Effective 02/02

 

**EXHIBIT10.4**

 

Agreement Number:

AGREEMENT

 

between

 

FISERV SOLUTIONS, INC.

255 Fiserv Drive

Brokfield, WI 53045-5815

 

and

 

Pacifica Bank

10900 NE 4th Street,Suite 200

Bellevue, WA. 98004

 

Date: September 27, 2001

 

**F**

 

ãCopyright 2000 by Fiserv Solutions, Inc.

All Rights Reserved

 

This document contains proprietary and confidential information ofFiserv Solutions, Inc. and may not be copied, published, disclosed ordistributed without the express written consent of Fiserv Solutions, Inc. Thematerial in this document, including terms, procedures, fees and otherconditions, comprise an agreement to consider which will remain valid forninety (90) days from September 27, 2001. 

 

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AGREEMENT dated as of September 27, 2001 (“Agreement”) between FISERVSOLUTIONS, INC., a Wisconsin corporation (“Fiserv”), and Pacifica Bank  (“Client”).

 

Fiserv and Client hereby agree as follows:

 

1.  Term.  The initial term of this Agreement shall end2 years following the later of (i) the date Fiserv Services (as defined below)commence; and (ii) November 1, 2001; and, unless written notification ofnon-renewal is provided by either party at least 180 days prior to expirationof the initial term, this Agreement shall automatically renew for a renewalterm(s) of 5 years.

 

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

 

Exhibit A - Account Processing Services

Exhibit B - Item Processing Services

 

The Exhibits set forth specific terms and conditionsapplicable to the Services and/or Products, and, where applicable, the Fiservaffiliate so performing.  Client mayselect additional services and products from time to time by incorporating anappropriate Exhibit to this Agreement.

 

(b) Conversion Services.  Fiserv will convert Client’s existingapplicable data and/or information to the Fiserv Services.  Those activities designed to transfer theprocessing from Client’s present servicer to the Fiserv Services are referredto as “Conversion Services”.  Clientagrees to cooperate with Fiserv in connection with Fiserv’s provision ofConversion Services and to provide all necessary information and assistance tofacilitate the conversion.  Client isresponsible for all out-of-pocket expenses associated with the ConversionServices.  Fiserv will provideConversion Services as required in connection with Fiserv Services.

 

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

 

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

 

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

(ii) Out-of-pocketcharges for the following month payable by Fiserv for the account of Client; and

(iii) Taxes (asdefined below) thereon (collectively, “Estimated Fees”).

 

Fees may be increased from time to time as set forth in theExhibits.  Upon 30 days notification toand acceptance by Client, Fiserv may increase its fees in excess of amountslisted in the Exhibits in the event that Fiserv implements major system enhancementsto comply with changes in law, government regulation, or industry practices.

 

(b) Additional Charges.  Fees for out-of-pocket expenses, such astelephone, microfiche, courier, and other charges incurred by Fiserv for goodsor services obtained by Fiserv on Client’s behalf shall be billed to Client atcost plus the applicable Fiserv administrative fee of 15%.  Such out-of-pocket expenses may be changedfrom time to time upon notification of a fee change from a vendor/provider.

 

(c) Taxes. Fiserv shall add to each invoice any sales, use, excise, value added,and other taxes and duties however designated that are levied by any taxingauthority relating to the Fiserv Services (“Taxes”).  In no event shall “Taxes” include taxes based upon the net incomeof Fiserv.

 

(e) Payment Terms.  Fees are due and payable monthly upon receipt of invoice.  Client shall pay Fiserv through theAutomated Clearing House. In the event any amounts due remain unpaid beyond the30th day after payment is due, Client shall pay a late charge of 1.5% permonth.  Client agrees that it shallneither make nor assert any right of deduction or set-off from Estimated Feeson invoices submitted by Fiserv for Fiserv Services.

 

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4.  Accessto Fiserv Services.  (a) Procedures.  Client agrees to comply with applicableregulatory requirements and procedures for use of Services established byFiserv.

 

(b) Changes. Fiserv continually reviews and modifies Fiserv systems used in thedelivery of Services (the “Fiserv System”) to improve service and comply withgovernment regulations, if any, applicable to the data and information utilizedin providing Services.  Fiserv reservesthe right to make changes in Services, including but not limited to operatingprocedures, type of equipment or software resident at, and the location ofFiserv’s service center(s).  Fiserv willnotify Client of any material change that affects Client’s normal operatingprocedures, reporting, or service costs prior to implementation of such change.

 

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

 

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

 

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

 

(b) Client Personnel.  Client shall designate appropriate Client personnel for trainingin the use of the Fiserv System, shall supply Fiserv with reasonable access toClient’s site during normal business hours for Conversion Services and shall cooperatewith Fiserv personnel in their performance of Services, including ConversionServices.

 

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

 

(d) Client’s Systems.  Client shall be responsible for ensuring that its systems areYear 2000 compliant and capable of passing and/or accepting date formats fromand/or to the Fiserv System.

 

6.  Ownershipand Confidentiality.  (a) Definition.

 

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

 

(ii) FiservInformation. “Fiserv Information” means: (A) confidential plans, information, research, development, tradesecrets, business affairs (including that of any Fiserv client, supplier, oraffiliate), and other proprietary material of Fiserv that is marked with arestrictive legend, or if not so marked with such legend or is disclosedorally, is identified as confidential at the time of disclosure (and writtenconfirmation thereof is promptly provided to Client); and (B) Fiserv’sproprietary computer programs, including custom software modifications,software documentation and training aids, and all data, code, techniques,algorithms, methods, logic, architecture, and designs embodied or incorporatedtherein (whether or not any such information is marked with a restrictivelegend).

 

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

 

(b) Obligations.  Recipient agrees to hold as confidential all Information itreceives from the disclosing party (“Discloser”).  All Information shall remain the property of Discloser or itssuppliers and licensors.  Informationwill be returned to Discloser at the termination or expiration of this Agreement.  Fiserv specifically agrees that it will notuse any non-public personal information about Client’s customers in any mannerprohibited by Title V of the Gramm-Leach-Bliley Act. Recipient

 

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will use the same care and discretion to avoid disclosure ofinformation as it uses with its own similar information that it does not wishdisclosed, but in no event less that a reasonable standard of care.  Recipient may only use information inaccordance with the purpose of this Agreement. Recipient may  disclose Information to (i) employees andemployees affiliates who have a need to know, and (ii) any other party withDiscloser’s written consent. Before disclosure to any of the above parties,Recipient will have a written agreement with such party sufficient to requirethat party to treat Information in accordance with this Agreement. Recipientmay disclose Information to the extent required by law. However, Recipientagrees to give Discloser prompt notice so that it may seek a protective order.The provisions of this sub-section survive any termination or expiration of theAgreement.

 

(c) Residuals. Nothing contained in this Agreement shall restrict Recipient from theuse of any ideas, concepts, know-how, or techniques contained in Informationthat are related to Recipient’s business activities (“Residuals”), providedthat in so doing, Recipient does not breach its obligations under thisSection.  However, this does not giveRecipient the right to disclose the Residuals except as set forth elsewhere inthis Agreement.

 

(d) Fiserv System.  The Fiserv System contains information and computer software thatare proprietary and confidential information of Fiserv, its suppliers, andlicensors.  Client agrees not to attemptto circumvent the devices employed by Fiserv to prevent unauthorized access tothe Fiserv System, including, but not limited to, alterations, decompiling,disassembling, modifications, and reverse engineering thereof.

 

(e) Information Security. Fiserv shallimplement and maintain appropriate measure designed to meet the objectives ofthe guidelines establishing standards for safeguarding non-public Clientcustomer information as adopted by any federal regulatory agencies havingjurisdiction over Client’s affairs.

 

(d) Confidentiality of this Agreement.  Fiserv and Client agree to keep confidentialthe prices, terms and conditions of this Agreement, without disclosure to thirdparties.

 

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

 

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

 

(i) Submitting acopy of this Agreement to the appropriate regulatory agencies prior to the dateServices commence;

(ii) Providingadequate notice to the appropriate regulatory agencies of the termination ofthis Agreement or any material changes in Services;

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

(iv) obtaining andmaintaining, at its own expense, any Fidelity Bond required by any regulatoryor governmental agency; and

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

 

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

 

(i)(A) Serviceswill conform to the specifications set forth in the Exhibits; (B) Fiserv willperform Client’s work accurately provided that Client supplies accurate dataand information, and follows the procedures described in all Fiservdocumentation, notices, and advices; (C) Fiserv personnel will exercise duecare in provision of Services; (D) the Fiserv System will comply in allmaterial respects with all applicable Federal and State regulations governingServices. In the event of an error or other default caused by Fiserv personnel,systems, or equipment, Fiserv shall correct the data or information and/orreprocess the affected item or report at no additional cost to Client.  Client agrees to supply Fiserv with awritten request for correction of the error within 7 days after Client’sreceipt of the work containing the error. Work reprocessed due to errors in data supplied by Client, on Client’sbehalf by a third party, or by Client’s failure to follow procedures set forthby Fiserv shall be billed to Client at Fiserv’s then current time and materialrates; and (ii) it owns or has a license to furnish all equipment or softwarecomprising the Fiserv System.  Fiservshall indemnify Client and hold it harmless against any claim or action thatalleges that the Fiserv System use infringes a United States patent, copyright,or other proprietary right of a third party. Client agrees to notify Fiserv promptly of any such claim and grantsFiserv the sole right to control the defense and disposition of all suchclaims.  Client shall provide Fiservwith reasonable cooperation and assistance in the defense of any such claim.

 

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THE WARRANTIES STATED ABOVE ARE LIMITED WARRANTIES AND ARE THE ONLYWARRANTIES MADE BY FISERV.  FISERV DOESNOT MAKE, AND CLIENT HEREBY EXPRESSLY WAIVES, ALL OTHER WARRANTIES, INCLUDINGWARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE.                (b) Client Warranties.  Client represents and warrants that: (A) nocontractual obligations exist that would prevent Client from entering into thisAgreement; (B) it has complied with all applicable regulatory requirements; and(C) Client has requisite authority to execute, deliver, and perform thisAgreement.  Client shall indemnify andhold harmless Fiserv, its officers, directors, employees, and affiliatesagainst any claims or actions arising out of (X) the use by Client of theFiserv System in a manner other than that provided in this Agreement; and (Y)any and all claims by third parties through Client arising out of theperformance and non-performance of Fiserv Services by Fiserv, providedthat the indemnity listed in clause (Y) hereof shall not preclude Client’srecovery of direct damages pursuant to the terms and subject to the limitationsof this Agreement.

 

9.  Limitationof Liability.  (a) General.  IN NO EVENT SHALL FISERV BE LIABLE FOR LOSSOF GOODWILL, OR FOR SPECIAL, INDIRECT, INCIDENTAL, OR CONSEQUENTIAL DAMAGESARISING FROM CLIENT’S USE OF FISERV SERVICES, OR FISERV’S SUPPLY OF EQUIPMENTOR SOFTWARE, REGARDLESS OF WHETHER SUCH CLAIM ARISES IN TORT OR IN CONTRACT.  CLIENT MAY NOT ASSERT ANY CLAIM AGAINSTFISERV MORE THAN 2 YEARS AFTER SUCH CLAIM ACCRUED.  FISERV’S AGGREGATE LIABILITY FOR ANY AND ALL CAUSES OF ACTIONRELATING TO SERVICES SHALL BE LIMITED TO THE TOTAL FEES PAID BY CLIENT TOFISERV FOR SERVICES RESULTING IN SUCH LIABILITY IN THE 6 MONTH PERIOD PRECEDINGTHE DATE THE CLAIM ACCRUED.  FISERV’SAGGREGATE LIABILITY FOR A DEFAULT RELATING TO EQUIPMENT OR SOFTWARE SHALL BELIMITED TO THE AMOUNT PAID BY CLIENT FOR THE EQUIPMENT OR SOFTWARE.

 

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

 

10.  DisasterRecovery.  (a) General.  Fiserv maintains a disaster recovery plan(“Disaster Recovery Plan”) for each Service. A “Disaster” shall mean any unplanned interruption of the operations ofor inaccessibility to Fiserv’s service center in which Fiserv, using reasonablejudgment, requires relocation of processing to a recovery location.  Fiserv shall notify Client as soon as possibleafter Fiserv deems a service outage to be a Disaster.  Fiserv shall move the processing of Client’s standard services toa recovery location as expeditiously as possible and shall coordinate thecut-over to back-up telecommunication facilities with the appropriatecarriers.  Client shall maintainadequate records of all transactions during the period of service interruptionand shall have personnel available to assist Fiserv in implementing theswitchover to the recovery location. During a Disaster, optional or on-request services shall be provided byFiserv only to the extent adequate capacity exists at the recovery location andonly after stabilizing the provision of base services.

 

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

 

(c) Disaster Recovery Test.  Fiserv shall test the Disaster Recovery Planperiodically.  Client agrees toparticipate in and assist Fiserv with such test, if requested by Fiserv.  Upon Client request, test results will bemade available to Client’s management, regulators, auditors, and insuranceunderwriters.

 

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

 

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

 

11.  Termination.  (a) Material Breach.  Except as provided elsewhere in this Section11, either party may terminate this Agreement in the event of a material breachby the other party not cured within 90 days following written notice stating,with particularity and in reasonable detail, the nature of the claimed breach.For purposes of this Section 11(a), any material failure by Fiserv to meet anyperformance standards described in the Agreement or any Exhibit hereto willconstitute a material breach.

 

(b) Failure to Pay.  In the event any invoice remains unpaid by Client 30 days afterdue, or Client deconverts any data or information from the Fiserv Systemwithout prior written consent of Fiserv, Fiserv, at its sole option, mayterminate this Agreement and/or Client’s access to and use of FiservServices.  Any invoice submitted byFiserv shall be deemed correct unless Client provides written notice to Fiservwithin 30 days of the invoice date specifying the nature of the disagreement.

 

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

 

(d) Defaults. If Client:

 

(i) Defaults inthe payment of any sum of money due;

(ii) Breaches thisAgreement in any material respect or otherwise defaults in any material respectin the performance of any of its obligations; or

(iii) Commits anact of bankruptcy or becomes the subject of any proceeding under the BankruptcyCode or becomes insolvent or if any substantial part of Client’s propertybecomes subject to any levy, seizure, assignment, application, or sale for orby any creditor or governmental agency;

 

Then, in any such event,Fiserv may, upon written notice, terminate this Agreement and be entitled torecover from Client as liquidated damages an amount equal to the present valueof all payments remaining to be made hereunder for the remainder of the initialterm or any renewal term of this Agreement. For purposes of the preceding sentence, present value shall be computedusing the “prime” rate (as published in *The**Wall Street Journal*) in effect at the dateof termination and “all payments remaining to be made” shall be calculatedbased on the average bills for the 3 months immediately preceding the date oftermination.  Client agrees to reimburseFiserv for any expenses Fiserv may incur, including reasonable attorneys’ fees,in taking any of the foregoing actions.

 

(e) Convenience.  Client may terminate this Agreement during any term by paying atermination fee based on the remaining unused term of this Agreement, theamount to be determined by multiplying Client’s average monthly invoices forthe twelve-month period immediately preceding the effective date oftermination. For each Fiserv Service received by Client during the term (or ifno monthly invoice has been received, the sum of the estimated monthly billingfor each Fiserv Service to be received hereunder) by 80% times the remainingmonths of the term, plus any unamortized conversion fees or third party costsexisting on Fiserv’s books on the date of termination.  Client understands and agrees that Fiservlosses incurred as a result of early termination of the Agreement would bedifficult or impossible to calculate as of the effective date of terminationsince they will vary based on, among other things, the number of clients usingthe Fiserv System on the date the Agreement terminates.  Accordingly, the amount set forth in thefirst sentence of this subsection represents Client’s agreement to pay and Fiserv’sagreement to accept as liquidated damages (and not as a penalty) such amountfor any such Client termination.

 

(f) Return of Data Files.  Upon expiration or termination of thisAgreement, Fiserv shall furnish to Client such copies of Client Files as Clientmay request in Fiserv’s standard machine readable format along with suchinformation and assistance as is reasonable and customary to enable Client todeconvert from the Fiserv System, provided, however, that exceptfor a termination by Client under Section 11(a), Client agrees to pay Fiservits then standard rates for the services necessary to return such Client Files.Client consents and agrees and authorizes Fiserv to retain Client Files until(i) Fiserv is paid in full for (A) all Services provided through the date suchClient Files are returned to Client; and (B) any and all other amounts that aredue or will become due under this Agreement; (ii) Fiserv is paid its thenstandard rates for the services necessary to return such Client Files; (iii) ifthis Agreement is being terminated, Fiserv is paid any applicable terminationfee pursuant to subsection (d) or (e) above; and (iv) Client has returned toFiserv all Fiserv Information. Unless directed by Client in writing to thecontrary, Fiserv shall be permitted to destroy Client Files any time after 30days from the final use of Client Files for Processing.

 

(g) Miscellaneous.  Client understands and agrees that Client is responsible for thedeinstallation and return shipping of any Fiserv-owned equipment located onClient’s premises.

 

12.  Arbitration.  (a) General.  Except with respect to disputes arising froma misappropriation or misuse of either party’s proprietary rights, any disputeor controversy arising out of this Agreement, or its interpretation, shall besubmitted to and resolved exclusively by arbitration under the rules thenprevailing of the American Arbitration Association, upon written notice ofdemand for arbitration by the party seeking arbitration, setting forth thespecifics of the matter in controversy or the claim being made.  The arbitration shall be heard before anarbitrator mutually agreeable to the parties; provided, that if the partiescannot agree on the choice of arbitrator within 10 days after the first partyseeking arbitration has given written notice, then the arbitration shall beheard by three arbitrators, one chosen by each party, and the third chosen bythose two arbitrators.  The arbitratorswill be selected from a panel of persons having experience with and knowledgeof information technology and at least one of the arbitrators selected will bean attorney.  A hearing on the merits ofall claims for which arbitration is sought by either party shall be commencednot later than 60 days from the date demand for arbitration is made by thefirst party seeking arbitration.  Thearbitrator(s) must render a decision within 10 days after the conclusion ofsuch hearing.  Any award in sucharbitration shall be final and binding upon the parties and the judgmentthereon may be entered in any court of competent jurisdiction.

 

(b) Applicable Law.  The arbitration shall be governed by the United StatesArbitration Act, 9 U.S.C. 1-16.  Thearbitrators shall apply the substantive law of the State of Washington, withoutreference to provisions relating to conflict of laws.  The arbitrators shall not have the power to alter, modify, amend,add to, or subtract from any term or provision of this Agreement, nor to ruleupon or grant any extension, renewal, or continuance of

 

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this Agreement.  The arbitratorsshall have the authority to grant any legal remedy available had the partiessubmitted the dispute to a judicial proceeding.

 

(c) Situs. If arbitration is required to resolve any disputes between the parties,the proceedings to resolve the first such dispute shall be held in King County,Washington, the proceedings to resolve the second such dispute shall be held inMilwaukee, Wisconsin, and the proceedings to resolve any subsequent disputesshall alternate between King County, Washington  and Milwaukee, Wisconsin.

 

13.  Insurance.  Fiserv carries and will maintain in fullforce and effect the following types of insurance policies each will bemaintained with insurers rated A+ or better by A.M. Best Company.

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

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

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

(iv) WorkersCompensation as mandated or allowed by the laws of the state in which Servicesare being performed, including $500,000 coverage for Employer’s Liability.

 

14.  Audit.  Fiserv employs an internal auditorresponsible for ensuring the integrity of its processing environments andinternal controls.  In addition, Fiservprovides for periodic independent audits of its operations.  Fiserv shall provide Client with a copy ofthe audit of the Fiserv service center providing Services within a reasonabletime after its completion and shall charge each client a fee based on the prorata cost of such audit.  Fiserv shallalso provide a copy of such audit to the appropriate regulatory agencies, ifany, having jurisdiction over Fiserv’s provision of Services.

 

15.  General.  (a) Binding Agreement.  This Agreement is binding upon the partiesand their respective successors and permitted assigns.  Neither this Agreement nor any interest maybe sold, assigned, transferred, pledged, or otherwise disposed of by eitherparty, whether pursuant to change of control or otherwise, without the otherparty’s prior written consent. Notwithstanding the foregoing, Fiserv may assign this Agreement to anaffiliate upon notice to Client. Client agrees that Fiserv may subcontract anyServices to be performed hereunder. Any such subcontractors shall be requiredto comply with all applicable terms and conditions.

 

(b) Entire Agreement.  This Agreement, including its Exhibits, which are expresslyincorporated herein by reference, constitutes the complete and exclusivestatement of the agreement between the parties as to the subject matter hereofand supersedes all previous agreements with respect thereto.  Modifications of this Agreement must be inwriting and signed by duly authorized representatives of the parties.  Each party hereby acknowledges that it hasnot entered into this Agreement in reliance upon any representation made by theother party not embodied herein.  In theevent any of the provisions of any Exhibit are in conflict with any of theprovisions of this Agreement, the terms and provisions of this Agreement shallcontrol unless the Exhibit in question expressly provides that its terms andprovisions shall control.

 

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

 

(d) Governing Law.  This Agreement will be governed by the substantive laws of theState of Washington,without reference to provisions relating to conflict oflaws.  The United Nations Convention ofContracts for the International Sale of Goods shall not apply to thisAgreement.

 

(e) Force Majeure.  Neither party shall be responsible for delays or failures inperformance resulting from an act of God, war, civil disturbance, court order,labor dispute, third party nonperformance (except for non performance of anysubcontractors contemplated by Section 15 (a) above0 or other cause beyond suchparty’s reasonable control, including failures or fluctuations in electricalpower, heat, light, air conditioning or telecommunications equipment and suchnonperformance shall not be a default or a ground for termination.

 

(f) Notices. Any written notice required or permitted to be given hereunder shall begiven by: (i) Registered or Certified Mail, Return Receipt Requested, postageprepaid; (ii) confirmed facsimile; or (iii) nationally recognized courierservice to the other party at the addresses listed on the cover page or to suchother address or person as a party may designate in writing.  All such notices shall be effective uponreceipt.

 

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

 

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

 

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

 

(j) Survival. All rights and obligations of the parties under this Agreement that, bytheir nature, do not terminate with the 

 

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expiration or termination of this Agreement shall survive theexpiration or termination of this Agreement.

 

(k) Exclusivity.  Client agrees that Fiserv shall be the sole and exclusiveprovider of the services that are the subject matter of this Agreement.  For purposes of the foregoing, the term“Client” shall include Client affiliates. During the term of this Agreement, Client agrees not to enter into anagreement with any other entity to provide these services (or similar services)without Fiserv’s prior written consent.  If Client acquires another entity, the exclusivity provided toFiserv hereunder shall take effect with respect to such acquired entity as soonas practicable after termination of such acquired entity’s previously existingarrangement for these services.  IfClient is acquired by another entity, the exclusivity provided to Fiservhereunder shall apply with respect to the level or volume of these servicesprovided immediately prior to the signing of the definitive acquisitionagreement relating to such acquisition and shall continue with respect to thelevel or volume of these services until any termination or expiration of thisAgreement.

 

(l) Recruitment of Employees. Each party agreesnot to hire the other’s employees during the term of this Agreement and for aperiod of six months after any termination or expiration thereof, except withthe other party’s prior written consent, provided however, this shall notprohibit a party from hiring an employee of the other party who responds to asolicitation of general publication.

 

IN WITNESS WHEREOF, the parties have caused thisAgreement to be executed by their duly authorized representatives as of thedate indicated below.
|          |                                |
|---------------|-------------------------------------|
| For Client:   | For Fiserv:                         |
|          |                                |
| Pacifica Bank | Fiserv Solutions, Inc.              |
|          |                                |
|          |                                |
| By:           | /s/ John D. Huddleston              |   | By: | /s/ Sam Langham |   |
| Name:         | John  D. Huddleston                 | Name: | Sam  Langham |
| Title:        | Executive  Vice President and C.F.O | Title: | Executive Vice  President, Business Unit Manager |
|          |                                | Los Angeles Data Center |
|          |                                |
| Date:         | 10/12/01                            |   | Date: | 11/12/01 |   |
|               |                                     |  |  |  |  |  |  |  |  |  |

 

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Effective 02/02

 

Exhibit A

Account ProcessingServices

 

Client agrees with Fiserv as follows:

 

1.   Services.  Fiserv will provide Client the FacilitiesManagement Services (“Account Processing Services”) specified in Exhibit A–1.

 

2.   Fees.  Client shallpay Fiserv fees and other charges for Account Processing Services specified inExhibit A–1. The fees listed in Exhibit A-2 are valid for the accountprocessing services Client contracts for as of the date of the Agreement. IfClient seeks additional services from Fiserv during the term of the Agreement,Fiserv’s fees there for will be quoted to Client upon request. Fiserv agrees togive at least 30 days notice to Client of any changes in the rules andprocedures established for processing, unless such changes are causes bychanges made by the Federal Reserve System or otherwise beyond the control ofFiserv, not permitting Fiserv to give such advance notice. Fiserv reserves theright to make such changes to the Exhibits without notice to the extentnecessary to cover any increases in Federal Reserve System costs and charges orin other costs and changes beyond Fiserv’s control, including changes requiredby applicable law or regulatory activity. The fees listed in Exhibit A–2 may bechanged annually effective October and each succeeding October 2002 upon 30days advance notice to Client. Each change shall be limited to the change inthe U.S. Department of Labor, Consumer Price Index (“CPI”) for All UrbanHouseholds in Snohomish County for the most recent 12-month period for whichsuch information is available or three percent (3%), whichever is greater.Fiserv will deliver to Client the notification of the fee change.

 

3.   Responsibilityfor Accounts.  Client shall beresponsible for balancing its accounts each business day and notifying Fiservimmediately of any errors or discrepancies. Provided that Client immediately notifies Fiserv of any discrepancy inClient’s accounts, Fiserv shall, at its expense, promptly recompute accountsaffected by discrepancies solely caused by the Fiserv Systems or provide foranother mutually agreeable resolution. Fiserv will use its commercially reasonable efforts to correct errorsattributable to Client or Client’s other third party servicers.  Reconstruction of error conditionsattributable to Client or to third parties acting on Client’s behalf will bedone at prevailing rates as set forth in Exhibit A–2.

 

4.   Annual Histories. Fiserv currently maintains annual histories, where applicable, for itsclients.  These histories can be used toreconstruct Client Files in an emergency. However, in order to permit prompt and accurate reconstruction ofaccounts, Client agrees to retain at all times and make available to Fiservupon request the most recent data printout(s) received from Fiserv, togetherwith copies or other accurate and retrievable records of all transactions to bereflected on the next consecutive printout(s).

 

5.   Hours of Operation. Account Processing Services will beavailable for use by Client during standard Fiserv business hours, excludingholidays, as specified in Exhibit A–3. Account Processing Services may beavailable additional hours during which time Client may use Services at itsoption and subject to additional charges.

 

6.   Performance Standards. The Fiserv performance standards for the Account Processing Services(“Performance Standards”) are set forth in Exhibit A – 4.  In no event shall Fiserv be liable to Clientfor damages of any nature arising solely from failure by Fiserv to meetPerformance Standards.

 

7.   Protectionof Data.  (a) For the purpose ofcompliance with applicable government regulations, Fiserv has an operationsbackup center, for which Client agrees to pay the charges indicated in ExhibitA–2.  Fiserv maintains copies of  transaction files off premises in securedvaults.

 

(b) Fiserv provides “on-line” security via utilizationof leased lines with poll/select protocol.

 

(c) Upon Client providing access to Client Filesthrough Client’s customers’ personal computers or voice response system, Clientagrees to indemnify and hold harmless Fiserv, its officers, directors,employees, and affiliates against any claims or actions arising out of suchaccess to Client Files or any Fiserv files (including the files of other Fiservclients) or the Fiserv System or other Fiserv systems.

 

9

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8.  ProcessingPriority.  Fiserv does not subscribeto any processing priority; all users receive equal processing consideration.

 

9.  Formsand Supplies.  Client assumes andwill pay the charges for all customized forms, supplies, and deliverycharges.  Custom forms ordered throughFiserv will be subject to a 15% administrative fee for warehousing andinventory control.  Forms ordered by Clientand warehoused at Fiserv will be subject to the administrative fee set forth inExhibit A–2.

 

10. RegulatorySupervision.

By entering into this Agreement, Fiserv agrees that the Office ofThrift Supervision, FDIC, or other regulatory agencies having authority overClient’s operations shall have the authority and responsibility provided to theregulatory agencies pursuant to the Bank Service Corporation Act, 12 U.S.C.1867(C) relating to services performed by contract or otherwise.

 

IN WITNESS WHEREOF, the parties hereto have causedthis Exhibit A to the Agreement to be executed by their duly authorizedrepresentatives as of the date indicated below.

 
| For Client:   | For Fiserv:                         |
|---------------|-------------------------------------|
| Pacifica Bank | Fiserv Solutions, Inc.              |
|          |                                |
|          |                                |
| By:           |                                | /s/ John D.  Huddleston |   | By: | /s/ Sam Langham |   |
| Name:         | John  D. Huddleston                 | Name: | Sam Langham |
| Title:        | Executive  Vice President and C.F.O | Title: | Executive Vice  President, Business Unit Manager |
|          |                                | Los Angeles Data Center |
|          |                                |
| Date:         | 10/12/01                            |   | Date: | 11/12/01 |   |
|               |                                     |  |  |  |  |  |  |  |  |  |  |

 

10

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Effective 02/02

 

Exhibit A - 1

Account ProcessingServices

 

***Fiserv Responsibilities***

 

Fiserv willprovide Client with the following ITI Software Account Processing Services forthe fees and charges out lined in Exhibit A:

 

**Base Services:**

•    Account Analysis

•    ACH Processing

•    ATM Card Transaction Processing

•    Auto Transfers

•    Certificates of Deposits

•    Customer Information File (CIF)

•    Demand Deposit Accounting

•    Financial Management System (G/L)

•    Host Disaster Recovery Back Up

•    Loan Investor Reporting

•    Lines of Credit

•    Loan Accounting Processing

•    Mortgage Loans

•    EIM NSF/OD Return Processing

•    Query Report Writer - SMART

•    Retirement Processing

•    Release Installation

•    Savings Account Processing

•    Service Charge Modeling

•    Sweep Accounting

•    Tape - Fiserv Forms & Graphics orDeluxe  Generation for Coupon Books(Weekly)

•    Tape (TRW) Format Generation for CreditBureau (Monthly)

 

**Interfaces:**

•    ATM + Balance File

•    Deposit Platform

•    Host Teller

•    Fiserv Item Processing

•    Loan Platform

•    Sendero Asset/Liability

•    Sendero MCIF

 

**NetworkSupport Services:**

•    Data Comm line between Fiserv’s accountprocessing center and Client’s primary banking locations.

 

**Training:**

•    Refresher training available (additionalcost)

 

**HelpDesk Services:**

•    Staffing and maintenance to undertakeinvestigations, inquiries, and problem resolution associated with theApplication Processing Services software.

•    Applications support personnel will beavailable to assist and support Client’s support services staff.

•    Account Management Staff to call on Client

 

11

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***Client Responsibilities***

 

Client will be responsible for the followingactivities:

 

**Personnel:**

•    Project Manager

•    Staff necessary to assist in ConversionServices

•    Courier services for delivery of data

 

**ThirdParty Software:**

•    Evaluation, selection, licensing, andprocurement of maintenance for third party application software as mutuallyagreed by Fiserv and Client.

•    Obtain any necessary consents to utilizethird party software licensed to Client as of the Effective Date, whichconsents shall be provided to Fiserv (the obtaining of such consents shall be acondition precedent to performance by Fiserv of its obligations).

•    Advising Fiserv of any connections, upgrades,or enhancements that become available from third party vendors so that they maybe installed on a mutually agreeable schedule and in accordance with the thirdparty vendor’s recommended time schedule.

•    Providing Fiserv with a complete copy of alllicense and maintenance agreements related to third party software.

 

3. Maintaining and Installing Ancillary Software: Software to belicensed by Pacifica Bank and a quote will be provided by the Van Nuys DataCenter for the time and material needed to install the software on the bank’smainframe.

 

12

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Effective 02/02

 

Exhibit A - 2

Account ProcessingServices Fees

 

Fiserv will provideClient the following Facitilites Management Services at the fees and prices indicated.

 
| **5. Conversion, Other and One-Time Costs**                                                                                                                                                      |   | **Facility   Management** |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|---------------------------|
| Monthly  Minimum Processing Fee                                                                                                                                                                  |   | $                         | 7,500 |
|                                                                                                                                                                                             |   |                      |
| Implementation  Assistance/Set-up Fee Imaging                                                                                                                                                    |   | $                         | 5,000 |
| Conversion  Assistance/Set-Up Fee Facility Management                                                                                                                                            |   |                      |
| Conversion  Assistance/Set-Up Fee Image Processing                                                                                                                                               |   |                      |
| (End  user training at the Fiserv Los Anges Data Center or on-site per day                                                                                                                       |   | $                         | 1,000 |
| A  schedule of training classes may be obtained from a Client Account Manager or  Help Desk Representative. Classes at the Fiserv ITI facility in Lincoln, NE  are Available at additional cost. |   |                      |

 

•      Conversion of Facility Management and ItemProcessing waived

 
| Dep  Con Software Installation and Configuration |   | $      | 3,400  |
|--------------------------------------------------|--------|--------|--------|
| Does not include hardware (PC and printer)       |   |   |
|                                             |   |   |
| Image Library Software (Per Copy)                |   | $      | 500    |
| Annual License Fee per copy                      |   | $      | 75     |
| (one copy is  needed per viewing station)        |   |   |   |

 

13

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Effective 02/02

 

Exhibit A - 2

Account ProcessingServices Fees

 

**FACITILITESMANAGEMENT SERVICES**

 

**Tapes-Backup Media**– Compatibility with hot-site and other main frames.

 

DLT required format for Van Nuys Center

DLT Tape Driver $5,000 (approximate cost after marketitems)

Tapes and Supplies: Cost

 

Auto Library tape functions – products such as BL–Lm; BL–LABEL will beused for tape management BL–Lm Cost

BL–LABEL – Cost

 

**Arcus** off sitestorage – Included with FM Service

**Disaster Recovery**

Bank will be covered under the Van Nuys contract with Sungard.  Bank will also comply with all policies andprocedures that relate to disaster recovery services in the Van Nuys DataCenter

 

Monthly DR Services: $4.25 per Unisys RPM

Travel Expense: paid by bank for declared disaster ortesting

 

**Servicing of Banks**:Not permitted under this agreement

 

**Maintaining and installing AncillarySoftware**: Software to be licensed by the bank at will beprovided by the time and Van Nuys for material needed to install the softwarebanks mainframe.

 

**Depcon**- Must belicensed on host and on remote print PC

 
| PDF              |   | Require by Van Nuys for print delivery             |
|------------------|--------|----------------------------------------------------|
| PIM Drivers      |   | Required by Van Nuys for files to come in standard |
| Pullfile Drivers |   | Required by Van Nuys                               |

 

All WO’s and Worksheets – Are proprietary of Fiserv–Van Nuys

 

**Computer Operations Special Requests–** examples Data Base reload $125.00/hour or request for quote

 

**Transmission Software –**none on F/M box

The banks do not buy modems or software to handle incoming or outgoingtransmission

 

**Install Upgrades Unisys SoftwareShould have hourly fee for upgrade to box, Install Upgrades ITI Software**

$174/hour or request quote

 

**Client Service phone support –**included with service Network Support – included with service

 

**Network Support –**included with service

 

**One Time Set Up Fee –**Van Nuys will set up mainframe to match all policies and procedures with in thedata center for standardization and control

 

**Note**: Allmainframes services by Van Nuys will be kept at the same software releaselevels as the mainframes owned and operated by the data center.

 

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Effective 02/02

 

Exhibit A - 3

Hours of Operation

 

The Fiserv Account Processing Center will be inoperation for on-line Account Processing Services in accordance with thefollowing:

 
| Monday    |   | 7:00 A.M. - 7:00 P.M. |
|-----------|--------|-----------------------|
| Tuesday   |   | 7:00 A.M. - 7:00 P.M. |
| Wednesday |   | 7:00 A.M. - 7:00 P.M. |
| Thursday  |   | 7:00 A.M. - 7:00 P.M. |
| Friday    |   | 7:00 A.M. - 7:00 P.M. |
| Saturday  |   | 8:00 A.M. - 2:00 P.M. |
| Sunday    |   | Not on-line           |

 

All times stated are in accordance with prevailinglocal times for the Fiserv Los Angeles Data Center. The Fiserv Los Angeles DataCenter observes national holidays, and will be closed for on-line operations.

 

15

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Effective 02/02

 

Exhibit A - 4

Performance Standards

 

1.  On-Line Availability -Fiserv’s standard of performance shall be on-line availability of the FiservSystem (exclusive of telecommunications and terminals) 98% of the time that itis scheduled to be so available over a 3 month period (“MeasurementPeriod”).  Actual on-line performancewill be calculated monthly by comparing the number of hours that the FiservSystem was scheduled to be operational on an on-line basis exclusive ofpreventive maintenance and scheduled maintenance with the number of hours, or aportion thereof, it was actually operational on an on-line basis.  Preventive maintenance will not be scheduledduring normal online processing hours. Only is necessary preventive maintenance will be performed on onlymission critical equipment during on-line processing hours.  Downtime caused by reasons beyond Fiserv’sexcept for down time caused in whole or in part by acts, omissions,nonperformance or system failures of or by any Fiserv agents or subcontractorswill not be considered in the statistics.

 

2.  Report Availability -Fiserv’s standard of performance for report availability shall be that, over aMeasurement Period, 97% of all Critical Daily Information shall be availablefor remote printing or dispatch to the courier on time without significanterrors.  Critical Daily Informationshall mean priority group reports that Fiserv and Client have mutually agreedin writing are necessary to properly account for the previous day’s activityand properly notify Client of overdraft, NSF, or return items.  The agreed upon Critical Daily Informationshall be listed on an exhibit attached to the final conversion plan.  On time delivery for Critical DailyInformation shall be 6:30 a.m. if delivered to Client’s remote print facilityand 8:30 a.m. if delivered to Client by courier.  A significant error is one that impacts Client’s ability toproperly account for the previous days activity and/or properly account foroverdraft, NSF, or Return items.  Actualperformance will be calculated monthly by comparing the total number of reportsscheduled to be available from Fiserv to the number of reports that wereavailable on time and without error.

 

3.  Response Time - Fiserv’sresponse time performance standard for 98% of transaction shall be  2 seconds for a teller transaction or 3.5seconds for a terminal transaction, Premier II workstations 5.5 seconds onaverage as determined from measurements taken over a Measurement Period.  A transaction shall mean a basic deposit,withdrawal, or monetary transaction. The measurement shall begin when the host computer receives the datatransmitted from the on-line device and shall end when the host computerreturns the data out to the on-line network for delivery to the on-linedevice.  Fiserv will log and retain arecord of response time maintaining appropriate analytical reports.  Fiserv will work with Client and third partyvendors to ensure commercially reasonable response time.

 

4. Client Inquiries - All Client inquiries will be acknowledgedby Fiserv within 2 hour of request. Resolution of the inquiry will be completed by Fiserv within 24 hours ofthe inquiry unless a mutually agreeable time is accepted by Fiserv andClient.  Fiserv strives to meet thefollowing goals:

a. Respond to 70%of calls immediately

b. Resolve 85% ofcalls on day of receipt

 

16

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Effective 02/02

 

Exhibit B

Item ProcessingServices

 

Client agrees with Fiserv as follows:

 

1.  Services.  Fiserv will provide Client the ItemProcessing Services (“Item Processing Services”) specified in Exhibit B – 1.

 

2.  DueDiligence.  All necessaryinformation concerning Client’s requirements for Item Processing Services shallbe set forth in a business assumptions list (the “IP Business AssumptionsList”), which Client shall complete prior to Fiserv rendering Item ProcessingServices hereunder.  Client acknowledgesthat Fiserv has relied on the information contained in the IP BusinessAssumptions List in determining pricing and performance levels for the ItemProcessing Services.  In the event ofmaterial change(s) in the actual volumes, types of items, and delivery timesfor work received from Client, as compared to the IP Business Assumptions List,Fiserv shall have the right to adjust its fees and/or performance standardsaccordingly upon 30-day’ notice to Client. Any increase in fees resulting from this due diligence process shall notbe subject to the CPI limitations as set forth in Paragraph 3 below.

 

3.  Fees.  Client shall pay Fiserv the fees and othercharges for the Item Processing Services specified in Exhibit B – 1.  Fees listed in Exhibit B – 2 are valid foritem processing services and locations that Client contracts for as of the dateof the Agreement.  If Client seeksadditional services and/or use additional locations from Fiserv during the termof the Agreement, Fiserv fees and services available, therefor will be quotedto Client upon request.  Fiserv agreesto give at least 30 days’ notice to Client of any changes in the rules andprocedures established for processing items, unless such changes are caused bychanges made by the Federal Reserve System or otherwise beyond the control ofFiserv, not permitting Fiserv to give such advance notice.  Fiserv reserves the right to make suchchanges to the Exhibits without notice as may be necessary to cover anyincreases in Federal Reserve System costs and charges or in other costs andcharges beyond Fiserv’s control, including changes required by applicable lawor regulatory activity.  The fees listedin Exhibit B - 2 may be changed annually effective October and each succeedingOctober 2002 upon 30 days advance notice to Client.  Each change shall be limited to the change in the U.S. Departmentof Labor, Consumer Price Index for All Urban Households (“CPI”) for the mostrecent 12-month period for which such information is available or three percent(3%) whichpreceding each January 1, or three percent (3%), whichever isgreater. Fiserv will deliver to Client the notification of the fee change.

 

4.  PerformanceStandards.  Fiserv will perform theItem Processing Services in accordance with the performance standards specifiedin Exhibit B – 3 (“Item Processing Services Performance Standards”), subject toClient meeting its performance obligations as set forth in Exhibits B – 1 and B– 3.  Fiserv shall not be liable for anydamages or losses to Client for errors occurring within the limits of theExhibit B – 3 performance standards.

 

5.  NoFiduciary Relationship.  Fiservshall perform such Item Processing Services for which Fiserv shall subscribe asagent of Client, and Fiserv shall not have by reason of this Agreement afiduciary relationship with respect to Client.

 

6.  Lost,Destroyed, and Misplaced Items. Fiserv assumes no liability for any item lost, destroyed, or misplacedwhile in transit before the item physically arrives at the premises of Fiservand is received by Fiserv.  In the eventany items are lost, destroyed, or misplaced, and such event is not due to grossnegligence or intentional misconduct by Fiserv, Client shall be solely responsiblefor the costs and expenses incurred by Fiserv in reconstructing any such itemsand for any damages or other losses that may be incurred by Fiserv due to thecollection of such items.  In the eventFiserv loses, destroys, or misplaces deposited items as a result of grossnegligence or intentional misconduct after acceptance of said deposit, Fiservshall be liable only for reasonable reconstruction costs of the deposit.  Reasonable reconstruction costs shall beonly those costs that arise from reconstruction of a microfilmed deposit.  Fiserv shall not be liable forreconstruction costs associated with a deposit for which Client cannot providea microfilmed record of such item(s) contained in the deposit.  In no event shall Fiserv be liable for the facevalue of any lost or missing item(s).

 

7.  GovernmentalRegulation.  This Exhibit shall begoverned by and is subject to:  theapplicable laws, regulations, rules, terms and conditions, as presently ineffect or hereafter amended or adopted, of the United States of America,Federal Reserve Board, Federal Reserve Banks, Federal Housing Finance Board,and any other governmental agency or instrumentality having jurisdiction overthe subject matter of this Exhibit. Client agrees to abide by such requirements and to execute and deliversuch agreements, documents, or other forms as may be necessary to comply withthe provisions hereof, including, without limitation, agreements to establishFiserv as Client’s Agent for purposes of delivery of items processed hereunderfrom or to the Federal Reserve Banks. Any such agreements shall be made a part of this Agreement and areincorporated herein.  A change ortermination of such laws, regulations, rules, terms, conditions, and agreementsshall constitute,

 

17

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respectively, a change or termination as to this Exhibit.  Client data and records shall be subject toregulation and examination by government supervisory agencies to the sameextent as if such information were on Client’s premises.

 

8.  ClientResponsibilities.  Client shallsubmit all items to Fiserv and otherwise comply with all Client obligations inaccordance with the requirements set forth in Exhibit B – 1.  Client shall maintain adequate supportingmaterials (i.e. exact copies of items, records, and other data supplied toFiserv) in connection with the provision of Item Processing Services.  Client shall provide written notice ofconfirmation and/or verification of any instructions given by Client, its agents,employees, officers, or directors to Fiserv in connection with Fiserv’sprovision of Item Processing Services. Client shall be responsible for balancing its accounts each business dayand notifying Fiserv, within 7 business days, of any errors or discrepancies.In the event Fiserv discovers an error or defect (it being understood thatFiserv shall be under no duty to discover any such error or defect), Fiserv isauthorized, in its sole discretion, to correct any such error or defect and tomake any adjustments in order to correct such error or defect.

 

9. Definition of Item.  An item is defined as all checks and otherdocuments presented to Fiserv for processing, transactional entries generatedby Client, such as teller cash tickets, general ledger entries, loan entriesand all control documents such as batch tickets.

 

IN WITNESSWHEREOF, the parties hereto have caused this Exhibit B to the Agreement to beexecuted by their duly authorized representatives as of the date indicatedbelow.

 
|          |                                |                              |
|---------------|-------------------------------------|-----------------------------------|
| For Client:   | For Fiserv:                         |                              |
|          |                                |                              |
| Pacifica Bank | Fiserv Solutions, Inc.              |                              |
|          |                                |                              |
|          |                                |                              |
| By:           | /s/ John D.  Huddleston             |                              | By: | /s/ Teri Carstensen |   |
| Name:         | John  D. Huddleston                 | Name:                             | Teri  Carstensen |   |
| Title:        | Executive  Vice President and C.F.O | Title:                            | Senior Vice President |   |
|          |                                | Item Processing  District Manager |   |
|          |                                |                              |
| Date:         | 10/12/2001                          |                              | Date: | 11/16/2001 |   |   |
|               |                                     |                                   |  |  |  |  |  |  |  |  |  |  |

 

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Effective 02/02

 

Exhibit B-1

Item ProcessingDescription of Services

 

1.     Proof:  On each business day (excluding Saturdays,Sundays, and holidays), Client will deliver to Fiserv Processing Center, checksand other items deposited to accounts with Client. Client will provide extradeliveries in support of proof operations for peak day processing.  Peak day processing is defined as any daywhen Client’s volume is expected to exceed twenty percent of daily averagevolume of the previous months volume divided by the number of business days inthe previous month.

 

a.     Clientwill contract with and pay for a courier, to pick up and deliver all workbetween Client and Fiserv.  Both partieswill mutually agree upon the times of pick-up and delivery.  If Fiserv has not received the items fromClient locations by the agreed upon delivery times, Fiserv may, in its solediscretion and without liability, delay the processing of such items until thenext business day.  Fiserv will contactClient’s after-hours contact and apprise said contact of the situation.  Client agrees to provide an after-hourscontact and update that contact should there be any change in Client personnel.

 

b.     Clientagrees to MICR encode documents to meet Fiserv requirements (ABA and AccountNumbers and Tran-codes)

 

c.     Client isresponsible for microfilming all items submitted to Fiserv.

 

d.     Clientagrees that all transactional entries, involving tellers’ cash tickets, generalledger entries, or loan entries shall be in balance, and that Fiserv may returnto Client, unprocessed, any transactional entries that are not in balance.

 

e.     Clientagrees to segregate all over-the-counter items into batches not to exceed threeinches (3”) in depth and to identify each such batch with an appropriate batchheader, which batch header shall meet written requirements provided by Fiserv.Client further agrees to segregate all items by type (i.e., single deposititems will be batched separately from multiple deposit items), and to provide atotal for each single batch.

 

f.      Clientagrees to include a batch manifest for each bag of work submitted to Fiserv.

 

g.     From theITEMS submitted to Fiserv, Fiserv shall retrieve such “on-us” information asmay be necessary for the proper accounting of the items and shall transmit thisinformation, through telephone lines or by such other means as Fiserv may, fromtime to time, deem appropriate to Client’s data processor for data processing.

 

h.     Clientauthorizes Fiserv to create ledger holdover entries, deposit corrections, orsuch other entries to balance transactions, except for those transactionsoutlined in subsection 1.d. above, as may be necessary to the efficientprocessing of the items.

 

i.      AfterFiserv has completed the process of retrieving and transmitting to Client’sdata processor the information necessary for data processing, allover-the-counter items not drawn against Client shall be forwarded forcollection to such correspondent banks as Client may designate from time totime in writing to Fiserv.

 

j.      All itemsdrawn against Client and those items internally generated shall be returned toClient or held by Fiserv in accordance with Client’s written instructions.

 

Encoding:  Fiserv will encode the dollar amount on allitems needing encoding and presented to Fiserv as part of the Proof functiondescribed above.  Fiserv may encodeadditional fields, such as account numbers, deposit ticket totals, or other itemsas specified by Client.  Any such encodingwill be according to terms agreed to by Fiserv.  In no event will Fiserv be liable for losses to Client due toencoding errors if Client has not satisfied all of its obligations set forth inSection 1 above.  Should Fiserv’sencoding services fail to meet the performance standard 

 

19

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for proof of deposit set forth in Exhibit B-3, andClient incurs a potential loss due to an encoding error, Client shall use itsbest efforts to collect the amount in question from its customer (includingwithout limitation, commencing legal action against the customer, obtaining ajudgment, and attempting collection efforts based on said judgment) prior tosubmitting a claim for damages to Fiserv.

 

Exception Item Processing:Fiserv will either reject or pay items listed on the appropriate report, inaccordance with written instructions, by Client’s authorized officer oremployee. The name of Client’s officer or employee giving such instructionshall be noted on the item or on such other record as Fiserv may establish,together with the nature of the instruction. If Client has not instructedFiserv regarding the disposition of any exception item drawn against Client bythe agreed upon time each day, then Fiserv shall return it through thepresentment chain to the depository bank or institution. Instructions to Fiservon disposition of items that are received after the agreed upon deadline or arechanged can result in a late charge. Should Fiserv’s exception item processing failto meet the performance standard for exception item processing set forth inExhibit B-3, and Client incurs a potential loss due to an error, Client shalluse its best efforts to collect the amount in question from its customer(including without limitation, commencing legal action against the customer,obtaining a judgment, and attempting collection efforts based on said judgment)prior to submitting a claim for damages to Fiserv.

 

4.      Statement Rendition: All checks,drafts, and other orders for the payment of money drawn against accounts atClient which are to be stored by Fiserv, will be retained by Fiserv until theend of each Client’s checking account cycle. The items will be sorted, filedwith the monthly statement, and mailed to the depositor.  Client agrees to have statements printedaccording to predefined cycles and print classes.  Statement enclosure counts will be accurately and clearlyreported in the top fold of the statement. If required, Client agrees to expedite the return of any paid exceptionitems to Fiserv in order to facilitate timely statement processing. Fiserv willapply proper postage, which will be pre- paid monthly (or as agreed upon byClient and Fiserv) on an estimated basis by Client.

 

5.      Inclearings:  Client authorizes Fiserv to receive itsinclearing items daily from the Federal Reserve Bank. Fiserv will balance theinclearing items to their cash letters, capture the items on magnetic media,microfilm or image scan and transmit the account information to Client’s dataprocessor. Fiserv will also pull out for further handling the appropriate itemsfor exception handling or scrutinizing, and deliver the items to bulk filestorage or to Client for further processing.

 

6.      Courier Service: The parties heretoacknowledge that it will be necessary to make arrangements for the transport ofitems, records, and other data from Client to Fiserv and from the FederalReserve or Correspondent bank to Fiserv. After Fiserv has provided the ItemProcessing Services, selected items, records, and data must be transported fromFiserv to Client and the Federal Reserve. The parties further acknowledge thatthe cost of such transportation shall be the sole responsibility of Client.

 

a.     Client hasthe right to make provision for its own courier service to provide the neededtransportation as set forth in subsection 1.a. above.  Should Client not make provision for such courier service, orshould Client request that Fiserv make arrangements for such courier service,then Fiserv, for the benefit of Client, shall make arrangements for such acourier service. Client must notify Fiserv to provide such courier service noless than thirty (30) days prior to the date that Fiserv is to begin providingItem Processing Services.

b.     Clientshall pay Fiserv for any and all charges, expenses, or costs incurred by Fiservin contracting for said courier service, as set forth in Exhibit B-2.

c.     It isunderstood and agreed that Fiserv shall not have, or assume, any liability orresponsibility for such items, records, or data until they have reached Fiservpremises and shall have no further responsibility or liability for them afterthey leave Fiserv premises.

d.     Thecourier service shall at all times be deemed the independent contractor ofClient, and shall not, at any time or under any circumstances, be deemed theagent or employee of Fiserv, regardless of whether said courier service, at anypertinent time herein, is affiliated with or employed by Fiserv.

e.     Fiservwill monitor and track deliveries for Client. Should a delivery be missing, Fiserv will notify Client throughappropriate channels.  Should there beany dispute as to the proper delivery of any records, Fiserv’s records ofdelivery will be accepted as the undisputed record of delivery.

 

20

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7.      Conversion Services:  Fiserv will provide conversion servicesbased on the information provided by Client during the due diligenceprocess.  Following Client’s initialconversion to Fiserv Services, any additional requests will be submitted toFiserv at least 90 days prior to the required implementation date.  An estimate for the additional conversionservices will be provided.  Theimplementation time for the conversion will be delayed if Client requires morethan three days to approve or decline the conversion estimate. Client alsoacknowledges that Fiserv must approve any changes to the MICR line and/orAccount Number structure for Client prior to proceeding with a conversion.  Fiserv will make every reasonable attempt toconvert new MICR line and/or Account Number structures.  Client agrees to eliminate any non-standardMICR line and/or Account number structure as identified during the duediligence process from its daily capture service within 120 days after theinitial conversion date.  Clientacknowledges that Fiserv may elect to charge a fee such as the SpecialStatements Fee listed in Exhibit B-2, for all non-standard items processed inthe service.  Client acknowledges thatFiserv may not be able to achieve the stated service level agreements onaccounts, transactions, or services involving non-standard MICR lines and/orAccount Number structures. In the event that the Account Number appearing onthe statement does not equal the Account Number on the MICR line, Fiserv willnot be responsible for any service level agreements relating to statementpreparation and rendition.

 

Initial Client conversionis based on the results obtained during the due diligence process.  This work would include an inclearings, PODand bulk file sort pattern.  Inaddition, it would include a single extraction program to support thetransmission of a daily inclearings and POD file to a host site forprocessing.  Sort specifications will bedeveloped in support of statement rendition services.  Standard reporting will be provided to Client to include a dailytransaction report sorted in transaction and account order, recaps oftransmissions and cash letters, and a daily cash report if required.

 

8.      Research Services: Fiserv will provideresearch and photocopy services upon request by Client.  Upon receipt from Client of a request forsubpoena work or other significant or voluminous research work, Fiserv will attempt to provide Client with anestimate of the time required and corresponding cost to complete the requestprior to commencing the research services.

 

9.      Data Transmission: Client and Fiservacknowledge and agree that Client has separately contracted with Client’s dataprocessor to provide data processing services for Client and that Fiserv shallhave no responsibility for the timeliness or quality of the service provided byClient’s data processor. Client’s data processor shall deliver directly toClient all reports generated from the data transmitted by Fiserv. Fiserv shallhave no responsibility for the timeliness of such delivery or for the adequacyor accuracy of the reports supplied by Client’s data processor, except forerrors caused by Fiserv failure to transmit information.

 

10.    Image Services:   Fiserv will provide CD-ROM containing retrievable images ofprocessed checks to Clients courier as agreed. Weekly and Daily CD’s are dispatched the next business day. EOM CD’s aredispatched within four business days. Fiserv will provide Client with remoteresearch availability  via a workstation from 8:00 AM Eastern Time to 12:00 AM Eastern Time Monday throughFriday, excluding holidays, and on weekends and holidays from 8:00 AM EasternTime to Noon Eastern Time.

a.     Fiservwill image capture Inclearings and POD through item capture.

b.     Re-entertransit all rejects.

c.     Fiservwill retain items sent to Fiserv for processing for up to 60 days at the feestated in Schedule B-2 and will maintain the ability to furnish such items to acustomer upon request during such period.

d.     After 60days, Fiserv will destroy items sent to it for processing.

e.     Fiservwill create and render the image statements for the designated accounts.  Images of the front and if specified byClient for an account, the back, or each ITEM shall be included with each statement.

f.      Archiveservices are maintained up to 90 days o RAID with response time of less that 10seconds. From day 91 through seven years a tape silo is used for storage.Response time for a single query from day 91 though the 24th month is 2 minutesor less. Next day response time is provided for items in the month 25 throughmonth 84 range. 

 

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Effective 02/02

 

Exhibit B-2

 

Item Processing ServicesFees

 

Fiserv will provide Client with the Item Processing Services for thefollowing fees and prices indicated:

 

Fiserv Administrative Fee (excluding postage): 15%

 

**I.  Item Handling** - **Sorter**

 
| **Service**                        |   | **Volume/Range**                                        |   | **Unit Fee**                                        |   | **Description  / Information**                                                                                                                                                                                                                                                                                                                          |
|------------------------------------|--------|---------------------------------------------------------|--------|-----------------------------------------------------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| In-Clearing Capture                |   | Per item                                                |   | $0.014/item                                         |   | Per item.   High-speed capture of MICR data, balancing to Inclearing Totals and  extracts.  A sequence number is spray  endorsed on the items.  Inclearings,  Same Day Capture.                                                                                                                                                          |
| In-Clearing Re-entry OVER 1%       |   |                                                    |   | $0.38/item                                          |   | Correcting of MICR   via on-line terminal                                                                                                                                                                                                                                                                                                          |
| Proof Encoding                     |   | <4 hour window  >4 hour window  >6 hour window |   | $0.032/per field  $.0260/per field $0.023/per field |   | MICR encoding of all On-Us and Transit items  received by Fiserv from Client.  All  transactions are balanced. The proof tape is forwarded to client. POD, Transit,  GL, Savings, Loans, Lock Box, Counter Items. Windows are based on first  deadline - (cash letter or transmission).   For work to be processed minimum window is 3 hours. |
| POD/Transit Capture                |   | Per item                                                |   | $0.02/item                                          |   | High-speed capture of MICR data, balancing to proof  totals, out sorting of other On-Us Items (Sav, GL, Loan, etc.) creation of  various Cash Letters and extraction.   A sequence number is spray endorsed on the items.                                                                                                                          |
| Reject Re-Entry and repair OVER 1% |   |                                                    |   | $0.45/item                                          |   | Correcting of MICR data via on-line terminals.                                                                                                                                                                                                                                                                                                          |
| Reject Repair                      |   | Per item                                                |   | $0.25/ item                                         |   | Client required stripping and re-qualification of  items.                                                                                                                                                                                                                                                                                               |
| Microfilming                       |   | Per item                                                |   | $0.003/item                                         |   | Microfilming of prime pass items during  capture.  Inclearings, On-Us or  Counter Items, **$**15.00 minimum per roll.                                                                                                                                                                                                                              |
| Microfilming                       |   | Per item                                                |   | $0.009/item                                         |   | Additional microfilming pass for Returns, Statement  Items, Daily Finesort, Electronic Presentment.  $15.00 minimum per roll.                                                                                                                                                                                                                      |
| Microfilming                       |   | Duplicate                                               |   | $12.000/roll                                        |   | Additional roll of microfilm.                                                                                                                                                                                                                                                                                                                           |
| Deposit Corrections                |   | Per item                                                |   | $2.00/item                                          |   | Corrections of Client deposit/teller errors.  Photocopy charges are extra.                                                                                                                                                                                                                                                                              |
| Same Day Settlement                |   | Per cash letter                                         |   | $5.00/letter                                        |   | Fee assessed to accept Same Day Settlement Cash  Letters on behalf of the Financial Institutions. This is in addition to the  per item fee charged as a part of the Inclearings.                                                                                                                                                                        |
| Cash Letter Preparation            |   | Per cash letter                                         |   | $6.50/letter                                        |   | Charge for preparation of Cash Letter(s)                                                                                                                                                                                                                                                                                                                |
| Image item Scan                    |   | Per item                                                |   | $0.012/item                                         |   | Scanning of items for the purpose of Image  Statements, Image Archive and Retrieval.                                                                                                                                                                                                                                                                    |
| Image item re-Scan                 |   | Per item                                                |   | $0.02/item                                          |   | Scanning of items for Clients that do not use other  IP services                                                                                                                                                                                                                                                                                        |
| Image Reject Item Correction       |   | Per item                                                |   | $0.250/item                                         |   | Reject repair of image items.                                                                                                                                                                                                                                                                                                                           |
| Exception Item   Pass         |   | Per item                                                |   | $0.004/item/pass                                    |   | Single pass of On-Us items for the purpose of  pulling items for review/return to Client. Statement Cycles are also pulled  at this time.                                                                                                                                                                                                               |
| Fine Sorting                       |   | Per item                                                |   | $0.006/item                                         |   | High speed sorting of items into account number  order.  Inclearings, GL, Savings,  Loans, On-Us, Cycle Sorting, Bulk file Sort, Daily Fine Sort.                                                                                                                                                                                                  |
| Serial Sorts                       |   | Per item                                                |   | $0.016/item                                         |   | High-speed sorting of items into check number order  per Client Request.                                                                                                                                                                                                                                                                                |

 

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**II.  Bookkeeping Services**

 
| **Service**                                    |   | **Unit Fee**     |   | **Description  / Information**                                                                                                                                                                                                                                                                                                                      |
|------------------------------------------------|--------|------------------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| Returns Items – Qualified –Automated |   | $1.50/item       |   | Automated pulling of return items upon Client timely  return decision.  Fiserv strips or  inserts item into a document carrier, encodes the special Fed character and  Routing Number of Bank of first deposit. Fiserv balances the items, stamps  the return reason, prepares the Return Cash Letter advice and delivers to the  FRB.         |
| Return Items – Raw–Automated         |   | $1.00/item       |   | Automated pulling of return items upon Client timely  return decision.  Items are balanced,  stamped with the return reason, Cash Letter advice created and delivered to  the FRB.  FRB qualifies and processes  the items.                                                                                                               |
| Return Items – Qualified –Manual     |   | $3.40/item       |   | Manual pulling of return items upon Client timely  return decision.  Fiserv strips or  inserts items into a document carrier, encodes the special Fed character and  Routing number of the bank of first deposit.   Fiserv balances the items, stamps the return reason, prepares the  Return Cash Letter advice and delivers to the FRB. |
| Late Return Items                              |   | $5.00/item       |   | Return item processing that exceeds the normal  24-hour FRB window for regular returns or is past the established deadline  for the return decision. Late Returns are subject to collection rules and  procedures.                                                                                                                                  |
| Fax Requests                                   |   | $1.00/item/side  |   | Copying and faxing   as requested and defined by Client.                                                                                                                                                                                                                                                                                       |
| Large  Dollar  Notification               |   | $3.25/item       |   | Client notifies Fiserv of the large items to be  returned.  Fiserv notifies the bank of  first deposit of the return. (Does include the cost of the return.)                                                                                                                                                                                   |
| Chargeback   Forwarding                   |   | $2.00/cashletter |   | Fiserv forwarding of chargebacks via the next  scheduled courier delivery to the Client or re-deposit to the Fed.  ($50.00 monthly minimum.)                                                                                                                                                                                                   |
| Photo Copies                                   |   | $2.75/item       |   | Upon Client request, Fiserv creates a copy of a  processed item from microfilm and provides via fax, mail, or both. Turn  around within a 24-hour timeframe.                                                                                                                                                                                        |
| Photo Copies – Expedited                  |   | $4.00/item       |   | Upon Client request, Fiserv creates a copy of a  processed item from microfilm and provides via fax, mail or both.  Turn around within a 4-hour timeframe.                                                                                                                                                                                     |
| Research Work                                  |   | $25.00/hour      |   | Any client requested research other than a Center  created error.  Billed in 1⁄2 hour  increments.                                                                                                                                                                                                                                          |
| Original Item Retrieval                        |   | $3.00/item       |   | Upon Client request, Fiserv pulls an original item  for forwarding via fax, mail or both to the Client or FRB.                                                                                                                                                                                                                                      |
| Fed or Correspondent Adjustments               |   | $10.00/item      |   | Research of outages.  (Plus Research time if over 1⁄2 hour).                                                                                                                                                                                                                                                                                |
| Non-Cash Collection                            |   | $2.00/envelope   |   | Fiserv forwarding of envelope via the next scheduled  courier delivery to the FRB.                                                                                                                                                                                                                                                                  |
| Daily Fed Notification                         |   | $55.00 Per Month |   | Notification of Daily Cash Letter Deposited at the  FRB.                                                                                                                                                                                                                                                                                            |
| Large Item Review and Fax to Client            |   | $0.29/item       |   | Fiserv review of points of negotiability and fax to  client for pay / return decision.   Signature is not reviewed with specimen file                                                                                                                                                                                                          |

 

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**III.  Image Archive(1)**

 
| **Service**                                  |   | **Unit Fee**              |   | **Description / Information**                                                                                                                |
|----------------------------------------------|--------|---------------------------|--------|----------------------------------------------------------------------------------------------------------------------------------------------|
| Seven Year Image Storage                     |   | $0.003/item               |   | Storage of images for seven years using the Fiserv  migrated media storage capability.                                                       |
| On- Line Image Retrieval -first 90 days      |   | $0.200/item query         |   | Retrieval of image items within the first 45 days of  scanning with or without the Seven-Year Image Storage service.                         |
| On- Line Image Retrieval -over n90 days      |   | $2.75/item query          |   | Retrieval of image items during the time span of 46  days to two years of storage following scanning with Seven-Year Image Storage  service. |
|                                         |   |                      |   |                                                                                                                                         |
| Image Library Software                       |   | $995.00/first copy        |   | Software for the viewing of images on CD-ROM.                                                                                                |
| Image Library Software                       |   | $500.00/add’l copies |   |                                                                                                                                         |
| Annual Maintenance on Image Library Software |   | $75.00/copy               |   | Annual fee for software support after first year.                                                                                            |

 

**IV.  Image Distribution(1)**

 
| **Service**         |   | **Unit Fee**                                           |   | **Description  / Information**          |
|---------------------|--------|--------------------------------------------------------|--------|-----------------------------------------|
| CD ROM Distribution |   | $25.00/CD plus  postage/handling for next day delivery |   | Creation of CD containing imaged items. |

 

**V.   Image Statements(2)**

 
| **Service**                                    |   | **Unit Fee** |   | **Description  / Information**                                                                   |
|------------------------------------------------|--------|--------------|--------|--------------------------------------------------------------------------------------------------|
| Scan Marketing Image                           |   | $100.00/each |   | Scanning of a promotional marketing insert to be  printed on the Image Statements.               |
| Special Statement Cuts                         |   | $10.00/each  |   | Creation of Image Statement not at a normal cycle  date.                                         |
| Non End of Month image Statements              |   | $0.50/acct   |   | Image statements, front of items only, includes five  sides of print, composition and insertion. |
| End of Month Image Statements                  |   | $0.70/acct   |   | Image statements, front of items only, includes five  sides of print, composition and insertion. |
| Image Statement Composition - Additional Sides |   | $0.04/side   |   | Additional sides of print on image Statements.                                                   |

 

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1 Startup costs to be applied for scanner programming and conversionsupport $5,000.00

2 

 

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**VI.  Set up / Other  Fees**

 
| **Service**                        |   | **Unit Fee**                           |   | **Description  / Information**                                                                                                          |
|------------------------------------|--------|----------------------------------------|--------|-----------------------------------------------------------------------------------------------------------------------------------------|
| Image Processing Set Up Fee        |   | $5,000.00                              |   | Minimum. Bid provided.                                                                                                                  |
| Image Processing Minimum Per Month |   | $1,000.00/month                        |   | If a combination of traditional services plus  Imaging, the monthly minimum is $2,500. Pass-through charges are excluded  from minimum. |
| Processing Minimum Per Month       |   | $1,000.00/month                        |   | Traditional Item Processing Services. Pass-through  charges are excluded from minimum.                                                  |
| Programming                        |   | $150.00 per hour                       |   | Bid provided.   Special requests that require detailed programming.                                                                |
| Training                           |   |                                   |   | Bid provided.                                                                                                                           |
| Conversions /Implementation Fee    |   | Per implementation  minimum fee $5,000 |   | Estimate provided, ($5,000 minimum)                                                                                                     |

 

**VII.  Customer Printed Statements - Rendering& Safekeeping (truncated)**

 
| **Service**                                                        |   | **Unit Fee**                            |   | **Description / Information**                                                                                                                                                                            |
|--------------------------------------------------------------------|--------|-----------------------------------------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| Bulk File Storage                                                  |   | $0.004/item                             |   | Bulk filed items housed in Fiserv facility pending  statement processing.                                                                                                                                |
| Truncated/Image Item Storage & Destruction                     |   | $0.0045/item                            |   | Truncated/Imaged items housed in Fiserv facility  pending destruction after 60 days.                                                                                                                     |
| Additional Storage                                                 |   | $0.0001/item/month                      |   | Items housed in Fiserv facility over the 60-day  storage.                                                                                                                                                |
| Statement Rendering - Automated                                    |   | $0.10/acct (minimum  $200.00 per cycle) |   | Machine rendering of statements (Additional charge  of $0.10 per statement for month end cycle drop). Statement format must  adhere to specifications for automated equipment.(see below)                |
| Statement Rendering - Manual                                       |   | $0.50/acct                              |   | Manual rendering of statements.                                                                                                                                                                          |
| Non Enclosure Statements-Truncated Manual                          |   | $0.18/acct                              |   | Statements that do not contain enclosures such as  Truncated, Savings, CD, Loan and Analysis. (truncated manual).                                                                                        |
| Non Enclosure Statements Truncated-Automated                       |   | $0.10/acct (minimum  $200.00 per cycle) |   | Statements that do not contain enclosures such as  Truncated, Savings, CD, Loan and Analysis. (truncated automated). Statement  format must adhere to specifications for automated equipment.(see below) |
| Special and Hold Statements                                        |   | $2.00/acct                              |   | Statements that do not conform to general bulk file  procedures - daily, weekly, BI-weekly cycles, conversion cycles, one-time  requests, differences in enclosure counts.                               |
| Statement Items Inserted ManualStatement Items  Inserted Automated |   | $0.01/item$0.005/item                   |   | Items are matched to corresponding Statements and  prepared for mailing.  This is also  used for inserting promotional items, stuffers, and additional pages.                                       |
| Selected Field Inserts                                             |   |                                    |   | Bid provided.                                                                                                                                                                                            |
| Statement/Envelope Inventory Management                            |   | $20.00/month                            |   | Inventory of Statement forms and envelopes.                                                                                                                                                              |
| Reformatting from Print file                                       |   | $10.00/cycle                            |   | Creation of reformatted print file upon receipt of  statement file.                                                                                                                                      |
| Other Mailings                                                     |   |                                    |   | Bid provided.                                                                                                                                                                                            |
| Statement Printing Non Image                                       |   |                                    |   | Bid provided if service available.                                                                                                                                                                       |

 

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**VIII.  Miscellaneous**

 
| **Service**                                        |   | **Unit Fee**           |   | **Description / Information**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
|----------------------------------------------------|--------|------------------------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| Subpoena Requests/Research                         |   | $15.00/hour            |   | Research requested by subpoena. Billed in 1⁄2 hour  increments plus $1.00 per item Photocopy fee. Bid provided                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
| Special Handling - Account Number Formats          |   |                   |   | Bid provided.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
| Special Handling - Multiple R/T Numbers            |   |                   |   | Bid provided.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
| Data Entry                                         |   |                   |   | Bid provided.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
| Deposit Bag/Envelope Handling (Optional service)   |   | $1.50 per bag/envelope |   | Receipt and manifesting of any direct deposit from  Client’s customer to IP center or special handling. $100.00 monthly minimum  and $50.00 per occurrence for cash handling fee.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
| Microfiche - Original                              |   | $2.00 per fiche        |   | Original record of MICR items captured daily.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
| Microfiche - Duplicate                             |   | $0.45 per fiche        |   | Duplicate microfiche copy of MICR items captured daily  for Client copy.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
| Transmission                                       |   | $0.005/item            |   | Transmitting of MICR data to a Client application  processor (non-Fiserv host).  Also for  the receipt of Exception Item Files/Statement File/Print File. (Minimum  $15.00  per file)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
| Statement Format -Automated Equipment Requirements |   |                   |   | Statement must contain bar coding compatible to the  equipment being used. The bar coding must reflect the number of enclosures  and page identification. The enclosure count must accurately reflect the  number of expected items excluding stuffers. Bar coding must reflect if the  statement is a “Special Pull” or a “Hold” statement. The checks to be  rendered must have “stop document dividers” between accounts. There must be a  maximum number of items and statement stuffers (defined by Center). The  envelopes must meet size criteria, usually defined as Standard #10 and must  be a “wet seal” not “self seal”. Truncated accounts must be separated from  accounts receiving checks. |

 

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Exhibit B-3

 

Item ProcessingPerformance Standards

 

1.             Client preparationand presentation of work for Fiserv proof department

 

a.        SUBJECT:   Presentationand Delivery of Work

b.       DESCRIPTION:

• Credits comebefore debits

• Customerdeposit is the first credit

• Items areencoded with route/transit number, account number and proper  trancode

•If multiple amounts, correct amount is circled(Currency not to be included)

c.        PROCEDURE:   Fiservwill notify Client of specific non-performance issues as required.

 

2.             Client preparationand presentation of work for Fiserv proof department

 

a.        SUBJECT:   Categories

b.       DESCRIPTION:

• Single items(one-on-ones) batched

• Multipleitem transactions batched

c.        PROCEDURE:   Fiservwill notify Client of specific non-performance as required.

 

3.             Client preparationand presentation of work for Fiserv proof department

 

a.        SUBJECT:   Batches andControl Tickets

b.       DESCRIPTION:

• All Ticketsare teller stamped

• All itemsare properly logged and recorded for filming and then microfilmed

• Bundles arelimited to 3” or 250 items, whichever limit is reached first.

• Tapelistings accompany multiples

• Single itemdeposits have headers preceding them and a tape listings

c.        PROCEDURE:   Fiservwill notify Client of specific non-performance issues as required.

 

4.             Client preparationand presentation of  work for Fiservproof department

 

a.        SUBJECT:   Work Shipment

b.       DESCRIPTION:

• All work forproof is in clear plastic bag

•Correspondent bank correspondence in clear plastic bag

• Clearplastic bag is in the Fiserv bag

• Othercorrespondence in the Fiserv bag

c.        PROCEDURE:   Fiservwill notify Client of specific non-performance issues as required.

 

5.             Fiserv proof andbalancing of work received from Client for processing

 

a.        SUBJECT:   Proof ofDeposit for dollar amount encoding

b.       DESCRIPTION:

• Dollarencoding errors to meet service goals

• Correctionsmade with accepted medium

• CustomerCorrections are legible and complete

• CustomerCorrections have the correct reason listed

• All CustomerCorrections over $100.00 are documented with accompanying copies as required.

• Items areendorsed with the proper bank stamp in proper Regulation CC position

• TransactionCorrections using G/L debits and credits contain the correct information

• Suspensedocumentation is legible and complete

• Items placedinto holdovers by Fiserv will be documented

 

27

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• Differencesof under $10.00 will be charged to a General Ledger account

c.        SERVICE GOAL:   99.997%

d.       PROCEDURE:

•Client will notify Fiserv of specific non-performance issues by submitting aservice incident report in the form approved by Fiserv with accompanyingdocumentation to Client Services.

e.        MEASUREMENT:   Percentof Proof Encoding Volume

 

6.             Fiserv modification of MICR rejects

 

a.        SUBJECT:   RejectRe-entry/ Reconciling or Balancing

b.       DESCRIPTION:

• ModifiedMICR reject errors to meet service goals

• TransactionCorrections using G/L debits and credits contain the correct information

• Suspensedocumentation is legible and complete

• Items placedinto suspense by Fiserv will be documented

• Differencesof under $10.00 will be charged to a General Ledger account

c.        SERVICE GOAL: 99.7%

d.       PROCEDURE:

•Client will notify Fiserv of specific non-performance issues by submitting aservice incident report in the form approved by Fiserv with accompanyingdocumentation to Client Services.

e.        MEASUREMENT:   Percentof Volume  (Based on total rejects)

 

7.             Fiserv preparationof outgoing transit items

 

a.     SUBJECT:      TransitCash Letter Processing

b.     DESCRIPTION:

• Cash Lettersare sent out with correct total(s)

• Cash Lettersare sent with complete bundle count(s)

• Cash Letterdifferences are explained

• Cash Lettersfor proper bank are used

• Cash Lettersfor the correct correspondent are used

• Cash Letterssent out in timely manner

• Low speedcash letters will be sent out within 24 hours of stated deadlines

• On-us itemswill not be sent out in transit cash letters

c.     SERVICE GOAL: Not to exceed one error percash letter endpoint  per month

• Cash LettersItems sent out 99.4% of the time on time

d.     PROCEDURE:

•Client will notify Fiserv of specific non-performance issues by submitting aservice incident report in the form approved by Fiserv with appropriatedocumentation to Client Services.

e.     MEASUREMENT:    Record ofOccurrence based on cash letter endpoints

 

8.             Fiserv capture and transmission of work from proofdepartment

 

a.     SUBJECT:      SecondShift Transmissions

b.     DESCRIPTION:

• Alltransmissions are sent in the approved Fiserv format

• Alltransmissions are sent to Fiserv in such time to insure that posting can becompleted timely.

• Transmissiondeadlines will not be earlier than 11:00 p.m. Mon. - Thurs. or 12:00 a.m.Friday

c.     SERVICEGOAL: Transmission errors or delays are not to exceed two per month that arewithin Fiserv’s control.

d.     PROCEDURE:

•Clientwill notify Fiserv of specific non-performance issues by submitting a serviceincident report in the form approved by Fiserv with accompanying documentationto Client Services.

e.     MEASUREMENTS:     Record of Occurrences

 

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9.             Fiserv preparationof statements and check filing requirements

 

a.     SUBJECT:      StatementPreparation

b.     DESCRIPTION:

•End of the month statements are sent no later than the 4th business day fromreceipt of the printed statements from Client and/or Agent andcompletion/receipt of paid exception items.

•Non end of the month statements are sent no later than the 3rd business dayfrom receipt of the printed statements from Client and/or Agent andcompletion/receipt of paid exception items.

•Special account statements are sent out no later than the 3rd business day fromreceipt of the printed statements from Client and/or Agent andcompletion/receipt of paid exception items.

• Crippledstatements will be mailed out within two additional days.

• There willbe only one statement per envelope.

• The correctcustomer’s checks will accompany the statement.

• Holdstatements that are properly labeled will be sent to Client for handling.

• Zip codesand addresses will be eliminated on all hold accounts.

• The correctnumber of statement  pages are in theenvelope.

•Client will submit statement stuffers to center with appropriate instructionsnoted on the Stuffer Instruction Form. Stuffers must arrive two days prior to cycle date to insure properhandling.

• The correctstatement stuffer(s) will be included in the statement.

• Notice ofmissing item(s) will be included in the statement if the statement is missing 3or fewer enclosures.

•Fiserv will monitor and report delays for receipt of statement print to Clientwithin 24 hours of the expected time of receipt.

 

c.     SERVICE GOAL: 99.9%  (10 errors per 10,000 Statements)

•Fiserv will also manage statements with incorrect item counts to no more than3% mailed with incorrect enclosure counts.

d.     PROCEDURE:

• Client willnotify Fiserv of specific non-performance issues by submitting a serviceincident report in the form approved by Fiesrv with accompanying documentationto Client Services.

e.     MEASUREMENT:       Percent of Total Statements Rendered

 

10.           Fiservprocessing of exception items (Outgoing Return Items) when Client has submittedfinal return decisions by 12:30 p.m. daily

 

a.     SUBJECT:      QualifiedReturned Items

b.     DESCRIPTION:

• The correct items will be returned

• All returneditems are stamped with the correct return reason

• The itemsClient wants returned are returned on the day they are listed as exceptions

• The T-186balances to the Fed return total daily

• G/L entriesmade for all check reversals

• Rejecteddebit totals balance

• Large itemsnotified through EARNS

• Items arereturned within specified Regulation CC. time requirements

• Items arepaid using correct account number and trancode

• Properbank’s T-186 forms are used

c.     SERVICE GOAL: 99.94%  (6 errors per 10,000 return items)

d.     PROCEDURE:

•Client will notify Fiserv of specific non-performance issues by submitting aservice incident report in the form approved by Fiserv with accompanyingdocumentation to Client Services.

e.     MEASUREMENT:    Percent of Total Qualified Return Items

 

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11.           Fiserv research ofitems, photocopy production

 

a.     SUBJECT:      Research

b.     DESCRIPTION:

•The turn-around time for a research request will be 48 hours from the time ofreceipt (unless Fiserv otherwise notifies Client, as in the case of subpoenaresearch or other significant or voluminous research requests).

•For subpoena research or other significant or voluminous research requests,Fiserv will provide a completion commitment estimate to Client within 48 hoursof receipt.

• Best effortwill be made to produce quality photocopies

• Tracereports will be delivered to Client within 2 business days

c.     SERVICE GOAL: 99.0% (1 error per 100requests)

d.     PROCEDURE:

•Client will notify Fiserv of specific non-performance issues by submitting aservice incident report in the form approved by Fiserv with accompanyingdocumentation to Client Services.

e.     MEASUREMENT:    Percent of Total Research Request andPhotocopies Serviced

 

12.Fiserv Imagescanning of Client on-us items

a.     DESCRIPTION:

• All on-usitems scanned daily

b.     SERVICE GOAL:          99.95 (50 error per 100,000 on-us items)

 

13. Fiservpreparation and mailing of check image statement

 

a.             DESCRIPTION:

•    All non-end of month image statement printfiles are delivered to printer within three days of statement cycle cut-offdate

•    All end of month image statement printfiles are delivered to printer within four days of statement cycle cut-off date

•    b.       SERVICEGOAL:  99.95 (5 errors per 10,000statements)

 

14. Fiserv preparation and distribution of check images on CD-ROM

 

a.             DESCRIPTION:

•    All CD-ROM’s will be distributed daily nomore than 48 hours following their processing date

•    The correct CD-ROM will be provided

•    b.       SERVICEGOAL:  99.00 (1 errors per CD-ROM)

 

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Exhibit B-4

 

**DESIGNATIONOF PAYMENT**

**FOR ITEM PROCESSING SERVICES**

 

Client shall pay for monthly item processing services by ACHtransaction, as per Agreement sub-paragraph 3.(e).

 

Complete the Authorization Agreement below for ACH Debit.

 

**Authorization Agreement For Automatic Payments**

**For Item Processing Services**

 

Fiserv is hereby authorized to initiate debit entries on Client’saccount at the depository institution indicated below, hereinafter calledDEPOSITORY, for payment of item processing services. (All information must beprovided)

 
| DEPOSITORY NAME |   |
|-----------------|--------|
| CITY            |   | STATE |   | ZIP |   |
| TRANSIT/ABA NO. |   | MASTER ACCOUNT NO. |   |
| ACCOUNT NAME    |   |
|                 |        |  |  |  |  |  |  |  |  |

 

This authority is to remain in effect until Fiserv and DEPOSITORY havereceived written notification from Client of termination in such time to affordFiserv and DEPOSITORY a reasonable opportunity to act on it. Client agrees todirect such notification to the Corporate Finance and Accounting Department ofFiserv at19935 Walnut Drive, Walnut, CA 91789. Client has the right to stop payment of a debit by notifyingDEPOSITORY in time to allow DEPOSITORY a reasonable opportunity to act prior tocharging the account listed above.

 
| CLIENT NAME:         |                                                                |
|----------------------|---------------------------------------------------------------------|
| ADDRESS:             |                                                                |
| CITY                 |                                                                | STATE |   | ZIP |   |
| AUTHORIZED SIGNATURE |                                                                |
|                 | (Signature must be identical to that now on file  with DEPOSITORY.) |
| TITLE                |                                                                |
| DATE                 |                                                                |
|                      |                                                                     |  |  |  |  |  |  |  |  |

 

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F

 

DISPUTED ITEM(S) FOR ACH PAYMENT

 
|           |   |            |   |   |
|----------------|--------|-----------------|--------|--------|
| CLIENT NAME    |   | DATE OF REQUEST |
|           |   |            |
|           |   |            |
|           |   |            |   |   |
| INVOICE NUMBER |   | INVOICE DATE    |
|                |        |                 |        |        |  |

 

ITEM(S) DISPUTEDAND AMOUNT:

 
|   |
|--------|
|   |
|   |
|   |
|   |
|   |
|   |

 

REASON FORDISPUTE:

 
|   |
|--------|
|   |
|   |
|   |
|   |
|   |
|   |

 

Please deduct atotal of $                                               from my next ACHdebit payment.  I will resolve theseissues with my Fiserv Account Executive within the next 10 business days.

 

 
|             |   |   |   |
|------------------|--------|--------|--------|
| NAME - SIGNED BY | TITLE  |
|             |   |
|             |   |   |

 

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