Exhibit 10.2


 


EMPLOYMENT AGREEMENT


 


This Agreement is made and entered into on January 1,
2009 by and among Manhattan Bancorp (“MB”),
Bank of Manhattan, N.A. (the “Bank”)
and Jeffrey M. Watson (“Executive”)
for the purposes set forth hereinafter (“Agreement”).


 


W I T N E S S E T H


 


WHEREAS, MB is a California corporation and bank
holding company registered under the Bank Holding Company Act of 1956, as
amended, subject to the supervision and regulation of the Board of Governors of
the Federal Reserve System (“FRB”);


 


WHEREAS, MB is the parent holding company for the
Bank, which is a national banking association and wholly-owned subsidiary of
MB, subject to the supervision and regulation of the Office of the Comptroller
of the Currency (“OCC”);


 


WHEREAS, Executive is currently the President and
Chief Executive Officer of the Bank and MB 
pursuant to an Employment Agreement dated December 5, 2008 between
the Bank, MB and Executive (the “Prior
Agreement”);


 


WHEREAS, Executive also serves as the President and
Chief Executive Officer of MB and as a director of the Bank and MB; and


 


WHEREAS, it is the intention of the parties to enter
into an employment agreement for the purposes of assuring the continued
services of Executive as the President and Chief Officer of the Bank and as the
President and Chief Executive Officer of MB.


 


NOW, THEREFORE, in consideration of the mutual
covenants and agreements contained herein, MB, the Bank and Executive agree as
follows:


 


A.                                   TERM OF EMPLOYMENT


 


The term of this
Agreement (“Term”) shall commence January 1,
2009 (the “Effective Date”), and
end three (3) years thereafter, subject, however, to prior termination of
this Agreement as hereinafter provided. 
Where used herein, “Term” shall refer to the entire period of employment
of Executive by the Bank hereunder, whether for the period provided above, or
whether terminated earlier as hereinafter provided.  The Prior Agreement is hereby terminated and
replaced by this Agreement.  This does
not replace or impair the Stock Option Agreements between MB and Executive
dated August 10, 2007, September 27, 2007 and December 18, 2008
(the “Stock Option Agreements”),
which shall remain in full force and effect.


 

















 


B.                                     DUTIES OF EXECUTIVE


 


1.                                       Duties.  Executive shall perform the duties of President
and Chief Executive Officer of the Bank and MB, reporting directly to the Board
of Directors (the “Board”) of the
Bank and MB, and subject, at all times, to the powers vested by law in the
Board of the Bank and MB and their respective shareholders.  Executive shall also serve as a member of the
Boards of MB and Bank throughout the Term. 
During the Term, Executive shall perform the services herein
contemplated to be performed by Executive faithfully, diligently and to the
best of Executive’s ability, consistent with the highest and best standards of
the banking industry and in compliance with all applicable laws and the Bank’s
and MB’s Articles of Association or Incorporation, Bylaws and internal written
policies.


 


2.                                       Conflicts of Interest.  Except as permitted by the prior written
consent of the Board of MB or Bank, Executive shall devote Executive’s entire
productive time, ability and attention to the business of the Bank and MB
during the Term and Executive shall not directly or indirectly render any services
of a business, commercial or professional nature, to any other person, firm or
corporation, whether for compensation or otherwise, which are in conflict with
the Bank’s or MB’s interests. 
Notwithstanding the foregoing, Executive may make investments of a
passive nature in any business or venture, provided that such business or
venture is not in competition, directly or indirectly, in any manner with the
Bank or MB.


 


C.                                     COMPENSATION


 


1.                                       Salary.  For Executive’s services hereunder, the Bank
or MB shall pay or cause to be paid as annual base salary (the “Base Salary”) to Executive not less than
Two Hundred Twenty Five Thousand Dollars ($225,000) for the first year of the
Term, with annual increases in the discretion of the Boards or the Bank’s and
MB’s Compensation Committees.  Base
Salary shall be payable in equal installments in conformity with the Bank’s
normal payroll period.


 


2.                                       Bonuses. Any bonuses shall be as
determined by the Boards of the Bank and MB, in their sole discretion.


 


D.                                    EXECUTIVE BENEFITS


 


1.                                       Vacation.  Executive shall be entitled to vacation
during each year of the Term consistent with the Bank’s approved vacation
schedule and policy, which shall provide Executive with not less than four (4) weeks
vacation for each year of the Term.  Executive
is encouraged to use all accrued vacation benefits and will be expected to take
vacation in the year it is earned. 
Accrual of any unused vacation shall be determined in accordance with
the Bank’s Personnel Policy as in effect from time to time and shall be subject
to any limitations set forth therein.


 


2.                                       Group Medical and Other Insurance Benefits.  The Bank shall provide for
Executive, at the Bank’s expense, group medical and other insurance benefits in
accordance with the Bank’s Personnel Policy as in effect from time to
time.  All coverage under this paragraph
shall be in existence or shall take effect as of the Effective Date
hereof.  The Bank’s and MB’s liability to
Executive for any breach of this paragraph shall be limited to the amount of 


 


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premiums required hereunder to be payable by the Bank to obtain or
maintain, as applicable, the coverage contemplated herein.


 


3.                                       Stock Option. MB has granted
Executive under the Stock Option Agreements options to purchase 174,382 of
shares of MB’s authorized but unissued Common Stock, at the fair market value
of the stock on the date of grant which equals the price at which such shares
were sold by MB prior to the Effective Date. 
Such option has a term of ten (10) years and shall vest in three
installments of 33.33% per year over a period of three (3) years, with the
first such installment to vest one year from the date of grant, and with
subsequent installments vesting two and three years thereafter.  To the maximum extent permitted by law, the
option will qualify as an “incentive stock option” within the meaning of Section 422
of the Internal Revenue Code of 1986, as amended.  Such stock option has been granted to
Executive, pursuant to MB’s Stock Option Plan (the “Plan”) and the Stock Option Agreement.


 


4.                                       Auto Allowance.  During the Term, Executive shall be entitled
to receive One Thousand Dollars ($1,000) per month as a car allowance.


 


5.                                       Club Membership.  Executive shall be provided with an executive
membership at Palos Verdes Country Club at the Bank’s expense.  The Bank shall pay or reimburse Executive for
all dues associated with such membership and reimburse Executive for all
business expenses in accordance with Bank’s reimbursement policies.


 


E.                                      REIMBURSEMENT FOR BUSINESS EXPENSES


 


Executive shall be
entitled to reimbursement by the Bank or MB for any ordinary and necessary
business expenses incurred by Executive in the performance of Executive’s
duties in accordance with the Bank’s and MB’s reimbursement policies in effect
from time to time, provided that each such expenditure is of a nature
qualifying it as a proper deduction on the federal and state income tax returns
of the Bank and MB as a business expense and not as deductible compensation to
Executive; and Executive furnishes to the Bank and MB adequate records and
other documentary evidence required by federal and state statutes and
regulations issued by the appropriate taxing authorities for the substantiation
of such expenditures as deductible business expenses of the Bank and not as
deductible compensation to Executive.


 


F.                                      TERMINATION


 


1.                                       Termination for Cause.  The Bank or MB may terminate this Agreement
at any time by action of its Board for cause (“Cause”).  For purposes
of this Agreement termination for “Cause” shall mean termination because of
Executive’s personal dishonesty, incompetence, willful misconduct, any breach
of fiduciary duty involving personal profit, intentional failure to perform
stated duties, willful violation of any law, rule or regulation (other
than traffic violations or similar offenses) or final cease-and-desist order or
material breach of any provision of this Agreement.  For purposes of this Agreement, no act, or
the failure to act, on Executive’s part shall be considered “willful” unless
done, or omitted to be done, not in good faith and without reasonable belief
that the action or omission was in the best interests of the Bank or MB.  Termination under this Paragraph shall not
prejudice any remedy that the Bank or MB may have at law, in equity, or under
this Agreement.


 


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2.                                       Death or Disability.  In the event of Executive’s death or if
Executive is found to be physically or mentally disabled (as hereinafter defined)
by the Board of Bank or MB in good faith, this Agreement shall terminate
without any further liability or obligation by the Bank to Executive.  For purposes of this Agreement only, physical
or mental disability shall be defined as Executive having been unable to fully
perform under this Agreement for a continuous period of ninety (90) days or a
cumulative period of one-hundred eighty (180) days in any calendar year, or, if
applicable, such other periods as may be defined in the Bank’s Personnel Policy
or in applicable disability insurance policies as in effect from time to
time.  If there should be a dispute
between the Bank or MB and Executive as to Executive’s physical or mental
disability for purposes of this Agreement, the question shall be settled by the
opinion of an impartial reputable physician or psychiatrist agreed upon by the
parties or their representatives, or if the parties cannot agree within ten (10) days
after a request for designation of such party, then by a physician or
psychiatrist designated by the Los Angeles County Medical Association.  The certification of such physician or
psychiatrist as to the question in dispute shall be final and binding upon the
parties hereto.  The Bank or MB shall
bear the costs of such physician or psychiatrist selected to determine such
matter.


 


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


 


4.                                       Termination Without Cause.  Notwithstanding anything to the contrary
contained herein, it is agreed by the parties hereto that the Bank or MB may at
any time without Cause and for any reason immediately terminate this Agreement
and Executive’s employment by the Bank by action of their respective
Boards.  Upon such termination by the
Bank or MB all 


 


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benefits provided by the Bank or MB hereunder to Executive shall
thereupon cease, except as provided in this Subparagraph F.4 or Subparagraph
F.5, and Executive shall be deemed to have voluntarily resigned as a director,
officer and employee of the Bank and MB and any corporation, partnership, venture,
limited liability company or other entity controlled by, controlling or under
common control with the Bank or MB, and shall deliver such written resignation
as Bank or MB may request. 
Notwithstanding the foregoing, it is agreed that in the event of such
termination without Cause by the Bank or MB upon the delivery to the Bank by
Executive of a waiver and release in substantially the form of Attachment “A”
to this Agreement, and Executive’s compliance with the terms thereof, Executive
shall be entitled to, upon the effective date of termination, payment of a lump
sum equivalent to twenty four (24) months’ base salary as such base salary is
in effect on the date of termination of employment, plus continuation of
Executive’s medical benefits for a period of twenty four (24) months following
such termination, with Bank continuing to pay Executive’s share of premiums and
associated costs as if Executive continued to be employed with the Bank and MB;
provided, however, that the Bank’s and MB’s obligation to provide such coverage
shall be terminated if Executive is eligible to receive comparable substitute
coverage from another employer at any time during such twenty four month
period.  Executive agrees to advise the Bank
and MB immediately if such comparable substitute coverage is available from
another employer.  Notwithstanding any
provision to the contrary in this Subparagraph F.4, no severance benefits shall
be payable to Executive hereunder if Executive’s employment is terminated for
any of the reasons delineated in Subparagraphs F.1, F.2 or F.3 hereof or while
grounds for termination under such Subparagraphs exist, and no severance
benefits shall be payable to Executive under this Subparagraph F.4 if payments
are required to be made to Executive under Subparagraph F.5 hereof.


 


5.                                       Termination Following Change in Control.


 


(a)                                  In the event a Change in
Control of the Bank or MB occurs (as defined below) and Executive’s employment
as President and Chief Executive Officer of the Bank or MB is terminated without
Cause by the Bank or MB, then Executive shall be entitled, upon such
termination of employment and upon delivery to the Bank of an executed waiver
and release in substantially the form of Attachment “A” to this Agreement, to
payment of a lump sum equivalent to two (2) times the highest annual cash
compensation amount paid to Executive by the Bank or MB within the three years’
preceding the Change in Control and to the continuation of Executive’s coverage
under the group medical care provided at the time of termination for a period
of twenty four (24) months following such termination; provided, however, that
the Bank’s obligation to provide such coverage shall be terminated if Executive
obtains comparable substitute coverage from another employer at any time during
such 24-month period.  Executive agrees
to advise the Bank and MB immediately if such comparable substitute coverage is
obtained from another employer. 
Notwithstanding any provision to the contrary in this Subparagraph F.5,
no severance benefits shall be payable to Executive hereunder if Executive’s
employment is terminated for any of the reasons delineated in Subparagraphs
F.1, F.2 or F.3 hereof or while grounds for termination under such
Subparagraphs exist.


 


(b)                                 A “Change in Control” of the Bank occurs upon
the effective date of the first to occur of the following events:


 


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(i)                                     Merger, Consolidation, and
Other Transactions.  Any (A) merger
where the Bank or MB, or a corporation in which the Bank’s or MB’s shareholders
as constituted immediately prior to the merger do not own at least 50% of such
corporation’s common stock or 50% of the common stock of the parent of such
corporation following such merger in the same proportions as their ownership
interests in the Bank or MB prior to such transaction, is not the surviving
corporation; (B) a transfer of all or a substantial portion (50% or more)
of the assets of the Bank or MB to another corporation or other person in which
the Bank’s or MB’s shareholders as constituted immediately prior to such
transfer do not own at least 50% of the common stock or 50% of the common stock
of the parent of such corporation (or an equivalent economic interest in the
case of a transferee that is not a corporation) following such transfer in the
same proportions as their ownership interests in the Bank or MB prior to such
transaction; or (C) the liquidation or dissolution of the Bank or MB,
except for a liquidation or dissolution in which the assets and liabilities of the
Bank or MB are transferred to a transferee in which the owners of the Bank’s or
MB’s common stock as constituted immediately prior to the transaction own at
least 50% of the common stock or 50% of the common stock of the parent of the
transferee (or an equivalent economic interest in the case of a transferee that
is not a corporation) following such liquidation or dissolution in the same
proportions as their ownership interests in the Bank or MB prior to such
transaction; or


 


(ii)                                  Majority Stockholder.  Any person (as such term is used in Section 13(d) of
the securities Exchange Act of 1934, as amended (the “Exchange Act”)), together with its
affiliates (but excluding the Bank’s employee benefit plans and the individuals
who were the Bank’s or MB’s officers or directors on the date of this Agreement
or their affiliates), becomes the beneficial owner (within the meaning of Rule 13(d)(3) under
the Exchange Act) of more than 50% of the Bank’s or MB’s outstanding common
stock.


 


(iii)                               Regulatory Exception.  Notwithstanding anything else to the contrary
set forth herein, a “Change in Control” shall not include any sale of stock or
securities, merger, transfer of assets, consolidation, liquidation,
reorganization or other transaction instituted by or at the request of the OCC,
FRB or the Federal Deposit Insurance Corporation to resolve any supervisory
concerns respecting the Bank or MB.


 


(c)                                  Notwithstanding anything to
the contrary in this Subparagraph F.5, no severance benefits shall be payable
to Executive hereunder if Executive’s employment is terminated for any of the
reasons delineated in Subparagraphs F.1, F.2 or F.3 hereof or while grounds for
termination under such Subparagraphs exist.


 


6.                                       Golden
Parachute Limitation.  Severance
compensation under Subparagraphs F.4 and F.5 hereof will be reduced as provided
below to avoid the penalties imposed on “parachute payments” under the Internal
Revenue Code of 1986 (the “Code”).


 


(a)                                  If the present value of all
Executive’s severance compensation provided by MB or the Bank under
Subparagraph F.4 or F.5 hereof and outside this Agreement is high enough to
cause any such payment to be a “parachute payment” (as defined in Section 280G(b)(2) of
the Code), then one or more of such payments will be reduced by the minimum
amount required to prevent the severance compensation under this Agreement from
being a “parachute payment.”


 


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(b)                                 Executive may direct the
Bank and MB regarding the order of reducing severance compensation and other
payments from the Bank or MB to comply with this Subparagraph F.6.


 


7.                                       Section 409A Limitation.  It is the intention of Employer and Executive
that the severance and other benefits payable to Executive under this Agreement
either be exempt from, or otherwise comply with, Section 409A (“Section 409A”) of the Internal Revenue
Code of 1986, as amended. 
Notwithstanding any other term or provision of this Agreement, to the
extent that any provision of this Agreement is determined by Employer, with the
advice of its independent accounting firm or other tax advisors, to be subject
to and not in compliance with Section 409A, including, without limitation,
the definition of “Change in Control” or the timing of commencement and
completion of severance benefit and/or other benefit payments to Executive
hereunder in connection with a merger, recapitalization, sale of shares or
other “Change in Control”, or the amount of any such payments, such provisions
shall be interpreted in the manner required to comply with Section 409A.  Employer and Executive acknowledge and agree
that such interpretation could, among other matters, (i) limit the
circumstances or events that constitute a “change in control;” (ii) delay
for a period of six (6) months or more, or otherwise modify the
commencement of severance and/or other benefit payments; and/or (iii) modify
the completion date of severance and/or other benefit payments.  Employer and Executive further acknowledge
and agree that if, in the judgment of Employer, with the advice of its
independent accounting firm or other tax advisors, amendment of this Agreement
is necessary to comply with Section 409A, Employer and Executive will
negotiate reasonably and in good faith to amend the terms of this Agreement to
the extent necessary so that it complies (with the most limited possible
economic effect on Employer and Executive) with Section 409A.  For example, if this Agreement is subject to Section 409A
and it requires that severance and/or other benefit payments must be delayed
until at least six (6) months after Executive terminates employment, then
Employer and Executive would delay payments and/or promptly seek a written
amendment to this Agreement that would, if permissible under Section 409A,
eliminate any such payments otherwise payable during the first six (6) months
following Executive’s termination of employment and substitute therefor a lump
sum payment or an initial installment payment, as applicable, at the beginning
of the seventh (7th) month following Executive’s termination of employment
which in the case of an initial installment payment would be equal in the
aggregate to the amount of all such payments thus eliminated.


 


G.                                     GENERAL PROVISIONS


 


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


 


2.                                       Indemnification.  To the extent permitted by law, applicable
statutes and the Bylaws or resolutions of the Bank in effect from time to time,
the Bank and MB shall indemnify Executive against liability or loss arising out
of Executive’s actual or asserted 


 


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misfeasance or non-feasance in the performance of Executive’s duties or
out of any actual or asserted wrongful act against, or by, the Bank or MB
including but not limited to judgments, fines, settlements and legal and other
expenses incurred in the defense of actions, proceedings and appeals
therefrom.  However, the Bank and MB
shall have no duty to indemnify Executive with respect to any claim, issue or
matter as to which Executive has been adjudged to be liable to the Bank or MB
in the performance of his duties, unless and only to the extent that the court
in which such action was brought shall determine upon application that, in view
of all of the circumstances of the case, Executive is fairly and reasonably
entitled to indemnification for the expenses which such court shall
determine.  The Bank and MB shall
endeavor to apply for and obtain Directors and Officers Liability Insurance to
indemnify and insure the Bank, MB and Executive from and against the aforesaid
liabilities.  The provisions of this
paragraph shall apply to the estate, executor, administrator, heirs, legatees
or devisees of Executive.  The
obligations of the Bank and MB under this Subparagraph G.2 shall continue
through and after the Term of this Agreement.


 


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


 


4.                                       Non-solicitation.  During the Term and for a period of one year
thereafter, Executive shall not, directly or indirectly, engage or participate
in the solicitation or any attempt to solicit employees of the Bank or MB to
work for any person, firm or business.


 


5.                                       Controlling Law.  This Agreement is to be governed by and
construed in accordance with the laws of the United States and, to the extent
not inconsistent therewith, the laws of the State of California.


 


6.                                       Invalid Provisions.  Should any provision of this Agreement for
any reason be declared invalid, void, or unenforceable by a court of competent
jurisdiction, the validity and binding effect of any remaining portion shall
not be affected, and the remaining portions of this Agreement shall remain in
full force and effect as if this Agreement had been executed with said
provision eliminated.


 


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


 


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8.                                       Notice.  For the purposes of this Agreement, notices,
demands and all other communications provided for in this Agreement shall be in
writing and shall be personally delivered or (unless otherwise specified)
mailed by United States mail, or sent by facsimile, provided that the facsimile
cover sheet contains a notation of the date and time of transmission, and shall
be deemed received:  (i) if
personally delivered, upon the date of delivery to the address of the person to
receive such notice, (ii) if mailed in accordance with the provisions of
this Subparagraph G.8, three (3) business days after the date placed in
the United States mail, or (iii) if given by facsimile, when sent.  Notices shall be addressed to the Bank and MB
at their main office and to Executive at the address then maintained by the
Bank and MB in its records for Executive, or to such other respective addresses
as the parties hereto shall designate to the other by like notice.


 


9.                                       Arbitration.  Any dispute or controversy
arising under or in connection with this Agreement, the inception or
termination of Executive’s employment, or any alleged discrimination or
statutory or tort claim related to such employment, including issues raised
regarding the Agreement’s formation, interpretation or breach, shall be settled
exclusively by binding arbitration in Los Angeles, California in accordance
with the National Rules for the Resolution of Employment Disputes of the
American Arbitration Association (“AAA”).  Without limiting the foregoing, the following
potential claims by Executive could be subject to arbitration under the
Arbitration Agreement:  claims for wages
or other compensation due; claims for breach of any contract or covenant
(express or implied) under which Executive believes he would be entitled to
compensation or benefits; tort claims related to such employment; claims for
discrimination and harassment (including, but not limited to, race, sex,
religion, national origin, age, marital status or medical condition,
disability, sexual orientation, or any other characteristic protected by
federal, state or local law); claims for benefits (except where an employee
benefit or pension plan specifies that its claims procedure shall culminate in
an arbitration or other procedure different from this one); and claims for
violation of any public policy, federal, state or other governmental law,
statute, regulation or ordinance.  The
arbitration will be conducted in Los Angeles County.  The arbitration shall provide for written
discovery and depositions adequate to give the parties access to documents and
witnesses that are essential to the dispute. 
The arbitrator shall have no authority to add to or to modify this
Agreement, shall apply all applicable law, and shall have no lesser and no
greater remedial authority than would a court of law resolving the same claim
or controversy.  The arbitrator shall
issue a written decision that includes the essential findings and conclusions
upon which the decision is based, which shall be signed and dated.  Executive and the Bank and MB shall each bear
his or their own costs and attorneys’ fees incurred in conducting the
arbitration and, except in such disputes where Executive assets a claim
otherwise under a state or federal statute prohibiting discrimination in
employment (“a  Statutory Claim”), or unless required
otherwise by applicable law, shall split equally the fees and administrative
costs charged by the arbitrator and AAA between Executive, on the one hand, and
Bank and MB on the other hand.  In
disputes where Executive asserts a Statutory Claim against the Bank or MB,
Executive shall be required to pay only the AAA filing fee to the extent such
filing fee does not exceed the fee to file a complaint in state or federal
court.  Executive shall pay the balance
of the arbitrator’s fees and administrative costs.  Judgment may be entered on the arbitrator’s
award in any court having jurisdiction.


 


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IN WITNESS WHEREOF, the parties hereto have executed this
Agreement as of the day and year first above written.


 


	
   

  	
  BANK
  OF MANHATTAN, N.A.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/Harry
  Chenoweth

  
	
   

  	
   

  	
  Harry Chenoweth

  
	
  /s/ Jeffrey M.
  Watson

  	
   

  	
   

  	
  Chairman,Compensation
  Committee

  
	
  Jeffrey
  M. Watson

  	
  MANHATTAN
  BANCORP

  
	
  (“Executive”)

  	
   

  
	
   

  	
  By:

  	
  /s/Harry
  Chenoweth

  
	
   

  	
   

  	
  Harry Chenoweth

  
	
   

  	
   

  	
  Chairman,
  Compensation Committee

  
				



 


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