EXHIBIT 10.1 


 


TRANSITION SERVICES
AGREEMENT DATED AS OF DECEMBER 18, 2012 BETWEEN THE GROUP AND BBVA


 


EXECUTION VERSION


TRANSITION SERVICES AGREEMENT


dated
as of


December
18, 2012



between



ORIENTAL FINANCIAL GROUP INC. 



and



BANCO BILBAO VIZCAYA ARGENTARIA, S.A.


 


 


TABLE OF CONTENTS


Page


Article 1

Definitions


Section
1.01.  Definitions.......................................................................................... 1


Article 2

Purchase And Sale Of Services


Section
2.01.  Purchase and Sale of Services............................................................ 4


Section
2.02.  Third Party Licenses and Consents.................................................... 5


Section
2.03.  Third Party Providers........................................................................ 5


Section
2.04.  Cooperation....................................................................................... 5










 




 










 








 




 








Article 3

Service Costs; Other Charges


Section
3.01.  Service Costs Generally..................................................................... 5


Section
3.02. Taxes................................................................................................... 6


Section
3.03.  Invoicing and Settlement.................................................................... 6


Article 4

The Services


Section
4.01.  Standards of Service........................................................................... 7


Section
4.02.  Changes to Services........................................................................... 7


Section
4.03.  Management of Services By Provider................................................ 7


Section
4.04.  Liaisons.............................................................................................. 8


Article 5

Disclaimer, Liability And Indemnification


Section
5.01.  Exclusion Of Warranties...................................................... 8


Section
5.02.   Limitation of Liability.......................................................................... 9


Section
5.03.   Indemnification of
Provider by Recipient............................................ 9


Section
5.04.   Indemnification of
Recipient by Provider.......................................... 10


Section
5.05.  Indemnification as Exclusive Remedy.............................................. 10


Article 6

Term and Termination


Section
6.01.   Term................................................................................................. 10


Section
6.02.   Termination...................................................................................... 10


Section
6.03.   Effect of Termination........................................................................ 11


Article 7

Additional Agreements


Section
7.01.  Confidential Information.................................................................. 12


Section
7.02.  Ownership of Assets......................................................................... 13


Section
7.03.  Security............................................................................................. 13


Section
7.04.  Access to Information....................................................................... 13


Section
7.05.  Compliance with Applicable Law.................................................... 14


Section
7.06.  Labor Matters................................................................................... 14


Section
7.07.  Record Retention.............................................................................. 14


Article 8

Representations And Warranties


Section
8.01.  Representations and Warranties of Provider.................................... 14


Section
8.02.  Representations and Warranties of Recipient................................... 15










 




 










 








 




 








Article 9

Miscellaneous


Section
9.01.   No Agency; Independent
Contractor Status...................................... 16


Section
9.02.   Subcontractors.................................................................................. 16


Section
9.03.   Force Majeure.................................................................................. 16


Section
9.04.   Entire Agreement.............................................................................. 17


Section
9.05.   Notices.............................................................................................. 17


Section
9.06.  Governing Law................................................................................. 18


Section
9.07.  Jurisdiction....................................................................................... 18


Section
9.08.  Specific Performance....................................................................... 18


Section
9.09.   WAIVER OF JURY TRIAL............................................................... 19


Section
9.10.   Severability....................................................................................... 19


Section
9.11.   Amendments and Waivers................................................................. 19


Section
9.12.  Successors and Assigns.................................................................... 19


Section
9.13.  Counterparts; Effectiveness; Third Party Beneficiaries.................... 20


Section
9.14.  Construction and Interpretation....................................................... 20


 


Schedule A     Services


Schedule B      Liaisons


 


TRANSITION SERVICES
AGREEMENT


This TRANSITION SERVICES AGREEMENT (this “Agreement”) is
entered into as of December 18, 2012 by and between Banco Bilbao Vizcaya
Argentaria, S.A., a limited liability company incorporated in Spain (“Provider”),
and Oriental Financial Group Inc., a Puerto Rico corporation (“Recipient”). 


RECITALS


WHEREAS, Provider and Recipient have entered enter into an
Acquisition Agreement dated as of June 28, 2012 (the “Acquisition Agreement”)
providing for the sale by Provider of the Transferred Shares to Recipient, as
more fully set forth therein; and


WHEREAS, the Acquisition Agreement contemplates that the parties
hereto will, at the Closing, enter into this Agreement for the provision of
certain services to the Companies, on the terms and conditions set forth
herein.


NOW, THEREFORE, for good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the parties hereto, for
themselves, their successors and permitted assigns, hereby agree as follows:


Article 1

Definitions


Section 1.01.  Definitions.  (a)Any capitalized
term that is used herein but not defined herein shall have the meaning assigned
to such term in the Acquisition Agreement.










 




 










 








 




 








                     
(b)           
As used in this Agreement, the following terms shall have the following
meanings, applicable both to the singular and the plural forms of the terms
described:


“Affiliate” means, with respect to any Person, any other
Person directly or indirectly controlling, controlled by, or under common
control with such Person.  For purposes of this definition, “control”
when used with respect to any Person means the power to direct the management
and policies of such Person, directly or indirectly, whether through the
ownership of voting securities, by contract or otherwise, and the terms “controlling”
and “controlled” have correlative meanings.


“Applicable Law” means, with respect to any Person, any
transnational, domestic or foreign federal, commonwealth, state or local law
(statutory, common or otherwise), constitution, treaty, convention, ordinance,
code, rule, regulation, order, injunction, judgment, decree, ruling or other
similar requirement enacted, adopted, promulgated or applied by a Governmental
Authority that is binding upon or applicable to such Person or its Affiliates,
as amended unless expressly specified otherwise.


“Business Day” means a day, other than Saturday, Sunday
or other day on which commercial banks in New York, New York, San Juan, Puerto
Rico or Madrid, Spain are authorized or required by Applicable Law to close.


“Governmental Authority” means any transnational,
domestic or foreign federal, commonwealth, state or local governmental,
regulatory or administrative authority (including any self-regulatory
authority), department, court, agency or official, including any political
subdivision thereof.


“Insolvency Event” means with respect to either party, as
applicable, (i) the making by such party of any assignment for the benefit of
creditors of all or substantially all of its assets or the admission by such
party in writing of its inability to pay all or substantially all of its debts
as they become due; (ii) the adjudication of such party as bankrupt or
insolvent or the filing by such party of a petition or application to any
tribunal for the appointment of a trustee or receiver for such party or any
substantial part of the assets of such party; or (iii) the commencement of any
voluntary or involuntary bankruptcy proceedings (and, with respect to
involuntary bankruptcy proceedings, the failure of such proceedings to be
discharged within 60 days), reorganization proceedings or similar proceeding
with respect to such party or the entry of an order appointing a trustee or receiver
or approving a petition in any such proceeding.


“Interest Rate” means (i) LIBOR plus (ii) 200
basis points.


“LIBOR” means the one-year London Interbank Offered Rate
as of 11 a.m., London time, on the day that is three Business Days preceding
the relevant date of payment, as published by The Wall Street Journal,
U.S. Edition.


“Mark-up Percentage” means 0% from the date hereof until
the six month anniversary of the date hereof, and 15% thereafter.


“Person” means an individual, corporation, partnership,
limited liability company, association, trust or other entity or organization,
including a Governmental Authority.


“Provider Systems”  means any computer software
program or routine or part thereof owned, licensed or provided by Provider, its
Affiliates or its suppliers on Provider’s or any of its Affiliates’ behalf,
each as 







 




 










 








 




 








modified, maintained or enhanced from time to
time by Provider, Recipient, any of their respective Affiliates or any third
party.


“Recipient Systems”  means any computer software
program or routine or part thereof owned, licensed or provided by Recipient,
its Affiliates or its suppliers on Recipient’s or any of its Affiliates’
behalf, each as modified, maintained or enhanced from time to time by
Recipient, Provider, any of their respective Affiliates or any third party.


“Schedule” means a Schedule attached hereto forming part
of this Agreement.


“Service Costs” means, with respect to any Service, (i)
the charge for such Service based on the pricing terms on which such Service
was provided by Provider or its Affiliates (other than the Companies) to the
Companies during the most recent relevant billing period prior to Closing, as
may be adjusted from time to time to reflect changes after the date hereof in
Provider’s cost of providing the Services as set forth in Section 3.01(b), plus  (ii) an amount equal to the product of (x) the Mark-up Percentage and (y)
the amount determined in accordance with clause (i).


“Subsidiary” means, with respect to any Person, any other
entity of which securities or other ownership interests having ordinary voting
power to elect a majority of the board of directors or other persons performing
similar functions are at the time directly or indirectly owned by such first
Person.


“Systems”  means the Provider Systems or the
Recipient Systems, individually, or the Provider Systems and the Recipient
Systems, collectively, as the context may indicate or require.


                                                          
(c)                       
Each of the following terms is defined in the Section set forth opposite
such term:


	
  
  Term

  

  	
  
  Section

  

  
	
  Acquisition Agreement

  	
  Recitals

  
	
  Actions

  	
  5.03

  
	
  Additional Services

  	
  2.01(a)

  
	
  Agreement

  	
  Preamble

  
	
  Baseline Period

  	
  4.01(a)

  
	
  Confidential Information

  	
  7.01

  
	
  force majeure

  	
  9.03

  
	
  Invoice Date

  	
  3.03(a)

  
	
  Liaison

  	
  4.04(a)

  
	
  Payment Date

  	
  3.03(b)

  
	
  Provider

  	
  Preamble

  
	
  Provider Indemnified Person

  	
  5.02

  
	
  Recipient

  	
  Preamble

  
	
  Recipient Indemnified Person

  	
  5.04

  
	
  Services

  	
  2.01

  
	
  Services IP

  	
  7.02(c)

  












 




 










 








 




 








Article 2

Purchase And Sale Of Services


Section 2.01.  Purchase and
Sale of Services.  


                      
(a)           
On the terms and subject to the conditions of this Agreement and in
consideration of the charges described in Section 3.01 below, Provider
agrees to provide to Recipient, or procure the provision to Recipient of, and Recipient
agrees to purchase from Provider, the transition services set forth on Schedule
A (the “Services”).  During the term of this Agreement, Recipient
may request that Provider provide additional services (“Additional Services”)
and Provider shall consider all such requests in good faith.  If Provider
determines to provide any such Additional Services the parties shall negotiate
in good faith the terms on which such Additional Services will be provided and,
if those terms are mutually agreed upon, Schedule A shall be amended
pursuant to Section 9.11 to reflect such addition and the Additional Service
will be deemed to form a part of the Services.  The foregoing provision shall
not be construed as imposing any obligation on the part of Provider to enter
into any agreement with the Recipient or to negotiate with Recipient in the
event that Provider determines in good faith not to provide the requested
Additional Service.


                     
(b)           
It is understood that (i) the Services to be provided to Recipient under
this Agreement shall only be provided for the
purpose of conducting the business of the Companies substantially as
conducted prior to Closing, and (ii) Provider may satisfy its obligation to
provide or procure Services hereunder by causing one or more of its Affiliates
to provide or procure such Services, which Affiliates it may change at its
discretion from time to time, provided  that Provider shall remain
responsible for the performance of such Affiliates. 


                      
(c)           
Except for the Services expressly contemplated to be provided in
accordance with this Section 2.01, Provider shall have no obligation under this
Agreement to provide any services to Recipient.


Section 2.02.  Third Party
Licenses and Consents.  Provider and Recipient shall use commercially
reasonable efforts to obtain, and to keep and maintain in effect, all
governmental or third party licenses and consents required for the provision of
any Service by Provider in accordance with the terms of this Agreement; provided  that if
Provider is unable to obtain any such license or consent, Provider shall
promptly notify Recipient in writing and shall, and shall cause its Affiliates
to, use commercially reasonable efforts to implement an appropriate alternative
arrangement.  The costs relating to obtaining any such licenses or
consents shall be borne by Recipient; provided  that Provider shall not
incur any such costs without the prior written consent of Recipient.  If any
such license, consent or alternative arrangement is not available despite the
commercially reasonable efforts of Provider and its Affiliates or as a result
of Recipient failing to consent to the incurrence of costs relating to
obtaining any such license or consent, Provider shall not be required to
provide the affected Services.  


Section 2.03.  Third Party Providers. 
If Provider receives written notice from any third party service provider that
such Person intends to terminate a service pursuant to which Provider provides
a Service to Recipient, then Provider shall provide a copy of such written
notice to Recipient and shall use commercially reasonable efforts to secure the
continued provision of that Service from such third party or an alternative
service provider.  If Provider is unable to secure the continued provision of
that Service from such third party or an alternative service provider, Provider
shall not be required to provide the affected Service.


Section
2.04.  Cooperation.  Provider and Recipient agree to cooperate in
providing for an orderly transition of Services, including Services terminated
pursuant to Section 6.02, to Recipient or a successor service provider
designated by Recipient. 










 




 










 








 




 








Article 3

Service Costs; Other Charges


Section
3.01.  Service Costs Generally.  (a)Unless the applicable Schedule
hereto expressly provides otherwise (in which event the parties agree to the
costs set forth therein) or the parties agree in writing to a different
arrangement, for each period in which Recipient receives a Service hereunder,
Recipient shall pay Provider the Service Costs for the applicable Service.


                     
(b)           
If at any time, or from time to time, after the date hereof there is a
material decrease in Provider’s cost of providing a given Service, the Service
Cost with respect to such Service will be appropriately adjusted by Provider to
account for such change.  If at any time, or from time to time, after the
date hereof there is a material increase in Provider’s cost of providing a
given Service, Provider will notify Recipient of the increase in writing,
specifying the reasons for the increase.  Recipient shall have the option to (i)bear the increase or (ii)notify Provider within five
Business Days of receipt of Provider’s notice of such increase that Recipient
wishes to immediately terminate the relevant Service notwithstanding the notice
requirement in Section 6.02(a).  Unless a termination notice is provided
pursuant to the foregoing sentence, the increased Service Cost with respect to
the affected Service will take effect five Business Days following Recipient’s
receipt of Provider’s notice of such increase.


Section 3.02. Taxes.  (a)  Recipient shall pay
all applicable sales or use taxes incurred with respect to provision of the
Services.  Such taxes shall be incremental to other payments or charges
identified in this Agreement.  


(b)        All sums payable under this
Agreement shall be paid free and clear of all deductions or withholdings unless
the deduction or withholding is required by Applicable Law, in which event the
amount of the payment due from the party required to make such payment (other
than amounts of interest) shall be increased to an amount which after any
withholding or deduction leaves an amount equal to the payment which would have
been due if no such deduction or withholding had been required.  The parties
shall cooperate with each other in determining the extent to which any such
deduction or withholding applies under the circumstances and shall provide and
make available to each other any resale certificate, information regarding
out-of-state use of materials, services or sale, and other exemption
certificates or information reasonably requested by the other party.


Section 3.03.  Invoicing
and Settlement.  (a)Unless
any Schedule hereto indicates otherwise or the parties agree in writing to a
different arrangement, Provider shall invoice or notify in writing the
Recipient on a monthly basis for the charges for Services hereunder for the
prior month (the date of delivery of such invoice, the “Invoice Date”). 



                     
(b)           
Recipient agrees to pay on or before the date (each, a “Payment Date”)
that is 30 days after the Invoice Date by wire transfer of immediately
available funds payable to the order of Provider to such account(s) designated
by Provider all amounts invoiced by Provider pursuant to Section 3.03(a).  If Recipient disputes any invoice or other request for payment, then Recipient
may withhold the disputed amount and will notify Provider in writing within
seven days of the receipt of the invoice or request for payment and the dispute
will be resolved in accordance with Section 4.04.  Where only part of an
invoice is disputed, Recipient will pay the undisputed amount on the due date. 
If it is determined that Provider is entitled to all or any portion of the
disputed amount, Recipient will pay Provider the applicable amount within 10
days of such determination and such payment shall include interest at the
Interest Rate from the original relevant Payment Date to the actual payment
date.










 




 










 








 




 








Article 4

The Services


Section 4.01.  Standards of
Service.  (a)Unless
any Schedule hereto indicates otherwise or the parties agree in writing to a
different arrangement, the level or volume of any specific Service required to
be provided to Recipient hereunder shall be at a level or volume consistent in
all material respects with the level or volume, as the case may be, of such
specific Service as utilized by the Companies during the twelve-month period
prior to the date hereof (the “Baseline Period”).


                     
(b)           
The manner, nature, quality and standard of care applicable to the
delivery by Provider of the Services hereunder shall be substantially the same
as that of similar services which Provider provided for the Companies during
the Baseline Period.


                      
(c)           
Provider shall have no obligation to provide any Services hereunder in
respect of any business, assets or properties not forming part of the business
of the Companies as of the date hereof.


Section 4.02.  Changes to Services.  It
is understood and agreed that Provider may from time to time modify or change
the manner, nature, quality and/or standard of care of any Service provided to
Recipient to the extent Provider is making a similar change in the performance
of such services for the Provider and its Affiliates and provided that any such
modification, change or enhancement will not reasonably be expected to
materially affect such Service.  Provider shall furnish to Recipient
substantially the same notice (in content and timing), if any, as Provider
furnishes to its own organization with respect to such modifications or
changes.  


Section 4.03.  Management of Services By Provider.  Except
as may otherwise be expressly provided in this Agreement, the management of and
control over the provision of the Services by Provider shall reside solely with
Provider and notwithstanding anything to the contrary Provider shall be
permitted to choose the personnel, methodology, systems, applications and third
party providers it utilizes in the provision of such Services; provided that
Provider shall remain responsible for the performance of the Services in
accordance with this Agreement.  The provision, use of and access to the
Services shall be subject to (i) Provider’s business, operational and technical
environment, standards, policies and procedures as in effect from time to time,
(ii) Applicable Law and (iii) the terms of this Agreement.


Section 4.04.  Liaisons.  (a)  Each party shall
designate one representative to act as such party’s primary contact person in
connection with the Services (each, a “Liaison”).  The Liaisons will
oversee the implementation and ongoing operation of this Agreement and shall
attempt in good faith to resolve disputes between the parties.  The parties
have designated their respective initial Liaisons and provided contact
information therefor on Schedule B.  The parties shall ensure that their
respective Liaisons shall meet in person or telephonically at such times as are
reasonably requested by Provider or Recipient to review and discuss the status
of, and any issues arising in connection with, the Services or this Agreement. 
Each party may re-designate its Liaison(s) from time to time; provided 
that it shall notify the other party in writing of the name and contact
information for the newly designated Liaison(s) in accordance with Section 9.05.


                     
(b)           
If the Liaisons are unable to make a decision, resolve a dispute or
agree upon any necessary action, the unresolved matter shall be referred to a
senior officer of each of Provider and Recipient notified to the other party
for such purpose from time to time, who shall attempt in good faith within a
period of 14 days to conclusively resolve any such matter.  If such senior
officers of the parties are unable to resolve the dispute within 30 days from
the date such dispute was submitted for consideration or such longer period as
the parties may agree, either party may pursue its remedies under Section 9.07.  










 




 










 








 




 








Article 5

Disclaimer, Liability And Indemnification


Section 5.01.  Exclusion
Of Warranties.  EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT, THE
SERVICES ARE PROVIDED “AS-IS” WITH NO WARRANTIES, AND PROVIDER EXPRESSLY
EXCLUDES AND DISCLAIMS ANY WARRANTIES UNDER OR ARISING AS A RESULT OF THIS
AGREEMENT, WHETHER EXPRESS, IMPLIED OR STATUTORY, INCLUDING, WITHOUT
LIMITATION, THE IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR
PURPOSE, TITLE, NON-INFRINGEMENT OR ANY OTHER WARRANTY WHATSOEVER.


Section 5.02.   Limitation
of Liability.  (a)Recipient
agrees that, except for the indemnity obligation set forth in Section 5.04, none of Provider, its Affiliates or any of its or their respective
directors, officers, agents, consultants, representatives and/or employees
(each, a “Provider Indemnified Person”) shall have any liability,
whether direct or indirect, in contract or tort or otherwise, to Recipient or
its Affiliates or any other Person for or in connection with the Services
rendered or to be rendered by or on behalf of any Provider Indemnified Person
pursuant to this Agreement, the transactions contemplated hereby or any actions
or inactions by or on behalf of a Provider Indemnified Person in connection
with any such Services or the transactions contemplated hereby, except to the
extent any damages have resulted from such Provider Indemnified Person’s gross
negligence or willful misconduct in connection with any such Services, actions
or inactions.


                     
(b)           
Notwithstanding the provisions of Section 5.02(a), no Provider
Indemnified Person or Recipient Indemnified Person shall be liable for any
special, indirect, incidental, consequential or punitive damages of any kind
whatsoever in any way due to, resulting from or arising in connection with any
of the Services or the performance of or failure to perform Provider’s or
Recipient’s obligations under this Agreement, as applicable.  This disclaimer
applies without limitation (i) to claims arising from the provision of the
Services or any failure or delay in connection therewith, (ii) to claims for
lost profits or opportunities, (iii) regardless of the form of action, whether
in contract, tort (including negligence), strict liability, or otherwise, and
(iv) regardless of whether such damages are foreseeable or whether the Provider
or Recipient, as applicable, or any of its Affiliates has been advised of the
possibility of such damages.


                      
(c)           
In addition to the foregoing, each party hereto agrees that it shall, in
all circumstances, use commercially reasonable efforts to mitigate and
otherwise minimize its damages and those of its Affiliates, whether direct or
indirect, due to, resulting from or arising in connection with any failure by
the other party to comply fully with its obligations under this Agreement.


Section 5.03.   Indemnification of
Provider by Recipient.  Recipient agrees to indemnify and hold harmless
each Provider Indemnified Person from and against any damages, and to reimburse
each Provider Indemnified Person for all costs, damages, liabilities and fees
and expenses (including reasonable attorneys’ fees and expenses and any other
expenses reasonably incurred in connection with investigating, prosecuting or
defending any Action) (collectively, “Losses”) incurred in
investigating, preparing, pursuing, or defending any claim, action, proceeding,
or investigation, whether or not in connection with pending or threatened
litigation and whether or not any Provider Indemnified Person is a party
(collectively, “Actions”), arising out of or in connection with Services
rendered or to be rendered by or on behalf of any Provider Indemnified Person
pursuant to this Agreement, the transactions contemplated hereby or any actions
or inactions by or on behalf of any Provider Indemnified Person in connection
with any such Services or transactions; provided  that Recipient shall
not be responsible for any Losses of any Provider Indemnified Person to the
extent such Losses have 







 




 










 








 




 








resulted from such Provider
Indemnified Person’s gross negligence or willful misconduct in connection with
any of such Services, actions or inactions. 


Section 5.04.   Indemnification of
Recipient by Provider.  Provider agrees to indemnify and hold harmless the
Recipient, each of its Affiliates and its and their respective directors,
officers, agents, consultants, representatives and/or employees (each, a “Recipient
Indemnified Person”) from and against any Losses incurred in investigating,
preparing, or defending any Action, in each case solely to the extent such
Losses have arisen out of the gross negligence or willful misconduct of any
Provider Indemnified Person in connection with the Services rendered or to be
rendered pursuant to this Agreement.


Section 5.05. 
Indemnification as Exclusive Remedy.  Except for the termination
rights provided under Sections 6.02(b) and 6.02(c), the indemnification
provisions of this Article 5 shall be the exclusive remedy for money damages
for breach of this Agreement and any matters relating to this Agreement.


Article 6

Term and
Termination


Section 6.01.   Term.  Except as otherwise provided in this Article 6 or Section 9.03, or as otherwise agreed in writing by the parties, the term of this
Agreement with respect to each Service shall commence as of the Closing and
shall cease on the earliest of (i) the date set forth in respect of such
Service on the applicable Schedule hereto, (ii) the date that is twelve months
after the Closing Date or (iii) such earlier date as determined in accordance
with Section 6.02.  This Agreement shall terminate in its entirety upon the
expiration of the terms (as determined pursuant to the preceding sentence) of
all Services; provided  that the provisions of Articles 3, 5, 6 and 9 and Sections 7.01 and 7.02 shall survive any such termination
indefinitely.


Section 6.02.   Termination.
 (a)Except
as otherwise provided in any Schedule hereto, Recipient may from time to time
terminate this Agreement with respect to one or more of the Services it
receives, in whole or in part, upon giving at least 60 days’ prior notice to
Provider.


                     
(b)           
Provider may terminate any Service or any part thereof it provides at
any time if (i)Recipient shall have failed to perform any of its material
obligations under this Agreement relating to any such Service, (ii)Provider has
notified Recipient in writing of such failure and (iii)such failure (A)shall have continued uncured for a period of 30 days after receipt by Recipient of
written notice of such failure or (B)is incapable of remedy.  For the avoidance
of doubt, the failure by Recipient to pay the full amount of any invoiced
amount when due shall be considered a breach of Recipient’s material
obligations under this Agreement.


                      
(c)           
Recipient may terminate any Service it receives as provided in the
applicable Schedule or at any time if (i)Provider shall have failed to
perform any of its material obligations under this Agreement relating to any
such Service, (ii)Recipient has notified Provider in writing of such failure
and (iii)such failure (A)shall have continued for a period of 30 days after
receipt by Provider of written notice of such failure or (B)is incapable of
remedy.


                     
(d)           
Upon completion of the sale or other disposition by Recipient of any
portion of the business, assets or properties of the Companies, Provider’s
obligation to provide any Service in respect of the business, assets or
properties so disposed shall terminate automatically and without any notice or
other action by Provider, and the aggregate level or volume of such Service
required to be provided to the Recipient, and (if applicable and if the
Recipient has given Provider at least 60 days’ prior notice of the sale or
disposition and 







 




 










 








 




 








subject to Section 6.03(a)(ii)) the Service Costs payable by Recipient in respect thereof, shall be reduced
appropriately.


                      
(e)           
Either party may terminate this Agreement at any time with immediate
effect upon serving written notice upon the other party if the other party
suffers an Insolvency Event.


Section 6.03.   Effect of Termination.  (a)Other than as required by Applicable Law, upon termination of any Service pursuant to Section 6.02, Provider shall have no further obligation to provide the terminated
Service and Recipient shall have no obligation to pay any fees relating to such
Services; provided  that, notwithstanding such termination, Recipient
shall remain liable to Provider for (i)Service Costs and other fees owed and
payable in respect of Services provided prior to the effective date of the
termination and (ii)in
the case of a termination under Section 3.01(b) or Section 6.02(a), (b) or (d), any costs incurred by Provider between the time of such termination and
the time the provision of the relevant Service(s) would have terminated absent
such early termination to the extent Provider cannot avoid the incurrence of
such costs using commercially reasonable efforts (other than, in the case of a
termination under Section 3.01(b), for any increase in such costs identified in
writing by Provider pursuant to Section 3.01(b)).


                     
(b)           
Termination of this Agreement as provided for herein shall not prejudice
or affect any rights or remedies which shall have accrued to either party, a
Recipient Indemnified Person or a Provider Indemnified Person.


Article 7

Additional Agreements


Section 7.01.  Confidential
Information


                      
(a)           
The parties hereby covenant and agree to keep confidential all
Confidential Information relating to the other party or any of such other
party’s Affiliates.  Without limiting the generality of the foregoing, each
party shall cause its employees and agents to exercise the same level of care
with respect to Confidential Information relating to the other party or any of
its Affiliates as it would with respect to proprietary information, materials
and processes relating to itself or any of its Affiliates.  “Confidential
Information” shall mean all information, materials and processes relating
to a party or any Affiliate of such party obtained by the other party or any
Affiliate of such other party at any time (whether prior to or after the date
hereof) in any format whatsoever (whether orally, visually, in writing,
electronically or in any other form) arising out of the rendering or receipt of
Services hereunder (or preparations for the same or for the termination
thereof) and shall include, but not be limited to, economic and business
information or data, business plans, computer software and information relating
to employees, vendors, customers, products, financial performance and
projections, processes, strategies and systems but shall not include (i)
information which is or becomes generally available to the public other than by
release in violation of the provisions of this Section 7.01(a), (ii) information which is or becomes available on a non-confidential basis to a party from a
source other than the other party to this Agreement, provided the party in
question reasonably believes that such source is not or was not bound by a
legal or contractual obligation to the other party or one of its Affiliates to
hold such information confidential and (iii) information acquired or developed
independently by a party without use or reference to otherwise Confidential
Information of the other party.  Except with the prior written consent of the
other party, each party will use the other party’s Confidential Information
only in connection with the performance of its obligations hereunder and each
party shall use commercially reasonable efforts to restrict access to the other
party’s Confidential Information to those employees of such party requiring
access for the purpose of providing or receiving Services hereunder. 
Notwithstanding any provision of this Section 7.01(a) to the contrary, a party 







 




 










 








 




 








may disclose such portion of the Confidential Information
relating to the other party to the extent, but only to the extent, the
disclosing party reasonably believes that such disclosure is required under
Applicable Law or the rules of a Governmental Authority; provided  that
if permissible under Applicable Law and practicable, the disclosing party shall
first notify the other party hereto of such requirement and allow such party a
reasonable opportunity to seek a protective order or other appropriate remedy
to prevent such disclosure.  The parties acknowledge that money damages would
not be a sufficient remedy for any breach of the provisions of this Section 7.01(a) and that the non-breaching party shall be entitled to equitable
relief in a court of law in the event of, or to prevent, a breach of this Section 7.01(a).  


Section 7.02.  Ownership of
Assets.  (a)Provider Systems and any and all enhancements thereof or
improvements thereto are and shall remain the sole exclusive property of
Provider or its Affiliates and/or their suppliers as applicable.


                     
(b)           
Recipient Systems and any and all enhancements thereof or improvements
thereto are and shall remain the sole exclusive property of Recipient or its
Affiliates and/or their suppliers as applicable.


                      
(c)           
Any Intellectual Property created or developed by Provider during the
term of this Agreement exclusively for Recipient in connection with the performance
of the Services hereunder (the “Services IP”) shall be owned by Provider, but
Provider hereby grants Recipient a worldwide, non-exclusive, fully paid-up,
perpetual, irrevocable, sublicenseable, royalty-free license to use such
Intellectual Property.  For the avoidance of doubt, the Services IP shall not
include enhancements or improvements to the Recipient Systems and the
Transferred Software shall be deemed Recipient Systems to the extent and solely
to the extent, that Seller was providing support to the Companies' use of such
applications as of the Closing Date.


                     
(d)           
If the receipt or provision of the Services hereunder requires the use
by Provider or Recipient, as applicable, of the Intellectual Property of the
Provider or Recipient, as applicable, then Recipient or Provider hereby grants
to the Provider or Recipient, as applicable, the non-exclusive, royalty-free
right to use such Intellectual Property for the sole purpose of, and only to
the extent and for the duration necessary for, the receipt or provision of the
Services hereunder, pursuant to the terms and conditions of this Agreement.


Section 7.03.  Security.  Each
party, its Affiliates and their respective employees, authorized agents and
subcontractors shall only use or access such other party’s Systems, premises or
data to the extent such Person is authorized by the other party or pursuant to
the terms hereof.  Each party, its Affiliates and their employees, authorized
agents and subcontractors shall comply with the other party’s policies and
procedures in relation to the use and access of the other party’s Systems
provided that they do not conflict with the terms of this Agreement; provided 
that to the extent such policies and procedures of Recipient make the provision
of a given Service impracticable, Provider will be relieved of the obligation
to provide such Service.


Section 7.04.  Access to Information.  Subject
to Applicable Law and Section 7.03, Recipient shall, and shall cause its
Affiliates to, with respect to any Service during the term of such Service,
upon reasonable advance notice, afford Provider and its representatives
reasonable access, during normal business hours, to the employees, properties,
books and records and other documents that are reasonably requested in
connection with the provision and receipt of such Service hereunder.


Section
7.05.  Compliance with Applicable Law.  Each party shall at all times
fully comply with all Applicable Law to which such party and its Affiliates (to
the extent such Affiliates are engaged in the receipt or provision of Services)
is subject in connection with the receipt or provision of Services hereunder,
as applicable.










 




 










 








 




 








Section 7.06.  Labor
Matters.  All labor matters relating to employees of Provider and its
Affiliates (including, without limitation, employees involved in the provision
of Services to Recipient or any of its Affiliates) shall be within the
exclusive control of Provider, and Recipient shall not take any action
affecting such matters.  Nothing in this Agreement is intended to transfer the
employment of employees engaged in the provision of any Service from one party
to the other.  All employees and representatives of a party and any of its
Affiliates will be deemed for all compensation, employee benefits, tax and
social security contribution purposes to be employees or representatives of
such party or its Affiliates (or their subcontractors) and not employees or
representatives of the other party or any of its Affiliates (or their
subcontractors).  In providing the Services, such employees and representatives
of Provider and its Affiliates (or their subcontractors) will be under the
direction, control and supervision of Provider or its Affiliates (or their
subcontractors) and not of Recipient or its Affiliates.


Section
7.07.  Record Retention.  Each party shall take reasonable steps to
preserve and maintain complete and accurate accounts, books, and records of and
supporting documentation relating to the Services provided hereunder, which
records shall be retained by such party and/or its Affiliates for the period of
time specified in such party’s record retention policies and procedures (which
are governed by Applicable Law).


Article 8

Representations And Warranties


Section
8.01.  Representations and Warranties of Provider.  Provider represents
and warrants to Recipient as of the date hereof that:


                      
(a)           
The execution, delivery and performance by Provider of this Agreement
are within Provider’s corporate powers and have been duly authorized by all
necessary corporate action on the part of Provider.  This Agreement constitutes
a valid and binding agreement of Provider enforceable against Provider in
accordance with its terms (subject to applicable bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium and other laws affecting
creditors’ rights generally and general principles of equity).


                     
(b)           
The execution, delivery and performance by Provider of this Agreement
require no action by or in respect of, or filing with, any Governmental
Authority other than any such action or filing that has already been taken or
made or as to which the failure to make or obtain would not reasonably be
expected to materially impede or delay the performance by Provider of its
obligations hereunder.


                      
(c)           
The execution, delivery and performance by Provider of this Agreement do
not and will not (i)violate the certificate of incorporation or bylaws of
Provider, (ii)violate any Applicable Law or (iii)constitute a default under or give rise to any right of termination, cancellation or
acceleration of any right or obligation under any provision of any agreement or
other instrument binding upon Provider, with such exceptions, in the case of
clauses (ii) and (iii), as would not reasonably be expected to materially
impede or delay the performance by Provider of its obligations hereunder.


Section
8.02.  Representations and Warranties of Recipient.  Recipient
represents and warrants to Provider as of the date hereof that:


                      
(a)           
The execution, delivery and performance by Recipient of this Agreement
are within Recipient’s corporate or other applicable powers and have been duly
authorized by all necessary corporate or other applicable action on the part of
Recipient.  This Agreement constitutes a valid and binding agreement of
Recipient enforceable against Recipient in accordance with its terms (subject
to applicable bankruptcy, 







 




 










 








 




 








insolvency, fraudulent
transfer, reorganization, moratorium and other laws affecting creditors’ rights
generally and general principles of equity).


                     
(b)           
The execution, delivery and performance by Recipient of this Agreement
require no action by or in respect of, or filing with, any Governmental
Authority other than any such action or filing that has already been taken or
made or as to which the failure to make or obtain would not reasonably be
expected to materially impede or delay the performance by Recipient of its
obligations hereunder.


                      
(c)           
The execution, delivery and performance by Recipient of this Agreement
do not and will not (i)violate the certificate of incorporation or bylaws or
other equivalent organizational documents of Recipient, (ii)violate any
Applicable Law or (iii)constitute a default under or give rise to any right of
termination, cancellation or acceleration of any right or obligation under any
provision of any agreement or other instrument binding upon Recipient, with
such exceptions, in the case of each of clauses (ii) and (iii), as would not
reasonably be expected to materially impede or delay the performance by
Recipient of its obligations hereunder.


Article 9

Miscellaneous


Section 9.01.   No Agency; Independent Contractor Status.  Nothing in this Agreement shall
constitute or be deemed to constitute a partnership or joint venture between
the parties hereto or constitute or be deemed to constitute any party the agent
or employee of the other party for any purpose whatsoever and neither party
shall have authority or power to bind the other or to contract in the name of,
or create a liability against, the other in any way or for any purpose.  The
parties hereto acknowledge and agree that Provider is an independent contractor
in the performance of each and every part of this Agreement and nothing herein
shall be construed to be inconsistent with this status.  Subject to the terms
and conditions of this Agreement, Provider shall have the authority to select
the means, methods and manner by which any Service is performed.


Section 9.02.   Subcontractors.  Provider may hire or engage one or more subcontractors to
perform all or any of its obligations under this Agreement; provided 
that, (i) Provider shall use the same degree of care in selecting any
subcontractors as it would if such subcontractor was being retained to provide
similar services to Provider and (ii) Provider shall in all cases remain
responsible for ensuring that obligations with respect to the standards of
services set forth in this Agreement are satisfied with respect to any Service
provided by a subcontractor hired or engaged by Provider.


Section 9.03.   Force Majeure.  (a)For purposes of this Section 9.03, “force majeure”
means an event beyond the reasonable control of either party, which by its
nature was not foreseen by such party, or, if it was foreseen, was not
reasonably avoidable, and includes without limitation, acts of God, storms,
floods, riots, fires, sabotage, civil commotion or civil unrest, interference
by civil or military authorities, threat, declaration, continuation, escalation
or acts of war (declared or undeclared) or acts of terrorism, failure or
shortage of energy sources, raw materials or components, strike, walkout,
lockout or other labor trouble or shortage, delays by unaffiliated suppliers or
carriers, and acts, omissions or delays in acting by any Governmental Authority
or the other party.


                     
(b)           
Without limiting the generality of Section 5.02(a), neither party shall
be under any liability for failure to fulfill any obligation under this
Agreement, so long as and to the extent to which the fulfillment of such
obligation is prevented, frustrated, hindered, or delayed as a consequence of
circumstances of force majeure; provided  that (i) such party shall have
used commercially reasonable efforts to minimize to the extent practicable the
effect of force majeure on its obligations hereunder and (ii) nothing in this Section 9.03 shall be 







 




 










 








 




 








construed to require the settlement of
any strike, walkout, lockout or other labor dispute on terms which, in the
reasonable judgment of the affected party, are contrary to its interests.  It
is understood that the settlement of a strike, walkout, lockout or other labor
dispute will be entirely within the discretion of the affected party.  The
party affected by the force majeure event shall notify the other party of that
fact as soon as practicable.


Section 9.04.   Entire
Agreement.  This Agreement constitutes the entire agreement between the
parties with respect to the subject matter hereof and supersedes all prior
agreements and understandings, both oral and written, between the parties with
respect to the subject matter hereof.  No provision of this Agreement is intended
to confer any rights, benefits, remedies, obligations, or liabilities hereunder
upon any Person other than the parties hereto and their respective successors
and permitted assigns.


Section 9.05.   Notices.  All notices, requests and other
communications to any party hereunder shall be in writing (including electronic
mail (“e-mail”) transmission, so long as a receipt of such e-mail is
requested and received) and shall be given:


                      
(a)           
if to Provider to: 


Banco Bilbao Vizcaya Argentaria


Paseo Castellana, 81


28046 Madrid


Attention: María Jesús Arribas de
Paz


Head of Corporate Legal Services


Facsimile No.: 34 91 374 6833


E-mail: mjesus.arribas@bbva.com


with a copy (which shall not
constitute notice) to:


Davis Polk &
Wardwell LLP

450 Lexington Avenue

New York, New York 10017

Attention: William L. Taylor

E-mail: william.taylor@davispolk.com


                     
(b)           
if to Recipient to:


Oriental
Financial Group Inc.

Professional Office Park S.E.

P.O. Box 195115


San Juan
00919-5115


Puerto Rico

Attention: Carlos O. Souffront

Facsimile No.: (787) 771-6896

E-mail: csouffront@orientalfg.com









 




 










 








 




 








with a
copy (which shall not constitute notice) to:


Cleary Gottlieb Steen & Hamilton LLP

One Liberty Plaza

New York, New York 10006

Attention: Victor I. Lewkow

Facsimile No.: (212) 225-3999

E-mail: vlewkow@cgsh.com


or such other address or e-mail
address as such party may hereafter specify for the purpose by notice to the
other parties hereto.  All such notices, requests and other communications
shall be deemed received on the date of receipt by the recipient thereof if received
prior to 5:00 p.m. in the place of receipt and such day is a business day in
the place of receipt.  Otherwise, any such notice, request or communication
shall be deemed not to have been received until the next succeeding business
day in the place of receipt.


Section 9.06.  Governing Law.  This Agreement shall be governed by and construed in
accordance with the law of the State of New York, without regard to the
conflicts of law rules of such state.


Section 9.07. 
Jurisdiction. Any suit, action or proceeding seeking to enforce any
provision of, or based on any matter arising out of or in connection with, this
Agreement or the transactions contemplated hereby shall be brought in the
United States District Court for the Southern District of New York or any New
York State court sitting in New York City, so long as one of such courts shall
have subject matter jurisdiction over such suit, action or proceeding, any
cause of action arising out of this Agreement shall be deemed to have arisen
from a transaction of business in the State of New York, and each of the
parties hereby irrevocably consents to the exclusive jurisdiction of such
courts (and of the appropriate appellate courts therefrom) in any such suit,
action or proceeding and irrevocably waives, to the fullest extent permitted by
law, any objection that it may now or hereafter have to the laying of the venue
of any such suit, action or proceeding in any such court or that any such suit,
action or proceeding brought in any such court has been brought in an
inconvenient forum.  Process in any such suit, action or proceeding may be
served on any party anywhere in the world, whether within or without the
jurisdiction of any such court.  Without limiting the foregoing, each party
agrees that service of process on such party as provided in Section 9.05 shall be deemed effective service of process on such party.


Section 9.08.  Specific Performance.  The parties
hereto agree that irreparable damage would occur if any covenant or agreement
in this Agreement were not performed in accordance with its specific terms or
otherwise were breached.  Therefore, notwithstanding anything to the contrary
set forth in this Agreement, each party hereto agrees that the other party
shall be entitled to an injunction or injunctions to prevent breaches of any of
the covenants or agreements in this Agreement, and to enforce specifically the
performance by such first party under this Agreement.  The equitable remedies
described in this Section 9.08 shall be in addition to, and not in lieu of,
any other remedies at law or in equity that the parties to this Agreement may
elect to pursue.


Section 9.09.   WAIVER OF JURY TRIAL.  EACH OF
THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY
IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATED TO THIS AGREEMENT OR THE
TRANSACTIONS CONTEMPLATED HEREBY.


Section 9.10.   Severability.  If any term, provision, covenant or restriction of this
Agreement is held by a court of competent jurisdiction or other Governmental
Authority to be invalid, void or unenforceable, the remainder of the terms,
provisions, covenants and restrictions of this Agreement shall remain in full
force and 







 




 










 








 




 








effect and shall in no way be affected,
impaired or invalidated so long as the economic or legal substance of the
transactions contemplated hereby is not affected in any manner materially
adverse to any party.  Upon such a determination, the parties shall negotiate
in good faith to modify this Agreement so as to effect the original intent of
the parties as closely as possible in an acceptable manner in order that the
transactions contemplated hereby be consummated as originally contemplated to
the fullest extent possible.


Section 9.11.   Amendments
and Waivers.  (a)  Any provision
of this Agreement (including the Schedules hereto) may be amended or waived if,
but only if, such amendment or waiver is in writing and is signed, in the case
of an amendment, by each party to this Agreement, or in the case of a waiver,
by the party against whom the waiver is to be effective.


                     
(b)           
No failure or delay by any party in exercising any right, power or
privilege hereunder shall operate as a waiver thereof nor shall any single or
partial exercise thereof preclude any other or further exercise thereof or the
exercise of any other right, power or privilege.  Except as set forth in Section 5.05, the rights and remedies herein provided shall be cumulative and not
exclusive of any rights or remedies provided by law.


Section 9.12.  Successors and Assigns.  The
provisions of this Agreement shall be binding upon and inure to the benefit of
the parties hereto and their respective successors and assigns; provided 
that no party may assign, delegate or otherwise transfer any of its rights or
obligations under this Agreement without the prior written consent of the other
party hereto, except that Provider may assign, delegate or otherwise transfer
its rights and obligations under this Agreement, in whole or from time to time
in part, to one or more of its Affiliates (it being understood that any such
assignment, delegation or transfer shall not relieve Provider of its
obligations hereunder).


Section
9.13.  Counterparts; Effectiveness; Third Party Beneficiaries.  This
Agreement may be signed in any number of counterparts, each of which shall be
an original, with the same effect as if the signatures thereto and hereto were
upon the same instrument.  This Agreement shall become effective when each
party hereto shall have received a counterpart hereof signed by the other party
hereto.  Until and unless each party has received a counterpart hereof signed
by the other party hereto, this Agreement shall have no effect and no party
shall have any right or obligation hereunder (whether by virtue of any other
oral or written agreement or other communication).  Except as set forth in
Sections 5.03 and 5.04, no provision of this
Agreement is intended to, or shall, confer any third party beneficiary or other
rights or remedies upon any Person other than the parties hereto and
their respective successors and permitted assigns.


Section
9.14.  Construction and Interpretation.  The parties hereto agree that
any rule of construction to the effect that ambiguities are to be resolved
against the drafting party shall not be applied in the construction or
interpretation of this Agreement.


[Remainder of page intentionally left blank]


IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed by their respective authorized officers as of the
day and year first above written.


 


	
  BANCO BILBAO VIZCAYA
  ARGENTARIA, S.A.

  
	
  By:

  	
  /s/ Javier Rodriguez Soler

  
	
   

  	
  Name:

  	
  Javier Rodriguez Soler

  
	
   

  	
  Title:

  	
  Attorney

  











 




 










 








 




 








 


	
  ORIENTAL FINANCIAL GROUP INC.

  
	
  By:

  	
  /s/ José Rafael Fernández

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  




 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


 


[Signature Page to Transition Services Agreement]


 


Transition Services
Schedule


 


The parties have identified the services set forth in items
(i), (ii) and (iii) below (the “Transition Services”) for inclusion in
this Transition Services Schedule as services to be provided by Provider or its
Affiliates to the Companies (as defined in the Acquisition Agreement).


 


The
parties agree that to the extent a service is being provided as of the date
hereof that is not included below as a Transition Service (a “Current Service”),
the parties will negotiate an amendment to this Transition Services Schedule
with respect to such Current Service in good faith, provided that if the
parties fail to agree on an amendment to this Transition Services Schedule for
any Current Service, such Current Service shall be provided by Provider or its
Affiliates to the Companies in substantially the same manner as such Current
Service was provided to the Companies in the ordinary course of business as of
the date hereof and otherwise in accordance with the Agreement; provided
further that such Current Service shall not be provided or included in the
Transition Services Schedules, and shall not constitute a Transition Service,
to the extent that the provision of such Current Service would require any
consent or other action by any Person under, constitute a default under, or
give rise to any right of termination, cancellation, modification or
acceleration of any right or obligation of Provider or any of its Affiliates or
to a loss or reduction of any benefit or right to which Provider or any of its 







 




 










 








 




 








Affiliates is entitled or trigger any requirement or
option for additional consideration under any provision of any Contract (as
defined in the Acquisition Agreement) or other instrument binding upon Provider
or any of its Affiliates.  In such an event, Section 2.02 of the Agreement will
apply with respect thereto.  Except as otherwise set forth in this Schedule A,
the Service Costs for Current Services shall be as set forth in the Agreement. 
For the avoidance of doubt, the parties agree that none of the following shall
be considered a Transition Service as of the date hereof nor a Current Service:
(x) the services provided under the Service Agreement dated as of February 1,
2006 as amended as of February 7, 2007 between Provider and PR Bank regarding
internal audit services, which was terminated pursuant to the Termination
Agreement dated as of December 10, 2012 between Provider and PR Bank; (y)
financial and insurance arrangements, including the use of correspondent
banking relationships, access to lines of credit and participation in group
insurance arrangements; and (z) commercial arrangements such as (1) providing
support regarding commercial and marketing strategies, customer segmentation,
customer pricing and risk admissions policies and (2) providing access to
information regarding the clients of Provider or its Affiliates in terms of
financial position, active products and customized commercial strategies.


Transition Services required, during the period starting from
the date hereof until the termination of the applicable Transition Service
pursuant to the Agreement, fall into the following categories:


 


(i)                
Day to day
services to the
extent being provided as of the date hereof and required for running the bank
as it is being run as of the date hereof.  These services are further detailed
in the paragraph below. 


(ii)              
Providing
data for integration of information during the transition period
required for regulatory, risk management, financial reporting, and for customer
management purposes , to the extent provided as of the date hereof.  These
services are further detailed in the paragraph below.


(iii)
Services to
assist in eventual transition, as required, to the Recipient’s
infrastructure (“Migration Services”). These services are further
detailed in the paragraph below.


 


Notwithstanding anything in the
Agreement to the contrary, to the extent that any service is covered by the
Agreement and the Existing ATA Agreement (as defined in Appendix 2), the
Existing ATA Agreement shall govern the provision of such service to
Recipient.  Provider shall cause Aplica
Tecnología Avanzada, Sociedad Anónima de Capital Variable (“ATA”), to comply with
its obligations under the Existing ATA Agreement.  For the avoidance of doubt,
(a) ATA shall invoice Recipient separately for all services provided by ATA
pursuant to the Existing ATA Agreement and (b) Provider shall invoice Recipient
separately for all services provided by Provider pursuant to the terms of the
Agreement.  Recipient shall direct all payments for such services in accordance
with such invoices. 


 


(i) The areas in which day
to day services are required consist of:


 


a.      
Use and
support of applications (see Appendix 1) supporting the business operations and
customer facing channels of the Companies, including:


 


·        
Core banking
and auxiliary applications to deposit originations, back office operations and
payment services, 


·        
Branch
platforms, 


·        
Loan
origination, administration and servicing platforms, for Auto, mortgage,
consumer, commercial/institutional loans, Credit Cards


·        
Credit
underwriting and risk management systems, 









 




 










 








 




 








·        
Customer
facing systems, 


·        
Regulatory
& compliance systems,


·        
Administrative
applications supporting functions such as Accounting, Human Resources, Internal
Audit, etc.


 


b.     
Networking
services that provide the following data and voice services:


 


·        
Internet
connectivity


·        
Wide area
networking for data & voice connectivity between business locations 


·        
Voice
services


 


c.      
ATM and other
electronic fund transfer infrastructure:


 


·        
ATM 


·        
Debit card/Credit
card infrastructure


·        
Merchant POS
connectivity


·        
Domestic and
international funds transfer platforms


 


d.     
Corporate,
international banking and foreign exchange transaction support (if and) as
required by the Companies’ clientele currently, and


 


·        
Connectivity
to SWIFT


 


e.      
Email,
intranet and other internal applications. 


 


(ii) The following data is
required for integration of information during transition period for
purposes including regulatory, risk management, financial reporting and for
meeting customer expectations:


 


a.       Data where combined information
is expected by regulatory and other agencies, including:


 


·        
Bank Secrecy
Act/Anti Money Laundering functions


·        
Regulatory
compliance


·        
FINRA
compliance


·        
Call reports


·        
Credit risk
management data including loan ratings, loan balances and payment status


·        
Financial
reporting & disclosures related information


·        
Customer
information data regarding accounts and balances <this is in the case we
decide to move forward with adding the accounts to CIS as a miscellaneous
account>


 


b.     
Technologies
related to customer facing functions, including Customer Information File (CIF)
interfaces, payment and electronic banking networks, etc.


 


c.      
Data and
voice connectivity between Recipient and the Companies, on the one hand, and
Provider, on the other hand, to facilitate this regular interchange of
information.


 


(iii) The following Migration Services required to facilitate
the transition from the Companies’ infrastructure as of the Closing to
Recipient’s infrastructure:









 




 










 








 




 








 


a.      
Application
conversion services including data mapping, creating data interfaces,
facilitation in testing of conversion plans, actual conversion and post
conversion validations.


b.     
Assistance
with rewriting interfaces, if any, Company applications might currently have
with the Provider’s technology.


c.      
Associated
data and voice technology infrastructure conversions.


d.     
Redirection
of the Retained Domain Names to the domain names provided by Recipient.


e.      
The services
set forth in Appendix 2.


 


The Service Costs for the Transition Services shall be as set
forth in the Agreement except as otherwise provided for in this Schedule A.


 


If the Recipient needs an increase in the scope or level of
service for a Transition Service over the scope or level of service for such
Transition Service provided as of the date hereof (e.g., elevated
service levels, support outside of normal business hours, on-site visits,
increased man hours)(an “Expanded Services Level”), then subject to the
next paragraph and the other provisions hereof, the parties will negotiate an amendment
to this Transition Services Schedule with respect to such Expanded Service
Level in good faith.  To the extent the provision of Migration Services
together with the other Services to be provided under the Agreement requires a
greater scope or level of services as compared to the scope or level of
services being provided as of the date hereof, such greater scope or level of
services will be considered an Expanded Service Level.  


 


For purposes of determining the Service Costs for an Expanded
Service Level, the amount to be used in clause (i) of the definition of
Service Costs shall be determined as follows: (i) fifty U.S. dollars (US$50.00)
per hour devoted by or on behalf of Provider to Expanded Service Levels
constituting general services provided in the ordinary course of Provider’s
business, (ii) sixty-five U.S. dollars (US$65.00) per hour devoted by or
on behalf of Provider to Expanded Service Levels constituting specialized
services provided outside the ordinary course of Provider’s business (it being
understood that (x) Provider shall not provide any Expanded Service Levels
described in this clause (ii) without Recipient’s written consent and
(y) in the event that such consent is withheld, Provider shall not be
required to provide such Expanded Service Levels), and (iii) the
out-of-pocket costs to the Provider for providing such Expanded Service Level,
including all reasonable travel costs and expenses plus a reasonable per diem
amount.  For the avoidance of doubt, any and all out-of-pocket costs incurred
by Provider and its Affiliates in connection with the acquisition of new or
replacement hardware, software or other equipment or materials for use by
Recipient in connection with Expanded Service Levels shall be included in the
amount to be used in clause (i) of the definition of the Service Costs. 
Notwithstanding anything in the Agreement to the contrary, neither Provider nor
any of its Affiliates shall be required to provide any Expanded Service Level
to the extent such Expanded Service Level is unduly burdensome to the conduct
of the business of Provider and its Affiliates.


 


Notwithstanding anything in the Agreement to the contrary, in
no event shall Provider or any of its Affiliates be required to provide any
services pursuant to the Agreement in respect of any services received prior to
the date hereof by Recipient or any of its Affiliates pursuant to the Acuerdo
Internacional de Software dated as of July 29, 2011 between Provider and
International Business Machines S.A. (“IBM”) or the Local Transaction
Document to the International Software Agreement dated as of
July 29, 2011 (the “Local IBM Agreement”) between PR Bank and
IBM.  Recipient hereby acknowledges that it will enter into Amendment I to the
Local IBM Agreement as of the date hereof and will be solely responsible for
all fees, costs and expenses associated therewith.


 


Appendix 1









 




 










 








 




 








 


	
  List of Applications:  For the avoidance of doubt, any application the licenses
  or rights to which are owned or held by any Company as of the date hereof
  shall not be included in the Transition Services except to the extent, and
  solely to the extent, that Provider was providing support to the Companies’
  use of such applications as of the date hereof.

   

  Accounting

  
	
  CEPRO

  MTS
  MAINT.

  FINANCE
  MAINT.

  LATIN
  AMERICA IDC MAINT.

  
	
  Audit

  
	
  AURA - 
  Altamira (BBVA Audit)

   

  
	
  Banking & Operations

  
	
  Architecture
  (Arquitectura) - Altamira 

  
	
  LAR 
  Altamira

  REGIONAL
  NACAR LIGERO MAINT.

  NACAR
  PESADO TECHNICAL ARCHITECTURE SUPPORT

  
	
  Internet Banking

  
	
  BBVA
  net

  BBVA
  Net Cash / BBVA Net Cash Helpdesk

  MANT. F
  ESTRUCTURALES NET CASH

  
	
  IT

  
	
  Intranet
  / Internet

  
	
  Risk management (RIESGO HERR. ADMISION, RIESGO OPERACIONAL & RIESGOS
  OTRAS HERRAMIENTAS)

  
	
  RAR –
  Altamira

  
	
  Rating
  – Altamira

  
	
  Riesgos
  Varios - Riesgo Global - Altamira

  
	
  SAE

  SALEM –
  Altamira

  
	
  Scorating

  SIC

  SIGRE –
  Altamira

  
	
  SIRO –
  Altamira

  
	
  Other

  
	
  SIG

  SW
  AUTENTICACION ROBUSTA

  SW
  HERRAMIENTA DE GESTION INFORMACION DE CLIENTES

  SW
  TRANSFERENCIAS FINANCIERAS

  INFRAESTRUCTURA
  INFORMACIONAL

  AMERICA
  RECONCILIATION SOFTWARE MAINT.

  
	
  Additional Services to be
  Provided by ATA

  
	
  MANTENIMENTO
  APLICATIVO

  ·        
  GMM 

  ·        
  SW TRANSFERENCIAS FINANCIERAS

  ·        
  CRM de America del Sur

  ·        
  MIS Regional

  SOPORTE

  ·        
  ARQUITECTURA AMERICA

  ·        
  INFRAESTRUCTURA AMERICA

  ·        
  PIBEE 

  ·        
  IMPLANTACIONES 

  ASISTENCIA
  TECNICA DYD CORPORATIVO

  
	
  Additional Services to be Provided
  by Provider

  
	
  ASESORAMIENTO
  Y CONSULTORIA DYD HOLDING

  MANTENIMENTO
  APLICATIVO

  ·        
  Experian-S 

  ·        
  SIG 

  ·        
  IDC Latam

  ·        
  CASH LATAM 

  ·        
  CASH MANAG. GLOBAL AMERICA

  SERVICIOS
  DE CISO - SEGURIDAD

   

  











 




 










 








 




 








Notwithstanding anything in the Agreement to the contrary,
Provider shall invoice Recipient separately for all Transition Services
described under “Additional Services to be Provided
by ATA,” and Recipient shall direct all payments for such Transition Services
in accordance with such invoices.












 




 










 








 




 








Appendix
2


 


Provider
and Recipient shall develop a mutually agreeable migration plan (the “Migration Plan”)
setting forth the Migration Services (including, as set forth in such Migration
Plan, the migration of (i) the software applications set forth in
Appendix 1 (or a subset of such applications as Provider and Recipient may
mutually identify and agree upon) and (ii) any software applications
provided pursuant to the Existing ATA Agreement (or a subset of such
applications as Provider and Recipient may mutually identify and agree upon),
and in each case any data owned by Recipient stored therein, from Provider’s
systems and technology to Recipient’s systems and technology).  For the
avoidance of doubt, all Migration Services shall constitute Services under the
Agreement.  The Migration Services shall include the preparation of the
Migration Plan, and the other Migration Services will be provided in accordance
with the Migration Plan.


In no
event shall the Migration Services include, nor shall Provider be required to
take or provide pursuant to this Appendix 2, any action or migration
service other than such actions and migration services that are reasonable and
not unduly burdensome to the conduct of the business of Provider and its
Affiliates.  Subject to the foregoing, the Migration Services shall consist of:


·        
Cooperation, knowledge transfer, and
assistance in data file transfer activities


·        
Provide file and data support
information (data base structures, archiving methods, records layouts, etc.)


·        
Hardware and software configurations


·        
Hardware and software support and
maintenance


·        
Operations support services


·        
Systems and data backups


·        
Disaster recovery procedures testing
and support


·        
Access to information


·        
Applications, systems and operations
documentation


·        
Migration consultancy


Without limitation of any provision of
the Acquisition Agreement (including Section 7.11), and notwithstanding
anything in the Agreement to the contrary, Provider and Recipient acknowledge
that the Migration Services shall not require any transfer or assignment of any
ownership interest in, or any cessation of use at any time of, any Licensed
Software or Excluded Software by Provider or any of its Affiliates.


For
purposes of the Agreement, “Existing ATA Agreement” means the Data
Processing and System Management Agreement (Contrato de Prestacion de
Servicios) between Aplica Tecnologia Avanzada, Sociedad Anonima de Capital
Variable and PR Bank, dated as of January 1, 2011, as amended from time to
time.


 


 









 




 










 








 




 








Schedule
B


Liaisons


Recipient:

Alfredo Izquierdo

alfredo.izquierdo@orientalfg.com

787-777-2871


Provider:

Rodolfo Medina Roos - BBVA CCR - Mexico

r.medina@bbva.com

+52 55 5621 10 90