1998 AMENDED AND RESTATED TRUST AGREEMENT

                                       OF

                             PACIFIC CAPITAL BANCORP

                  VOLUNTARY EMPLOYEES' BENEFICIARY ASSOCIATION

                                December 30, 1998




<PAGE>

                    1998 AMENDED AND RESTATED TRUST AGREEMENT

                                       OF

                             PACIFIC CAPITAL BANCORP

                  VOLUNTARY EMPLOYEES' BENEFICIARY ASSOCIATION

         THIS AMENDED AND RESTATED TRUST AGREEMENT (the "agreement") is made and
entered  into,  effective  on the date set forth below,  by and between  PACIFIC
CAPITAL BANCORP, a California corporation, in its capacity as the sponsor of the
Trust created in this Agreement  ("Bancorp"),  and SANTA BARBARA BANK & TRUST, a
California  corporation,   in  its  capacity  as  Trustee  of  that  Trust  (the
"Trustee"), with reference to the following facts:

         RECITALS:

         A. SANTA BARBARA BANK & TRUST, a California  corporation (ASBBT"),  (i)
on December 29, 1992,  executed a "Trust  Agreement"  and a "First  Amendment to
Trust  Agreement"  (together,  the  "Original  Trust  Agreement")  in  order  to
establish the terms and  conditions on which the Trustee would act as trustee of
a Trust holding  contributions to pay the obligations of SBBT under that certain
"Santa Barbara Bank & Trust Retiree Health Plan" (the "Plan"),  and (ii) amended
and restated that Prior Trust Agreement  effective January 1, 1996,  pursuant to
that certain  "Amended and Restated Trust  Agreement" (the "First Restated Trust
Agreement") (the Original Trust Agreement and the First Restated Trust Agreement
together are referred to as the "Prior Trust Agreement").

         B.  Effective  December  30,  1998,  (i)  Pacific  Capital  Bancorp,  a
California  corporation  ("target"),  was  merged  with and into  Bancorp,  (ii)
Bancorp changed its name to "Pacific Capital  Bancorp," and (iii) Bancorp became
the  sponsor of the Plan for the  benefit of Bancorp  and all of its  subsidiary
corporations.

         C. Bancorp and the Trust have agreed to execute this Agreement in order
to reflect  that  Bancorp  has become the sponsor of the Plan and the results of
the Merger Transaction.

         AGREEMENTS:

         NOW, THEREFORE,  the parties hereto,  intending to be legally bound, do
hereby agree as follows:

1.       CREATION OF TRUST

         1.1 Creation.  Bancorp and the Trustee hereby confirm the establishment
of the Trust as of December 29, 1992, and that Bancorp has become sponsor of the
Trust as of December 30, 1998.

         1.2 Purpose and Interpretation.  The purpose of the Trust is to pay the
Post-Retirement  Contribution  toward the cost of Coverage pursuant to the terms
of the  Plan.  This  Agreement  shall be  interpreted,  and the  Trust  shall be
operated,  in such  manner  as to  ensure  that the  Trust  qualifies  as a VEBA
satisfying the requirements of Section 501(c)(9) of the Code and all regulations
promulgated  thereunder,  and the requirements of the Employee Retirement Income
Security Act of 1976, as amended (AERISA").

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<PAGE>

2.       DEFINITIONS

         For  purposes of this  Agreement,  the  following  terms shall have the
meanings indicated below:

         2.1 "affiliate"  shall mean each  corporation in which Bancorp owns all
the outstanding capital stock.

         2.2 "Bancorp" means PACIFIC CAPITAL BANCORP,  a California  corporation
formerly known as "Santa Barbara Bancorp."

         2.3 "code" means the Internal Revenue Code of 1986, as amended.

         2.4 "Coverage" means coverage under a Group Health Insurance Plan.

         2.5 "Covered Key  Employees"  means each person who (a) has been a "key
employee,"  as that term is defined  for  purposes of Code  Section  419A(d)(3),
during any plan year under any plan previously  maintained by Bancorp or SBBT to
provide  health  insurance  coverage to retired  employees,  (b) had  terminated
employment with SBBT prior to adoption of the  predecessor  Plan on December 29,
1992, and (c) as of that date satisfied the eligibility  requirements  set forth
in Section 2.1.1A of the Plan (as then in effect).

         2.6 "Effective Date" means December 30, 1998.

         2.7  "Employee"  means each person who is a common law  employee of any
Employer.

         2.8 "employer" means Bancorp and each Affiliate of Bancorp.

         2.9 "ERISA" means the Employee  Retirement Income Security Act of 1976,
as amended.

         2.10 "Group Health Insurance Plan" means, in each Plan Year, each group
medical  insurance  plan and each group  dental  insurance  plan under which any
Employer offers medical or dental  insurance  coverage to Employees in such Plan
Year.

         2.11 "Key  Employee"  means each  Employee  other than an Excluded  Key
Employee  who, at any time during any Plan Year under this Plan or any plan year
under any plan previously maintained by the Employer to provide health insurance
coverage to retired employees, meets the requirements of Section 2.11.1, 2.11.2,
2.11.3, or 2.11.4, below:

                    2.11.1  Is  an  officer  of  the  Employer   having   annual
compensation  greater than fifty  percent  (50.0%) of the limit on the amount of
benefits  payable  under a defined  benefit  plan,  as set forth in Code Section
415(b)(1)(A). For purposes of this Section 1.16.1, the term "officer" shall mean
only those  persons who have  officer-type  titles and  exercise  administrative
executive  authority,  and the  persons  who  qualify as  "officers"  under such
definition  shall be determined by the board of directors of the Employer or its
designee;

                    2.11.2 Is one of the ten (10)  employees of the Employer who
(a) has annual  compensation  from the  Employer in an amount  greater  than the
limitation  on  the  maximum   contributions   which  can  be  made  to  defined
contribution plans under Code Section  415(c)(1)(A),  and (b) owns (or by reason
of the


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<PAGE>

constructive  ownership  rules of Code Section 318) is deemed to own the largest
portions of the outstanding shares of the Employer's common capital stock.

                    2.11.3 Is an Employee of the  Corporation who owns more than
five percent (5.0%) of the outstanding  capital stock of the Employer or capital
stock  possessing  more than five percent  (5.0%) of the total  combined  voting
power of all capital stock of the Employer.

                    2.11.4 Is an Employee of the  Corporation  who both (a) owns
more than one percent (1.0%) of the  outstanding  capital stock of the Employer,
or owns capital stock of the Employer possessing more than one percent (1.0%) of
the total  combined  voting power of all  outstanding  shares of the  Employer's
capital stock, and (b) receives from the Employer  compensation of more than One
Hundred Fifty Thousand Dollars ($150,000) per year.

         2.12  "participant"  means each person who qualifies as a "participant"
under the terms of the Plan.

         2.13 "plan" means the Pacific Capital Bancorp 1998 Amended and Restated
Retiree Health Plan (for Non-Key Employees) adopted effective December 30, 1998,
as amended from time to time.

         2.14  "Plan  Administrator"  means  the  person  serving  as the  "Plan
Administrator" of the Plan.

         2.15 "Plan Year" shall have the same  meaning  ascribed to such term in
the Plan.

         2.16 "SBBT" means SANTA BARBARA BANK & TRUST, a California corporation.

         2.17 "trust" means the Trust established under this Agreement.

         2.18  "Trustee"  means SBBT, and each  additional or successor  trustee
serving as a trustee of the Trust.

         2.19 "Trust Fund" means all contributions made by Bancorp to the Trust,
all earnings  from the  investment of such  contributions,  and all other assets
acquired by the  Trustee in its  capacity  as Trustee or  otherwise  held by the
Trustee pursuant to this Agreement.

         2.20  "VEBA"  means  a  Voluntary  Employees'  Beneficiary  Association
satisfying  the  requirements  of  Section   501(c)(9)  of  the  Code,  and  the
regulations promulgated thereunder.

3.       CONTRIBUTIONS

         3.1  Receipt  of   Contributions.   The  Trustee   shall  receive  such
contributions  as are  paid to it in cash or in  kind,  from  time to  time,  by
Bancorp.  Upon  receipt,  all such  contributions,  together with all income and
other gains from such contributions,  shall be held, invested,  reinvested,  and
administered  by the  Trustee  pursuant to the terms of this  Agreement  without
distinction between principal and income.

         3.2  Limitation  of Trustee  Responsibility.  The Trustee  shall not be
responsible  for the  calculation  or collection of any  contribution  under the
Plan,  but rather  shall be  responsible  only for such  property as is actually
received by the Trustee pursuant to this Agreement.

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<PAGE>

4.       POWERS OF TRUSTEE

         4.1 Investment of Funds.  Pursuant to the Plan, Bancorp shall establish
and implement a funding policy  consistent with the purposes of the Plan and the
requirements  of law,  and from time to time may direct the  Trustee to exercise
its  investment   discretion  in  such  manner  as  Bancorp   determines  to  be
appropriate.  Subject  to such  funding  policy  and  periodic  directions  from
Bancorp, the Trustee shall invest the funds held in Trust as follows:

                    4.1.1  Permitted  Investments.  The Trustee shall invest and
reinvest the Trust Fund,  without  distinction  between principal and income, in
such securities or other property,  real or personal,  wherever situated, as the
Trustee  may deem  advisable,  including  but not  limited to stocks,  common or
preferred,  bonds, and other evidences of  indebtedness,  and real estate or any
interest therein. In making investments, the Trustee shall:

                           A. Consider,  among other factors, the short-term and
long-term needs of the Plan; and

                           B. Not be restricted to securities or other  property
of a character expressly authorized by applicable law for trust investments.

                    4.1.2 Employment of Custodian. The Trustee may employ a bank
or trust company  pursuant to the terms of its usual and  customary  bank agency
agreement,  under which the duties of such bank or trust  company  shall be of a
custodial, clerical, and record-keeping nature.

                    4.1.3  Pooled  Funds.  From  time to time  the  Trustee  may
transfer to a common,  collective, or pooled trust fund maintained by any person
serving as a  corporate  trustee  hereunder  all or such part of the assets held
under this Agreement as the Trustee may deem  advisable,  and any such monies so
transferred  shall be  subject  to all the terms of  provisions  of the  common,
collective,   or  pooled  trust  fund  which  contemplate  the  commingling  for
investment  purposes of such Trust assets with the assets of other  trusts.  The
Trustee may, from time to time, withdraw from such common,  collective,  or pool
trust fund all or any part of the monies so invested.

                    4.1.4 Life  Insurance  Policies.  The Trustee may apply for,
own,  and  pay  premiums  on life  insurance  policies  insuring  the  lives  of
Participants.

         4.2 Other  Powers.  In addition to the powers  expressly  or  impliedly
granted to the Trustee in other provisions of this Agreement,  the Trustee shall
have the power:

                    4.2.1   Borrow.   To  borrow   money  upon  such  terms  and
conditions,  at any time or times,  and for such  purposes of the Trust,  as the
Trustee may deem proper or desirable.  For sums borrowed,  the Trustee may issue
promissory notes and secure the payment thereof by mortgaging or pledging all or
any part of the assets of the Trust.

                    4.2.2  Real  Estate.  To buy,  sell,  and hold title to real
estate and  interests  therein in the name of the  Trustee or in the name of the
Trustee's  nominee.  In accepting title to real estate,  neither the Trustee nor
the  Trustee's  nominee  shall be held to have  assumed the  obligation  to make
payment  of  any  encumbrances   thereon  from  its  personal  assets,  nor  any
responsibility  as to the  validity  of the  title  conveyed


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<PAGE>

to or held by the Trustee's nominee.  All conveyances  executed and delivered by
the  Trustee  or the  Trustee's  nominee  shall  be made  without  covenants  or
warranty, except as against the Trustee's own acts.

                    4.2.3 Voting.  With respect to all stocks,  bonds, and other
securities held in the Trust,  (a) to exercise all voting rights with respect to
such  securities;  (b) to give  general and special  powers of attorney  without
power of substitution  in order to exercise such voting rights;  (c) to exercise
any conversion privileges,  subscription rights or other options and to make any
payments  incidental  thereto;  (d) to consent to or  otherwise  participate  in
corporate  reorganizations and other changes affecting corporate securities held
by the Trust; (e) to delegate discretionary powers and to pay any assessments or
charges in connection therewith; and (f) generally to exercise any of the rights
and powers otherwise exercisable by any other owner of such securities.

                    4.2.4 Prosecute and Defend Claims.  To sue and defend in any
suit or legal  proceedings by or against the Trust.  The Trustee shall have full
power in the  Trustee's  discretion  to  compromise  and  adjust  all claims and
demands in favor of or against the Trust upon such terms as the Trustee may deem
appropriate.  In the  administration  of the  Trust,  the  Trustee  shall not be
obligated  to take any action  which may  subject  the Trustee to any expense or
liability  unless the Trustee is first  indemnified to the  satisfaction  of the
Trustee for all expenses and liabilities,  including  attorneys' fees, which the
Trustee may incur in connection with such action.

                    4.2.5 Nominee. To register in the name of the Trustee or the
Trustee's nominee any investment held by the Trust and to hold any investment in
bearer form; provided,  however, (a) the books and records of the Trustee at all
times shall show that all such  investments  are part of the Trust Fund, and (b)
such form of  registration  or holding shall  neither  increase nor decrease the
liability of the Trustee.

                    4.2.6   Employment   of  Agents.   To  employ  such  agents,
attorneys-in-fact, experts, and investment and legal counsel, including any firm
or corporation with which the Trustee may be associated as a partner,  director,
stockholder,  or otherwise, and to delegate discretionary powers to or rely upon
information or advice furnished by, such agents, attorneys-in-fact,  experts, or
counsel.

                    4.2.7 Execution of Instruments. To make, execute and deliver
any and  all  documents  of  transfer  and  conveyance  and  any  and all  other
instruments that may be necessary or appropriate to carry out the powers granted
in this Agreement.

                    4.2.8  Necessary  Acts.  To do  all  acts,  whether  or  not
expressly authorized in this Agreement, which may be necessary or proper for the
protection  of the Trust Fund or for the carrying out of any duty under the Plan
or this Agreement.

5.       ADMINISTRATION OF TRUST

         5.1 Standard of Care. The Trustee shall discharge its duties under this
Agreement (a) in a manner which satisfies the duties imposed upon  "fiduciaries"
by  ERISA,  and (b)  subject  to  such  duties,  (1) in the  best  interests  of
Participants,  (2) with the  care,  skill,  prudence  and  diligence  under  the
circumstances  then  prevailing  that a prudent person acting in a like capacity
and familiar  with such matters  would use in the conduct of an  enterprise of a
like character and with like aims, and (3) by  diversifying  the  investments of
the  Trust  so as to  minimize  the  risk of  large  losses,  unless  under  the
circumstances it is clearly not prudent to do so.

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         5.2 Accounts  and  Records.  The Trustee  shall  maintain  accurate and
detailed  accounts  of  all  investments,  receipts,  disbursements,  and  other
transactions  under this  Agreement,  and all such  accounts  and other  records
relating  thereto shall be open to inspection and audit at all reasonable  times
by Bancorp and any person designated by Bancorp.

                    5.2.1  Exclusion  of Key  Employees.  Except for Covered Key
Employees,  Bancorp  and the  Trustee  acknowledge  and agree that (a) under the
terms of the Plan, no Key Employee is entitled to receive  Coverage or any other
benefits  under the Plan or this VEBA;  and (b) the  Trustee  shall not make any
payment from the Trust to or for the benefit of any Key  Employee.  With respect
to the Covered Key  Employees,  the Trustee at all times shall comply fully with
the requirements of Code Section 419A(d)  (regarding the maintenance of separate
accounts  for  "key  employees,"  as  that  term  is  defined  in  Code  Section
419A(c)(3)) and any other provision of the Code requiring that  contributions to
the Trust and  benefits  paid by the Trust with respect to "key  employees"  (as
that term is defined in Code Section 419A(c)(3)) be separately  accounted for or
subject to other special restrictions.

                    5.2.2  Annual  Accounting.  Within sixty (60) days after the
end of each Plan Year,  the  Trustee  shall  furnish  the Plan  Administrator  a
written statement of account setting forth all receipts and disbursements during
such Plan Year. The Plan  Administrator  shall acknowledge in writing receipt of
such  statement,  and shall advise the Trustee of its approval or disapproval of
the statement.  If, within sixty (60) days after receiving such  statement,  the
Plan Administrator fails to disapprove the statement,  then such statement shall
be deemed approved. The actual or deemed approval of the statement of account by
the Plan Administrator shall serve to release and discharge the Trustee from any
liability  or  accountability  to the Plan  Administrator  with  respect  to the
propriety  of the  Trustee's  acts or  transactions  shown on the  statement  of
account,  except with respect to any acts or  transactions  as to which the Plan
Administrator  shall file written objections with the Trustee within such 60-day
time period.

         5.3 Exempt Function  Income.  Prior to filing the Trust's annual income
tax return for each taxable year,  the Trustee shall  designate  that portion of
the Trust's  income for such year as qualifies as "exempt  function  income" (as
such term is defined in Section 512(a)(3) of the Code). All such exempt function
income shall be segregated  from the general assets of the Trust,  accounted for
separately on the Trust's books and records,  and used solely for the payment of
the cost of Coverage and those reasonable costs of administering the Trust which
are directly connected with the payment of the cost of the Coverage.

         5.4 Payment of Benefits.  Subject to Sections  5.2.1 and 8 hereof,  the
Trustee  shall  apply  the  assets  of the  Trust  to pay  the  Post  Retirement
Contribution  toward the cost of Coverage for  Participants  (as required by the
Plan)  at  such  times,  in  such  amounts,  and to such  persons,  as the  Plan
Administrator designates.

         5.5 Expenses of Administration.  Subject to Section 8.3, below, (a) the
Trustee's  compensation,  if any,  shall be fixed from time to time by agreement
with Bancorp,  provided,  no such  compensation  shall be paid if the payment or
receipt of such funds would constitute a "prohibited transaction" under the Code
or ERISA; and (b) the Trustee shall be entitled to be reimbursed,  by Bancorp or
from the Trust Fund, for its reasonable expenses.

6.       RESIGNATION, REMOVAL AND SUCCESSION OF TRUSTEE

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         6.1 Resignation or Removal. Bancorp may remove the Trustee at any time,
without  cause,  by delivering a written  notice of removal to the Trustee.  The
Trustee may resign as a trustee under this  Agreement by delivering to Bancorp a
written  notice  of  resignation.  Any  such  removal  or  resignation  shall be
effective  on the later of (a) the date  specified  in the  notice of removal or
resignation, or (b) the fifteenth (15th) day after the delivery of such notice.

         6.2  Successor  Trustee.  Upon  the  removal,  resignation,  death,  or
inability  of any Trustee to serve under this  Agreement,  a successor  shall be
appointed  (a) by  Bancorp,  or (b) if  Bancorp  does  not  then  exist or is in
bankruptcy proceedings or its assets are being managed by a receiver,  then by a
majority  of the  Participants  then  having  an  interest  in the  Trust.  Upon
accepting  appointment as a successor  Trustee,  the successor  Trustee shall be
vested  with the same  powers,  duties,  privileges,  and  immunities  that such
Trustee  would have  possessed  if it  originally  had been named as the initial
trustee in this Agreement.  Upon acceptance of such appointment by the successor
Trustee,  each  Trustee who shall have  resigned or been removed  shall  assign,
transfer,  and pay over to the successor Trustee all funds and properties of the
Trust.

         6.3 Report by Trustee.  Within sixty (60) days after resigning or being
removed,  the Trustee who has so resigned or been removed  shall  furnish to the
Plan Administrator a written statement of account with respect to the portion of
the Plan Year for which the Trustee has served.  Upon receipt of such statement,
the Plan  Administrator  shall acknowledge  receipt thereof in writing and shall
advise the Trustee whether the Plan  Administrator  approves or disapproves such
statement.  If the Plan  Administrator  fails to approve any such  statement  of
account  within  sixty  (60)  days  after  receiving  the  statement,  then such
statement  shall be deemed to be approved.  The actual or deemed approval of any
such  statement  shall  serve to release and  discharge  such  Trustee  from any
liability or  accountability  to Bancorp  with  respect to the  propriety of the
Trustee's acts or transactions as shown in the statement of account.

         6.4 Waiver of Notice. The Trustee and Bancorp may, by mutual agreement,
waive any required advance notice of resignation or removal set forth in Section
6.1 above.

7.       AMENDMENT AND TERMINATION OF AGREEMENT

         Subject to the prohibitions set forth in Section 8, below:

         7.1  Amendment.  This Agreement may be amended at any time, in whole or
in part, by a written instrument executed by Bancorp and the Trustee.

         7.2  Termination.  This  Agreement  may be  terminated  at any  time by
Bancorp. Upon such termination,  the assets of the Trust shall be applied in the
manner directed by the Plan Administrator.

8.       PROHIBITION AGAINST DISCRIMINATION, REVERSION OR INUREMENT

         Notwithstanding any other provision of this Agreement to the contrary:

         8.1  Discrimination.  The  assets of the Trust  shall be  applied  in a
manner which satisfies the nondiscrimination  requirements of Section 505 of the
Code;

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<PAGE>

         8.2  Exclusive  Benefit.  The assets of the Trust at all times shall be
applied and invested  for the  exclusive  purpose of paying the  Post-Retirement
Contribution toward the cost of Coverage under the Plan and the reasonable costs
of administering the Trust;

         8.3 Prohibited  Reversion and  Inurement.  Except to the extent Bancorp
may make a good faith mathematical or other  computational  error in determining
the amount of its contribution in any Plan Year and except as otherwise provided
in Section 9.1, below,  under no circumstances  shall any assets or net earnings
of the Trust,  either  during the  existence of the Trust or at the  termination
thereof:

                    8.3.1 Reversion.  Revert to Bancorp or be applied to or from
the  benefit of  Bancorp  (except to the extent the Trust Fund is applied to pay
the cost of Coverage pursuant to the Plan); or;

                    8.3.2  Inurement.  Otherwise  be paid  to,  or  inure to the
benefit of, any private individual,  shareholder or other person, except through
the  payment  of the cost of  Coverage  pursuant  to the  Plan and the  costs of
administering the Trust.

9.       MISCELLANEOUS

         9.1  Qualification  and Initial  Contribution.  Bancorp and the Trustee
shall cooperate in preparing and submitting to the Internal  Revenue Service all
documents  that may be necessary to obtain from the Internal  Revenue  Service a
letter  determining  that the Trust,  in operation with the Plan,  constitutes a
VEBA and is exempt from federal income taxes under Section 501(a) of the Code.

                    9.1.1  Amendment.  Bancorp and the Trustee shall execute any
amendment to this Agreement  that may be necessary to obtain such  determination
letter,  and any such  amendment  shall  have  retroactive  effect to the extent
necessary to ensure the  qualification  of the Trust as a tax-exempt  VEBA as of
the effective date of this Agreement.

                    9.1.2 Contributions. Bancorp and the Trustee acknowledge and
agree that all contributions  made by Bancorp to the Trust are made on condition
that such contributions are deductible by Bancorp under Section 419 of the Code.
If a deduction is not  allowable  under that Section for any portion of any such
contribution   for  the  taxable  year  of  Bancorp  with  respect  to  which  a
contribution is made, then the non-deductible portion of such contribution shall
be returned to Bancorp if Bancorp demands such portion within one year following
(a)  the  last  day of  Bancorp's  taxable  year  with  respect  to  which  such
contribution  was made, or (b) if later,  the date on which the Internal Revenue
Service  disallows  a  deduction  for all or any  portion of such  contribution;
provided, no portion of the earnings on such excess contribution may be returned
to the Bank,  and any losses  attributable  to such  excess  contribution  shall
reduce the amount which otherwise would have been returned to Bancorp under this
Section 9.1.2.

         9.2 No Employment Rights.  Neither the adoption and maintenance of this
Agreement,  nor any express or implicit  provision of this  Agreement,  shall be
deemed:

                    9.2.1  Contract.   To  constitute  a  contract  between  any
Employer and any other person,  or to be a consideration for or an inducement or
condition of, the employment of any person;

                    9.2.2 Right.  To give any person the right to be retained in
the employ of any Employer;

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<PAGE>

                    9.2.3 Discharge. To interfere with the right of any Employer
to discharge any Employee at any time; or

                    9.2.4 Continuing Employment.  To give any Employer the right
to require an Employee to remain in the employ of any Employer,  or to interfere
with an Employee's right to terminate employment with any Employer at any time.

         9.3 Interpretation. As used in this Agreement, the masculine, feminine,
and neuter  gender and the singular  and plural  numbers each shall be deemed to
include the other whenever the context so indicates or requires. The captions to
the Sections of this  Agreement are only for reference  purposes,  and shall not
affect in any way the meaning or  interpretation  of this Plan. Any  capitalized
term which is set forth in this  Agreement and not defined herein shall have the
meaning ascribed to such term in the Plan.

         9.4 Governing  Law. This  Agreement  shall be governed and construed in
accordance with the laws of the state of California, in a manner consistent with
the requirements of the Code applicable to tax-exempt VEBAs and the requirements
of ERISA applicable to welfare benefit plans and the fiduciaries of such plans.

         9.5 Effective  Date.  The  effective  date of this  Agreement  shall be
December 30, 1998.

         IN WITNESS  WHEREOF,  the parties hereto have executed this  Agreement,
effective on the Effective Date set forth above.

"BANCORP"                                "TRUSTEE:"
---------                                ----------

PACIFIC CAPITAL BANCORP, a California    SANTA BARBARA BANK & TRUST, a
corporation                              California corporation


By ___________________________________   By __________________________________
  Name:                                    Name:
  Title:                                   Title:






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