. This Agreement shall not affect or otherwise
modify the provisions of any other compensation, retirement or other benefit
program or plan of Employer.

     5.     Termination of Employment. This Agreement, the compensation and
benefits provided under this Agreement, and Officer’s employment with Employer,
are terminable as herein provided.

          5.1 Grounds for Termination. Employer may, in its sole and absolute
discretion, terminate this Agreement and Officer’s employment on the following
grounds:

               5.1.1 Disability. In the event of Officer’s inability to perform
his or her duties (with or without reasonable accommodation) because of illness,
injury or similar incapacity for four (4) consecutive calendar months, or for
shorter periods aggregating eighty (80) or more business days in any twelve
(12)-month period (“Disability”), this Agreement and Officer’s employment may be
terminated by Employer by giving Notice of Termination as provided in
Section 9.1.

               5.1.2 Death. In the event of Officer’s death during the term of
this Agreement (“Death”), this Agreement and Officer’s employment shall
immediately and automatically terminate.

               5.1.3 Cause. Employer may terminate this Agreement and Officer’s
employment by giving Notice of Termination at any time for cause. “Cause” means
any act or omission to act by Officer which constitutes, in the sole discretion
of Employer, (i) a material breach of this Agreement that is committed in bad
faith or without reasonable belief that such act or omission is in the best
interests of Employer, (ii) Officer’s breach of the terms of any promissory note
executed by the Officer for any loan to the Officer made by Employer pursuant to
the Employer’s Loan Plan, including a failure to meet a margin call,
(iii) negligence or misconduct resulting in a material loss to Employer,
(iv) gross negligence, (v) an intentional and material failure to perform
Officer’s assigned duties, (vi) fraud, theft or dishonesty, (vii) willful
violation of any law, rule or regulation of a governmental authority, other than
traffic violations, (viii) regular alcohol or drug abuse, (ix) such other
conduct as is reasonably likely to cause Employer public disgrace or disrepute,
or (x) entry of an order by any state or federal regulatory agency either
removing Officer from Officer’s position with Employer or its affiliates or
prohibiting Officer from participating in the conduct of the affairs of Employer
or any of its affiliates.

               5.1.4 Poor Performance. Employer may terminate this Agreement and
Officer’s employment by giving Notice of Termination at any time for poor
performance. “Poor Performance” means a failure of Officer to properly meet, in
the sole discretion of Employer, the duties and responsibilities of Officer’s
position in a competent fashion.

               5.1.5 No Cause. Employer may, in its sole and absolute
discretion, terminate this Agreement and Officer’s employment by giving Notice
of Termination at any time for no reason, or for any reason whatsoever other
than Death, Disability, Cause or Poor Performance (“No Cause”).

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               5.1.6 Resignation. Should Officer voluntarily resign Officer’s
employment, either by giving Notice of Termination during the term of this
Agreement or otherwise (“Resignation”), Officer’s employment shall terminate
immediately, unless Officer and Employer mutually agree on a later effective
date of termination.

          5.2 Benefits Upon Termination.

               5.2.1 Disability. Regardless of Officer’s position or years of
service with Employer or its affiliates, in the event that Officer’s employment
terminates by reason of Disability, as defined in Section 5.1.1, Officer shall
be entitled to receive (i) all accrued but unpaid vacation benefits as of the
Termination Date, as defined in Section 9.1, (ii) any other benefits already
vested as of the Termination Date under any of Employer’s applicable stock
option, pension, bonus or other similar plans in which Officer participated
immediately prior to termination (“Vested Benefits”), (iii) the immediate
vesting, to the extent not otherwise vested, of all outstanding stock options or
similar awards previously granted to Officer under Section 4.3, and (iv)
Officer’s incentive compensation award for the year in which Officer became
disabled, prorated to the Termination Date. Officer shall also be entitled to
receive the following benefits for a period of time commencing from the
Termination Date and continuing for the number of months remaining in the term
of this Agreement, or until Officer’s death, whichever first occurs: (v)
continuation of Officer’s base salary, reduced by 50%, minus the amount of any
cash payments due to Officer under the terms of Employer’s disability insurance
or other disability benefit plan funded by Employer or Employer’s tax-qualified
Defined Benefit Pension Plan, all subject to Section 5.2.8, and (vi)
continuation of benefits substantially equivalent to the life, disability and
medical insurance policies maintained by Employer on behalf of Officer and
Officer’s spouse and dependents, if any, immediately prior to the Notice of
Termination, but then only to the extent that Officer is not entitled to
comparable benefits from other employment.

               5.2.2 Death. Regardless of Officer’s position or years of service
with Employer or its affiliates, in the event of Officer’s Death, as defined in
Section 5.1.2, Employer shall pay to such person or persons as Officer shall
have designated in writing or, in the absence of such a designation, to
Officer’s estate, (i) all accrued but unpaid vacation benefits as of the date of
Death, (ii) any Vested Benefits, (iii) to the extent not otherwise vested, all
outstanding stock options or similar awards previously granted to Officer, which
will vest immediately upon Officer’s Death, and (iv) Officer’s incentive
compensation award for the year in which Death occurs, prorated to date of
Death. Employer shall also, within forty-five (45) days following Officer’s
Death, pay to Officer’s designee or to Officer’s estate an amount equal to two
times Officer’s last annual base salary. Employer shall also, for a period of
twelve (12) months following the date of Officer’s Death, pay the cost of any
continued coverage under Employer’s group medical insurance plan for the benefit
of Officer’s spouse and dependents, if any, should they elect continued coverage
under COBRA, provided they were covered under the plan immediately prior to
Officer’s Death.

               5.2.3 Cause. Regardless of Officer’s position or years of service
with Employer or its affiliates, in the event of Officer’s termination for
Cause, as defined in Section 5.1.3, Officer shall be entitled to payment of
Officer’s base salary through the Termination Date, to any accrued but unpaid
vacation benefits, and to any other Vested Benefits, but to no other payments or
benefits whatsoever.

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               5.2.4 Poor Performance. In the event of Officer’s termination for
Poor Performance, as defined in Section 5.1.4, the benefits payable to Officer
shall depend upon Officer’s position and years of continuous service to Employer
or its affiliates. If Officer had five (5) or fewer years of continuous service
as of the Termination Date, Officer shall be entitled to payment of Officer’s
base salary through the Termination Date, and to continuation of Officer’s base
salary, reduced by 50%, for the lesser of one year or the number of months
remaining in the term of this Agreement as of the Termination Date, subject to
Section 5.2.8.

               If Officer had more than five (5) years of continuous service as
of the Termination Date, or if Officer is a director, officer or principal
stockholder of Employer or of any of its affiliates as described in
Section 16(a) of the Exchange Act (“Section 16 Employee”), Officer shall be
entitled to payment of Officer’s base salary through the Termination Date, and
to continuation of Officer’s base salary for the lesser of one year or the
number of months remaining in the term of this Agreement as of the Termination
Date, subject to Section 5.2.8, and to the additional benefit described in
Section 5.2.9, if allowed by law.

               Regardless of Officer’s position or years of service, Officer
shall also be entitled to any accrued but unpaid vacation benefits, to any other
Vested Benefits, and to Officer’s incentive compensation award for the year in
which Officer was terminated, prorated to the Termination Date, but to no other
payments or benefits whatsoever.

               5.2.5 No Cause. In the event Officer’s employment is terminated
for No Cause, as defined in Section 5.1.5, the benefits payable to Officer shall
depend upon Officer’s position and years of continuous service to Employer or
its affiliates. If Officer had five (5) or fewer years of continuous service as
of the Termination Date, Officer shall be entitled to payment of Officer’s base
salary through the Termination Date, and to continuation of Officer’s base
salary for the lesser of one year or the number of months remaining in the term
of this Agreement as of the Termination Date, subject to Section 5.2.8.

               If Officer had more than five (5) years of continuous service as
of the Termination Date, or if Officer is a Section 16 Employee, Officer shall
be entitled to payment of Officer’s base salary through the Termination Date, to
continuation of Officer’s base salary, increased by 100%, for the lesser of one
year or the number of months remaining in the term of this Agreement as of the
Termination Date, subject to Section 5.2.8, and to the additional benefit
described in Section 5.2.9, if allowed by law.

               Regardless of Officer’s position or years of service, Officer
shall also be entitled to any accrued but unpaid vacation benefits, to any other
Vested Benefits, to Officer’s incentive compensation award for the year in which
Officer was terminated, prorated to the Termination Date, and to the immediate
vesting, to the extent not otherwise vested, of all outstanding stock options or
similar awards previously granted to Officer under Section 4.3, but only to the
extent that any such outstanding stock options or similar awards would, by their
terms, vest within one (1) year of the Termination Date. In addition, Officer
shall be entitled, for a period of twelve (12) months following the Termination
Date, to continuation of benefits substantially equivalent to the life,
disability and medical insurance policies maintained by Employer on behalf of
Officer and Officer’s spouse and dependents, if any, immediately prior to

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the Notice of Termination, but only to the extent that Officer is not entitled
to comparable benefits from other employment.

               5.2.6 Resignation. In the event of Officer’s Resignation, as
defined in Section 5.1.6, Officer shall be entitled to payment of Officer’s base
salary through the Termination Date, to any accrued but unpaid vacation
benefits, and to any other Vested Benefits, but to no other payments or benefits
whatsoever.

               5.2.7 Change in Control. As used herein, a “Change in Control”
shall be deemed to have occurred if any person or entity other than IndyMac Bank
Corp., Inc. becomes the beneficial owner, as defined in Rule 13d-3 under the
Exchange Act, of more than 50% of the combined voting power of the outstanding
stock of Employer, or acquires all or substantially all of the assets of
Employer.

               If a Change in Control should occur during the term of this
Agreement, and should Officer’s employment be terminated within one (1) year
following the Change in Control (i) by reason of Officer’s Disability or Death,
or (ii) either for No Cause or because this Agreement expires and is not renewed
by Employer or its successor on terms that are substantially comparable to the
terms of this Agreement, then all outstanding stock options or similar awards
previously granted to Officer under Section 4.3 that have not already vested
shall vest on the Termination Date.

               If a Change in Control should occur during the term of this
Agreement, and should Officer’s employment continue without termination beyond
the first anniversary of the Change in Control, then all outstanding stock
options or similar awards previously granted to Officer under Section 4.3 that
have not already vested shall vest upon the first anniversary of the Change in
Control.

               If a Change in Control should occur during the term of this
Agreement, and should Officer’s employment be terminated within two (2) years
following the Change in Control either for No Cause or because this Agreement
expires and is not renewed by Employer or its successor on terms that are
substantially comparable to the terms of this Agreement, then Officer shall be
entitled, in addition to the foregoing and in lieu of any other benefits
described elsewhere in this Agreement, to (i) any accrued but unpaid vacation
benefits, (ii) any other Vested Benefits, (iii) payment of Officer’s base salary
through the Termination Date, (iv) continuation of Officer’s base salary,
increased by 100%, for a period of twelve (12) months following the Termination
Date, (v) Officer’s incentive compensation award, without proration, for the
year in which Officer was terminated, also increased by 100%, (vi) the
additional benefit described in Section 5.2.9, if allowed by law, and
(vii) continuation, for a period of twelve (12) months following the Termination
Date, of benefits substantially equivalent to the life, disability and medical
insurance policies maintained by Employer on behalf of Officer and Officer’s
spouse and dependents, if any, immediately prior to the Notice of Termination,
but only to the extent that Officer is not entitled to comparable benefits from
other employment.

               5.2.8 Other Employment. Employer’s obligation to pay salary
continuation benefits to Officer in the event of Officer’s termination for
Disability, Poor Performance or No Cause shall immediately cease in the event
that Officer obtains employment

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for compensation (whether as an employee, independent contractor, consultant or
otherwise) with any person or entity.

               5.2.9 Excise Tax. In the event it should be determined that any
payment or distribution by Employer as the result of Officer’s termination due
to Poor Performance or No Cause would be subject to the excise tax imposed by
Section 4999 of the Internal Revenue Code, the affected payments or
distributions shall include gross-up for any excise taxes due under Section 280G
of the Code or similar “golden parachute” provisions, plus any excise, income,
or payroll taxes owed on the excise payment amount. In order to be eligible for
this benefit, Officer must have had more than five (5) years of continuous
service to Employer or its affiliates as of the Termination Date, or must be a
Section 16 Employee. If the law prohibits any form of the foregoing benefit,
then Employer and Officer understand and agree that this Section 5.2.9 is of no
effect.

               5.2.10 Release of Claims. Employer’s obligation to pay any salary
continuation, benefits continuation or other non-vested benefits in the event of
the termination of Officer’s employment due to Disability, Poor Performance or
No Cause, as defined in Sections 5.1.1, 5.1.4 and 5.1.5, is expressly
conditional upon Officer first executing a general release of all claims or
causes of action, whether known or unknown, that Officer may have or hold
against Employer including, but not limited to, any claims for breach of
contract, for employment discrimination or harassment, for wrongful termination
or for other tortious conduct in connection with Officer’s employment or its
termination. Such release agreement shall be prepared by Employer, and shall
include an express waiver by Officer of California Civil Code section 1542.

     6.     No Solicitation, Non-Competition and Confidentiality. In order to
receive and retain the salary continuation, benefits continuation or other
non-vested benefits payable to Officer in the event of termination by reason of
Disability, Poor Performance or No Cause, as defined in Sections 5.1.1, 5.1.4
and 5.1.5, Officer agrees to the following:

          6.1 Non-Competition. During employment and for a period of one
(1) year after termination of employment, Officer shall not engage in any
business, whether as an employee, consultant, partner, principal, agent,
representative or stock holder (other than as a holder of less than one percent
(1%) equity interest), or in any other corporate or representative capacity,
with any other business that is engaged in any activity that competes with the
business of Employer or its affiliates, as conducted as of the date of the
termination of Officer’s employment.

          6.2 No Solicitation. During employment and for a period of one
(1) year after termination of employment, Officer shall not:

               6.2.1 Solicit, or cause to be solicited, any customers of
Employer or its affiliates for purposes of promoting or selling any products or
services competitive with those of Employer or its affiliates;

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               6.2.2 Solicit business from, or perform services for, any company
or other business entity which at any time during the two (2) year period
immediately preceding Officer’s termination of employment with Employer was a
client of Employer or its affiliates; or

               6.2.3 Solicit for employment, offer, or cause to be offered
employment, either on a full time, part-time or consulting basis, to any person
who was employed by Employer or its affiliates on the date Officer’s employment
terminated, unless Officer shall have received the prior written consent of
Employer.

          6.3 Confidentiality. Officer hereby acknowledges and agrees that
Employer and its affiliates have developed and own valuable information related
to their business, personnel and customers including, but not limited to,
concepts, ideas, customer lists, business lists, business and strategic plans,
financial data, accounting procedures, secondary marketing and hedging models,
trade secrets, computer programs and plans, and information related to officers,
directors, employees and agents. Officer hereby agrees that all such
information, and all codes, concepts, copies and forms relating to such
information, Employer’s plans and intentions with respect thereto, and any
information provided by Employer or its affiliates to Officer with respect to
any of the foregoing, shall be considered “Confidential Information” for the
purpose of this Agreement. Officer acknowledges and agrees that all such
Confidential Information is a valuable asset of Employer, and if developed by
Officer, is developed by Officer in the course of Officer’s employment with
Employer, and is the sole property of Employer. Officer agrees that Officer will
not divulge or otherwise disclose, directly or indirectly, any Confidential
Information concerning the business or policies of Employer or any of its
affiliates which Officer may have learned as a result of Officer’s employment
during the term of this Agreement or prior thereto as an employee, officer or
director of or consultant to Employer or any of its affiliates, except to the
extent such use or disclosure is (i) necessary or appropriate to the performance
of this Agreement and in furtherance of Employer’s best interests, (ii) required
by applicable law or in response to a lawful inquiry from a governmental or
regulatory authority, (iii) lawfully obtainable from other sources, or
(iv) authorized by Employer.

          6.4 Reimbursement. If any part of this Section 6 is challenged by
Officer and is determined to be invalid or unenforceable for any reason by a
court of competent jurisdiction, then Officer and Employer agree that these
covenants shall be of no effect, that Officer shall immediately return to
Employer the salary continuation, benefits continuation or other non-vested
compensation described in Section 5.2 that has been paid to Officer after
termination of Officer’s employment, and that Officer shall not be entitled to
any further sums from Employer.

     7.     Reimbursement of Business Expenses. During the term of this
Agreement, Employer shall promptly reimburse to Officer all business expenses
reasonably incurred by Officer in the performance of Officer’s duties under this
Agreement to the extent that such expenditures meet Internal Revenue Code
requirements for deductibility by Employer for federal income tax purposes, or
are otherwise in compliance with the rules and policies of Employer and are
substantiated by Officer in accordance with applicable requirements of the Code
and Treasury Regulations, and the applicable rules and policies of Employer.

     8.     Indemnity. To the extent permitted by applicable law and by
Employer’s articles, bylaws or other governing instruments, Employer shall
defend and indemnify Officer and hold Officer harmless for any acts or decisions
made by Officer in good faith and while

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performing approved services for Employer or its affiliates, and Employer shall
use reasonable efforts to obtain coverage for Officer under liability insurance
policies then in effect which cover the other officers or directors of Employer.

     9.     Miscellaneous.

          9.1 Notice of Termination and Termination Date. Any termination of
this Agreement by Employer or by Officer (including any Resignation) shall be
communicated by a written Notice of Termination to the other party, stating the
specific termination provision in this Agreement relied upon, if any, and
setting forth in reasonable detail the facts and circumstances, if applicable,
claimed to provide a basis for termination. The effective date of termination
(“Termination Date”) shall be (i) the date specified in the Notice of
Termination, or (ii) in the event of Officer’s Death, the date of Death, or
(iii) in the event of Officer’s resignation without providing Notice of
Termination, Officer’s last day of employment, or (iv) in the event of a Change
in Control, either the date specified in the Notice of Termination or the last
day of the term of this Agreement should same not be renewed on substantially
comparable terms within two (2) years following the Change in Control.

          9.2 Successorship. This Agreement shall inure to the benefit of and
shall be binding upon Employer, its successors and assigns. This Agreement may
not be assigned without the prior written consent of the parties, other than in
connection with a merger or sale of Employer or the sale of substantially all
the assets of Employer, or similar transaction. Notwithstanding the foregoing,
Employer may, without Officer’s consent, assign, whether by assignment
agreement, merger, operation of law or otherwise, this Agreement to the Public
Company or to any successor or affiliate of Employer or the Public Company,
subject to such assignee’s express assumption of all obligations of Employer
hereunder. The failure of any successor to or assignee of the Employer’s
business and/or assets in such transaction to expressly assume all obligations
of Employer hereunder shall be deemed a termination for No Cause, pursuant to
Section 5.1.5.

          9.3 Notices. Any notices provided for in this Agreement shall be sent
to Employer at its corporate headquarters, Attention: General Counsel, with a
copy to the Human Resources department at the same address, or to such other
address as Employer may from time to time in writing designate, and to Officer
at such address as Officer may from time to time in writing designate (or
Officer’s business address of record in the absence of such designation). All
notices shall be deemed to have been given two (2) business days after they have
been deposited as certified mail, return receipt requested, postage paid and
properly addressed to the designated address of the party to receive the
notices.

          9.4 Entire Agreement. This instrument contains the entire agreement of
the parties relating to the subject matter hereof, and it replaces and
supersedes any prior agreements between the parties relating to said subject
matter; provided, however, that all provisions of Employer’s Employee Handbook
and any other written personnel policies of Employer shall be incorporated
herein by this reference, and Officer hereby expressly acknowledges that all
provisions of the Employee Handbook and other written policies are applicable to
Officer’s employment relationship with Employer, except to the extent that any
such provisions directly conflict with any term contained in this Agreement;
PROVIDED, FURTHER, THAT OFFICER

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HEREBY EXPRESSLY ACKNOWLEDGES THAT OFFICER HAS EXECUTED EMPLOYER’S STANDARD
MUTUAL AGREEMENT TO ARBITRATE CLAIMS CONCURRENTLY HEREWITH, WHICH REQUIRES THAT
ANY DISPUTE UNDER THIS AGREEMENT WILL BE ARBITRATED. No modifications or
amendments of this Agreement shall be valid unless made in writing and signed by
the parties hereto.

          9.5 Waiver. The waiver of the breach of any term or of any condition
of this Agreement shall not be deemed to constitute the waiver of any other
breach of the same or any other term or condition.

          9.6 California Law. This Agreement shall be construed and interpreted
in accordance with the laws of California, without reference to its conflict of
laws principles.

          9.7 Injunctive Relief. Employer and Officer acknowledge that the
services Officer is obligated to render under the provisions of this Agreement
are of a special, unique, unusual, extraordinary and intellectual character,
which gives this Agreement peculiar value to Employer. The loss of these
services cannot be reasonably or adequately compensated in damages in an action
at law and it would be difficult (if not impossible) to replace these services.
By reason thereof, if either party violates any of the material provisions of
this Agreement, the parties shall, in addition to any other rights and remedies
available under this Agreement, or under applicable law or the Mutual Agreement
to Arbitrate Claims, be entitled to seek injunctive relief, as permitted by law,
from a court or tribunal of competent jurisdiction, restraining the other from
committing or continuing any violation of this Agreement. The provisions hereof
shall survive the expiration, suspension or termination, for any reason, of this
Agreement.

          9.8 Severability. If any provision of this Agreement is held invalid
or unenforceable, the remainder of this Agreement shall nevertheless remain in
full force and effect, and if any provision is held invalid or unenforceable
with respect to particular circumstances, it shall nevertheless remain in full
force and effect in all other circumstances.

          9.9 Regulatory Intervention. Notwithstanding anything in this
Agreement to the contrary, this Agreement is subject to the following terms and
conditions:

               9.9.1 If Officer is suspended and/or temporarily prohibited from
participating in the conduct of Employer’s affairs by a notice served under
Section 8(e)(3) or (g)(1) of the Federal Deposit Insurance Act (12 U.S.C. 1818
(e)(3) and (g)(1)), Employer’s obligations hereunder shall be suspended as of
the date of service unless stayed by appropriate proceedings. If the charges in
the notice are dismissed, Employer shall (i) pay Officer all or part of the
compensation withheld while Employer’s contract obligations were suspended, and
(ii) reinstate any of Employer’s obligations which were suspended.

               9.9.2 If Officer is removed and/or permanently prohibited from
participating in the conduct of Employer’s affairs by an order issued under
Section 8(e)(4) or (g)(1) of the Federal Deposit Insurance Act (12 U.S.C. 1818
(e)(4) and (g)(1)), all obligations of Employer under this Agreement shall
terminate as of the effective date of the order, but Officer’s vested rights
shall not be affected.

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               9.9.3 If Employer is in default (as defined in Section 3(x)(1) of
the Federal Deposit Insurance Act (12 U.S.C. 1813 (x)(1)), all obligations under
this Agreement shall terminate as of the date of default, but Officer’s vested
rights shall not be affected.

               9.9.4 All obligations under this Agreement shall be terminated,
except to the extent determined that continuation of the contract is necessary
for the continued operation of Employer, (i) by the Office of Thrift Supervision
(“OTS”) at the time the Federal Deposit Insurance Corporation (“FDIC”) enters
into an agreement to provide assistance to or on behalf of Employer under the
authority contained in Section 13(c) of the Federal Deposit Insurance Act (12
U.S.C. 1823 (c)); or (ii) by the OTS at the time the OTS approves a supervisory
merger to resolve problems related to operation of Employer or when Employer is
determined by the OTS to be in an unsafe or unsound condition. Any rights of
Officer that shall have vested under this Agreement shall not be affected by
such action.

               9.9.5 With regard to the provisions of this Section 9.9:

                       (i) Employer agrees to use its best efforts to oppose any
such notice of charges as to which there are reasonable defenses;

                       (ii) In the event the notice of charges is dismissed or
otherwise resolved in a manner that will permit Employer to resume its
obligations to pay compensation hereunder, Employer will promptly make such
payment hereunder; and

                       (iii) During the period of suspension, the vested rights
of the contracting parties shall not be affected except to the extent precluded
by such notice.

               9.9.6 Any payments made to Officer by Employer pursuant to this
Agreement, or otherwise, are subject to and conditioned upon their compliance
with 12 U.S.C. Section 1828(k) and any regulations promulgated thereunder.

EMPLOYER:

              By:       Dated:        

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         Michael W. Perry                  Chairman and Chief Executive Officer
                      OFFICER:                 Dated:    

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Name:        

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APPENDIX A
PROFIT CENTER
ANNUAL INCENTIVE PLAN

      Officer Name:   Raymond Matsumoto Annual Base Rate for 2004:   $215,000
Target Annual Bonus for 2004:   $225,000 Target Quarterly Bonus for 2004:   $0

Annual or Quarterly Incentive Awards:

    Officer shall be eligible for an Annual or Quarterly Incentive Awards (as
applicable), which shall be comprised of the following components:

  1.   Business Metrics     2.   Corporate Earnings per Share (Wrap)     3.  
Safety and Soundness, Compliance, Internal Audit and Internal Controls (Wrap)  
  4.   Subjective Assessment (Wrap)

These components shall be measured as follows: Measurement of Components
Intentionally Omitted.