EXHIBIT 10.1

 

EMPLOYMENT AGREEMENT

 

THIS EMPLOYMENT AGREEMENT (the “Agreement”) is effective as of September 13,
2018 between FIRST CHOICE BANK, a California state banking corporation, (the
“Bank”), FIRST CHOICE BANCORP (the “Bancorp”), a California corporation
(collectively referred to as the “Company”) with their principal offices at
17785 Center Court Drive, Suite 750, Cerritos, California 90703 (hereinafter
“Bank”), and LYNN M. HOPKINS (hereinafter “Executive”) whose present residence
address is 6210 Parima Street, Long Beach, CA 90803 (Bank, Bancorp and Executive
are each sometimes referred to herein as a “Party” and collectively as the
“Parties”). Executive may be carried on the records of the Bank as an employee
and Executive’s compensation shall be paid by the Bank, subject to the Bank’s
right of reimbursement from the Bancorp under other agreements to which the
Executive is not a party.

 

A. TERM OF EMPLOYMENT

 

The Bank hereby employs Executive, and Executive hereby accepts employment with
Bank, for the two (2) year period (the “Term”) commencing on September 13, 2018
(the “Effective Date”), through September 12, 2020, subject however to prior
termination as hereinafter provided. Where used herein, “Term” shall refer to
the entire period of the employment of Executive by Bank hereunder, for the
period provided above, or whether terminated earlier as hereinafter provided.

 

B. DUTIES OF EXECUTIVE

 

1. Duties. Executive’s duties under this Employment Agreement include all
ordinary and reasonable duties customarily performed by the full-time Executive
Vice President and Chief Financial Officer of a bank holding company and a
state-chartered bank located in California, subject to the powers by law vested
in the Board of Directors of the Bank and in the Bank’s shareholders, and
Executive shall report to and be directed by the Bank’s President and Chief
Executive Officer. Executive shall render her services to the Bank and shall
exercise such corporate responsibilities as Executive may be directed by the
Board of Directors and the Bank’s President and Chief Executive Officer, and
Executive shall perform her duties faithfully, diligently and to the best of her
ability, consistent with the highest and best standards of the banking industry
and in compliance with applicable laws and the Bank’s Articles of Incorporation
and Bylaws.

 

2. Conflicts of Interest. Executive expressly agrees as a condition to the
performance by Bank of its obligations herein that during the term of her
Agreement and of any renewals hereof, she will not, directly or indirectly,
render any services of an advisory nature or otherwise to or become employed by
or participate or engage in any business competitive with any businesses of the
Bank, without the prior written consent of the Bank, however, that nothing
herein shall prohibit Executive from owning stock or other securities of a
competitor which are relatively insubstantial to the total outstanding stock of
such competitor, and so long as she in fact does not have the power to control
or direct the management or policies of such competitor and does not serve as a
director or officer of, and is not otherwise associated with, any competitor
except as consented to by the Bank. Nothing contained herein shall preclude
substantially passive investments by Executive during the Term that may require
nominal amounts of her time, energies and interest. The Bank and the Bancorp
specifically acknowledge that Executive is a board member of the National MPS
Society, PO Box 14686, Durham, NC 27709-4686. Executive agrees to manage her
affairs with the National MPS Society so that they do not unduly interfere with
Executive’s responsibilities to the Bank and Bancorp.

 

3. Performance. Except as provided in paragraph J.2. herein, Executive after the
Effective Date shall devote substantially her full energies, interests,
abilities, and productive time to the business of the Bank. Executive shall at
all times loyally and conscientiously perform all of these duties and
obligations hereunder and shall at all times strictly adhere to and obey and
instruct and require all that work under and with her strictly to adhere and
obey, all applicable federal and state laws, statutes, rules and regulations to
the end that the Bank shall at all times be in full compliance with such laws,
statutes, rules and regulations.

 

 

 

 

C. COMPENSATION

 

1. Salary. In consideration of the performance by Executive of all of her
obligations under this Agreement, the Bank agrees to pay Executive during the
Term hereof a base annual salary of $310,000. The Board of Directors may elect
to adjust upward the base annual salary and other compensation of Executive from
time to time, at its sole discretion. The Executive’s salary shall be reviewed
at least annually by the Board of Directors, with the initial review to occur in
the first quarter of 2020, which may, but shall not be required to, increase the
salary during the Employment Term.

 

2. Bonuses. During the term of this Agreement, Executive may receive an annual
target bonus opportunity, in the form of cash and/or stock grants, with such
percentage initially set at 50% of base annual salary and subject to the
approval by the board of directors or such additional bonuses, if any, in the
form of cash and/or stock grants as the Board of Directors of the Bank in its
sole discretion shall determine (collectively, the “Annual Target Bonus”).

 

3. Stock Options/Awards. Upon commencement of the Term, Bancorp shall grant to
Executive a restricted stock award (the “Restricted Stock Award”) of 10,000
shares which is intended to vest in equal amounts over five (5) years from the
date of grant, subject to acceleration in specified circumstances. The terms and
conditions of the Restricted Stock Award shall be governed by the Bancorp’s 2013
Omnibus Stock Incentive Plan and Executive’s Restricted Stock Award Agreement.

 

4. Claw-back Provisions. Notwithstanding any other provisions in this Agreement
to the contrary, any incentive-based compensation, or any other compensation,
paid to the Executive pursuant to this Agreement or any other agreement or
arrangement with the Company which is subject to recovery under any law,
government regulation or stock exchange listing requirement, will be subject to
such deductions and claw-back as may be required to be made pursuant to such
law, government regulation or stock exchange listing requirement or any policy
adopted by the Company.

 

D. EXECUTIVE BENEFITS

 

1. Personal Days. Executive shall be entitled to twenty-five (25) personal days
per year during the Term. Executive further agrees that she will not take the
entire twenty-five (25) days of personal days consecutively, and that she will
not take any personal days at times which would be detrimental to the interests
of the Bank and/or the Bancorp. Executive shall be entitled to accrue personal
days up to two times the annual personal days entitlement described above, at
which time the personal time will stop accruing until personal time is taken by
Executive. This is subject to any and all California laws and regulatory
requirements.

 

2. Automobile Allowance. Executive shall be entitled to payment of an automobile
allowance in the amount of $1,000 per month during the Term. During the Term
hereunder, the Board of Directors would be willing to reanalyze the benefit if
Executive’s actual and reasonable costs are significantly in excess of the
reimbursement rate.

 

3. Group Medical and Life Insurance Benefits. The Bank will provide Executive
and Executive’s direct and immediate family with, and pay for, participation in
medical, dental, vision, accident and health benefits, appropriate life and
disability insurance, and an annual physical examination. Said coverage shall be
in existence or shall take effect as of the Effective Date hereof and shall
continue throughout the Term. The Bank’s or First Choice Bancorp’s liability to
Executive for any breach of this paragraph shall be limited to the amount of
premiums payable by the Bank to obtain the coverage contemplated herein.

 

4. Salary Continuation Plan and Other Plans. During the Term, Executive shall be
eligible to participate in any pension or profit-sharing plan, deferred
compensation plan, salary continuation plan, stock purchase plan, or similar
benefit or retirement program of the Bank, including the Bank’s 401k Plan, as
approved by the Board of Directors now or hereafter existing, to the extent that
she is eligible under the provisions thereof and commensurate with Executive’s
position in relationship to other participants.

 

 

 

 

E. REIMBURSEMENT FOR BUSINESS EXPENSES

 

Executive shall be entitled to reimbursement by the Bank for any ordinary and
necessary business expenses incurred by Executive in the performance of
Executive’s duties and in acting for the Bank during the Term, which type of
expenditures shall be determined by the Board of Directors, provided that:

 

(a) Each such expenditure is of a nature qualifying it as a proper deduction on
the federal and state income tax returns of the Bank as a business expense and
not as deductible compensation to Executive; and

 

(b) Executive furnishes to the Bank adequate records and other documentary
evidence required by federal and state statutes and regulations issued by the
appropriate taxing authorities for the substantiation of such expenditures as
deductible business expenses of the Bank and not as deductible compensation to
Executive.

 

Upon timely presentation to the Bank of necessary and proper documentation in
accordance with the Regulations of the Internal Revenue Service, the Bank will
reimburse Executive for any necessary, usual, customary and reasonable business
expenses incurred by Executive in connection with her position or for the Bank’s
benefit, including the costs of cellular phone service related to the Bank’s
business.

 

Any expenses of Executive for her activities in industry association groups, or
other business, industry, civic, or charitable organizations that are not
reimbursed by those organizations will be reimbursed by the Bank to Executive
upon presentation of proper documentation.

 

F. TERMINATION

 

Notwithstanding any and all other provisions of this Agreement to the contrary,
Executive’s employment hereunder may be terminated:

 

1. Without Cause. In the sole and absolute discretion of the Board of Directors
for any cause whatsoever; provided, however, that if such termination occurs
during the Term, and is for any cause other than any more particularly described
in Sections F.2. or F.3. hereof, Executive shall receive a severance payment in
the amount of twelve (12) months of Executive’s then current annual salary, plus
the amount of Executive’s Annual Target Bonus that Executive would have been
eligible to receive for the year in which Executive’s employment is terminated,
had Executive remained employed and the Annual Target Bonus criteria had been
met (the “Bonus Severance Payment Amount”), payable in equal installments on the
normal payroll dates of the Bank, in full and complete satisfaction of any and
all rights which Executive may enjoy hereunder other than the right, if any, to
exercise any of the Options vested prior to such termination. In addition, Bank
will, for twelve (12) months after the date of termination, pay all premiums and
costs necessary to permit Executive to continue receiving those benefits
provided hereunder that Executive was receiving as of Executive’s date of
termination and which Executive is eligible to receive post termination under
the applicable plans or COBRA (the “Benefits Severance Payment Amount”);
provided, however, if such Benefits cannot be provided by the Company, then the
Company will pay Executive the amount on an after-tax basis equal to the
premiums for the twelve (12) month period. In order to qualify for the severance
benefit, Executive must execute a general release in favor of the Bank, First
Choice Bancorp and its officers, directors, employees, shareholders, attorneys,
and agents, and all other related parties. Such payments will be made (or begin
if installments payments are made by the Bank) on the 60th day following
termination if the release referred to in Section F.5 is executed and not
revoked by that day. Executive agrees and acknowledges that Executive will not
be entitled to receive any unvested portion of the Restricted Stock Award.

 

2. Disability or Death. Upon Executive’s physical or mental disability to
continue her duties hereunder as the Chief Financial Officer of the Bank;
provided, however, that if such termination occurs as a result of such
disability, Executive shall receive a severance payment in an amount equal to
twelve (12) months of Executive’s annual base salary in effect hereunder at the
date of such termination, in full and complete satisfaction of any and all
rights which Executive might enjoy hereunder, other than the right, if any, to
retain any shares that have vested pursuant to the Restricted Stock Award prior
to such termination, or which Executive is otherwise entitled to receive
pursuant to Bancorp’s 2013 Omnibus Stock Incentive Plan or Executive’s
Restricted Stock Award Agreement, less any payments received from any Bank
provided benefit, including worker’s compensation, FICA or disability insurance.
For purposes of this Agreement, physical or mental disability shall be defined
as Executive being unable to fully perform under this Agreement for a continuous
period of 90 days and reasonably accommodate for that disability as required by
the Americans with Disability Act of 1990.

 

 

 

 

Upon Executive’s death; provided, however, Executive’s estate shall receive the
payment in an amount equal to six (6) months of Executive’s annual base salary
in effect hereunder at the date of such termination, in full and complete
satisfaction of any and all rights which Executive might enjoy hereunder other
than the right, to retain any shares that have vested pursuant to the Restricted
Stock Award prior to such termination, or which Executive’s estate is otherwise
entitled to receive pursuant to Bancorp’s 2013 Omnibus Stock Incentive Plan or
Executive’s Restricted Stock Award Agreement.

 

3. For Cause. The Bank may terminate immediately this Agreement without any
further obligation or liability whatsoever to Executive, if:

 

(a) Executive engages in misconduct, including fraudulent acts, acts that would
substantially harm the reputation of the Bank or the Company, or is negligent in
the performance of her material duties hereunder and fails to cure such
negligence within thirty (30) days after written notice thereof to Executive; or

 

(b) Executive is convicted of or pleads guilty or nolo contendere to any felony
or a crime that constitutes a misdemeanor involving moral turpitude; or

 

(c) Bank is required to remove or replace Executive by formal order or formal or
informal instruction, including a requested consent order or agreement, from the
Department of Business Oversight, Federal Deposit Insurance Corporation
(“FDIC”), the Federal Reserve Bank, or any other regulatory authority having
jurisdiction; or

 

(d) Executive has failed to perform or habitually neglected Executive’s duties
after written notice thereof to Executive and a thirty (30) day cure period; or

 

(e) Executive has willfully and materially failed to follow any valid and
material legal written policies of the Board of Directors, any resolutions of
the Board adopted at a duly called meeting or any instructions from the Board of
Directors, or follow any other material policies, rules, regulations or statutes
of the Bank or Company, or to which the Bank or Company is subject, as
promulgated from time to time; or

 

(f) Due to Executive’s lack of care or negligence, the Bank receives a Section
8(a) Order from the FDIC, a Section 8(b) Order from the FDIC, an order from the
Department of Business Oversight or the Federal Reserve Bank, or an informal
regulatory enforcement action from any of the agencies named above; or

 

(g) Executive’s engagement in dishonesty or illegal conduct directly related to
Executive’s employment; or

 

(h) Executive’s willful unauthorized disclosure of Confidential Information (as
defined below); or

 

(i) Executive’s breach of any material obligation under this Agreement or any
other written agreement between the Executive and the Company after written
notice thereof to Executive and a thirty (30) day cure period, if capable of
cure; or

 

(j) Executive is directly responsible for the failure of the Bank and the
Company, or otherwise maintain the Bank and the Company in good standing.

 

 

 

 

Any termination under this paragraph F.3 shall not prejudice any remedy which
Bank may otherwise have at law, in equity, or under this Agreement.

 

4. Change of Control

 

(a) Except for termination for Cause (pursuant to Section F.3 hereof),
disability or death (pursuant to Section F.2 hereof), after the occurrence of a
Change in Control (as defined below), if Executive’s employment with the Bank is
materially adversely altered or Executive is not retained by the Bank or the
surviving bank or company, Executive shall be entitled to receive a severance
payment in the amount of twelve (12) months of Executive’s then current monthly
salary and the Benefits Severance Payment Amount. In addition, all unvested
shares issued pursuant to the Restricted Stock Award and any other unvested
Award, as defined by Bancorp’s 2013 Omnibus Stock Incentive Plan and evidenced
by an Award Agreement, granted to Executive, with or without performance
objectives, will immediately vest in accordance with the terms and conditions of
the Bancorp’s 2013 Omnibus Stock Incentive Plan and Executive’s Restricted Stock
Award Agreement and other Award Agreement, if any.

 

A material adverse alteration in employee status would mean (i) a material
breach by the Bank of its obligations under this Agreement, (ii) a change in
Executive’s status or position or responsibilities as Executive Vice President
and Chief Financial Officer of the Bank which represents a demotion from her
status, title, position and responsibilities, or the assignment to her of any
significant duties which are inconsistent with such status, title or position,
or (iii) a reduction by the Bank in Executive’s base annual salary, or (iv) a
relocation of Executive’s principal office to a location that is more than
twenty-five (25) miles from the Bank’s headquarters office currently located in
Cerritos, California. . Such payments will be made (or begin if installments
payments are made by the Bank) on the 60th day following termination if the
release referred to in Section F.5 is executed and not revoked by that day.

 

The Executive cannot terminate her employment for a material adverse alteration
in employee status unless she has provided written notice to the Company of the
existence of the circumstances providing grounds for termination for a material
adverse alteration in employee status within thirty (30) days of the initial
existence or occurrence of such grounds and the Company has had at least (30)
days from the date on which such notice is provided to cure such circumstances.
If the Executive does not terminate her employment for a material adverse
alteration in employee status within seventy-five (75) days after the first
occurrence of the applicable grounds, then the Executive will be deemed to have
waived her right to terminate for a material adverse alteration in employee
status with respect to such grounds.

 

(b) A “Change in Control” shall be deemed to have occurred if the conditions set
forth in any one of the following paragraphs shall have been satisfied:

 

(i) any “person” (as such term is used in Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934 (the “Exchange Act”) (other than the Company;
any trustee or other fiduciary holding securities under an employee benefit plan
of the Company; any entity owned, directly or indirectly, by the stockholders of
the Company in substantially the same proportions as their ownership of the
stock of the Company) is or becomes the “beneficial owner” (as defined in Rule
13d-3 under the Exchange Act), directly or indirectly, of securities of the
Company (not including in the securities beneficially owned by such Person any
securities acquired directly from the Company or its affiliates) representing
25% or more of the combined voting power of the Company’s then outstanding
securities; or

 

(ii) the stockholders of the Company approve a merger or consolidation of the
Company with any other corporation, other than (A) a merger or consolidation
which would result in the voting securities of the Company outstanding
immediately prior thereto continuing to represent (either by remaining
outstanding or by being converted into voting securities of the surviving
entity), in combination with the ownership of any trustee or other fiduciary
holding securities under an employee benefit plan of the Company, at least 25%
of the combined voting power of the voting securities of the Company or such
surviving entity outstanding immediately after such merger or consolidation, or
(B) a merger or consolidation effected to implement a recapitalization of the
Company (or similar transaction) in which no person acquires more than 25% of
the combined voting power of the Company’s then outstanding securities; or

 

 

 

 

(iii) the stockholders of the Company approve a plan of complete liquidation of
the Company or an agreement for the sale or disposition by the Company of all or
substantially all the Company’s assets.

 

Notwithstanding the foregoing, a Change in Control shall not include (A) any
event, circumstances or transaction that results from the action of any entity
or group that includes, is affiliated with, or is wholly or partly controlled by
Executive (e.g., a management-led buyout), or (B) the repurchase by the Company
or the redemption directly or indirectly, of securities of the Company
representing 25% or more of the combined voting power of the Company’s then
outstanding securities.

 

Notwithstanding the foregoing, such an occurrence shall constitute a “Change in
Control” only if the occurrence is a “change in ownership,” a “change in
effective control” or a “change in the ownership of a substantial portion of the
assets” (as such terms are defined for purposes of Section 409A of the Internal
Revenue Code of 1986, as amended (“Section 409A”)) of the Company.

 

5. Release and Resignation. As a condition to Executive receiving any payments
pursuant to Sections F.1, F.2, and F.4 hereof, Executive will execute and
deliver a general release to the Company, releasing the company, its employees,
officers, directors, stockholders and agents, and each person who controls any
of them within the meaning of Section 15 of the Securities Act of 1933, as
amended, from any and all claims (other than claims with respect to payments
pursuant to such Sections) from the beginning of time to the date of
termination.

 

Upon termination of Executive’s employment with the Bank, Executive, if she is
then serving as a director of the Company, agrees to immediately resign her
position as a director of the Company, unless otherwise agreed, by providing
written notice of her resignation to the Board of Directors of the Company.

 

6. Supervisory Matters.

 

(a) If the Executive is suspended and/or temporarily prohibited from
participating in the conduct of the Bank’s or the Bancorp’s affairs by notice
served under Section 8(e)(3) or 8(g)(1) of the Federal Deposit Insurance Act (12
U.S.C. Section 1818(e)(3) and (g)(1)), the obligations of the Company under this
Agreement shall be suspended as of the date of service, unless stayed by
appropriate proceedings. If the charges in the notice are dismissed, the Company
may, in its discretion: (i) pay the Executive all or part of the compensation
withheld while its obligations under this Agreement were suspended; and (ii)
reinstate (in whole or in part) any of its obligations which were suspended. If
the Executive is removed and/or permanently prohibited from participating in the
conduct of the Bank’s or the Bancorp’s affairs by an order issued under Section
8(e) (3) or 8(g)(1) of the Federal Deposit Insurance Act (12 U.S.C. Section
1818(e)(3) or (g)(1)), all obligations of the Company under this Agreement shall
terminate as of the effective date of the order, but vested rights of the
parties shall not be affected. If the Company is in default (as defined in
Section 3(x)(1) of the Federal Deposit Insurance Act (12 U.S.C. Section
1813(x)(1)), all obligations under this Agreement shall terminate as of the date
of default, but vested rights of the parties shall not be affected. All
obligations under this Agreement shall be terminated, except to the extent that
it is determined that continuation of the Agreement is necessary for the
continued operation of the Company; (i) by the Federal Deposit Insurance
Corporation at the time that the Federal Deposit Insurance Corporation enters
into an agreement to provide assistance to or on behalf of the Bank under the
authority contained in Section 11 of the Federal Deposit Insurance Act (12
U.S.C. Section 1821); or (ii) by the Federal Deposit Insurance Corporation or
the Federal Reserve Board, at the time that the Federal Deposit Insurance
Corporation or the Federal Reserve Board approves a supervisory merger to
resolve problems related to the operation of the Bancorp or when the Company is
in an unsafe or unsound condition. All rights of the parties that have already
vested, however, shall not be affected by such action.

 

Notwithstanding anything to the contrary contained herein, the obligation to
make payment of any severance benefits as provided herein (including without
limitation, any payment contemplated under Section F.4), is conditioned upon (i)
the Company and/or Bank obtaining any necessary approval from the Board of
Governors of the Federal Reserve System and/or the Federal Deposit Insurance
Corporation, and (ii) compliance with applicable law, including 12 C.F.R. Part
359. In addition, the Executive covenants and agrees that the Company and its
successors and assigns shall have the right to demand the return of any “golden
parachute payments” (as defined in 12 C.F.R. Part 359) in the event that any of
them obtain information indicating that the Executive committed, is
substantially responsible for, or has violated, the respective acts or
omissions, conditions, or offenses contained in 12 C.F.R. § 359.4(a)(4), and the
Executive shall promptly return any such “golden parachute payment” upon such
demand.

 

 

 

 

(7) Section 280G.

 

(i) If any of the payments or benefits received or to be received by the
Executive (including, without limitation, any payment or benefits received in
connection with a Change in Control or the Executive’s termination of
employment, whether pursuant to the terms of this Agreement or any other plan,
arrangement or agreement, or otherwise) (all such payments collectively referred
to herein as the “280G Payments”) constitute “parachute payments” within the
meaning of Section 280G of the Code and would, but for this Section F.(7), be
subject to the excise tax imposed under Section 4999 of the Code (the “Excise
Tax”), then such 280G Payments shall be reduced (by the minimum possible
amounts), a manner determined by the Company that is consistent with the
requirements of Section 409A, until no amount payable to the Executive will be
subject to the Excise Tax. If two economically equivalent amounts are subject to
reduction but are payable at different times, the amounts shall be reduced (but
not below zero) on a pro rata basis.

 

(ii) All calculations and determinations under this Section F.(7) shall be made
by an independent accounting firm or independent tax counsel appointed by the
Company (the “Tax Counsel”) whose determinations shall be conclusive and binding
on the Company and the Executive for all purposes. For purposes of making the
calculations and determinations required by this Section F.(7), the Tax Counsel
may rely on reasonable, good faith assumptions and approximations concerning the
application of Section 280G and Section 4999 of the Code. The Company and the
Executive shall furnish the Tax Counsel with such information and documents as
the Tax Counsel may reasonably request in order to make its determinations under
this Section F.(7). The Company shall bear all costs the Tax Counsel may
reasonably incur in connection with its services.

 

G. Confidential Information Defined.

 

(a) Definition.

 

For purposes of this Agreement, “Confidential Information” includes, but is not
limited to, all information not generally known to the public, in spoken,
printed, electronic or any other form or medium, relating directly or indirectly
to: business processes, practices, methods, policies, plans, documents,
operations, services, strategies, agreements, contracts, terms of agreements,
transactions, potential transactions, negotiations, trade secrets, policy
manuals, records, vendor information, financial information, results, accounting
records, legal information, marketing information, pricing information, credit
information, payroll information, staffing information, personnel information,
employee lists, supplier lists, vendor lists, reports, internal controls,
security procedures, market studies, sales information, revenue, costs, notes,
communications, product plans, ideas, customer information, customer lists, of
the Company or its businesses or any existing or prospective customer, supplier,
investor or other associated third party, or of any other person or entity that
has entrusted information to the Company in confidence.

 

The Executive understands that the above list is not exhaustive, and that
Confidential Information also includes other information that is marked or
otherwise identified as confidential or proprietary, or that would otherwise
appear to a reasonable person to be confidential or proprietary in the context
and circumstances in which the information is known or used.

 

The Executive understands and agrees that Confidential Information includes
information developed by her in the course of her employment by the Company as
if the Company furnished the same Confidential Information to the Executive in
the first instance. Confidential Information shall not include information that:
(i) is generally available to and known by the public at the time of disclosure
to the Executive; provided that, such disclosure is through no direct or
indirect fault of the Executive or person(s) acting on the Executive’s behalf;
(ii) becomes available on a non-confidential basis from a source other than a
party to this Agreement or a representative of a party to this Agreement,
provided that such source is not bound by a confidentiality agreement with a
party or otherwise prohibited from transmitting the information by a
contractual, legal or fiduciary obligation, (iii) is disclosed in accordance
with an order of a court of competent jurisdiction or applicable law.

 

 

 

 

(b) Company Creation and Use of Confidential Information.

 

The Executive understands and acknowledges that the Company has invested, and
continues to invest, substantial time, money and specialized knowledge into
developing its resources, creating a customer base, generating customer and
potential customer lists, training its employees, and improving its product
offerings in the field of financial services. The Executive understands and
acknowledges that as a result of these efforts, the Company has created, and
continues to use and create Confidential Information. This Confidential
Information provides the Company with a competitive advantage over others in the
marketplace.

 

(c) Disclosure and Use Restrictions.

 

The Executive agrees and covenants: (i) to treat all Confidential Information as
strictly confidential; (ii) not to directly or indirectly disclose, publish,
communicate or make available Confidential Information, or allow it to be
disclosed, published, communicated or made available, in whole or part, to any
entity or person whatsoever (including other employees of the Company) not
having a need to know and authority to know and use the Confidential Information
in connection with the business of the Company and, in any event, not to anyone
outside of the direct employ of the Company except as required in the
performance of the Executive’s authorized employment duties to the Company in
each instance (and then, such disclosure shall be made only within the limits
and to the extent of such duties; and (iii) not to access or use any
Confidential Information, and not to copy any documents, records, files, media
or other resources containing any Confidential Information, or remove any such
documents, records, files, media or other resources from the premises or control
of the Company, except as required in the performance of the Executive’s
authorized employment duties to the Company acting on behalf of the Company in
each instance (and then, such disclosure shall be made only within the limits
and to the extent of such duties). Nothing herein shall be construed to prevent
disclosure of Confidential Information as may be required by applicable law or
regulation, or pursuant to the valid order of a court of competent jurisdiction
or an authorized government agency, provided that the disclosure does not exceed
the extent of disclosure required by such law, regulation or order. The
Executive shall promptly provide written notice of any such order to the
Company’s General Counsel.

 

The Executive understands and acknowledges that her obligations under this
Agreement with regard to any particular Confidential Information shall commence
immediately upon the Executive first having access to such Confidential
Information (whether before or after she began employment by the Company) and
shall continue during and after her employment by the Company until such time as
such Confidential Information has become public knowledge other than as a result
of the Executive’s breach of this Agreement or breach by those acting in concert
with the Executive or on the Executive’s behalf.

 

H. Security.

 

(a) Security and Access. The Executive agrees and covenants (a) to comply with
all Company security policies and procedures as in force from time to time
including, without limitation, those regarding computer equipment, telephone
systems, voicemail systems, facilities access, monitoring, key cards, access
codes, Company intranet, internet, social media and instant messaging systems,
computer systems, e-mail systems, computer networks, document storage systems,
software, data security, encryption, firewalls, and passwords (“Facilities
Information Technology and Access Resources”); (b) not to access or use any
Facilities Information Technology and Access Resources except as authorized by
the Company; and (iii) not to access or use any Facilities Information
Technology and Access Resources in any manner after the termination of the
Executive’s employment by the Company, whether termination is voluntary or
involuntary. The Executive agrees to notify the Company promptly in the event
she learns of any violation of the foregoing by others, or of any other
misappropriation or unauthorized access, use, reproduction or reverse
engineering of, or tampering with any Facilities Information Technology and
Access Resources or other Company property or materials by others.

 

(b) Exit Obligations. Upon (a) voluntary or involuntary termination of the
Executive’s employment or (b) the Company’s request at any time during the
Executive’s employment, the Executive shall (i) provide or return to the Company
any and all Company property, including keys, key cards, access cards,
identification cards, security devices, employer credit cards, network access
devices, computers, cell phones, smartphones, PDAs, pagers, fax machines,
equipment, manuals, reports, files, books, compilations, e-mail messages,
recordings, disks, thumb drives or other removable information storage devices,
hard drives, data and all Company documents and materials belonging to the
Company and stored in any fashion, including but not limited to those that
constitute or contain any Confidential Information, that are in the possession
or control of the Executive, whether they were provided to the Executive by the
Company or any of its business associates or created by the Executive in
connection with her employment by the Company; and (ii) delete or destroy all
copies of any such documents and materials not returned to the Company that
remain in the Executive’s possession or control, including those stored on any
non-Company devices, networks, storage locations and media in the Executive’s
possession or control.

 

 

 

 

I. Publicity. The Executive hereby irrevocably consents to any and all uses and
displays, by the Company and its agents, representatives and licensees, of the
Executive’s name, voice, likeness, image, appearance and biographical
information in, on or in connection with any pictures, photographs, audio and
video recordings, digital images, websites, television programs and advertising,
other advertising and publicity, sales and marketing brochures, books,
magazines, other publications, CDs, DVDs, tapes and all other printed and
electronic forms and media throughout the world, at any time during or after the
period of her employment by the Company, for all legitimate commercial and
business purposes of the Company (“Permitted Uses”) without further consent from
or royalty, payment or other compensation to the Executive. The Executive hereby
forever waives and releases the Company and its directors, officers, employees
and agents from any and all claims, actions, damages, losses, costs, expenses
and liability of any kind, arising under any legal or equitable theory
whatsoever at any time during or after the period of her employment by the
Company, arising directly or indirectly from the Company’s and its agents’,
representatives’ and licensees’ exercise of their rights in connection with any
Permitted Uses.

 

J. GENERAL PROVISIONS

 

1. Trade Secrets. During the Term, Executive will have access to and become
acquainted with what Executive and the Bank acknowledge are trade secrets, to
wit, knowledge or data concerning the Bank, including its operations and
business, and the identity of customers of the Bank, including knowledge of
their financial conditions, their financial needs, as well as their methods of
doing business. Executive shall not disclose any of the aforesaid trade secrets,
directly or indirectly, or use them in any way, except as required in the course
of Executive’s employment with the Bank.

 

2. Covenant Not to Solicit Customers or Fellow Employees. If the Bank or the
Executive terminates this Agreement for any reason, Executive agrees that for a
one-year period, Executive shall not solicit the banking business of any
customer with whom the Bank has done business during the preceding eighteen (18)
month period. Executive further agrees not to solicit the services of any
officer or employee of the Bank during such period.

 

The covenants contained in this Section J.2 shall be considered as a series of
separate covenants, one for each political subdivision of California, and one
for each entity or individual with respect to whom solicitation is prohibited.
Except as provided in the previous sentence, each such separate covenant shall
be deemed identical in terms to the covenant contained in this Section J.2. If
in any judicial proceeding a court refuses to enforce any of such separate
covenants (or any part thereof), then such unenforceable covenant (or such part)
shall be eliminated from this Agreement to the extent necessary to permit the
remaining separate covenants (or portions thereof) to be enforced. In the event
that a provision of this Section J.2 or any such separate covenant or portion
thereof, is determined to exceed the time, geographic or scope limitations
permitted by applicable law, then such provision shall be reformed to the
maximum time, geographic or scope limitations, as the case may be, permitted by
applicable law. Executive hereby consents, to the extent Executive may lawfully
do so, to the judicial modification of this Agreement as described in this
Section J.2.

 

In the event of a merger, where Bank is not the surviving corporation, or in the
event of a consolidation, in the event of a transfer of all or substantially all
of the assets of Bank, or in the event that the majority of the Bank’s Board of
Directors, as it exists as of the date of this Agreement, does not have control,
the Executive shall be unconditionally released from all of her duties and
obligations under this paragraph.

 

 

 

 

3. Indemnification. The Bank shall use its most diligent and best efforts to
obtain and maintain during and after the Term, a Directors and Officers
Liability Insurance Policy in the largest amount available or reasonably
affordable. In addition, to the fullest extent allowed by law, the Bank shall
indemnify Executive for any and all of her actions, or forbearance of any
action, as an employee and Director of the Bank, carried out or undertaken in
good faith in the course of her duties, even if such is held to be negligent.
The Bank will indemnify Executive, defend, and bear the cost of defense with
regard to any action or threatened action brought by a third party against the
Executive (whether or not the Bank is joined or included as a party defendant)
and/or the Bank. This indemnification shall include not only the costs of
defense, but also any other expenses, judgments, fines, settlements, and other
amounts actually and reasonably incurred. This indemnification does not and will
not include illegal acts knowingly and willfully carried out by the Executive,
but will include all actions carried out by the Executive acting in good faith
and in a manner the Executive reasonably believed to be in the best interest of
the Bank. Such indemnification shall also apply to any and all subsidiaries of
the Bank and organizations with which the Bank requests Executive to serve, and
as regards the actions of Executive and her involvement and actions within or
regarding those subsidiaries or organizations. The indemnification rights of
Executive herein are in addition to any rights of indemnification under
applicable law, contract, or the articles of incorporation or bylaws of the
Bank.

 

4. Return of Documents. Executive expressly agrees that all manuals, documents,
files, reports, studies, instruments or other materials used and/or developed by
Executive during the Term are solely the property of the Bank, and that
Executive has no right, title or interest therein. Upon termination of this
Agreement, Executive or Executive’s representative shall promptly deliver
possession of all of said property to the Bank in good condition.

 

5. Notices. Any notice, request, demand or other communication required or
permitted hereunder shall be deemed to be properly given when personally served
in writing, when deposited in the United States mail, postage prepaid, or when
communicated to a public telegraph address appearing at the beginning of this
Agreement. Either party may change its address by written notice in accordance
with this paragraph.

 

6. California Law. This Agreement is to be governed by and construed under the
laws of the State of California.

 

7. Captions and Paragraph Headings; Interpretation. Captions and paragraph
headings used herein are for convenience only and are not a part of this
Agreement and shall not be used in construing it. The parties have participated
jointly in the negotiation and drafting of this Agreement. In the event an
ambiguity or question of intent or interpretation arises, this Agreement will be
construed as if drafted jointly by the parties and no presumption or burden of
proof will arise favoring or disfavoring any party by virtue of the authorship
of any of the provisions of this Agreement.

 

8. Invalid Provisions. Should any provision of this Agreement for any reason be
declared invalid, the validity and binding effect of any remaining portion shall
not be affected, and the remaining portions of this Agreement shall remain in
full force and effect as if this Agreement had been executed with said provision
eliminated.

 

9. Entire Agreement. This Agreement contains the entire agreement of the
parties. It supersedes any and all other agreements, either oral or in writing,
between the parties hereto with respect to the employment of Executive by the
Bank. Each party to this Agreement acknowledges that no representations,
inducements, promises, or agreements, oral or otherwise, have been made by any
party, or anyone acting on behalf of any party, which are not embodied herein,
and that no other agreement, statement, or promise not contained in this
Agreement shall be valid or binding. This Agreement may not be modified or
amended by oral agreement, but only by an agreement in writing signed by the
Bank and Executive.

 

10. Receipt of Agreement. Each of the parties hereto acknowledges that it or she
has read this Agreement in its entirety and does hereby acknowledge receipt of a
fully executed copy thereof. A fully executed copy shall be an original for all
purposes, and is a duplicate original.

 

 

 

 

11. Dispute Resolution Procedures. In the event of any dispute, claim or
controversy between the Executive and the Bank (or its directors, officers,
employees or agents) arising out of this Agreement or the Executive’s employment
with the Bank, both Parties agree to submit such dispute, claim or controversy
to final and binding arbitration under the Federal Arbitration Act, in
conformity with the procedures of the California Arbitration Act (Cal. Code Civ.
Proc. sec. 1280 et seq.). The arbitration will be conducted before JAMS (“JAMS”)
in accordance with the JAMS Employment Arbitration Rules and Procedures. These
rules are available at the JAMS web site at: http://www.jamsadr.com. The claims
governed by this arbitration provision include, but are not limited to, claims
for wages and other compensation, claims for breach of contract (express or
implied), claims for violation of public policy, wrongful termination, wrongful
demotion, tort claims, claims for fraud and misrepresentation, claims for
unlawful discrimination, harassment, and/or retaliation to the extent allowed by
law, and claims for violation of any federal, state, or other government law,
statute, regulation, or ordinance. The claims which are to be arbitrated under
this Agreement include claims under Title VII of the Civil Rights Act of 1964,
the Americans with Disabilities Act, the Age Discrimination in Employment Act,
the California Fair Employment and Housing Act and the California Labor Code.

 

(a) The arbitration shall be conducted by a single arbitrator selected either by
mutual agreement of the Executive and the Bank or, if they cannot agree, from an
odd-numbered list of experienced employment law arbitrators provided by JAMS.
Each Party shall strike one arbitrator from the list alternately until only one
arbitrator remains.

 

(b) Each Party shall have the right to conduct reasonable discovery, as
determined by the arbitrator.

 

(c) The arbitrator shall have all powers conferred by law and a judgment may be
entered on the award by a court of law having jurisdiction. The arbitrator shall
render a written arbitration award that contains the essential findings and
conclusions on which the award is based. The award and judgment shall be binding
and final on both Parties, subject to such review as is authorized by law.

 

(d) Either Party may bring an action to confirm the arbitration award in a court
of competent jurisdiction. To the maximum extent permitted by law, the decision
of the arbitrator shall be final and binding on the Parties to this Agreement
and shall be subject to judicial review only to the extent provided by law.

 

(e) The Parties shall share equally the costs of the arbitrator and the
arbitration forum unless a different fee payment arrangement is otherwise
required by applicable law to preserve the enforceability of this arbitration
provision. Company will pay the costs of the arbitrator and the arbitration
forum to the extent required by applicable law to preserve the enforceability of
this arbitration provision.

 

(f) In the event litigation, mediation, or arbitration is commenced to enforce
or construe any of the provisions of this Agreement, to recover damages for
breach of any of the provisions of this Agreement, or to obtain declaratory
relief in connection with any of the provisions of this Agreement, the
prevailing Party shall, to the extent permitted by law without impairing the
enforceability of the arbitration provision hereinabove, be entitled to recover
reasonable attorneys’ fees and costs. In the event this Agreement is asserted,
in any litigation, mediation, or arbitration, as a defense to any liability,
claims, demands, actions, causes of action, or rights herein released or
discharged, the prevailing Party on the issue of that defense shall, to the
extent permitted by law without impairing the enforceability of the arbitration
provision hereinabove, be entitled to recover reasonable attorneys’ fees and
costs.

 

(g) The Executive and the Company understand that by signing this Agreement,
they give up their right to a civil trial in a court of law and their right to a
trial by jury.

 

(h) This agreement to arbitrate does not apply to disputes or claims related to
workers’ compensation benefits, disputes or claims related to unemployment
insurance benefits, unfair labor practice charges under the National Labor
Relations Act, or disputes or claims that are expressly excluded from
arbitration by statute or are expressly required to be arbitrated under a
different procedure pursuant to an employee benefit plan.

 

(i) This agreement to arbitrate does not prevent Executive from filing a charge
or complaint with the California Department of Fair Employment and Housing, or
the U.S. Equal Opportunity Commission. It also does not prevent Executive from
participating in any investigation or proceeding conducted by an agency.
However, if one of these agencies issues a right to sue notice, binding
arbitration under this agreement will be Executive’s sole remedy.

 

 

 

 

(j) This agreement to arbitrate shall continue during the Term and thereafter
regarding any employment-related disputes.

 

Any controversy or claim arising out of, or relating to this Agreement or the
breach thereof, shall be settled by arbitration in the County of Los Angeles,
State of California, in accordance with the rules of JAMS, and a judgment upon
the award rendered may be entered is any court having jurisdiction thereof.

 

12. Section 409A. This Agreement is intended to comply with Section 409A or an
exemption thereunder and shall be construed and administered in accordance with
Section 409A. Notwithstanding any other provision of this Agreement, payments
provided under this Agreement may only be made upon an event and in a manner
that complies with Section 409A or an applicable exemption. Any payments under
this Agreement that may be excluded from Section 409A either as separation pay
due to an involuntary separation from service or as a short-term deferral shall
be excluded from Section 409A to the maximum extent possible. For purposes of
Section 409A, each installment payment provided under this Agreement shall be
treated as a separate payment. For purposes of determining the timing of any
payments to be made under this Agreement by reference to Executive’s termination
of employment, “termination” and “termination of employment” shall refer to
Executive’s “separation from service” as defined for purposes of Section 409A.
Notwithstanding the foregoing, the Company makes no representations that the
payments and benefits provided under this Agreement comply with Section 409A and
in no event shall the Company be liable for all or any portion of any taxes,
penalties, interest or other expenses that may be incurred by the Executive on
account of non-compliance with Section 409A.

 

Notwithstanding any other provision of this Agreement, if any payment or benefit
provided to the Executive in connection with her termination of employment is
determined to constitute “nonqualified deferred compensation” within the meaning
of Section 409A and the Executive is determined to be a “specified employee” as
defined in Section 409A(a)(2)(b)(i), then such payment or benefit shall be paid
on the first payroll date to occur following the six-month anniversary of the
Termination Date (the “Specified Employee Payment Date”). The aggregate of any
payments that would otherwise have been paid before the Specified Employee
Payment Date shall be paid to the Executive in a lump sum on the Specified
Employee Payment Date and thereafter, any remaining payments shall be paid
without delay in accordance with their original schedule.

 

Signature Page to Follow

 

 

 

 

IN WITNESS WHEREOF, the Bank has caused this Agreement to be executed by its
duly authorized officer or representative and Executive has executed this
Agreement to be effective as of the day and year first written above.

 

  FIRST CHOICE BANK         By: /s/ Pravin Pranav     Pravin Pranav,    
Chairman, Compensation Committee

 

  By: /s/ Phillip Thong     Phillip Thong,     Secretary

 

  FIRST CHOICE BANCORP         By: /s/ Pravin Pranav     Pravin Pranav,    
Chairman, Compensation     Committee

 

  By: /s/ Phillip Thong     Phillip Thong,     Secretary

 

  EXECUTIVE       /s/ Lynn M. Hopkins   Lynn M. Hopkins