**Exhibit 10.93**

 

**FIRST AMENDED AND RESTATED**

**SANTA LUCIA BANK**

**SALARY CONTINUATION AGREEMENT**

** **

ThisFirst Amended and Restated Santa Lucia Bank Salary Continuation Agreement(hereinafter “Agreement”) is made and entered into effective as of December 17,2008, by and between **Santa Lucia Bank**,a bank organized and existing under the laws of the state of California(hereinafter the “Bank” or “Employer”) and **Larry H. Putnam**,an executive of the Bank (hereinafter “Executive”);

 

WHEREAS it is the parties’ intent to comply with the final regulationsunder Internal Revenue Code Section 409A, issued on April 10, 2007 bythe Internal Revenue Service (IRS) and the Treasury Department;

 

WHEREFORE, the Bank and Executive hereby agree to amend and restate theoriginal Santa Lucia Bank Salary Continuation Agreement effective as of February 1,1997 (hereinafter “Original Agreement”), and thereafter amended by virtueof  the following: a February 3,1998 Amendment (First Amendment);  an April 15,1998 Amendment (Second Amendment);  a January 10,2001  Amendment (not numbered); an August 1,2003 Amendment (not numbered); a January 21, 2004 Amendment (notnumbered); and finally, an April 12, 2007 Amendment (sixth Amendment). Theparties intend and further agree that this First Amended and Restated SantaLucia Bank Salary Continuation Agreement shall amend, supersede and replace theOriginal Agreement (as amended) in its entirety;

 

WHEREFORE, the parties hereby agree to the following;

 

# **RECITALS**

# ** **

WHEREAS, Executive has been and continues to be a valued Executive ofthe Bank, and is now serving the Bank;

 

WHEREAS, Executive’s experience and knowledge of the affairs of theEmployer and the banking industry are extensive and valuable;

 

WHEREAS, it is deemed to be in the best interests of the Employer toprovide Executive with certain fringe benefits, on the terms and conditions setforth herein, in order to reasonably induce Executive to remain in the Employer’semployment; and

 

WHEREAS, Executive and the Employer wish to specify in writing theterms and conditions upon which this additional compensatory incentive will beprovided to Executive;

 

NOW, THEREFORE, in consideration of the services to be performed byExecutive in the future, as well as the mutual promises and covenants containedherein, Executive and the Employer agree as follows:

 

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**AGREEMENT**

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**1.0****                              ****Terms and Definitions****.**

** **

For the purposes of thisAgreement, the following terms shall have the meanings indicated below, unlessthe context clearly indicates otherwise. In the event any provision of thisAgreement is ambiguous, then it shall be interpreted in a manner that isconsistent with Internal Revenue Code Section 409A. Subject to theforgoing, the terms below shall be defined as follows:

** **

**1.1****                               AccruedLiability Balance.** The term “Accrued Liability Balance” shall mean theamount accrued by the Bank to fund the future benefit expense associated withthis Agreement, as of the end of the month preceding Executive’s Separationfrom Service. The Bank shall account for this benefit using Generally AcceptedAccounting Principles, regulatory accounting guidance of the Bank’s primaryfederal regulator, and other applicable accounting guidance, including but notlimited to Accounting Principles Board Opinion Number 12 (“APB 12”) as amendedby Statement of Financial Accounting Standards Number 106 (“FAS 106”) and theDiscount Rate. Accordingly, the Bank shall establish a liability retirementaccount for Executive into which appropriate accruals shall be made using theapplicable Discount Rate.  Any one of avariety of amortization methods may be used to determine the AccrualBalance.  However, once chosen, themethod must be consistently applied.  Forillustrative purposes ONLY, a sample table showing possible prospective AccruedLiability Balance numbers shall be attached hereto as Exhibit “A”; howeverthis Exhibit A is merely a sample of the potential Accrued LiabilityBalance based on a future given date and using a sample discount rate. Theactual Accrued Liability Balance will be determined based on the actualDiscount Rates in effect over time.

 

**1.2****                               Administrator. **The Bank shall be the “Administrator”and, solely for the purposes of ERISA as discussed herein, the “fiduciary” ofthis Agreement where a fiduciary is required by ERISA.

 

**1.3****                              ****Bank.****  **For the purpose ofthis Agreement, the term “Bank” or “Employer” shall be read so as to includethe Santa Lucia Bank holding company, Santa Lucia Bancorp, when permissible.

 

**1.4****                               Boardof Directors.** The Board ofDirectors shall mean the Board of Directors for the Bank, hereinafter, the “Board”.

 

**1.5****                              ****Change in Control****.** For the purpose of this Plan, a “Changein Control” shall be deemed to have occurred upon any of the following events,as such term and events are defined in Internal Revenue Code Section 409Aand the related guidance and Notices thereto. IRC 409A currently provides thata Change in Control Event shall include any of the following events (and forthe purposes of this provision, the term “corporation” shall mean the Bank orthe Bank’s holding company):

 

A.                                   AChange in the Ownership of a Corporation. A change in theownership of a corporation occurs on the date that any one person or

 

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personsacting as a group (as defined in IRC 409A), acquires ownership of stock of thecorporation that, together with stock held by such person or group, constitutesmore than fifty percent (50%) of the total fair market value or total votingpower of the stock of such corporation.

 

B.                                     Changein the Effective Control of a Corporation. A change in theeffective control of the corporation shall be deemed to occur on either of thefollowing dates:

(i) The date anyone person, or persons acting as a group acquires (or has acquired during the12 month period ending on the date of the most recent acquisition by suchperson or group) ownership of stock of the corporation possessing thirtypercent (30%) or more of the total voting power of the stock of suchcorporation; or

(ii) The date amajority of members of the corporation’s board of directors  is replaced during any twelve (12) monthperiod by directors whose appointment or election is not endorsed by a majorityof the members of the corporation’s board of directors before the date of theappointment or election. (In this sub-paragraph, 409A limits “corporation” tothe “relevant” corporation” as defined therein).

 

C.                                     Change in the Ownership of a SubstantialPortion of a Corporation’s Assets. A change in the ownership of a substantialportion of a corporation’s assets shall be deemed to occur on the date that anyone person or group acquires (or has acquired during the twelve (12) monthperiod ending on the date of the most recent acquisition by such person orpersons) assets from the corporation that have a total gross fair market valueequal to or more than forty percent (40%) of the total gross fair market valueof all of the assets of the corporation immediately before such acquisition oracquisitions. No Change in Control shall result if the assets are transferredto certain entities controlled directly or indirectly by the shareholders ofthe transferring corporation.

 

For the purposes of thisdefinition, the term “corporation” shall be read as including the Bank or the bank’sholding company, Santa Lucia Bancorp. In addition to the forgoing, and inaccordance with IRC 409A, in order to constitute a Change in Control event withrespect to Executive, the Change in Control event must relate to (i) thecorporation for whom Executive is performing services at the time of the Changein Control; (ii) the corporation that is liable for the payment of thedeferred compensation (or all corporations liable for the payment if more thanone corporation is liable) but only if either the deferred compensation isattributable to the performance of service by the Participant for suchcorporation (or corporations) or there is a bona fide business purpose for suchcorporation or corporations to be liable for such payment and, in either case,no significant purpose of making such corporation or corporations liable forsuch payment is the avoidance of Federal income tax; or  (iii) a corporation that is a majorityshareholder of a corporation identified above, or any corporation in a chain ofcorporations in which each corporation is a majority shareholder of anothercorporation in the chain, ending in a

 

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corporation identified above.Should there be any question of whether a Change in Control has occurred suchas to trigger payment of a benefit described herein, any ambiguity shall beresolved in accordance with the final regulations and any subsequentclarification of IRC 409A.

 

**1.6****                              ****The Code****. **The “Code” shall meanthe Internal Revenue Code of 1986, as amended.

 

**1.7****                              ****Disability/Disabled****. **For the purposes of this Agreement, the term “Disability”shall be interpreted in accordance with IRC 409A. Pursuant to IRC 409A, aParticipant will be considered Disabled if:

 

A.                                   Executive is unable toengage in any substantial gainful activity by reason of any medicallydeterminable physical or mental impairment that can be expected to result indeath or can be expected to last for a continuous period of not less thantwelve (12) months; or

 

B.                                     Executiveis, by reason of any medically determinable physical or mental impairment thatcan be expected to result in death or can be expected to last for a continuousperiod of not less than twelve (12) months, receiving income replacementbenefits for a period of not less than three (3) months under an accidentand health plan covering employees of Executive’s employer.

** **

**1.8****                               Discount Rate.**  Theterm “Discount Rate” means the rate used by the Plan Administrator for in anyspecified year to accrue benefits under this Plan; however, the PlanAdministrator, in its sole discretion, may adjust the Discount Rate to maintainthe rate within reasonable standards according to GAAP (Generally AcceptedAccounting Principles).

 

**1.9****                              ****Early Retirement and EarlyRetirement Age.** The term“Early Retirement” shall refer to the Executive’s Separation From Service on orafter attaining the Early Retirement Age of sixty-two (62), but beforeattaining the Normal Retirement Age, and for any reason other than “For Cause”(or because of death).

 

**1.10****                       ****Effective Date****. **The term “EffectiveDate” shall mean the date first written above.

 

**1.11****                       ****ERISA****. **The term “ERISA”shall mean the Employee Retirement Income Security Act of 1974, as amended.

** **

**1.12****                       ****Executive Benefit****. **The term “ExecutiveBenefit” shall mean the annual benefit amounts determined pursuant toParagraphs 1 through 4 (including sub-paragraphs, as applicable), forfeited,reduced or adjusted to the extent:  (a) requiredunder the other provisions of this Agreement; (b) required by reason ofthe lawful order of any regulatory agency or body having jurisdiction over theEmployer; or (c) required in order for the Employer to comply with any andall applicable state and federal laws, including, but not limited to, income,employment and disability income tax laws (*e.g.*, FICA,FUTA, SDI).

 

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**1.13****                       ****Involuntary Separation FromService**. In accordance with IRC 409A, the term “InvoluntarySeparation from Service” shall mean a Separation from Service due to the independentexercise of the unilateral authority of the Bank to terminate the Executive’sservices, other than due to Executive’s implicit or explicit request, whereExecutive was willing and able to continue performing services.

 

**1.14**                        **IRC 409A.** The term “IRC 409A” shall refer to the finalregulations issued by the IRS and the Treasury Department under Section 409Aof the Code.

 

**1.15****                       ****Normal Retirement / NormalRetirement Age.**** **The term “Normal Retirement” shall mean the Executive’s Separation FromService on or after attaining the Normal Retirement Age of Sixty-Five (65) forany reason other than “For Cause” (or because of death).

 

**1.16****                       ****Plan Year****. **The term “Plan Year”shall mean the calendar year.

 

**1.17****                        SeparationFrom Service/ Termination of Employment.**  The terms “Separation From Service”(Separates From Service) and “Termination of Employment” shall be usedinterchangeably for the purposes of this Agreement and shall be interpreted inaccordance with the provisions of IRC 409A. Currently, IRC 409A provides that,whether a termination of employment has occurred is determined based on whetherthe facts and circumstances indicate that the Bank and Executive reasonablyanticipate that no further services will be performed after a certain date orthat the level of bona fide services the employee will perform after such date(whether as an employee or as an independent contractor) will permanentlydecrease to no more than twenty (20%) percent of the average level of bona fideservices performed (as an employee or an independent contractor) over theimmediately preceding 36-month period (or the full period of services to theemployer  if the employee has beenproviding services to the employer less than 36 months). There shall be noSeparation From Service while Executive is on military leave, sick leave orother bona fide leave of absence, as long as such leave does not exceed sixmonths, or if longer, so long as the individual retains a right tore-employment with the service recipient under an applicable statute or bycontract.

 

**1.18****                        SpecifiedEmployee.** The term “Specified Employee” shall be defined in accordancewith IRC 409A. At present, and in accordance with IRC 409A, the term “SpecifiedEmployee” means an employee who, as of the date of the employee’s Separationfrom Service, is a key employee of an employer of which any stock is publiclytraded on an established securities market or otherwise. An employee is a keyemployee if the employee meets the requirements of section 416(i)(1)(A)(i),(ii), or (iii) (applied in accordance with the regulations thereunder anddisregarding section 416(i)(5)) at any time during the twelve (12) month periodending on a specified employee identification date. If Executive is a keyemployee as of a specified employee identification date, then Executive shallbe treated as a key employee for the entire twelve (12) month period beginningon the specified employee effective date.

 

**1.19****                        Terminationfor Cause.**The term “Termination for Cause” shall mean Termination ofExecutive’s employment by reason of any of the following:

 

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A.                                   Executive’s personaldishonesty, incompetence or willful misconduct;

 

B.                                     Executive’sbreach of fiduciary duty involving personal profit;

 

C.                                     Executive’sintentional failure to perform Executive’s duties for the Bank after a writtendemand for performance is given to Executive by the Board which demandspecifically identifies the manner in which the Board believes that Executivehas not performed his duties;

 

D.                                    Executive’s willfulviolation of any law, rule, regulation or final cease and desist order (otherthan traffic violations or similar minor offenses) to the extent detrimental tothe Bank’s business or reputation; or

 

E.                                      Executive’smaterial breach of any provision of this Agreement.

 

**1.20****                       ****Voluntary Termination.** The term “VoluntaryTermination” shall mean a Separation From Service of Executive which is not asa result of an Involuntary Termination, a Termination For Cause or because of aDisability.

 

**2.****                                     ****Scope, Purpose and Effect****.**

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**2.1****                               Contractof Employment.**  Although thisAgreement is intended to provide Executive with an additional incentive toremain in the employ of the Employer, this Agreement shall not be deemed toconstitute a contract of employment between Executive and the Employer norshall any provision of this Agreement restrict or expand the right of theEmployer to terminate Executive’s employment. This Agreement shall have no impact or effect upon any separate writtenEmployment Agreement which Executive may have with the Employer, it being theparties’ intention and agreement that unless this Agreement is specificallyreferenced in said Employment Agreement (or any modification thereto), thisAgreement (and the Employer’s obligations hereunder) shall stand separate andapart and shall have no effect on or be affected by, the terms and provisionsof said Employment Agreement.

 

**2.2****                              ****Fringe Benefit****. **The benefits providedby this Agreement are granted by the Bank as a fringe benefit to Executive andare not a part of any salary reduction plan or any arrangement deferring abonus or a salary increase. Executive has no option to take any currentpayments or bonus in lieu of the benefits provided by this Agreement.

 

**2.3****                              ****Prohibited Payments.**** **Notwithstandinganything in this Agreement to the contrary, if any payment made under thisAgreement is a “golden parachute payment” as defined in Section 28(k) ofthe Federal Deposit Insurance Act (12 U.S.C. section 1828(k) and Part 359of the Rules and Regulations of the Federal Deposit InsuranceCorporation  (collectively, the “FDICRules”) or is otherwise prohibited, restricted or subject to the prior approvalof a Bank Regulator, no payment shall be made hereunder without complying withsaid FDIC Rules.

 

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**2.4****                               AdditionalProhibited Payments.**If the Bank is subject to the executivecompensation limitations under the United States Treasury Department’s TroubledAsset Relief Progra**m** (“TARP”) atthe time Executive becomes entitled to any payment under this Agreement, and ifsuch payment, together with any other payments which Executive has the right toreceive from the Bank, exceed the limits allowed for Executive establishedunder TARP, then the aggregate payments to Executive pursuant to this Agreementand any other agreement with Executive shall be reduced to the largest amountas will result in no portion of such payments violating the executivecompensation limitations under TARP.

 

**3.****                                     ****Delay in Payments for Specified Employee in the Event of a  Separation From Service**.

 

**3.1****                              ****Internal Revenue Code Section 409ACompliance****.**Itis the intent of the parties to comply with all applicable Internal RevenueCode Sections, including, but not limited to, IRC 409A. Furthermore, for thepurposes of this Agreement, IRC Section 409A shall be read to include anyrelated or relevant IRS Notices or clarifications. While it is understood thata general IRC 409A savings clause will not be effective, the parties intendthat any ambiguities regarding any terms or payouts contained herein shall beinterpreted in a manner consistent with IRC 409A.

 

Thus, for any benefits payable pursuant to this Agreement due to aSeparation From Service, if the individual is a Specified Employee (as definedherein and by IRC 409A) as of the date of the Separation From Service, and theEmployer’s stock is publicly traded on an established securities market orotherwise, any such benefit shall be withheld for six (6) months followingsuch Separation From Service in order to comply with IRC 409A. In addition, forany individual affected by this six (6) month delay in payment imposed byIRC 409A, and if and/or when applicable, the aggregate amount of the firstseven (7) months of installments shall be paid at the beginning of theseventh month following the date of Separation From Service. Monthlyinstallment payments shall continue thereafter if called for.

 

**4.****                                     ****Executive Benefits Payments****.**

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**4.1.****                            PaymentsUpon Normal Retirement.**In the event Executive Separates From Servicefor any reason other than For Cause (or because of death) on a date whichconstitutes a Normal Retirement date as defined herein, then he shall beentitled to be paid the following:

 

**4.1.1****                     Amount ofBenefit.** Executive shall receive an annual Executive Benefit ofThirty-Six Thousand Dollars ($36,000).

 

**4.1.2****                     PaymentMethod and Duration.** This annual Executive Benefit shall be paid intwelve (12) substantially equal monthly installments, with payments commencingon the first day of the first month following Executive’s Separation FromService and continuing until the death of Executive.

 

**4.2.****                            ExecutiveBenefit Payments Upon Early Retirement. **In the event Executive Separates From Service for any reason otherthan For Cause (or because of death) on a date

 

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which constitutes an Early Retirement date as defined herein, thenExecutive shall be entitled to be paid the following:

 

**4.2.1****                     Amount ofBenefit.**Executive shall receive an annual Executive Benefit based onthe Early Retirement payment date and calculated as follows: An annual lifetimeannuity based on the Accrued Liability Balance as of the date of EarlyRetirement, taking into consideration the discount rate and mortalityassumptions in use by the Bank as of the Early Retirement Date. This annualamount shall remain consistent for the duration of the benefit. Forillustrative purposes ONLY, a sample table showing possible prospective AccruedLiability Balance and the corresponding potential benefit hereunder is attachedhereto as Exhibit “A”; however this Exhibit A is merely a sampletable and not intended to bind the parties. The actual benefit amount will bedetermined by the Bank’s actuaries at the time the benefit becomes due.

 

**4.2.2****                     PaymentMethod and Duration.** This annual Executive Benefit shall be paid intwelve (12) substantially equal monthly installments, with payments commencingon the first day of the first month following Executive’s Separation FromService and continuing until the death of Executive.

 

**5.0****                               Paymentsin the Event of Disability or Death During Employment.**

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**5.1****                               Disability.**  In the event Executive becomes Disabled priorto Separating from Service with the Bank and prior to qualifying for Early orNormal Retirement, then Executive shall be entitled to be paid the followingbenefit in lieu of any other benefits herein (i.e., this provision shallcontrol even in the event such Disability occurs within 2 years of a Change inControl, etc); however, in the event Executive becomes Disabled afterqualifying for Early or Normal Retirement, then Executive shall be deemed tohave elected Early or Normal Retirement and shall receive the benefit specifiedunder the applicable provisions of this Agreement.

 

**5.1.1****                     Amount ofBenefit.**  Executive shall receivean annual Executive Benefit  based on theDisability date and calculated as follows: an annual lifetime annuity based onthe Accrued Liability Balance as of the date of Disability, taking intoconsideration the discount rate and mortality assumptions in use by the Bank asof the Disability date. This annual amount shall remain consistent for theduration of the benefit. For illustrative purposes ONLY, a sample table showingpossible prospective Accrued Liability Balance and the corresponding potentialbenefit hereunder is attached hereto as Exhibit “A”; however this Exhibit Ais merely a sample table and not intended to bind the parties. The actualbenefit amount will be determined by the Bank’s actuaries at the time thebenefit becomes due.

 

**5.1.2****                     PaymentMethod and Duration.** This annual Executive Benefit shall be paid intwelve (12) substantially equal monthly installments, with payments

 

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commencing on the first day of the first month following Executive’sDisability and continuing until the death of Executive.

 

**5.2****                               Death.**  There are no death benefits payable underthis Agreement (such benefits are described by a Joint Beneficiary DesignationAgreement, if any), nor will Executive Benefit Payments be made after Executivedies, regardless of whether such death occurs before or after termination, andregardless of whether payments have already begun pursuant to this Agreement.

 

**6.0****                               Paymentsin the Event Executive Voluntarily or Involuntarily Separates From ServicePrior to Early Retirement.**

 

As indicated above, the Bank reserves the right to terminate Executive’sEmployment, with or without Cause but subject to any written employmentagreement which may then exist.  In theevent that Executive Separates From Service prior to qualifying for EarlyRetirement, other than by reason of a termination For Cause, following a Changein Control or as a result of a Disability, then, for the following events oftermination, and as applicable, Executive shall be entitled to the benefitsdescribed below which correspond to the circumstances surrounding  Executive’s termination.

 

**6.1****                               InvoluntaryTermination. **In the event Executive is InvoluntarilyTerminated prior to qualifying for Early or Normal Retirement (for reasonsother than a Termination For Cause, following a Change in Control or as aresult of Disability, as addressed in alternate provisions herein), then heshall be entitled to receive the following:

 

**6.1.1****                     Amount ofBenefit.** Executive shall receive an Executive Benefit equal to theAccrued Liability Balance based on the date such Termination occurs.

 

**6.1.2****                     PaymentMethod and Duration.**  ThisExecutive Benefit amount shall be paid in one lump sum on the first day of thefirst month immediately following Executive’s Separation From Service.

 

**6.2****                               VoluntaryTermination by the Executive.**Executive agrees that if he VoluntarilyTerminates his Employment with the Employer prior to qualifying for Early or NormalRetirement (for reasons other thanfollowing a Change in Control or as a result of Disability), thenExecutive shall forfeit all rights and benefits he may have had under the termsof this Agreement and shall have no right to be paid any of the amounts whichwould be due or paid to Executive by the Bank pursuant to the terms of thisAgreement.

 

**7.0****                               Upona Change in Control.**

 

**7.1**                               In the event of a Changein Control, followed by a Separation From Service (for any reason other thanfor Cause) prior to Executive qualifying for Early or Normal Retirement, thenExecutive shall be entitled to receive the following Executive Benefit in lieuof all others identified herein:

 

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**7.1.1****                     BenefitAmount.**  Executive shall receivean Executive Benefit equal to the Accrued Liability Balance based on the datesuch Separation From Service occurs.

 

**7.1.2****                     PaymentMethod and Duration.**  ThisExecutive Benefit amount shall be paid in one lump sum on the first day of thefirst month immediately following Executive’s Separation From Service.

 

In the event Executive Separates From Serviceafter a Change in Control, and after qualifying for Early or Normal Retirement,then Executive shall be deemed to have elected Early or Normal Retirement andshall receive the benefit specified under the applicable provisions of thisAgreement.

 

**8.0****                               Terminationfor Cause.**

 

Executive agrees that if his employment withthe Bank is terminated at any time For Cause as defined in this Agreement(including after having qualified for Early or Normal Retirement, and includingfollowing a Change in Control), then he shall forfeit any and all rights andbenefits he may have under the terms of this Agreement and shall have no rightto be paid any of the amounts which would otherwise be due or paid to Executiveby the Bank pursuant to the terms of this Agreement.

 

**9.0****                               IRSSection 280G Issues.** If allor any portion of the amounts payable to Executive under this Agreement, eitheralone or together with other payments which Executive has the right to receivefrom the Employer, constitute “excess parachute payments” within the meaning ofSection 280G of the Internal Revenue Code of 1986, as amended (the “Code”),that are subject to the excise tax imposed by Section 4999 of the Code (orsimilar tax and/or assessment), Executive shall be responsible for the paymentof such excise tax and Employer (and its successor) shall be responsible forany loss of deductibility related thereto; provided, however, that Employer andExecutive shall cooperate with each other and use all reasonable efforts tominimize to the fullest extent possible (and in accordance with IRC 409A)  the amount of excise tax imposed by Section 4999of the Code.  If, at a later date, it isdetermined (pursuant to final regulations or published rulings of the InternalRevenue Service, final judgment of a court of competent jurisdiction, orotherwise) that the amount of excise taxes payable by Executive is greater thanthe amount initially so determined, then Executive shall pay an amount equal tothe sum of such additional excise taxes and any interest, fines and penaltiesresulting from such underpayment.  Thedetermination of the amount of any such excise taxes shall be made by theindependent accounting firm employed by the Employer immediately prior to thechange in control or such other independent accounting firm or advisor as maybe mutually agreeable to Employer and Executive in the exercise of theirreasonable good faith judgment.

 

**10.0****                        Administrativeand Claims Provision.**

 

**10.1****                        NamedFiduciary and Plan Administrator. **The“Named Fiduciary and Plan Administrator” of this Executive Plan shall be theBank until its resignation or removal by the

 

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Board of Directors. As Named Fiduciary andPlan Administrator, the Bank shall be responsible for the management, controland administration of this Executive Plan. The Named Fiduciary may delegate toothers certain aspects of the management and operation responsibilities of theplan, including employment of advisors and the delegation of ministerial dutiesto qualified individuals.

 

**10.2****                        ClaimsProcedure.**  In the event adispute arises over the benefits under this Agreement and benefits are not paidto the Employee (or to the Employee’s beneficiary[ies], if applicable) and suchclaimants feel they are entitled to receive such benefits, then a written claimmust be made to the Employer (as the plan administrator) in accordance with thefollowing procedures:

 

A.                                   Written Claim.  The claimant may file a written request forsuch benefit with the Administrator.

 

B.                                     ClaimDecision.  Upon receipt of such claim, the Administratorshall respond to such claimant within ninety (90) days after receiving theclaim.  If the Administrator determinesthat special circumstances require additional time for processing the claim,the Administrator can extend the response period by an additional ninety (90)days for reasonable cause by notifying the claimant in writing, prior to the endof the initial ninety (90) day period, that an additional period is required.The notice of extension must set forth the special circumstances and the dateby which the Administrator expects to render its decision.

 

If the claim is denied in whole or in part, the Administrator shallnotify the claimant in writing of such denial. The Administrator shall writethe notification in a manner calculated to be understood by the claimant.  The notification shall set forth:

 

(i)                                     Thespecific reasons for the denial;

(ii)                                  Thespecific reference to pertinent provisions of the Agreement on which the denialis based;

(iii)                               Adescription of any additional information or material necessary for theclaimant to perfect the claim and an explanation of why such material or informationis necessary;

(iv)                              Appropriateinformation as to the steps to be taken if the claimant wishes to submit theclaim for review and the time limits applicable to such procedures; and

(v)                                 Astatement of the claimant’s right to bring a civil action under ERISA Section 502(a) followingan adverse benefit determination on review.

 

C.                                     Request forReview.  Within sixty (60) days afterreceiving notice from the Administrator that a claim has been denied (in partor all of the claim), then claimant (or their duly authorized representative)may file with the Administrator, a written request for a review of the denialof the claim.

 

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The claimant (or his duly authorized representative) shall then havethe opportunity to submit written comments, documents, records and otherinformation relating to the claim.  TheAdministrator shall also provide the claimant, upon request and free of charge,reasonable access to, and copies of, all documents, records and other informationrelevant (as defined in applicable ERISA regulations) to the claimant’s claimfor benefits.

 

D.                                    Decision onReview.  The Administrator shallrespond in writing to such claimant within sixty (60) days after receiving therequest for review.  If the Administratordetermines that special circumstances require an extension of time forprocessing the claim, written notice of the extension shall be furnished to theclaimant prior to the termination of the initial sixty (60) day period. In noevent shall such extension exceed a period of sixty (60) days from the end ofthe initial period. The notice of extension must set forth the specialcircumstances requiring an extension of time and the date by which theAdministrator expects to render its decision.

 

In considering the review, the Administrator shall take into accountall materials and information the claimant submits relating to the claim,without regard to whether such information was submitted or considered in theinitial benefit determination.

 

The Administrator shall notify the claimant in writing of its decisionon review.  The Committee shall write thenotification in a manner calculated to be understood by the claimant.  The notification shall set forth:

 

(i)                                     Thespecific reasons for the denial;

(ii)                                  Areference to the specific provisions of the Agreement on which the denial isbased;

(iii)                               Astatement that the claimant is entitled to receive, upon request and free ofcharge, reasonable access to, and copies of, all documents, records and otherinformation relevant (as defined in applicable ERISA regulations) to theclaimant’s claim for benefits; and

(iv)                              Astatement of the claimant’s right to bring a civil action under ERISA Section 502(a).

 

**11.0****                        Attorneys’Fees.**  If any legal action orother proceeding is brought for the enforcement of this Agreement, or becauseof an alleged dispute, breach, default or misrepresentation in connection withany of the provisions of this Agreement, the successful or prevailing party orparties shall be entitled to recover reasonable attorneys’ fees and other costsincurred in that action or proceeding in addition to any other relief to whichit or they may be entitled. The “prevailing party” means any party determinedby the arbitrator(s) or court to be entitled to money payments from theother, not necessarily the party in whose favor a judgment is rendered.

 

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**12.0****                        Statusas an Unsecured General Creditor and Rabbi Trust. **Notwithstanding anything contained hereinto the contrary:  (i) Executiveshall have no legal or equitable rights, interests or claims in or to anyspecific property or assets of the Employer as a result of this Agreement; (ii) noneof the Bank’s assets shall be held in or under any trust for the benefit ofExecutive or held in any way as security for the fulfillment of the obligationsof the Bank under this Agreement; (iii) all of the Bank’s assets shall beand remain the general unpledged and unrestricted assets of the Bank; (iv) theBank’s obligation under this Agreement shall be that of an unfunded andunsecured promise by the Bank to pay money in the future; and (v) Executiveshall be an unsecured general creditor with respect to any benefits which maybe payable under the terms of this Agreement.

 

Notwithstanding subparagraphs (i) through (v) above, the Bankand Executive acknowledge and agree that, in the event of a Change in Control,upon request of Executive, or in the Bank’s discretion if Executive does not sorequest and the Bank nonetheless deems it appropriate, the Bank shallestablish, not later than the effective date of the Change in Control, a RabbiTrust or multiple Rabbi Trusts (the “Trust” or “Trusts”) upon such terms andconditions as the Bank, in its sole discretion, deems appropriate and incompliance with applicable provisions of the Code, in order to permit the Bankto make contributions and/or transfer assets to the Trust or Trusts todischarge its obligations pursuant to this Agreement.  The principal of the Trust or Trusts and anyearnings thereon shall be held separate and apart from other funds of the Bankto be used exclusively for discharge of the Bank’s obligations pursuant to thisAgreement and shall continue to be subject to the claims of the Bank’s generalcreditors until paid to Executive in such manner and at such times as specifiedin this Agreement.

 

**13.0****                        Miscellaneous.**

 

**13.1****                        OpportunityTo Consult With Independent Advisors.** Executive acknowledges that he has been afforded the opportunity toconsult with independent advisors of his choosing including, withoutlimitation, accountants or tax advisors and counsel regarding both the benefitsgranted to him under the terms of this Agreement and the (i) terms andconditions which may affect Executive’s right to these benefits and (ii) personaltax effects of such benefits including, without limitation, the effects of anyfederal or state taxes, Section 280G of the Code, and any other taxes,costs, expenses or liabilities whatsoever related to such benefits, which inany of the foregoing instances Executive acknowledges and agrees shall be thesole responsibility of Executive, provided, however, that Employer andExecutive shall cooperate with each other and use all reasonable efforts tominimize to the fullest extent possible the amount of excise tax imposed by Section 280Gand 4999 of the Code. In the event the parties are unable to eliminate suchexcise taxes, Executive further acknowledges and agrees that the Bank shallhave no liability whatsoever related to any such personal tax effects or otherpersonal costs, expenses, or liabilities applicable to Executive and furtherspecifically waives any right for himself or herself, and his or her heirs,beneficiaries, legal representatives, agents, successor and assign to claim orassert liability on the part of the Bank related to the matters described abovein this paragraph.  Executive furtheracknowledges that he has read, understands and consents to all of the terms andconditions of this Agreement, and that he enters into this Agreement with afull understanding of its terms and conditions.

 

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**13.2****                        Notice.**  Any notice required or permitted of eitherExecutive or the Bank under this Agreement shall be deemed to have been duly given,if by personal delivery, upon the date received by the party or its authorizedrepresentative; if by facsimile, upon transmission to a telephone numberpreviously provided by the party to whom the facsimile is transmitted asreflected in the records of the party transmitting the facsimile and uponreasonable confirmation of such transmission; and if by mail, on the third dayafter mailing via U.S. first class mail, registered or certified, postageprepaid and return receipt requested, and addressed to the party at the addressgiven below for the receipt of notices, or such changed address as may berequested in writing by a party.

 
|   |   | If to the Bank:      |   | 7480 El Camino Real                                                                                                                                                                                                                                                      |
|--------|--------|----------------------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |   |                 |   | Atascadero, CA 93422                                                                                                                                                                                                                                                     |
|   |   |                 |   | FAX (805) 466-1058                                                                                                                                                                                                                                                       |
|   |   |                 |   |                                                                                                                                                                                                                                                                     |
|   |   | If to the Executive: |   |                                              |
|   |   |                 |   |                                                                                                                                                                                                                                                                     |
|   |   |                 |   |                                              |

 

**13.3****                        Assignment.**  Executive shall have no power or right totransfer, assign, anticipate, hypothecate, modify or otherwise encumber anypart or all of the amounts payable hereunder, nor, prior to payment inaccordance with the terms of this Agreement, shall any portion of such amountsbe:  (i) subject to seizure by anycreditor of Executive, by a proceeding at law or in equity, for the payment ofany debts, judgments, alimony or separate maintenance obligations which may beowed by Executive; or (ii) transferable by operation of law in the eventof bankruptcy, insolvency or otherwise. Any such attempted assignment ortransfer shall be void. In the event Executive or any beneficiary attemptsassignment, communication, hypothecation, transfer or disposal of the benefitshereunder, any such attempted transfer or assignment shall be void.

 

**13.4****                        BindingEffect/Merger or Reorganization.** This Agreement shall be binding upon and inure to the benefit ofExecutive and the Bank.  Accordingly, theBank shall not merge or consolidate into or with another corporation, orreorganize or sell substantially all of its assets to another corporation, firmor person, unless and until such succeeding or continuing corporation, firm orperson agrees to assume and discharge the obligations of the Bank under thisAgreement.  In the alternative, theHolding Company may agree to assume and discharge the obligation of the Bankunder this Agreement. Upon the occurrence of such event, the term “Bank” asused in this Agreement shall be deemed to refer to such surviving or successorfirm, person, entity or corporation, or the Holding Company, as the case maybe.

 

**13.5****                        Nonwaiver.**  The failure of either party to enforce at anytime or for any period of time any one or more of the terms or conditions ofthis Agreement shall not be a waiver of such term(s) or condition(s) orof that party’s right thereafter to enforce each and every term and conditionof this Agreement.

 

**13.6****                        PartialInvalidity.** If any terms, provision, covenant, or condition of this

 

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Agreement is determined by an arbitrator or a court, as the case maybe, to be invalid, void, or unenforceable, such determination shall not renderany other term, provision, covenant or condition invalid, void orunenforceable, and the Agreement shall remain in full force and effectnotwithstanding such partial invalidity.

 

**13.7****                        EntireAgreement.**  This Agreementsupersedes any and all other agreements, either oral or in writing, between theparties with respect to the subject matter of this Agreement and contains allof the covenants and agreements between the parties with respect thereto.  Each party to this Agreement acknowledgesthat no other representations, inducements, promises, or agreements, oral orotherwise, have been made by any party, or anyone acting on behalf of anyparty, which are not set forth herein, and that no other agreement, statement,or promise not contained in this Agreement shall be valid or binding on eitherparty.

 

**13.8****                        Modifications.**  Any modification of this Agreement shall beeffective only if it is in writing and signed by each party or such party’sauthorized representative, and only to the extent that it is compliant with allapplicable codes and statutes, including but not limited to IRS Code Section 409A.

 

**13.9****                        ParagraphHeadings.**  The paragraph headingsused in this Agreement are included solely for the convenience of the partiesand shall not affect or be used in connection with the interpretation of thisAgreement.

 

**13.10****                 No StrictConstruction.**  The language usedin this Agreement shall be deemed to be the language chosen by the partieshereto to express their mutual intent, and no rule of strict constructionwill be applied against any person.

 

**13.11****                 Governing Law.**  The laws of the State of California, otherthan those laws denominated choice of law rules, and where applicable, the rules andregulations of the Board of Governors of the Federal Reserve System, FederalDeposit Insurance Corporation, Office of the Comptroller of the Currency, orany other regulatory agency or governmental authority having jurisdiction overthe Bank or the Holding Company, shall govern the validity, interpretation,construction and effect of this Agreement.

 

**13.12****                 Gender. **Whenever in this Agreement words are usedin the masculine, feminine or neuter gender, they shall be read and construedas in the masculine, feminine or neuter gender, whenever they should so apply.

 

**14.0****                        Terminationor Modification of Agreement by Reason of Changes in the Law, Rules orRegulations.**

 

The Bank is entering into this Agreement upon the assumption thatcertain existing tax laws, the Code, rules and regulations will continuein effect in their current form. If any said

 

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assumptions should change and said change has a detrimental effect onthis Executive Plan, then the Bank reserves the right to terminate or modifythis Agreement accordingly.

 

IN WITNESS WHEREOF, the Bank and Executive have executed this Agreementon the date first above-written in the City of Atascadero, California.

 
| **Santa Lucia Bank**       |                                             |                |
|----------------------------|--------------------------------------------------|---------------------|
| ** **                 |                                             |                |
| ** **                 |                                             |                |
| By:                        |      /s/ John C. Hansen |                | Date: | 12/17/08 |
| Signature & Title |                                             |                |
|                       |                                             |                |
|                       |                                             |                |
| **Executive**              |                                             |                |
| ** **                 |                                             |                |
| ** **                 |                                             |                |
| By:                        |      Larry H. Putnam    |                | Date: | December 17, 2008 |
| Signature & Title |                                             |                |
|                       |                                             |                |
|                       |                                             |                |
|                       |      /s/ John C. Hansen |                | /s/ Cindy Dilbeck |
| Witness                    |                                             |   Witness |

 

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