Exhibit 10.07

EMPLOYMENT AGREEMENT

This Agreement is made and entered into as of the 11th day of January, 2017, by
and between BANK OF GUAM, a Guam corporation (herein called the “Bank”) and
Francisco M. Atalig (herein called the “Employee”).

NOW, THEREFORE, in consideration of the mutual promises of the parties to the
Agreement, it is hereby agreed as follows:

1. Employment. Bank hereby designates and employs, and Employee hereby accepts
employment with Bank, as its Senior Vice President and Chief Financial Officer.

2. Term. This Agreement shall be for a term of five (5) years effective
January 1, 2017, and terminating on December 31, 2021.

3. Duties. Employee shall, subject to the control of the Chief Executive Officer
or the Chief Operating Officer, have the general powers and duties of management
usually vested in the office assigned, and shall have such other powers and
duties as may be prescribed by the Chief Executive Officer or the Chief
Operating Officer of the Bank, or the By-Laws. The duties of the Employee shall
include without limitation the duties described in the attached Exhibit A.

4. Extent of Services. Employee shall devote his full time, attention and energy
to the business of Bank and shall not, during the term of this Agreement, be
engaged in any other business activities, unless such activities are reasonably
determined by the Chief Executive Officer or Chief Operating Officer of the Bank
not to be in competition or in conflict with the commercial banking business of
Bank.

5. Base Compensation. As regular compensation for Employee’s services hereunder,
Bank shall pay Employee an annual base salary of Two Hundred One Thousand and
00/100 ($201,000.00) during each year of the term hereof, payable in equal
installments not less frequently than bi-weekly (herein called “Base
Compensation”).

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6. Adjustments to Base Compensation. The Base Compensation shall be adjusted
annually to reflect the increase, if any, in the cost-of-living by adding
thereto an amount obtained by multiplying the Base Compensation by the
percentage of which the level of the Consumer Price Index for the United States
has increased over its level as of the date of commencement of the term of
Agreement (herein called, together with Base Compensation, the “Adjusted Base
Compensation”).

Following the end of each year of this Agreement and within thirty (30) days
after the release by the United States Bureau of Labor Statistics of the figures
for such year, Bank shall pay to the Employee the amount of any additional
compensation to which he is entitled as a result of such cost-of-living
adjustment for that year.

7. Incentive Bonus. As an incentive to Employee for his continuing services and
contributions to the growth and profitability of Bank, Employee shall be paid,
in addition to his Adjusted Base Compensation, an Incentive Bonus as follows:

(a) Subject to the quarterly adjustments at Section 8 below, an amount equal to
one hundred basis points (1.00%) of current net profits of the Bank after taxes,
payable in capital stocks of the Bank or in cash, or combination, at the option
of Employee.

(b) The Incentive Bonus shall be computed and payable quarterly, within fifteen
(15) days following each quarter except that each of the first calendar quarter
payments of the Incentive Bonus shall be subject to adjustment, either increase
or decrease, depending on the Bank’s final audited financial statements of the
preceding year by the Bank’s independent accountants.

 

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8. Adjustments To Bonus. On an annual basis, the Bank’s management shall submit
an annual budget and strategic plan to the Board. Based upon the criteria
contained within the budget and strategic plan, the Incentive Bonus of the
Employee shall be adjusted on a quarterly basis as follows:

(a) If the then current Return on Equity (ROE) of the Bank is below the
preceding three-year average ROE of the Bank, then the Incentive Bonus shall be
reduced by ten percent (10%);

(b) If the then current Return on Assets (ROA) of the Bank is less than that of
the Bank’s peer group as published in the Federal Deposit Insurance
Corporation’s (FDIC) Uniform Bank Performance Report, then the Incentive Bonus
shall be reduced by ten percent (10%);

(c) If the then current Bank’s FDIC Examination Composite Rating (FDIC Rating)
is 2 or better, there shall be no reduction to the Incentive Bonus; if the FDIC
Rating is 3, then Incentive Bonus shall be reduced by fifteen percent (15%); if
the FDIC Rating is 4, then the Incentive Bonus shall be reduced by fifty percent
(50%); if the FDIC Rating is 5, then the Incentive Bonus shall be reduced by
one-hundred percent (100%);

(d) If the then current Total Adversely Classified Items to Tier 1 Capital of
the Bank plus the Allowance for Loan and Lease Losses is greater than
twenty-five percent (25%), then the Incentive Bonus shall be reduced by ten
percent (10%);

(e) If the Efficiency Ratio of the Bank is greater than 75%, the Incentive Bonus
shall be reduced by five percent (5%).

 

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For purposes of this Section 8, the ROA, ROE, FDIC Rating, Total Adversely
Classified Items to Tier 1 Capital, Allowance for Loan and Lease Losses and
Efficiency Ratio shall all be derived from any report of management submitted to
the Board of Directors at the Board Meeting immediately preceding the date of
any adjustment. If any dispute arises as to the calculations of any of such
figures, the Ad Hoc Compensation Committee, subject to Board approval, shall
make the sole determination of such figures using whatever resources the
Committee shall deem reasonably necessary. Attached to this Agreement and made a
part hereof by this reference as Exhibit B, is a worksheet, which shall be used
by the Bank to calculate the Incentive Bonus of the Employee.

9. Other Compensation or Benefits. In addition to the Adjusted Base Compensation
and Incentive Bonus and any other compensation provided hereunder, Bank shall
provide Employee with the following:

(a) Twenty-five days of paid time-off annually, at full pay.

(b) A health insurance and accident insurance and disability insurance of a type
and in an amount generally made available by Bank to its executive employees, at
Bank’s sole cost and expense.

(c) A group term life insurance that is generally available to Bank’s executive
employees, at Bank’s sole expense and cost. As of the execution of this
Agreement, Employee’s group life insurance amount is Seven Hundred Thousand
Dollars ($700,000.00). Employee shall be allowed to name his beneficiary.

(d) A Survivor Income Plan that is generally available to Bank’s executive
employees, at Bank’s sole expense and cost.

(e) Employee will be entitled to participate in any retirement plans currently
available to other similarly situated employees, as well as any plans
implemented in the future.

 

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10. Termination With Cause. Notwithstanding anything to the contrary, the Bank
may terminate this Agreement upon five (5) days written notice to the Employee
upon the occurrence of any of the following events:

(a) Within sixty (60) days of the effective date of this Agreement, the Bank
determines, in its sole judgment, that the Employee’s character, personality and
abilities are not suited to the position for which hired hereunder.

(b) If the Bank, in its sole judgment, determines that the Employee is not
properly and efficiently performing the duties of the position to which
assigned.

(c) If the Employee violates any material provisions in this Agreement.

(d) If the Employee becomes bankrupt or insolvent, is frequently under the
influence of alcoholic beverages or illegal drugs, is convicted of a felony or
perpetration of a common law fraud, misrepresentation or embezzlement, is found
to have violated the Bank’s productive work environment policy, or otherwise
habitually acts in a manner inconsistent with the policies, rules and
regulations of the Bank.

(e) Employee engages in excessive risk taking in contravention of standards
established or revised by his supervisor, or Employee fails to comply with any
balance sheet or working or regulatory capital guidance provided by his
Supervisor;

(f) Employee is subject to an action taken by a regulatory body as a result of
his act or omission which substantially impairs him from performing his duties;

(g) Employee violates a federal or state securities or banking law, or
regulation;

(h) Employee made a factual representation or omission in the furtherance of his
hiring or retention which proves to have been incorrect in any material respect
when made.

 

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(i) If the Employee willfully breaches or neglects the duties which the Employee
is required to perform under the terms of this Agreement.

11. Termination of Contract for Good Reason.

“Good Reason” shall mean the occurrence of any one of the following acts by the
Bank, or failures by the Bank to act, without the Employee’s consent, provided
the Employee give the Bank notice of the Employee’s intent to incur a Separation
from Service for Good Reason within 30 days of the initial existence of the act
or failure to act such act or failure to act is not corrected within 30 days of
such notice:

 

  (a) A material diminution in the Employee’s base compensation.

 

  (b) A material diminution in the Employee’s authority, duties, or
responsibilities.

 

  (c) A material diminution in the authority, duties, or responsibilities of the
supervisor to whom the Employee is required to report, including a requirement
that the Employee report to a corporate officer or employee instead of reporting
directly to the Chief Executive Officer or The Chief Operating Officer.

12. Restrictive Covenants.

(a) During the term of this Agreement and for a period of one (1) year following
his employment with the Bank, the Employee shall not without the written consent
of the Bank, actively participate in any other business in Guam, whether as
owner, employee, or consultant, whether for compensation or not, which is in
competition with the Bank. The Employee may, however, invest in the securities
of companies which are publicly traded and which may compete with the Bank so
long as Employee owns less than two percent (2%) of such company.

 

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(b) Employee shall not divulge, publish or otherwise reveal, either directly or
indirectly through another, to any person, firm or corporation, during the term
of this Agreement or any time thereafter any knowledge or information of a
confidential nature received by him during the course of his employment with
regard to the services, clients, personnel, financial or other affairs of the
Bank, and such information shall be kept confidential and shall not in any
manner be revealed except as may be necessary in connection with his duties
hereunder.

(c) Upon the termination of employment with the Bank, the Employee shall
promptly turn over to the Bank all records, including client lists or
references, keys, credit cards and all other property belonging to or supplied
by the Bank.

13. Business Expenses. Bank shall pay or reimburse Employee upon submission of
an itemized account by his for all reasonable business expenses incurred by
Employee in promoting, pursuing or otherwise furthering the business of Bank,
including, but not limited to expenses for travel, meals, hotel accommodations,
entertainment, gifts and the like.

14. Payments Following Disability. Upon the permanent disability of the
Employee, Bank shall pay to the Employee, or his assigns, the Adjusted Base
Compensation, together with all Incentive Bonuses, for the remainder of the term
of this Contract.

15. Successors and Assigns. This Agreement and all the terms and conditions
hereof shall be binding upon and inure to the benefit of the Bank, including any
successor entity to Bank by liquidation, merger, consolidation, reorganization,
sale of assets or otherwise, and to the Employee, and when applicable, to his
heirs, successors and assigns.

 

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16. Retirement Plans. The bank will provide employee with a Supplemental
Executive Retirement Plan.

17. Non-Assumption. The services to be performed by Employee under this
Agreement are personal to him, and may not be assumed by any other party except
with Bank’s prior written consent.

18. Entire Agreement. The making and execution of this Agreement by the parties
hereto has been induced by no representations, statements, warranties or
agreements other than those expressed herein. This Agreement embodies the entire
understanding of the parties, and there are no further or other agreements or
understandings, written or oral, in effect between the parties relating to the
subject matter hereof, unless specifically referred to herein by reference.

19. Amendments. This Agreement and any term hereof may be changed, waived,
discharged, or terminated only by an instrument in writing signed by the party
against whom enforcement of such change, waiver, discharge or termination is or
would be sought and without the necessity of additional consideration.

20. Notices. All communications and notices hereunder shall be deemed to have
been properly given or served for all purposes when personally delivered to the
party to whom it is directed, or in lieu of such personal service, if received
by certified or registered United States mail, postage prepaid, at the following
addresses:

 

If to Bank at:    P.O. Box BW          Hagåtña, Guam 96932       If to Employee
at:         

 

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Either party may change the address provided above by giving written notice of
such change to the other party as herein provided.

21. Severability. Whenever possible, each provision of this Agreement shall be
interpreted in such a manner as to be effective and valid under applicable law,
but if any provision of this Agreement shall be prohibited or invalid under such
law, such provision shall be ineffective to the extent of the prohibition or
invalidity without invalidating the remainder of such provision or the remaining
provisions of this Agreement.

22. Law. This Agreement shall be governed under and construed in accordance with
the laws of Guam.

23. Attorney’s Fees. In the event of any action, suit or proceeding brought
under or in connection with this Agreement, the prevailing party therein shall
be entitled to recover, and the other party thereto agrees to pay, costs and
expenses in connection therewith including reasonable attorney’s fees,
disbursements and expenses.

24. The headings of this sections of this Agreement have been included for
convenience of reference only and shall in no way restrict or modify any of the
terms or provisions thereof.

IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first above mentioned.

 

BANK OF GUAM, a Guam corporation (herein called the “Bank”) By:  

/s/ Lourdes Leon Guerrero

  Its Authorized Representative  

/s/ Francisco M. Atalig

  Francisco M. Atalig   (herein called the “Employee”)

 

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