**Exhibit 10.95**

 

**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 **John C. Hansen**,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 April 15,1998 (hereinafter “Original Agreement”), and thereafter amended by virtue of a January 10,2001 Amendment, an August 1, 2003 Amendment,  a January 21, 2004 Amendment, andfinally, an April 12, 2007 Amendment, and further agree that this FirstAmended and Restated Santa Lucia Bank Salary Continuation Agreement shallamend, supersede and replace the Original Agreement (as amended) in itsentirety;

 

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**

 

**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 the 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 the Executive into which appropriate accruals shall be made usingthe applicable Discount Rate.  Any one ofa variety of amortization methods may be used to determine the Accrual Balance.  However, once chosen, the method must beconsistently applied.  For illustrativepurposes ONLY, a sample table showing possible prospective Accrued LiabilityBalance numbers shall be attached hereto as Exhibit “A”; however this Exhibit Ais merely a sample of the potential Accrued Liability Balance based on a futuregiven date and using a sample discount rate. The actual Accrued Liability Balance will be determined based on theactual Discount 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 “theBoard”.

 

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

 

**1.6****                               Discount Rate 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).

 

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**1.7****                              ****Early Retirement****. **The term “EarlyRetirement” shall mean the Executive’s Separation From Service on or afterattaining the “Early Retirement Age” of sixty-two (62), but before attainingthe Normal Retirement Age, and for any reason other than for Cause.

 

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

 

**1.9****                              ****ERISA****.  **The term “ERISA” shall mean the Employee Retirement Income Security Actof 1974, as amended.

 

**1.10****                       ****Executive Benefit****. **The term “ExecutiveBenefit” shall mean the benefit amounts determined pursuant to Paragraphs 1through 6 (including sub-paragraphs, as applicable), forfeited, reduced oradjusted 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).

 

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

 

**1.12****                       ****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)for any reason other than for Cause.

 

**1.13****                       ****Plan Year****. **The “Plan Year” shallmean the calendar year.

 

**1.14****                        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 the 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 thirty-six (36) month period (or the full period ofservices to the employer  if the employeehas been providing services to the employer less than 36 months). There shallbe no Separation From Service while the Executive is on military leave, sickleave or other bona fide leave of absence, as long as such leave does notexceed six (6) months, or if longer, so long as the individual retains aright to re-employment with the service recipient under an applicable statuteor by contract.

 

**1.15****                        SpecifiedEmployee.** The term “Specified Employee” shall be defined in accordancewith IRC 409A. At present, and in accordance with IRC 409A, the term “Specified

 

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Employee” 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.

 

**1.16****                        Terminationfor Cause.**The term “Termination for Cause” shall mean  Executive’s Termination of employment byreason of any of the following:

 

A.                                   Executive’spersonal dishonesty, 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.

 

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

 

**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.

 

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**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.

 

**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****.**

 

**4.1****                               PaymentsUpon Normal Retirement.**In the event Executive Separates From Serviceon or after qualifying for Normal Retirement (for any reason other than forCause or because of death), then Executive shall be entitled to be paid anannual Executive Benefit equal to Thirty Thousand Dollars ($30,000).  This annual Executive Benefit shall be paidin twelve (12) substantially equal monthly installments on the first day ofeach month, beginning with the month following the month in which ExecutiveSeparates From Service and continuing until the death of the Executive.

 

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**4.2****                               PaymentsUpon Early Retirement.** AsExecutive has already attained the Early Retirement Age, in the event heSeparates From Service prior to attaining the Normal Retirement Age for anyreason other than for Cause (or due to death), then Executive shall be entitledto be paid an  Executive Benefitcalculated as follows: an annual lifetime annuity based on the AccruedLiability Balance as of the date of Early Retirement, taking into considerationthe discount rate and mortality assumptions in use by the Bank as of the EarlyRetirement Date. This annual amount shall remain consistent for the duration ofthe benefit. This annual Executive Benefit shall be paid in twelve (12)substantially equal monthly installments, with payments commencing on the firstday of the first month following Executive’s Separation From Service andcontinuing until the death of the Executive. For illustrative purposes ONLY, asample table showing possible prospective Accrued Liability Balance figures andresulting Early Retirement Benefit amounts is attached hereto as Exhibit “A”;however this Exhibit A is merely a sample of the potential ExecutiveBenefit based on a given Early Retirement date and using a sample discountrate. The actual Accrued Liability Balance and resulting benefit will bedetermined at the time of Early Retirement, if applicable.

 

**4.3****                               Terminationfor Cause.**  In the eventExecutive’s Employment with the Employer is Terminated at any time for Cause(including after qualifying for Early or Normal Retirement) as defined herein,then he shall forfeit any and all rights and benefits he may have under theterms of this Agreement and shall have no right to be paid any of the amountswhich would otherwise be due or paid to the Executive by the Employer pursuantto the terms of this Agreement.

 

**4.4****                               Death.**There are no death benefits payable under this Agreement (such benefits aredescribed by a Life Insurance Endorsement Method Split Dollar Plan Agreement,if any), nor will Executive Benefit Payments be made after the Executive dies,regardless of whether such death occurs before or after termination, andregardless of whether payments have already begun pursuant to this Agreement.

 

**5.0****                               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

 

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independent accounting firm or advisor as may be mutually agreeable toEmployer and Executive in the exercise of their reasonable good faith judgment.

 

**6.0****                               Administrativeand Claims Provision.**

 

**6.1****                               NamedFiduciary and Plan Administrator. **The“Named Fiduciary and Plan Administrator” of this executive plan shall be theBank until its resignation or removal by the Board of Directors. As NamedFiduciary and Plan Administrator, the Bank shall be responsible for themanagement, control and administration of this executive plan. The Named Fiduciarymay delegate to others certain aspects of the management and operationresponsibilities of the plan, including employment of advisors and thedelegation of ministerial duties to qualified individuals.

 

**6.2****                               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) daysfor reasonable cause by notifying the claimant in writing, prior to the end ofthe initial ninety (90) day period, that an additional period is required. Thenotice of extension must set forth the special circumstances and the date bywhich 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 orinformation is 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

 

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Section 502(a) following an adversebenefit 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.

 

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 otherinformation relevant (as defined in applicable ERISA regulations) to theclaimant’s claim for 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 of charge,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).

 

**7.0****                               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

 

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connection with any of the provisions of this Agreement, the successfulor prevailing party or parties shall be entitled to recover reasonableattorneys’ fees and other costs incurred in that action or proceeding inaddition to any other relief to which it or they may be entitled. The “prevailingparty” means any party determined by the arbitrator(s) or court to beentitled to money payments from the other, not necessarily the party in whosefavor a judgment is rendered.

 

**8.0****                               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.

 

**9.0****                               Miscellaneous.**

 

**9.1****                               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

 

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her heirs, beneficiaries, legalrepresentatives, agents, successor and assign to claim or assert liability onthe part of the Bank related to the matters described above in this paragraph.Executive further acknowledges that he has read, understands and consents toall of the terms and conditions of this Agreement, and that he enters into thisAgreement with a full understanding of its terms and conditions.

 

**9.2****                               Notice.**  Any notice required or permitted of eitherExecutive or the Bank under this Agreement shall be deemed to have been dulygiven, if by personal delivery, upon the date received by the party or itsauthorized representative; if by facsimile, upon transmission to a telephonenumber previously 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: |                 |
|                  |                 |
|                  |                 |

 

**9.3****                               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.

 

**9.4****                               BindingEffect/Merger or Reorganization.** This Agreement shall be binding upon and inure to the benefit of Executiveand the Bank.  Accordingly, the Bankshall not merge or consolidate into or with another corporation, or reorganizeor sell substantially all of its assets to another corporation, firm or person,unless and until such succeeding or continuing corporation, firm or personagrees 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.

 

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**9.5****                               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.

 

**9.6****                               PartialInvalidity.** If any terms, provision, covenant, or condition of thisAgreement is determined by an arbitrator or a court, as the case may be, to beinvalid, void, or unenforceable, such determination shall not render any otherterm, provision, covenant or condition invalid, void or unenforceable, and theAgreement shall remain in full force and effect notwithstanding such partialinvalidity.

 

**9.7****                               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.

 

**9.8****                               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.

 

**9.9****                               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.

 

**9.10****                        NoStrict Construction.**  Thelanguage used in this Agreement shall be deemed to be the language chosen bythe parties hereto to express their mutual intent, and no rule of strictconstruction will be applied against any person.

 

**9.11****                        GoverningLaw.**  The laws of the State ofCalifornia, other than those laws denominated choice of law rules, and whereapplicable, the rules and regulations of the Board of Governors of theFederal Reserve System, Federal Deposit Insurance Corporation, Office of theComptroller of the Currency, or any other regulatory agency or governmentalauthority having jurisdiction over the Bank shall govern the validity,interpretation, construction and effect of this Agreement.

 

**9.12****                        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.

 

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**10.0****                        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 assumptions should change and saidchange has a detrimental effect on this Executive plan, then the Bank reservesthe right to terminate or modify this 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/ Larry H. Putnam        |              | Date:  | December 17, 2008 |
|---------------------|----------------------------|-------------------|--------|-------------------|
|                | Signature & Title |              |   |              |
|                |                       |
|                |                       |
| **Executive**       |                       |
|                |                       |
|                |                       |
| By:                 | /s/ John C. Hansen         |              | Date:  | 12/17/08          |
|                | Signature & Title |              |   |
|                |                       |
|                |                       |
| /s/ Larry H. Putnam |                       | /s/ Cindy Dilbeck |
| Witness             | Witness                    |

 

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