# EDGAR Filing Document

**Accession Number:** 0001962911
**File Stem:** 0001104659-23-023274
**Filing Date:** 2023-2
**Character Count:** 1082695
**Document Hash:** 79ce9ada9135407d2b5c89bd8b09ef62
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001104659-23-023274.hdr.sgml**: 20230217

**ACCESSION NUMBER**: 0001104659-23-023274

**CONFORMED SUBMISSION TYPE**: 1-A

**PUBLIC DOCUMENT COUNT**: 40

**FILED AS OF DATE**: 20230217

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** Infinity Bancorp
- **CENTRAL INDEX KEY:** 0001962911
- **IRS NUMBER:** 883121738
- **STATE OF INCORPORATION:** CA
- **FISCAL YEAR END:** 1231

**FILING VALUES:**
- **FORM TYPE:** 1-A
- **SEC ACT:** 1933 Act
- **SEC FILE NUMBER:** 024-12158
- **FILM NUMBER:** 23642671

**BUSINESS ADDRESS:**
- **STREET 1:** 6 HUTTON CENTRE DRIVE
- **STREET 2:** SUITE 100
- **CITY:** SANTA ANA
- **STATE:** CA
- **ZIP:** 92707
- **BUSINESS PHONE:** 657-223-1000

**MAIL ADDRESS:**
- **STREET 1:** 6 HUTTON CENTRE DRIVE
- **STREET 2:** SUITE 100
- **CITY:** SANTA ANA
- **STATE:** CA
- **ZIP:** 92707

## Part

**SEC File No. ______-______**

**As filed with the Securities and Exchange Commission on March __, 2023**

PART II - INFORMATION REQUIRED IN OFFERING CIRCULAR

Preliminary Offering Circular dated March __, 2023

An offering statement pursuant to Regulation A+ relating to these securities has been filed with the United States Securities and Exchange Commission (the "SEC"). Information contained in this Preliminary Offering Circular is subject to completion or amendment. These securities may not be sold nor may offers to buy be accepted before the offering statement filed with the SEC is qualified. This Preliminary Offering Circular shall not constitute an offer to sell or the solicitation of an offer to buy nor may there be any sales of these securities in any state in which such offer, solicitation or sale would be unlawful before registration or qualification under the laws of any such state. Infinity Bancorp may elect to satisfy its obligation to deliver a Final Offering Circular by sending you a notice within two business days after the completion of the Bancorp's sale to you that contains the URL where the Final Offering Circular or the offering statement in which such Final Offering Circular was filed may be obtained.

---

| | |
|:---|:---|
| **<u>OFFERING CIRCULAR</u>** | **<u>ACCREDITED INVESTORS ONLY</u>** |

---

**INFINITY BANCORP**

**6 Hutton Centre Drive, Suite 100**

**Santa Ana, California 92707**

**(657) 223-1000**

**Offering under Tier I of Regulation A+ of the Securities and Exchange Commission**

**800,000 Shares of Common Stock, No Par Value, $12.50 per Share**

**Offering Amount: Up to $10,000,000**

**Minimum Purchase Amount: 20,000 Shares for $250,000**

**Sales will be made to Accredited Investors Only**

Infinity Bancorp, a California corporation (the "Bancorp") and holding company for Infinity Bank, its wholly owned subsidiary (the "Bank"), is hereby offering for sale in an offering (the "Offering") to accredited investors only under Tier I of Regulation A+ of the U.S. Securities and Exchange Commission (the "SEC"), up to 800,000 shares of the Bancorp's common stock, no par value (the "Shares") for a fixed purchase price of $12.50 per Share , for a total offering amount of up to $10,000,000. **There is no minimum required sale amount for the Offering.**

**The Bancorp is offering the Shares to accredited investors only under an exemption from registration under Regulation A+ under the Securities Act of 1933 (the "Securities Act") and the Limited Offering Exemption Notice pursuant to Section 25102(f) of the California Corporations Code. For the definition of "accredited investors," and the requirements of Section 25102(f) of the California Corporations Code, see "WHO MAY INVEST IN THE OFFERING" beginning on page 21.**

**THE SEC DOES NOT PASS UPON THE MERITS OF, OR GIVE ITS APPROVAL TO, ANY SECURITIES OFFERED OR THE TERMS OF THE OFFERING, NOR DOES IT PASS UPON THE ACCURACY OR COMPLETENESS OF ANY OFFERING CIRCULAR OR OTHER SOLICITATION MATERIALS. THE SHARES ARE OFFERED PURSUANT TO AN EXEMPTION FROM REGISTRATION WITH THE SEC. HOWEVER, THE SEC HAS NOT MADE AN INDEPENDENT DETERMINATION THAT THE SHARES ARE EXEMPT FROM REGISTRATION.**

This Offering is made pursuant to Tier I of Regulation A+ of the SEC and Section 25102(f) of the California Corporations Code.

**Investing in the Shares involves certain risks. Possible subscribers should read the section entitled "RISK FACTORS" beginning on page 12 of this Offering Circular (this "Offering Circular"), and the rest of the information provided herein before making any investment decision.**

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | Price to Public | Underwriting Discount<br> and Commissions<sup>1</sup> | Proceeds to Issuer<sup>2</sup> | Proceeds to Other<br> Persons |
| &nbsp;&nbsp;Per Share | $12.50 | 0 | $12.50 | 0 |
| &nbsp;&nbsp;Total Minimum | $0.00 | 0 | $0.00 | 0 |
| &nbsp;&nbsp;Total Maximum | $10000000.00 | 0 | $10000000.00 | 0 |

---

**The date of this Offering Circular is March __, 2023**

See footnotes to table on next page.

Footnotes to table on prior page:

<sup>1</sup> The Bancorp is offering the Shares in this non-public offering on a "best efforts" basis solely through the Bancorp's and the Bank's officers and directors. The Bancorp's and the Bank's officers and directors are not entitled to receive any discounts or commissions for selling such Shares, but may be reimbursed for reasonable expenses they incur, if any.

<sup>2</sup> If the Offering is consummated and all 800,000 Shares offered hereby are sold, the gross proceeds from the sale of those Shares at $12.50 per share would be $10,000,000, and the net proceeds would be approximately $9,952,000 after giving effect to estimated expenses in connection with the Offering of approximately $48,000, including, but not limited to, printing and copying costs, legal fees, accounting fees, filing fees, postage, and other miscellaneous costs and expenses, including meeting expenses. Notwithstanding the foregoing, the Bancorp can provide no assurances as to the total number of Shares that may be sold or the amount of expenses to be paid.

THE SHARES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION (THE "FDIC"), THE CALIFORNIA DEPARTMENT OF FINANCIAL PROTECTION AND INNOVATION (THE "DFPI"), OR THE CALIFORNIA DEPARTMENT OF CORPORATIONS (THE "CDOC"), NOR HAS THE FDIC, THE DFPI, OR THE CDOC PASSED ON THE ADEQUACY OR ACCURACY OF THIS OFFERING CIRCULAR.

**The Bancorp estimates that this Offering will commence within two days of qualification; this Offering will terminate at the earliest of (a) 4:00 p.m., Pacific time, on April 28, 2023, (b) the date on which the maximum Offering has been sold, (c) the date which is one year from this Offering being qualified by the Securities and Exchange Commission (the "SEC") or (d) the date on which this Offering is earlier terminated by us, in our sole discretion. (See "Plan of Distribution" on page 25).**

There are no selling shareholders offering any shares of Common Stock of the Bancorp. No proceeds from the Offering shall be released to the Bancorp until the Offering is closed. The Bancorp will pay all of the expenses of the Offering.

**THIS OFFERING CIRCULAR FOLLOWS THE OFFERING CIRCULAR FORMAT DESCRIBED IN PART II OF SEC FORM 1-A.**

The estimated offering expenses of $48,000 include printing and copying costs of $700, legal fees of $25,000, accounting fees of $15,000, transfer agent fees of $2,500, filing fees of $300, postage and mailing costs of $2,000, and miscellaneous costs and expenses, including expenses for meals and meetings with possible investors, of $2,500. All of these expenses are estimates only and the actual offering expenses may be higher or lower than anticipated.

Once a subscriber's subscription agreement has been received by the Bancorp, it may not be revoked. All proceeds from the sale will be held by the Bank in a specially designated, non-interest-bearing stock subscription account at the Bank (the "Stock Subscription Account").

**NO FUNDS SHALL BE RELEASED TO THE BANCORP FROM THE STOCK SUBSCRIPTION ACCOUNT UNTIL THE BANCORP HAS CLOSED THE OFFERING. NO MINIMUM AMOUNT MUST BE RAISED BEFORE THE OFFERING IS CLOSED. THE PRINCIPAL PURPOSE OF THIS OFFERING IS TO RAISE WORKING CAPITAL TO SUPPORT THE GROWTH OF THE BANCORP AND THE BANK.**

**Possible subscribers should only rely on the information contained in this Offering Circular when making a decision to purchase the Shares. No one else is authorized to provide possible subscribers with different information. The Bancorp is not offering to sell nor soliciting an offer to buy the Shares in any state or to any person where the offer or solicitation is prohibited.**

**PROSPECTIVE INVESTORS ARE NOT TO CONSTRUE THE CONTENTS OF THIS OFFERING CIRCULAR AS LEGAL, BUSINESS OR TAX ADVICE. EACH PROSPECTIVE INVESTOR SHOULD CONSULT HIS, HER OR ITS OWN ATTORNEY, BUSINESS ADVISER AND TAX ADVISER AS TO LEGAL, BUSINESS, TAX AND RELATED MATTERS CONCERNING THE SHARES.**

**The Bancorp's common stock is quoted in the OTCQB market tier of the Over-the-Counter Markets Group (the "OTC Markets") under the symbol OTCQB: INFT. On December 30, 2022, the Real Time Best Bid & Ask prices of the Bancorp's common stock were $8.70 Bid (volume of 500 shares) and $8.76 Ask (volume of 900 shares).**

**TABLE OF CONTENTS**

---

| | |
|:---|:---|
|  | <u>PAGE</u> |
| [CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS](#a_001) | [4](#a_001) |
| [QUESTIONS AND ANSWERS ABOUT THE OFFERING](#a_002) | [5](#a_002) |
| [OFFERING CIRCULAR SUMMARY](#a_003) | [7](#a_003) |
| [SELECTED FINANCIAL DATA](#a_004) | [9](#a_004) |
| [GENERAL SUMMARY OF THE OFFERING](#a_005) | [10](#a_005) |
| [RISK FACTORS](#a_006) | [12](#a_006) |
| [WHO MAY INVEST IN THE OFFERING](#a_007) | [21](#a_007) |
| [USE OF PROCEEDS](#a_008) | [24](#a_008) |
| [THE PLAN OF DISTRIBUTION](#a_009) | [25](#a_009) |
| [PRO FORMA CAPITALIZATION](#a_010) | [28](#a_010) |
| [PRO FORMA CAPITAL RATIOS](#a_011) | [29](#a_011) |
| [DILUTION](#a_012) | [30](#a_012) |
| [DISQUALIFYING EVENTS AND BAD ACTOR DISCLOSURE](#a_013) | [31](#a_013) |
| [TRADING HISTORY](#a_014) | [32](#a_014) |
| [DIVIDENDS](#a_015) | [32](#a_015) |
| [BUSINESS](#a_016) | [33](#a_016) |
| [DESCRIPTION OF PROPERTY](#a_017) | [35](#a_017) |
| [MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS](#a_018) | [36](#a_018) |
| [SUPERVISION AND REGULATION](#a_019) | [49](#a_019) |
| [DIRECTORS, EXECUTIVE OFFICERS, AND SIGNIFICANT EMPLOYEES](#a_020) | [52](#a_020) |
| [COMPENSATION OF DIRECTORS AND EXECUTIVE OFFICERS](#a_021) | [57](#a_021) |
| [SECURITY OWNERSHIP OF MANAGEMENT AND CERTAIN SECURITYHOLDERS](#a_022) | [59](#a_022) |
| [INTEREST OF MANAGEMENT AND OTHERS IN CERTAIN TRANSACTIONS](#a_023) | [61](#a_023) |
| [SECURITIES BEING OFFERED](#a_024) | [61](#a_024) |
| [AUTHORIZATION FOR THE OFFERING](#a_025) | [63](#a_025) |
| [LEGAL OPINIONS](#a_026) | [63](#a_026) |
| [DESCRIPTION OF FINANCIAL STATEMENTS](#a_027) | [63](#a_027) |
| [FINANCIAL STATEMENTS](#ac_005) |  |

---

**CAUTIONARY STATEMENT REGARDING<br> FORWARD-LOOKING STATEMENTS**

**Forward-Looking Information**

This Offering Circular contains certain "forward-looking statements" about the Bancorp and the Bank within the meaning of the Private Securities Litigation Reform Act of 1995, including certain plans, strategies, goals, and projections and including statements about our expectations regarding our operating expenses, profitability, allowance for credit losses, net interest margin, net interest income, deposit growth, loan and lease portfolio growth and production, maintaining capital adequacy, liquidity, goodwill, and interest rate risk management. All statements contained in this Offering Circular that are not clearly historical in nature are forward-looking, and the words "anticipate," "assume," "intend," "believe," "forecast," "expect," "estimate," "plan," "continue," "will," "should," "look forward" and similar expressions are generally intended to identify forward-looking statements. You should not place undue reliance on these statements as they involve risks, uncertainties, and contingencies, many of which are beyond the Bancorp's control, which may cause actual results, performance, or achievements to differ materially from those expressed in them. Actual results could differ materially from those anticipated in such forward-looking statements as a result of risks and uncertainties more fully described under "RISK FACTORS", beginning on page 12 of this Offering Circular. Factors that might cause such differences include, but are not limited to:

&nbsp;&nbsp;&nbsp;&nbsp;· the COVID-19 pandemic could adversely affect the Bancorp and the Bank, and their employees, customers and third-party service providers,
and the ultimate extent of the impacts of the pandemic and related government stimulus programs on the business, financial position, results
of operations, liquidity and prospects of the Bancorp and the Bank is uncertain. Continued deterioration in general business and economic
conditions could adversely affect the Bank's revenues and the values of its assets and liabilities, lead to a tightening of credit
and increased volatility in the price of the Bancorp's common stock;

&nbsp;&nbsp;&nbsp;&nbsp;· the ability of the Bancorp and the Bank to compete effectively against other financial service providers;

&nbsp;&nbsp;&nbsp;&nbsp;· the impact of changes in interest rates or levels of market activity, especially on the fair value of the Bank's loan and investment
portfolios;

&nbsp;&nbsp;&nbsp;&nbsp;· deterioration, weaker than expected improvement, or other changes in the state of the economy or the markets in which the Bank conducts
business, which may affect the ability of borrowers to repay their loans from the Bank and the value of real property or other property
held as collateral for such loans;

&nbsp;&nbsp;&nbsp;&nbsp;· changes in credit quality, including the magnitude of individual loan losses, and the effect of credit quality on the Bank's
provision for credit losses and allowance for credit losses;

&nbsp;&nbsp;&nbsp;&nbsp;· the Bank's ability to attract deposits and other sources of funding or liquidity;

&nbsp;&nbsp;&nbsp;&nbsp;· the need to retain capital for strategic or regulatory reasons;

&nbsp;&nbsp;&nbsp;&nbsp;· compression of the net interest margin due to changes in the interest rate environment, forward yield curves, loan products offered,
spreads on newly originated loans and leases, changes in asset or liability mix, and/or changes to the cost of deposits and borrowings;

&nbsp;&nbsp;&nbsp;&nbsp;· reduced demand for the Bank's services due to strategic or regulatory reasons or reduced demand for the Bank's products
due to legislative changes;

&nbsp;&nbsp;&nbsp;&nbsp;· the ability of the Bancorp and the Bank to successfully execute on initiatives relating to enhancements of their respective technology
infrastructures;

&nbsp;&nbsp;&nbsp;&nbsp;· legislative or regulatory requirements or changes, including an increase of capital requirements, and increased political and regulatory
uncertainty;

&nbsp;&nbsp;&nbsp;&nbsp;· the impact on the reputation and business of the Bancorp and the Bank from their interactions with business partners, counterparties,
service providers and other third parties;

&nbsp;&nbsp;&nbsp;&nbsp;· higher than anticipated increases in operating expenses;

&nbsp;&nbsp;&nbsp;&nbsp;· a deterioration in the overall macroeconomic conditions or the state of the banking industry;

&nbsp;&nbsp;&nbsp;&nbsp;· the effectiveness of the Bancorp's and the Bank's risk management framework and quantitative models;

&nbsp;&nbsp;&nbsp;&nbsp;· the costs and effects of legal, compliance, and regulatory actions, changes and developments;

&nbsp;&nbsp;&nbsp;&nbsp;· the impact of changes made to tax laws affecting the Bancorp's and the Bank's business, including the disallowance of
tax benefits by tax authorities and/or changes in tax filing jurisdictions or entity classifications; and

&nbsp;&nbsp;&nbsp;&nbsp;· the Bancorp's and the Bank's success at managing risks involved in the foregoing items and all other risk factors described
in our audited consolidated financial statements, and other risk factors described in this Offering Circular.

All forward-looking statements included in this Offering Circular are based on information available at the time the statement is made. The Bancorp is under no obligation to (and expressly disclaim any such obligation to) update or alter its forward-looking statements, whether as a result of new information, future events or otherwise except as required by law.

**QUESTIONS AND ANSWERS ABOUT THE OFFERING**

**If I am not an accredited investor, may I purchase shares in the Offering?**

No. The Offering is being made only to accredited investors and investors who satisfy the requirements of Section 25102(f) of the California Corporations Code. See "WHO MAY INVEST IN THE OFFERING" beginning on page 21.

**Is there any limit on the number of Shares a subscriber may purchase in the Offering?**

It is presently anticipated that no subscriber will be permitted to purchase that number of Shares which, when added to any existing shares of common stock of the Bancorp owned by such subscriber, would exceed 9.9% of the total amount of issued and outstanding shares of the Bancorp upon close of the Offering. The Bancorp presently has 3,325,716 shares of common stock issued and outstanding. If 800,000 Shares are sold in this Offering, there will be 4,125,716 total shares issued and outstanding, so no subscriber will be permitted to purchase that number of shares which, when added to any existing shares owned by such subscriber, would be more than 408,445 shares of the Bancorp.

**Is there a minimum amount that I must purchase in the Offering?**

Yes, the minimum amount that must be purchased by a subscriber is 20,000 shares for $250,000, unless a lesser amount is approved for any investor by the Board of Directors of the Bancorp in its discretion (for Executive Officers and for others where special circumstances are involved).

**Must a minimum number of Shares be purchased before the Offering may be closed?**

No, the Offering may be closed by the Bancorp at any time without notice without any minimum number of Shares having been sold.

**To whom may subscribers direct questions or send forms and payment?**

If any subscriber has questions about the Offering, the subscriber should direct those questions to Victor E. Guerrero, President/Chief Operating Officer, 6 Hutton Centre Drive, Suite 100, Santa Ana, California 92707 (telephone: 657-223-1000, email: victor@goinfinitybank.com).

Subscribers should direct their payments for the Shares to Infinity Bancorp, Attention: Victor E. Guerrero, President and Chief Operating Officer, 6 Hutton Centre Drive, Suite 100, Santa Ana, California 92707.

**What is the Bancorp's authority for the Offering?**

The Bancorp is offering an aggregate of up to 800,000 Shares for purchase in the Offering to accredited investors only under an exemption from registration under Regulation A+ under the Securities Act of 1933 (the "Securities Act") and Section 25102(f) of the California Corporations Code. See "WHO MAY INVEST IN THE OFFERING" beginning on page 21.

**How was the offering price of $12.50 per share determined?**

The Board of Directors of the Bancorp established the offering price of $12.50 per share after reviewing factors deemed relevant by the Board, including the book value of the Bancorp's common stock, the Bank's profitability in 2021 and through September 30, 2022, lack of an active market for the Bancorp's stock resulting in very limited availability of the Bancorp's stock in the marketplace, the Bancorp's and the Bank's strong management teams and boards, and the opportunities in the marketplace for growth. The price of $12.50 per share represents 159.6% of the book value of $7.83 per share of the Bank's common stock as of September 30, 2022, or a 59.6% premium to book value. All of the Bank's shares of common stock were exchanged on a one-for-one basis for shares of common stock of the Bancorp as of October 21, 2022, the date of the completion of the reorganization of the Bank as a wholly owned subsidiary of the Bancorp (the "Reorganization").

**How soon must I act if I wish to purchase Shares?**

**The Bancorp estimates that this Offering will commence within two days of qualification; this Offering will terminate (the "Closing Date"** **) at the earliest of (a) 4:00 p.m., Pacific time, on April 28, 2023, (b) the date on which the maximum Offering has been sold, (c) the date which is one year from this Offering being qualified by the SEC, or (d) the date on which this Offering is earlier terminated by the Bancorp, in its sole discretion. (See "Plan of Distribution" on page 25).** In order to participate in the Offering, you must ensure that the Bancorp actually receives all required documents and payments before the Closing Date. Any subscription agreements for the Offering which are received after the Closing Date may be rejected and returned at the discretion of the Board of Directors of Bancorp.

**Have the Boards of the Bancorp and the Bank made a recommendation regarding the Offering?**

The Boards of the Bancorp and the Bank make no recommendation to you about whether you should purchase Shares in the Offering.

**Will there be an impound account for the subscription funds?**

All subscription funds shall be held in a non-interest-bearing stock subscription account at the Bank until the Closing Date. Thereafter, all subscriptions accepted by the Bancorp shall be released to the Bancorp and paid into the capital accounts of the Bancorp, to be used by the Bancorp without restriction.

**What forms and payment are required to purchase Shares?**

You are receiving a subscription agreement with this Offering Circular. The subscription agreement must be properly completed and delivered before expiration of the Offering with full payment for the number of Shares you wish to purchase.

**Must I pay the subscription price in cash?**

In order to participate in the Offering, you must timely pay the subscription price by wire transfer, a U.S. bank check, or personal check that clears before the Closing Date.

**Will my money be returned if the Offering is cancelled?**

Yes, but without any payment of interest.

Assuming the Offering is not cancelled by the Bancorp, your subscription in the Offering is irrevocable. However, your funds will be deposited in a non-interest-bearing stock subscription account and shall be held in that account until the Closing Date. Then, upon acceptance by the Bancorp, your funds will be released to the Bancorp and added to the capital accounts of the Bancorp.

**THE PRINCIPAL PURPOSE OF THIS OFFERING IS TO RAISE WORKING CAPITAL TO SUPPORT THE GROWTH OF THE BANCORP AND THE BANK.** See "USE OF PROCEEDS" on page 24.

**What fees or charges apply if I do choose to participate in the Offering?**

The Bancorp is not charging any fee or sales commission in connection with the Offering. If you elect to participate in the Offering and purchase Shares through a broker, you are responsible for paying any fees that person may charge.

**May I change or cancel my subscription agreement after I send it to the Bancorp?**

Your subscription agreement is irrevocable and may be accepted by the Bancorp at any time following the Closing Date. Upon the Bancorp's acceptance of your subscription, your funds shall be immediately added to the capital accounts of the Bancorp.

**When will I know how many Shares I will be able to purchase?**

**As noted above, the Offering will** **terminate at the earliest of (a) 4:00 p.m., Pacific time, on April 28, 2023, (b) the date on which the maximum Offering has been sold, (c) the date which is one year from this Offering being qualified by the SEC, or (d) the date on which this Offering is earlier terminated by the Bancorp, in its sole discretion. (the "Closing Date").** After the Closing Date, the Bancorp may formally approve subscriptions received prior to the Closing Date, in whole or in part, or reject subscriptions, at any time up to the date which is 14 days after the Closing Date. The Bancorp will notify all investors no later than 14 days after the Offering is Closed whether their subscription has been accepted or rejected, in whole or in part. If the Bancorp does not approve, in whole or in part, any subscription, a refund will be mailed to the investor in an amount equal to the subscription price for the number of Shares as to which the subscription is not approved, without interest, by no later than 14 days after the Close of the Offering. The Bancorp reserves the right to cancel the Offering at any time and return all subscriptions.

**Are there any restrictions on the Shares being sold in the Offering?**

The Shares are being sold by the Bancorp in an offering under Regulation A+ under the Securities Act of 1933 (the "Act"). Shares will not have a legend condition and will be freely transferable. See "WHO MAY INVEST IN THE OFFERING" beginning on page 21.

**Does this contain all information material to an investment decision by subscribers?**

No. Because the shares are being offered only to accredited investors, this Offering Circular does not contain all the information that would be required to be disclosed if the Offering was made to persons other than accredited investors.

**OFFERING CIRCULAR SUMMARY**

*This summary provides an overview of selected information contained elsewhere in this Offering Circular and does not contain all of the information you should consider. You should read the following summary together with the more detailed information set out in this Offering Circular, including the "RISK FACTORS" section beginning on page 12 and the Bancorp's and the Bank's financial statements and notes to those financial statements that appear following page 64 of this Offering Circular.*

**Continuing Reporting Requirements Under Regulation A+**

As a Tier I issuer under Regulation A+ of the Securities and Exchange Commission (the "SEC"), the Bancorp will be required to file with the SEC a Form 1-Z (Exit Report Under Regulation A+) upon termination of this Offering. The Bancorp will not be required to file any other reports with the SEC following this Offering.

However, during the pendency of this Offering and following this Offering, the Bancorp intends to file financial reports and other supplemental reports with the OTC Markets which will be available at <u>www.otcmarkets.com</u>. and at <u>https://www.goinfinitybank.com/about-us/investor-relations.html</u>.

All future periodic reports, whether filed with the OTC Markets or published at <u>https://www.goinfinitybank.com/about-us/investor-relations.html</u>. will not be required to include the same information as analogous reports required to be filed by companies whose securities are listed on the New York Stock Exchange or NASDAQ for companies reporting to the SEC under the Securities Exchange Act of 1934 (the "Exchange Act"). This will continue so long as the common stock of the Bancorp is not registered under the Exchange Act. The Bancorp has no plans to register its common stock under the Exchange Act at any time in the foreseeable future.

**Infinity Bancorp Reorganization**

Infinity Bancorp was incorporated as a California corporation on June 16, 2022. On July 6, 2022, the Bancorp, the Bank, and Infinity Merger Co., a California corporation organized on June 16, 2022 for the sole purpose of effecting the Reorganization, entered into a Plan of Reorganization and Merger Agreement (the "Merger Agreement"). The Merger Agreement provided for a reverse triangular merger transaction (the "Reorganization") pursuant to which the Bank became a wholly owned subsidiary of the Bancorp. The Merger Agreement provides that upon completion of the Merger, the Bank's outstanding shares of common stock were exchanged for an equal number of shares of the Bancorp's common stock, and the shareholders of the Bank become shareholders of the Bancorp. The Reorganization was subject to approval by the DFPI, the FDIC, the Federal Reserve Bank of San Francisco, and by shareholders of the Bank holding a majority of the issued and outstanding shares of the Bank. All regulatory approvals were received, and the shareholders of the Bank approved the reorganization on September 29, 2022. The Effective Date of the Merger and the Reorganization was the date the Merger Agreement was filed with the California Secretary of State, which was October 21, 2022. As of the Effective Date, the Bancorp owned 100% of the issued and outstanding shares of the Bank, and all former shareholders of the Bank became shareholders of the Bancorp with the same number of shares they previously owned in the Bank.

As of the date of this Offering Circular, the Bancorp has 3,325,716 shares of common stock issued and outstanding. If 800,000 Shares are sold in this Offering, there will be 4,125,716 total shares issued and outstanding. The common stock of the Bancorp is traded under the symbol "OTCQB: INFT" on the OTCQB market system. The Bancorp's headquarters office is located at 6 Hutton Centre Drive, Suite 100, Santa Ana, California 92707. Presently, the sole business of the Bancorp is to operate its subsidiary Bank.

The current members of the Board of Directors of the Bancorp are Karkutla P. ("Bala") Balkrishna (Chairman), Cary D. Bren, Curtis E. Campbell, Raymond J. Gagnon, Victor E. Guerrero II, Katherine T. Le, Richard H. Schlatter and Glenn B. Stearns. The Bancorp's executive officers are Bala Balkrishna (Chairman and Chief Executive Officer), Victor E. Guerrero II (President/Chief Operating Officer), Elaine Crouch (Executive Vice President/Risk Management/Director of HR/Corporate Secretary), and Allison Duncan (Executive Vice President/Chief Financial Officer).

The Bancorp's telephone number is: (657) 223-1000. Elaine Crouch, the Bancorp's Corporate Secretary, may be reached at Infinity Bank, 6 Hutton Centre Drive, Suite 100, Santa Ana, California 92707, Telephone: (657) 223-1000, facsimile: (714) 619-7456, or email: <u>elaine@goinfinitybank.com</u>.

**Infinity Bank**

Infinity Bank is a California state-chartered bank headquartered in Santa Ana, California. The Bank was incorporated as a California banking corporation on January 27, 2017 and commenced business on February 1, 2018. Upon opening for business in 2018, the Bank focused its lending efforts on small to medium-sized businesses, high-net-worth individuals, and professionals in its market area. The Bank has one full-service office in Santa Ana, Orange County, California: the Bank's headquarters office is located at 6 Hutton Centre Drive, Suite 100, Santa Ana, California 92707. The Bank engages in substantially all the business operations customarily conducted by state-chartered banks in California. Its deposits are insured by the Federal Deposit Insurance Corporation up to the maximum legal limit.

The Bank became a wholly owned subsidiary of Infinity Bancorp on October 21, 2022.

The current members of the Board of Directors of the Bank are Karkutla P. ("Bala") Balkrishna, Cary D. Bren, Curtis E. Campbell, Raymond J. Gagnon (Chairman), Victor E. Guerrero II, Katherine T. Le, Richard H. Schlatter and Glenn B. Stearns. The Bank's executive officers are Bala Balkrishna (Chief Executive Officer), Victor E. Guerrero II (President/Chief Operating Officer), Elaine Crouch (Executive Vice President/Risk Management/Director of HR/Corporate Secretary), Allison Duncan (Executive Vice President/Chief Financial Officer), and Patty Staples (Executive Vice President/Chief Credit Officer).

The Bank's telephone number is: (657) 223-1000. Elaine Crouch, the Bank's Corporate Secretary, may be reached at Infinity Bank, 6 Hutton Centre Drive, Suite 100, Santa Ana, California 92707, Telephone: (657) 223-1000, facsimile: (714) 619-7456, or email: <u>elaine@goinfinitybank.com</u>.

On October 22, 2021, the Bank issued $4 million of subordinated capital notes (the "Subordinated Notes") in a non-public offering to accredited investors only pursuant to a Permit issued by the DFPI, subject to the requirements of Section 1211 of the California Financial Code. The Subordinated Notes are fixed to floating rate notes due in 10 years, are callable by the Bank after five years at par, are not callable by the holders, are structured to satisfy the requirements for Tier 2 capital and are not convertible into shares of common stock of the Bank. Payments under the Subordinated Notes are due semi-annually in arrears.

**The Business Strategy of the Bank**

The Bank's business strategy is to operate a client-focused, well-capitalized and profitable Southern California bank dedicated to providing personal service to its business and individual customers. The Bank believes that stable, long-term growth and profitability are the result of building strong customer relationships while maintaining disciplined credit underwriting standards.

The Bank's loan portfolio consists primarily of loans to borrowers within Orange County and its surrounding areas. Although the Bank seeks to avoid concentrations of loans to a single industry or based upon a single class of collateral, real estate and real estate associated businesses are among the principal industries in the Bank's market area and, as a result, the Bank's loan and collateral portfolios are, to some degree, concentrated in those industries. The composition of the Bank's loan portfolio as of September 30, 2022 is: Construction and land development ($37.4 million or 24.8% of total loans of $150.7 million), Real Estate – Commercial and Residential ($34.9 million or 23.2%), Commercial & Industrial ($78.3 million or 51.9%), and Consumer ($0.1 million or 0.1%). This compares to the following totals as of September 30, 2021: Construction and land development ($27.5 million or 17.9% of total loans of $153.6 million), Real Estate – Commercial and Residential ($40.3 million or 26.3%), Commercial & Industrial ($81.0 million or 52.7%), and Consumer ($4.8 million or 3.1%).

**SELECTED FINANCIAL DATA**

The following summary presents Selected Financial Data as of and for the periods indicated. The financial data as of and for the years ended December 31, 2021 and 2020 has been derived from the audited annual financial statements for the Bank. The financial data as of and for the 9 months ended September 30, 2022 and 2021 are unaudited and are for the Bank. This Selected Financial Data should be read in conjunction with the audited financial statements and notes thereto, which are included following page 64. See "Infinity Bancorp Reorganization" on page 7 concerning the impact of the Reorganization which was effective October 21, 2022.

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **As of and for the** | **As of and for the** | **As of and for the 9 months** | **As of and for the 9 months** |
| | **Years Ended December 31,** | **Years Ended December 31,** | **Ended September 30,** | **Ended September 30,** |
| <br>**(Dollars in thousands, except per share data)** | **2021** | **2020** | **2022** | **2021** |
| **Operating Data:** |  |  |  |  |
| Interest Income | $9465 | $6391 | $8951 | $6554 |
| Interest Expense | 526 | 557 | 671 | 346 |
| Net Interest Income | 8939 | 5834 | 8280 | 6208 |
| Provision for Loan Losses | 691 | 659 | 610 | 542 |
| Net Interest Income After Provision for Loan Losses | 8248 | 5175 | 7670 | 5666 |
| Noninterest Income | 302 | 214 | 241 | 224 |
| Noninterest Expenses | 6807 | 5706 | 5600 | 4811 |
| Income (Loss) before Income Taxes | 1743 | (317) | 2311 | 1079 |
| Provision (Benefit) for Income Taxes | (1430) | 1 | 684 | (1654) |
| Net Income/(Loss) | $3173 | $(318) | $1627 | $2733 |
| **Per Share Data:** |  |  |  |  |
| Net Income (Loss) Per Share - Basic | $0.96 | $(0.10) | $0.49 | $0.82 |
| Book Value | $8.62 | $7.80 | $7.83 | $8.57 |
| Actual Number of Shares Outstanding | 3319287 | 3312858 | 3325716 | 3319287 |
| Weighted Average Number of Shares Outstanding | 3316073 | 3309644 | 3321454 | 3315025 |
| **Balance Sheet Data:** |  |  |  |  |
| Total Assets | $296826 | $204882 | $322309 | $329311 |
| Total Loans | $150113 | $135866 | $150718 | $153593 |
| Allowance for Loan and Lease Losses (ALLL) | $2273 | $1582 | $2731 | $2214 |
| Investment Securities | $66764 | $23013 | $54735 | $65090 |
| Total Deposits | $262518 | $172416 | $290989 | $299408 |
| Total Stockholders' Equity | $28607 | $25828 | $26033 | $284590 |
| **Operating Ratios and Other Selected Data:** |  |  |  |  |
| Return on Average Assets | 1.29% | (0.18)% | 0.70% | 1.63% |
| Return on Average Equity | 11.65% | (1.24)% | 7.90% | 13.62% |
| Net Interest Margin | 3.71% | 3.46% | 3.64% | 3.78% |
| Average Equity to Average Assets | 11.11% | 14.94% | 8.86% | 11.99% |
| 90+ Days Delinquencies/Total Loans | 0.13% | 0.00% | 1.11% | 0.00% |
| 30-89 Days Delinquent Loans/Total Loans | 0.00% | 0.00% | 0.00% | 0.50% |
| Non-accrual Loans/Total Loans | 0.00% | 0.16% | 3.05% | 0.13% |
| Classified Loans/Tier 1 Capital and ALLL | 8.30% | 0.80% | 13.95% | 0.68% |
| ALLL as a Percentage of Total Loans | 1.51% | 1.16% | 1.81% | 1.38% |
| Leverage Capital Ratio (Tier 1 Capital to Total Average Assets) | 9.20% | 12.00% | 9.28% | 8.96% |
| Tier 1 Risk Based Capital Ratio | 14.50% | 15.50% | 14.54% | 12.42% |
| Total Risk Based Capital Ratio | 15.70% | 16.40% | 17.64% | 13.53% |

---

**General Summary of Offering**

---

| | |
|:---|:---|
| Offering Entity | Infinity Bancorp |
| Address and Telephone Number | 6 Hutton Centre Drive, Suite 100 |
|  | Santa Ana, California 92707 |
|  | (657) 223-1000 |
| OTCQB Trading Symbol | OTCQB: INFT |
| Main Office Location | 6 Hutton Centre Drive, Suite 100 |
|  | Santa Ana, California 92707 |
|  | (657) 223-1000 |
| Securities Offered | Up to 800,000 shares of no par common stock of the Bancorp (the "Shares") |
| Offering Price Per Share | $12.50 per Share |
| Minimum Subscription Total | There is no minimum number of Shares that must be sold. Upon the close of the Offering, the Bancorp may accept subscriptions and add the subscription funds to the capital of the Bancorp. |
| Minimum Subscription Per Subscriber | The minimum number of Shares which must be purchased is 20,000 Shares for $250,000, unless a lesser amount is approved for any investor by the Board of Directors in its discretion (for executive officers and for others where special circumstances are involved). |
| Maximum Subscription Per Subscriber | No subscriber shall be permitted to purchase that number of Shares which would result in the subscriber's ownership of more than 9.9% of the total shares outstanding after the completion of the Offering (maximum of 408,445 shares if all 800,000 Shares are sold, resulting in 4,125,716 outstanding shares |
| Maximum Offering Amount | $10,000,000, assuming all 800,000 Shares are purchased in the Offering. |
| Shares of Common Stock Outstanding after the Offering | As of the date of this Offering Circular, the Bancorp has 3,325,716 shares of common stock outstanding. If all 800,000 Shares are sold in the Offering, the Bancorp will have an aggregate of 4,125,716 shares of common stock issued and outstanding, assuming no exercise of any outstanding stock options and no further vesting of any Restricted Stock Units. |
| How to Subscribe | To subscribe for Shares in the Offering, complete a subscription agreement (the form is included with this Offering Circular), and deliver it, together with the total subscription price for all the Shares you wish to purchase, on or before the Closing Date, as defined below, to: |
|  | Infinity Bank |
|  | Attention: Victor E. Guerrero II |
|  | President/Chief Operating Officer |
|  | 6 Hutton Centre Drive, Suite 100 |
|  | Santa Ana, California 92707 |

---

---

| | |
|:---|:---|
|  | **The Bancorp estimates that this Offering will commence within two days of qualification; this Offering will terminate (the "Closing Date") at the earliest of (a) 4:00 p.m., Pacific time, on April 28, 2023, (b) the date on which the maximum Offering has been sold, (c) the date which is one year from this Offering being qualified by the SEC or (d) the date on which this Offering is earlier terminated by the Bancorp, in its sole discretion. (See "Plan of Distribution").** After the Closing Date, the Bancorp may formally approve subscriptions received prior to the Closing Date, in whole or in part, or reject subscriptions, at any time up to the date which is 14 days after the Closing Date. Upon the close of the Offering, if the Bancorp decides to approve your subscription, your funds may be immediately accepted by the Bancorp and added to the Bancorp's capital accounts. No later than 21 days after the conclusion of the Offering, a book-entry record for the Shares you have purchased in the Offering will be made by the Bancorp's registrar and transfer agent. |
| Stock Subscription Account | Your subscription funds will be held in a stock subscription account at the Bank until accepted by the Bancorp, which shall occur no later than 14 days after the Offering closes. Upon acceptance by the Bancorp, your subscription funds shall be immediately released from the stock subscription account and added to the capital accounts of the Bancorp. |
| Expiration Time and Date | **This Offering will terminate (the "Closing Date") at the earliest of (a) 4:00 p.m., Pacific time, on April 28, 2023, (b) the date on which the maximum Offering has been sold, (c) the date which is one year from this Offering being qualified by the SEC or (d) the date on which this Offering is earlier terminated by the Bancorp, in its sole discretion. (See "Plan of Distribution" on page 25).** |
| Release of Subscription Funds from the Offering to the Bancorp | **NO FUNDS SHALL BE RELEASED TO THE BANCORP FROM THE STOCK SUBSCRIPTION ACCOUNT FOR THE OFFERING UNTIL THE BANCORP HAS CLOSED THE OFFERING.** |
| Risk Factors | **An investment in the Shares involves certain risks. You should carefully consider the information included in the Risk Factors section of this Offering Circular, as well as the other information contained in this Offering Circular, prior to making an investment decision regarding the Shares.** |

---

**RISK FACTORS**

*You should carefully consider the following risk factors and all other information contained in this Offering Circular before investing. Investing in the Bancorp's common stock involves certain risks. The risks and uncertainties described below are not the only ones faced by the Bancorp and the Bank. Additional risks and uncertainties not presently known to the Bancorp and the Bank or that are currently believed to be immaterial also may impair the Bancorp's and the Bank's business. If any of the events described in the following risks occur, the Bancorp's and the Bank's business results of operations and financial condition could be materially adversely affected. In addition, the trading price of the Bancorp's common stock could decline due to any of the events described in these risks, and you may lose all or part of your investment.*

**Risks Related to the Bancorp and the Bank**

In the course of conducting the Bancorp's and the Bank's business operations, the Bancorp and the Bank are exposed to a variety of risks, some of which are inherent in the financial services industry and others of which are more specific to the Bancorp's and the Bank's own business. COVID-19 issues continue to be present in some locations, but those concerns have waned in Orange County and surrounding areas as of the date of this Offering Circular. Nonetheless, the risk of a resurgence of the pandemic continues, and for purposes of this Offering Circular is considered an ongoing risk to the Bancorp and the Bank and their business. The discussion below assumes that COVID-19 remains a problem for the Bancorp and the Bank and addresses the most significant factors, of which the Bancorp and the Bank are currently aware, that could affect the Bancorp's and the Bank's business, results of operations and financial condition. However, other factors not discussed below or elsewhere in this Offering Circular could adversely affect the Bancorp's and the Bank's businesses, results of operations and financial condition. Therefore, the risk factors below should not be considered a complete list of potential risks the Bancorp and the Bank may face.

Any risk factor described in this Offering Circular could by itself, or together with other factors, materially adversely affect the Bancorp's and the Bank's liquidity, cash flows, competitive position, business, reputation, results of operations, capital position or financial condition, including materially increasing expenses or decreasing revenues, which could result in material losses.

**Risks Related to Organization and Structure under Tier I of Regulation A+**

As a Tier I issuer under Regulation A+ of the Securities and Exchange Commission (the "SEC"), the Bancorp will not have reporting obligations to the SEC under Sections 14 or 16 of the Securities Exchange Act of 1934 (the "Exchange Act"), nor will any shareholders have reporting requirements under Regulation 13D or 13G or Regulation 14D. So long as the Bancorp's common stock is not registered under the Exchange Act, the Bancorp's directors and executive officers and beneficial owners of 10% or more of the Bancorp's common stock will not be subject to Section 16 of the Exchange Act. Section 16(a) of the Exchange Act requires executive officers and directors and persons who beneficially own more than 10% of a registered class of equity securities to file with the SEC initial statements of beneficial ownership, reports of changes in ownership and annual reports concerning their ownership of common shares and other equity securities, on Form 3, 4, and 5, respectively. Such information about the Bancorp's directors, executive officers and beneficial holders will only be available through periodic reports filed with the OTC Markets.

The Bancorp's common stock is not registered under the Exchange Act and the Bancorp does not intend to register its common stock under the Exchange Act for the foreseeable future; provided, however, that the Bancorp will register its common stock under the Exchange Act if the Bancorp has, after the last day of any fiscal year, more than either (1) 2,000 persons, or (2) 500 shareholders of record who are not accredited investors, in accordance with Section 12(g) of the Exchange Act.

Further, so long as the Bancorp's common stock is not registered under the Exchange Act, the Bancorp will not be subject to Section 14 of the Exchange Act, which, among other things, prohibits companies that have securities registered under the Exchange Act, from soliciting proxies or consents from shareholders without furnishing to shareholders and filing with the SEC a proxy statement and form of proxy complying with the proxy rules.

In addition, so long as the Bancorp's common stock is not registered under the Exchange Act, the Bancorp will not be subject to the reporting requirements of Regulations 13D and Regulation 13G. which require the disclosure of any person who, after acquiring directly or indirectly the beneficial ownership of any equity securities of a class, becomes, directly or indirectly, the beneficial owner of more than 5% of the class.

Finally, as a non-listed company conducting an exempt offering pursuant to Regulation A+, the Bancorp is not subject to a number of corporate governance requirements, including but not limited to (a) the requirements for independent board members, (b) an independent audit committee operating under a written audit committee charter meeting the requirements of a national stock exchange, (c) a nominating/corporate governance committee composed entirely of independent directors and a written nominating/corporate governance committee charter meeting the requirements of a national stock exchange, (d) a compensation committee composed entirely of independent directors and a written compensation committee charter meeting the requirements of a national stock exchange, and (e) independent audits of the Bancorp's and the Bank's internal controls. The Bancorp and the Bank largely comply with these requirements voluntarily as "best practice" recommendations from their banking regulators, but to the extent they do not fully comply with these requirements, you may not have the same protections afforded to shareholders of companies that are subject to all of the corporate governance requirements of a national stock exchange.

**General Economic and Market Conditions Risk**

***COVID-19 concerns and resulting substantial disruption to global and domestic economies have adversely impacted and may continue to adversely impact the Bancorp's and the Bank's business operations, asset valuations, and financial results, and the ultimate impact on their business and financial results is uncertain.***

COVID-19 concerns have created global and domestic economic and financial disruptions that have adversely affected, and may continue to adversely affect, the Bancorp's and the Bank's business operations, asset valuations and financial results. COVID-19 negatively impacted global and domestic economies, disrupted supply chains, lowered some equity market valuations, created significant volatility and disruption in financial markets, and temporarily increased unemployment levels. Certain industries have been particularly hard hit, including the travel and hospitality industry, the restaurant industry and the retail industry. In addition, COVID-19 resulted in temporary and permanent closures of many businesses. Should economic impacts of COVID-19 persist or further deteriorate, this macroeconomic environment could have a continued adverse impact on the Bancorp's and the Bank's business, financial condition and results of operations.

COVID-19 concerns have influenced and could further influence the recognition of the provision for credit losses in the Bank's loan portfolio and could further increase the Bank's allowance for credit losses, depending on the duration of COVID-19 concerns and the ongoing impact on the overall economy. The provision for credit losses reflects estimates of future credit losses; however, the actual credit losses that the Bank's loan portfolio may experience remains uncertain since the economic cycle is not complete, particularly as more customers may draw on their lines of credit or seek additional loans to help finance their businesses.

Similarly, because of changing economic and market conditions affecting issuers, the securities the Bank holds may lose value. The volatility in the equity markets has impacted the Bank's asset valuations, and asset valuations of goodwill or other assets could be further impacted depending on future developments.

***The Bank's business is adversely affected by inflation, unfavorable economic, market, and political conditions.***

The capital and credit markets have experienced unprecedented levels of volatility and disruption over the last year. In some cases, the markets have produced downward pressure on stock prices and credit availability for certain issuers without regard to those issuers' underlying financial strength. As a consequence of the current inflation in the United States and the COVID-19 concerns, business activity across a wide range of industries faces serious difficulties.

In the event of an economic recession, which many are predicting for 2023, the Bank's operating results could be adversely affected because the Bank could experience higher loan and lease charge-offs and higher operating costs. Global inflation and economic conditions also affect the Bank's operating results because global inflation and economic conditions directly influence the U.S. economic conditions. Sources of global inflation and economic and market instability include, but are not limited to, the war in Ukraine, the global shortage of oil and gas, the impact of trade negotiations, economic challenges in China, including global economic ramifications of Chinese economic difficulties, and the effects of COVID-19 and or other health crises. Various market conditions also affect the Bank's operating results. Real estate market conditions directly affect performance of the Bank's loans secured by real estate. Debt markets affect the availability of credit which impacts the rates and terms at which the Bank offers credit. Stock market downturns often signal broader economic deterioration and/or a downward trend in business earnings which may adversely affect businesses' ability to raise capital and/or service their debts. Political and electoral changes, developments, conflicts and conditions (such as changes implemented by the state or federal governments) may introduce additional uncertainty and also affect the Bank's operating results.

**Credit Risk**

**Credit Risk is the Risk of Loss Arising from the Inability or Failure of a Borrower or Counterparty to Meet Its Obligation.**

***The Bank may not recover all amounts that are contractually owed by our borrowers.***

The Bank is dependent on the collection of loan and lease principal, interest, and fees to partially fund its operations. A shortfall in collections and proceeds may impair the Bank's ability to fund its operations or to repay its existing debt.

When the Bank loans money, commits to loan money or enters into a letter of credit or other contract with a counterparty, the Bank incurs credit risk. The credit quality of the Bank's portfolio can have a significant impact on its earnings. The Bank expects to experience charge-offs and delinquencies on its loans and leases in the future. Borrowers have been negatively impacted by the COVID-19 pandemic and related economic consequences and may continue to be similarly or more severely affected in the future. The Bank's clients' actual operating results may be worse than the Bank's underwriting indicated when the Bank originated the loans and leases, and in these circumstances, if timely corrective actions are not taken, the Bank could incur substantial impairment or loss of the value on these loans and leases.

***The Bank's allowance for credit losses may not be adequate to cover actual losses.***

In June 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2016-13, "*Financial Instruments-Credit Losses (Topic 326), Measurement of Credit Losses on Financial Instruments*," commonly referred to as the "Current Expected Credit Losses" standard, or "CECL." CECL changes the allowance for credit losses methodology from an incurred loss concept to an expected loss concept, which is more dependent on future economic forecasts, assumptions, and models than the previous accounting standards and, when effective, could result in increases and add volatility to our allowance for credit losses and future provisions for loan losses. These forecasts, assumptions, and models are inherently uncertain and are based upon management's reasonable judgment in light of information currently available. CECL may result in the Bank's allowance for credit losses not being adequate to absorb actual credit losses, and future provisions for loan and lease losses could materially and adversely affect the Bank's operating results.

The Bank's federal and state regulators, as an integral part of their examination process, review the Bank's loans and leases and allowance for credit losses. While the Bank believes its allowance for credit losses is appropriate for the risk identified in the Bank's loan and lease portfolio, neither the Bancorp nor the Bank can provide assurance that the Bank will not further increase the allowance for credit losses, that it will be sufficient to address losses, or that regulators will not require the Bank to increase this allowance. Neither the Bancorp nor the Bank can be certain that actual results will be consistent with forecasts and assumptions used in the Bank's CECL modeling. Any of these occurrences could materially and adversely affect the Bancorp's and the Bank's financial condition and results of operations.

***The Bank has a number of large credit relationships and individual commitments.***

At September 30, 2022, there were 13 customers with commitments greater than or equal to $5.0 million totaling $78.1 million with the largest commitment being $8.0 million. The total aggregate outstanding balance was $51.7 million. At December 31, 2021, there were 14 commitments greater than or equal to $5.0 million totaling $84.2 million and had an aggregate outstanding balance of $68.1 million, and at December 31, 2020 there were no commitments greater than or equal to $5.0 million.

A significant loss related to one of the Bank's large lending relationships or individual commitments could have a material adverse effect on the Bank's financial condition and results of operations.

**Market Risk**

**Market Risk Is the Risk That Market Conditions May Adversely Impact the Value of Assets or Liabilities or Otherwise Negatively Impact Earnings. Market Risk is Inherent to the Financial Instruments Associated with the Bank's Operations, Including Loans, Deposits, Securities, Short-term Borrowings, and Long-term Debt.**

***The Bank's business is subject to interest rate risk, and variations in interest rates may materially and adversely affect the Bank's financial performance.***

Changes in the interest rate environment may reduce the Bank's profits. It is expected that the Bank will continue to realize income from the differential or "spread" between the interest earned on loans, securities and other interest-earning assets, and interest paid on deposits, borrowings and other interest-bearing liabilities. Net interest spreads are affected by the difference between the maturities and repricing characteristics of interest-earning assets and interest-bearing liabilities. Changes in market interest rates generally affect loan volume, loan yields, funding sources and funding costs. The Bank's net interest spread depends on many factors that are partly or completely out of the Bank's control, including competition, general economic conditions, and federal economic monetary and fiscal policies, and in particular, the Federal Reserve Board. The Federal Reserve Board has increased interest rates over 2022 and is likely to continue increasing rates until it believes inflation has been controlled.

While an increase in interest rates may increase the Bank's loan yield, it may adversely affect the ability of certain borrowers with variable rate loans to pay the contractual interest and principal due to the Bank. Following an increase in interest rates, the Bank's ability to maintain a positive net interest spread is dependent on its ability to increase its loan offering rates, replace loans that mature and repay or that prepay before maturity with new originations, minimize increases on deposit rates, and maintain an acceptable level and composition of funding. The Bank cannot provide assurances that it will be able to increase its loan offering rates and continue to originate loans due to the competitive landscape in which the Bank operates. Additionally, the Bank cannot provide assurances that it can minimize the increases in its deposit rates while maintaining an acceptable level of deposits. Finally, the Bank cannot provide any assurances that it can maintain its current levels of noninterest-bearing deposits as customers may seek higher-yielding products when interest rates increase.

***The value of the securities in the Bank's investment portfolio may decline in the future.***

The fair market value of the Bank's investment securities may be adversely affected by general economic and market conditions, including changes in interest rates, credit spreads, and the occurrence of any events adversely affecting the issuer of particular securities in the Bank's investment portfolio or any given market segment or industry in which the Bank is invested. The Bank analyzes its securities, all of which are classified as available-for-sale, on a quarterly basis to measure currently expected credit losses. The process for determining currently expected credit losses usually requires complex, subjective judgments about the future financial performance of the issuer in order to assess the probability of receiving principal and interest payments sufficient to recover the amortized cost of the security. Because of changing economic and market conditions affecting issuers, the Bank may be required to recognize credit losses in future periods, which could have a material adverse effect on the Bank's business, financial condition, or results of operations.

**Capital and Liquidity Risk**

**Capital and Liquidity Risk is the risk of loss resulting from insufficient capital levels or inadequate liquid assets that could impair the Bank's ability to operate free of regulatory enforcement actions and to meet the Bancorp's and the Bank's contractual and contingent financial obligations, on- or off-balance sheet, as they become due.**

***The Bancorp and the Bank are subject to capital adequacy standards, and a failure to meet these standards could adversely affect their financial condition.***

The Bancorp and the Bank are subject to capital adequacy and liquidity rules and other regulatory requirements specifying minimum amounts and types of capital that must be maintained. From time to time, the regulators implement changes to these regulatory capital adequacy and liquidity guidelines. If the Bancorp and the Bank fail to meet these minimum capital and liquidity guidelines and other regulatory requirements, they may be restricted in the types of activities they may conduct and may be prohibited from taking certain capital actions, such as paying dividends and repurchasing or redeeming capital securities.

***The Bancorp may need to raise additional capital in the future and such capital may not be available when needed or at all.***

The Bancorp and the Bank are required by federal and state regulators to maintain adequate levels of capital. They may need to raise additional capital in the future to meet regulatory or other internal requirements. The Bancorp's ability to raise additional capital, if needed, will depend on, among other things, conditions in the capital markets at that time, which are outside of the Bancorp's control, and its financial performance.

The Bancorp cannot provide any assurance that access to such capital will be available on acceptable terms or at all. Any occurrence that may limit the Bancorp's access to the capital markets, such as a decline in the confidence of debt purchasers or counterparties participating in the capital markets, may materially and adversely affect the Bancorp's capital costs and its ability to raise capital and, in turn, its liquidity. Further, if the Bancorp needs to raise capital in the future, it may have to do so when many other financial institutions are also seeking to raise capital and would then have to compete with those institutions for investors. The inability to raise additional capital on acceptable terms when needed could have a materially adverse effect on the Bancorp's and the Bank's business, financial condition, or results of operations.

***The Bank is subject to liquidity risk, which could adversely affect its financial condition and results of operations.***

Effective liquidity management is essential for the operation of the Bank's business. Although the Bank has implemented strategies to maintain sufficient and diverse sources of funding to accommodate planned, as well as unanticipated, changes in assets, liabilities, and off-balance sheet commitments under various economic conditions, an inability to raise funds through deposits, borrowings, the sale of investment securities and other sources could have a material adverse effect on the Bank's liquidity. The Bank's access to funding sources in amounts adequate to finance its activities could be impaired by factors that affect the Bank specifically or the financial services industry in general. Factors that could detrimentally impact the Bank's access to liquidity sources include a decrease in the level of its business activity due to a market disruption, a decrease in the borrowing capacity assigned to the Bank's pledged assets by its secured creditors, or adverse regulatory action against the Bank. Deterioration in economic conditions and the loss of confidence in financial institutions may increase the Bank's cost of funding and limit access to some of its customary sources of liquidity, including, but not limited to, inter-bank borrowings and borrowings from the Federal Home Loan Bank. The Bank's ability to acquire deposits or borrow could also be impaired by factors that are not specific to the Bank, such as a severe disruption of the financial markets or negative views and expectations about the prospects for the financial services industry generally as a result of conditions faced by banking organizations in the domestic and international credit markets.

**Regulatory, Compliance and Legal Risk**

**Regulatory, Compliance and Legal Risk is the Risk of Loss Related to Violations of Laws, Rules, or Regulations, or from Non-Conformance with Prescribed Practices, Internal Policies and Procedures, Contractual Obligations and Other Legal and Ethical Standards.**

***The Bancorp and the Bank are subject to extensive regulation, which could materially and adversely affect their business.***

The banking industry is extensively regulated and supervised under both federal and state laws and regulations that are intended primarily for the protection of depositors, customers, federal deposit insurance funds and the banking system as a whole, not for the protection of the Bancorp's stockholders and the Bancorp's and the Bank's creditors. The Bancorp is subject to regulation and supervision by the Federal Reserve. The Bank is subject to regulation and supervision by the DFPI, the FDIC and the Consumer Financial Protection Bureau. The laws and regulations applicable to the Bancorp and the Bank govern a variety of matters, including, but not limited to, permissible types, amounts and terms of loans and investments the Bank makes, the types of businesses permitted for the Bancorp, the maximum interest rate that may be charged, consumer disclosures on the products and services the Bank offers, the amount of reserves the Bank must hold against its customers' deposits, the types of deposits the Bank may accept and the rates the Bank may pay on such deposits, the establishment or acquisition of new branch offices by the Bank, maintenance of adequate capital and liquidity, restrictions on dividends, and stock repurchases. The Bancorp and the Bank must obtain approval from their regulators before engaging in certain activities, including certain acquisitions, and there can be no assurance that any regulatory approvals the Bancorp and the Bank may require will be obtained, or obtained without conditions, either in a timely manner or at all. The Bancorp's and the Bank's regulators have the ability to compel the Bancorp and the Bank to, or restrict them from, taking certain actions entirely, such as actions that the Bancorp's and the Bank's regulators deem to constitute unsafe or unsound banking practice. While the Bancorp and the Bank have policies and procedures designed to prevent violations of the extensive federal and state regulations, any failure to comply with any applicable laws or regulations, or regulatory policies and interpretations of such laws and regulations, could result in regulatory enforcement actions, civil monetary penalties, or damage to the Bancorp's and the Bank's reputation, all of which could have a material adverse effect on the Bancorp's or the Bank's business, financial condition, or results of operation.

***The Bancorp and the Bank are subject to changes in federal and state tax laws, interpretation of existing laws, and examinations and challenges by taxing authorities.***

The Bancorp's and the Bank's financial performance is impacted by federal and state tax laws. Given the current economic and political environment, and ongoing budgetary pressures, the enactment of new federal or state tax legislation or new interpretations of existing tax laws could occur. The enactment of such legislation, or changes in the interpretation of existing law, including provisions impacting income tax rates, apportionment, consolidation or combination, income, expenses, and credits, may have a material adverse effect on the Bancorp's and the Bank's financial condition, results of operations, and liquidity.

***The Bancorp and the Bank may be subject to claims and litigation which could adversely affect cash flows, financial condition, and results of operations, or cause them significant reputational harm.***

The Bancorp and the Bank and certain of our directors, officers, and employees may be involved, from time to time, in reviews, investigations, litigation, and other proceedings pertaining to the Bancorp's and the Bank's business activities. If claims or legal actions, whether founded or unfounded, are not resolved in a favorable manner to the Bancorp and the Bank, they may result in significant financial liability. Although the Bancorp and the Bank establish accruals for legal matters when and as required by U.S. GAAP and certain expenses and liabilities in connection with such matters may be covered by insurance, the amount of loss ultimately incurred in relation to those matters may be substantially higher than the amounts accrued and/or insured. Substantial legal liability could adversely affect the Bancorp's and the Bank's business, financial condition, results of operations, and reputation. To date, neither the Bancorp nor the Bank has had any such reviews, investigations, litigation or other proceedings.

***Regulations relating to privacy, information security, and data protection could increase the Bancorp's and the Bank's costs, affect or limit how the Bancorp and the Bank collect and use personal information, and adversely affect their business opportunities.***

The Bancorp and the Bank are subject to various privacy, information security and data protection laws, such as the Gramm-Leach-Bliley Act, which among other things requires privacy disclosures, and maintenance of a robust security program that are increasingly subject to change which could have a significant impact on the Bancorp's and the Bank's current and planned privacy, data protection and information security-related practices, their collection, use, sharing, retention and safeguarding of consumer or employee information, and some of their current or planned business activities. The Bancorp's and the Bank's regulators also hold them responsible for privacy and data protection obligations performed by third party service providers while providing services to the Bancorp and the Bank.

**Risk of the Competitive Environment in which the Bancorp and the Bank Operate**

***The Bancorp's and the Bank's ability to attract and retain qualified employees is critical to their success.***

The Bank's employees are its most important resource, and in many areas of the financial services industry, competition for qualified personnel is intense. The Bank endeavors to attract talented and diverse new employees and retain and motivate its existing employees to assist in executing its growth, acquisition, and business strategies. The Bancorp and the Bank also seek to retain proven, experienced senior employees with superior talent to provide continuity of succession of the Bancorp's and the Bank's executive management team. In addition, the Board oversees succession planning, including review of the succession plans for each member of executive management. Losses of or changes in the Bancorp's and the Bank's current executive officers or other key personnel, or the inability to recruit and retain qualified personnel in the future could materially and adversely affect the Bancorp's and the Bank's financial condition and results of operations.

***The Bank faces strong competition from financial services companies and other companies that offer banking services, which could materially and adversely affect the Bank's business.***

The financial services industry has become even more competitive as a result of legislative, regulatory and technological changes and continued banking consolidation, which may increase in connection with current economic, market and political conditions. The Bank faces substantial competition in all phases of its operations from a variety of competitors, including national banks, regional banks, community banks and, more recently, financial technology (or "fintech") companies. Many of the Bank's competitors offer the same banking services that the Bank offers, and the Bank's success depends on its ability to adapt its products and services to evolving industry standards. Increased competition in the Bank's market may result in reduced new loan and lease production and/or decreased deposit balances or less favorable terms on loans and leases and/or deposit accounts. The Bank also faces competition from many other types of financial institutions, including without limitation, non-bank specialty lenders, insurance companies, private investment funds, investment banks, and other financial intermediaries.

Should competition in the financial services industry intensify, the Bank's ability to market its products and services may be adversely affected. If the Bank is unable to attract and retain banking customers, it may be unable to grow or maintain the levels of its loans and deposits and its results of operations and financial condition may be adversely affected as a result. Ultimately, the Bank may not be able to compete successfully against current and future competitors.

***Failure to keep pace with technological change could adversely affect the Bancorp's and the Bank's business.***

The financial services industry experiences continuous technological change with frequent introductions of new technology-driven products and services. The effective use of technology increases efficiency and enables financial institutions to better serve customers and to reduce costs. The Bancorp's and the Bank's future success depends, in part, upon their ability to address the needs of the shareholders of the Bancorp and the Bank's customers by using technology to provide products and services that will satisfy shareholder and customer demands, as well as to create additional efficiencies in the Bancorp's and the Bank's operations. Many of the Bancorp's and the Bank's competitors, however, have substantially greater resources to invest in technological improvements or are technology focused start-ups with internally developed cloud-native systems that offer improved user interfaces and experiences. The Bancorp and the Bank may not be able to effectively implement new technology-driven products and services or be successful in marketing these products and services. In addition, the Bancorp and the Bank depend on internal and outsourced technology to support all aspects of their business operations. Interruption or failure of these systems creates a risk of business loss as a result of adverse customer experiences and possible diminishing of the Bancorp's and the Bank's reputation, damage claims or civil fines. Failure to successfully keep pace with technological change affecting the financial services industry or to successfully implement core processing strategies could have a material adverse impact on the Bancorp's and the Bank's business and, in turn, their financial condition and results of operations.

***The Bank's ability to maintain, attract and retain customer relationships and investors is highly dependent on its reputation.***

Damage to the Bancorp's and the Bank's reputation could undermine the confidence of the Bancorp's investors and the Bank's current and potential customers, in the Bancorp's and the Bank's ability to provide high-quality financial services. Such damage could also impair the confidence of the Bancorp's and the Bank's counterparties and vendors and ultimately affect their ability to effect transactions. Maintenance of the Bancorp's and the Bank's reputation depends not only on their success in maintaining their service-focused culture and controlling and mitigating the various risks described herein, but also on the Bancorp's and the Bank's success in identifying and appropriately addressing issues that may arise in areas such as potential conflicts of interest, anti-money laundering, client personal information and privacy issues, customer and other third-party fraud, record-keeping, technology-related issues including but not limited to cyber fraud, regulatory investigations and any litigation that may arise from the failure or perceived failure to comply with legal and regulatory requirements. Defense of the Bancorp's and the Bank's reputation, trademarks, and other intellectual property, including through litigation, also could result in costs that could have a material adverse effect on their business, financial condition, or results of operations.

**Risks Related to Risk Management**

***The Bancorp and the Bank rely on other companies to provide key components of their business infrastructure.***

The Bancorp and the Bank rely on certain third parties to provide products and services necessary to maintain day-to-day operations, such as data processing and storage, recording and monitoring transactions, on-line banking interfaces and services, Internet connections, telecommunications, and network access. Even though the Bancorp and the Bank have a vendor management program to help them carefully select and monitor the performance of third parties, the Bancorp and the Bank do not control third party actions. The failure of a third-party to perform in accordance with the contracted arrangements under service level agreements as a result of changes in the third party's organizational structure, financial condition, support for existing products and services, strategic focus, system interruption or breaches, or for any other reason, could be disruptive to the Bancorp's and the Bank's operations, which could have a material adverse effect on their business, financial condition and results of operations. Replacing these third parties could also create significant delays and expense. Accordingly, use of such third parties creates an inherent risk to the Bancorp's and the Bank's business operations.

***Severe weather, natural disasters, acts of war or terrorism, new public health issues, or other adverse external events could harm the Bank's business.***

Severe weather, natural disasters, acts of war or terrorism, new public health issues, and other adverse external events could have a significant impact on the Bank's ability to conduct business. Severe weather and natural disasters cannot be predicted and could harm the Bank's operations through interference with communications, including the interruption or loss of its computer systems, which could prevent or impede the Bank from gathering deposits, originating loans and processing and controlling the flow of business, as well as through the destruction of facilities and our operational, financial and management information systems. California, in which a substantial portion of the Bank's business and a substantial portion of its loan collateral is located, is susceptible to severe weather and natural disasters such as earthquakes, floods, droughts and wildfires. Additionally, the United States remains a target for potential acts of war or terrorism. Moreover, a new public health issue, such as a major epidemic or another pandemic, could adversely affect economic conditions. Severe weather, natural disasters, acts of war or terrorism, public health issues, or other adverse external events could each negatively impact the Bank's business operations or the stability of the Bank's deposit base, cause significant property damage, adversely impact the values of collateral securing the Bank's loans and/or interrupt the Bank's borrowers' abilities to conduct their business in a manner to support their debt obligations, which could result in losses and increased provisions for credit losses. There is no assurance that the Bancorp's and the Bank's business continuity and disaster recovery program can adequately mitigate the risks of such business disruptions and interruptions.

**Risk from Accounting and Other Estimates**

**Risk from Accounting and Other Estimates Is the Risk That the Estimates and Assumptions That the Bancorp and the Bank Use in Preparing Their Consolidated Financial Statements and In Models They Utilize to Make Business Decisions May Be Subject to Adjustment for Reasons Within or Beyond the Bancorp's and the Bank's Control, Which Could Result in Unexpected Losses and Adverse Effects on the Bancorp's and the Bank's Financial Condition.**

***The Bancorp's and Bank's financial statements are based in part on assumptions and estimates which, if incorrect, could cause unexpected losses in the future.***

The Bancorp and the Bank have made a number of estimates and assumptions relating to the reporting of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period to prepare these financial statements in conformity with U.S. GAAP. Actual results could differ from these estimates.

**Risks Related to Investments in the Bancorp's Common Stock**

**The offering price was determined by the Bancorp's board of directors, not by an independent advisor.**

The Board of Directors of the Bancorp established the offering price of $12.50 per share after reviewing factors deemed relevant by the Board, including the book value of the Bancorp's common stock, the Bank's profitability in 2021 and through September 30, 2022, lack of an active market for the Bancorp's stock resulting in very limited availability of the Bancorp's stock in the marketplace, the Bancorp's and the Bank's strong management teams and boards, and the opportunities in the marketplace for growth. The price of $12.50 per share represents 159.6% of the book value of $7.83 per share of the Bancorp's common stock as of September 30, 2022, or a 59.6% premium to book value.

**The Bancorp's common stock is quoted in the OTCQB market tier of the Over-the-Counter Markets Group (the "OTC Markets") under the symbol OTCQB: INFT. On December 30, 2022, the Real Time Best Bid & Ask prices of the Bancorp's common stock were $8.70 Bid (volume of 500 shares) and $8.76 Ask (volume of 900 shares).** Due to the limited market for the Bancorp's shares, the Board does not consider this price to be reflective of the actual value of the Bancorp's common stock.

**The Bancorp and the Bank depend on the skills and performance of management.**

The Bancorp and the Bank depend heavily on their executive management teams: Karkutla P. ("Bala") Balkrishna (Chairman and CEO of the Bancorp and CEO of the Bank), Victor E. Guerrero II (President/Chief Operating Officer of the Bancorp and the Bank), Elaine Crouch (Executive Vice President/Risk Management/Director of HR/Corporate Secretary of the Bancorp and the Bank), Allison Duncan (Executive Vice President/Chief Financial Officer of the Bancorp and the Bank), and Patty Staples (Executive Vice President/Chief Credit Officer of the Bank), to provide leadership and to make the Bancorp and the Bank successful. The Bancorp's and the Bank's executive management teams provide valuable banking and management services to the Bancorp and the Bank. The loss or substandard performance of any member of the Bancorp's and the Bank's executive management teams could impair the Bancorp's and the Bank's ability to succeed. As of February 1, 2018, the date the Bank opened for business, the Bank entered into 5-year employment agreements with Karkutla P. Balkrishna and Victor E. Guerrero II. The agreements will be automatically renewed after the expiration of the initial 5-year terms on January 31, 2023 for every one (1) year period occurring thereafter, unless written notice is given and received not less than three (3) months prior to the end of the then applicable term of the intention of either party not to renew the agreement.

The loss of services of any member of our executive management team, or their failure to adequately perform their management functions, would make it difficult for the Bank to improve earnings, continue to grow its business, obtain and retain customers, and set up and maintain appropriate internal controls for the Bancorp's and the Bank's operations. If any member of the executive management team does not perform up to expectations, the Bancorp's and the Bank's results of operations could suffer and their current plans for growth and increased profitability may not succeed. Finally, if any of the Bancorp's or the Bank's executive officers decides to leave, it may be difficult to replace the departing officer and the Bancorp and the Bank would lose the benefit of the knowledge the departing officer gained during his or her tenure with the Bancorp and the Bank.

**If the Bancorp cannot raise additional capital, the Bancorp's and the Bank's growth may be limited.**

The Offering is intended to help the Bancorp and the Bank finance additional growth. However, as with all small banks, for the Bancorp and the Bank to continue to grow over time and maintain adequate capital ratios, the Bancorp may need additional capital. The equity markets are competitive, and the Bancorp can give no assurances that it will be able to raise additional capital in the future.

The Bancorp's ability to raise capital through the sale of additional securities after the Offering will depend primarily upon the performance of the Bank, the financial condition of the Bancorp and the Bank, and the condition of financial markets generally, as well as in the Bank's market area, at the time of any such offering. Any such offering could have a dilutive effect on the earnings per share and book value per share to our existing shareholders. Even if an offering is accretive to book value per share, the future offering could have a dilutive effect on the earnings per share. If additional capital is required, there can be no assurance that such capital will be available on terms satisfactory to the Board, if at all. Failure to obtain additional capital when needed could slow or prevent the Bancorp's and the Bank's growth, hamper their ability to compete, and reduce their net income.

The Bancorp may decide to commence another public or private offering at any time after the close of the Offering. Depending upon the performance of the Bancorp and the Bank at the time of such a possible subsequent offering, the offering price of the subsequent offering might be more or less than $12.50 per share. If it is less than $12.50 per share, purchasers of common stock in this Offering will be diluted. No subsequent offerings are contemplated for the near future.

**Risks Related to the Offering**

**The Bancorp is selling the Shares on a "best efforts" basis.**

The Shares are being offered on a "best efforts" basis by the Bancorp's and the Bank's directors and officers. There is no requirement that the Bancorp sell any particular number of Shares and the Bancorp cannot assure subscribers that the Offering will be fully subscribed. If the Bancorp sells less than the $10,000,000 being offered, the lesser amount sold may not necessarily be sufficient for the Bancorp to accomplish its present goals. Among other things, if the Bancorp does not sell the full amount offered, the Bancorp and the Bank will grow more slowly and the Bancorp may need to raise additional capital in the future.

**The Offering is not underwritten.**

The Offering is not being underwritten. Thus, there has not been an independent review of matters covered by this Offering Circular as might be conducted by an underwriter had an underwriter been affiliated with the Offering. For instance, the determination of the offering price was not subject to underwriter review. The price was determined by the Board. You must rely solely on the Bancorp's and the Bank's directors and officers as to the accuracy of the information contained in this Offering Circular.

**There is a limited market for the Bancorp's Common Stock.**

As of the date of this Offering Circular, the Bancorp has 3,325,716 shares of common stock issued and outstanding. If 800,000 Shares are sold in this Offering, there will be 4,125,716 total shares issued and outstanding. The common stock of the Bancorp is traded under the symbol "OTCQB: INFT" on the OTCQB market system. The market for the Bank's shares, which have now been exchanged for shares of the Bancorp on a one-for-one basis, has been limited since the Bank opened on February 1, 2018.

Although the Shares will not have a legend condition and will be freely transferable, the Bancorp can give no assurances that there will be a market for the sale of the Shares.

**Neither the Bancorp nor the Bank has paid dividends in the past and the Bancorp's ability to pay significant dividends in the future is dependent upon the earnings of the Bank.**

The payment of cash dividends by the Bancorp is subject to restrictions set forth in the California Corporations Code (the "Code"). The shareholders of the Bancorp will be entitled to receive dividends, on a pro rata basis, when and as declared by the Board, out of funds legally available for the payment of dividends, as provided in the California General Corporation Law. Under California law, the Bancorp would be prohibited from paying dividends unless: (1) its retained earnings immediately prior to the dividend equals or exceeds the sum of (A) the amount of the proposed dividend plus (B) the cumulative dividends in arrears on all shares having a preference with respect to payment of dividends over the common stock; or (2) immediately after the dividend, its assets would equal or exceed the sum of its total liabilities plus the amount that would be needed if it were to be dissolved at the time of the dividend to satisfy the preferential rights, including accrued but unpaid dividends, of other shareholders upon dissolution that are superior to the rights of the common stock shareholders. In certain circumstances, the Bancorp may also be required to obtain the prior approval of the Federal Reserve Board to make capital distributions to shareholders.

**Although the Bank has not previously paid dividends, the Bancorp intends to pay dividends to its shareholders, in amounts to be determined by the Board of Directors of the Bancorp in its discretion, subject to the requirements of California law.**

**WHO MAY INVEST IN THE OFFERING**

The Bancorp is offering for sale in this Regulation A+ offering (the "Offering") up to 800,000 shares of its common stock, no par value, for a purchase price of $12.50 per share, for a total offering amount of $10,000,000. The shares are being offered for sale by this Offering Circular only to accredited investors, as such term is defined in Regulation D of the Securities and Exchange Commission (the "SEC") under the Securities Act of 1933, as amended (the "Act"), and only to those investors who satisfy the requirements of Section 25102(f) of the California Corporations Code.

**Accredited Investor**

To be an "accredited investor," an investor must come within any of the following categories, or be a person who the issuer reasonably believes comes within any of the following categories at the time of the sale of the shares to that investor:

&nbsp;&nbsp;&nbsp;&nbsp;· Any bank as defined in Section 3(a)(2) of the Act, or any savings and loan association or other institution as defined in
Section 3(a)(5)(A) of the act whether acting in its individual or fiduciary capacity; any broker or dealer registered pursuant
to Section 15 of the Securities Exchange Act of 1934; any insurance company registered under the Investment Company Act of 1940 or
a business development company as defined in Section 2(a)(48) of that Act; any Small Business Investment Company licensed by the
U.S. Small Business Administration under Section 301(c) or (d) of the Small Business Investment Act of 1958; any plan established
and maintained by a state, its political subdivisions, or any agency or instrumentality of a state or political subdivisions, for the
benefit of its employees, if such plan has total assets in excess of $5,000,000; any employee benefit plan within the meaning of the Employee
Retirement Income Security Act of 1974, if the investment decision is made by a plan fiduciary, as defined in Section 3(21) of such
Act, which is either a bank, savings and loan association, insurance company, or registered investment advisor, or if the employee benefit
plan has total assets in excess of $5,000,000, or, if a self-directed plan, with investment decisions made solely by persons that are
accredited investors;

&nbsp;&nbsp;&nbsp;&nbsp;· Any private business development company as defined in Section 202(a)(22) of the Investment Advisers Act of 1940;

&nbsp;&nbsp;&nbsp;&nbsp;· Any organization described in Section 501(c)(3) of the Internal Revenue Code, or corporation, Massachusetts or similar business
trust, or partnership, not formed for the specific purpose of acquiring the shares offered, with total assets in excess of $5,000,000;

&nbsp;&nbsp;&nbsp;&nbsp;· Any director, executive officer, or general partner of the issuer of the securities being offered or sold, or any director, executive
officer, or general partner of a general partner of that issuer;

&nbsp;&nbsp;&nbsp;&nbsp;· Any natural person whose individual net worth, or joint net worth with that person's spouse or spousal equivalent, at the time
of his purchase (excluding the value of the person's primary residence) exceeds $1,000,000;

&nbsp;&nbsp;&nbsp;&nbsp;· Any natural person who had an individual income in excess of $200,000 in each of the two most recent years, or joint income with that
person's spouse or spousal equivalent in excess of $300,000 in each of those years and has a reasonable expectation of reaching
the same income level in the current year;

&nbsp;&nbsp;&nbsp;&nbsp;· Any trust, with total assets in excess of $5,000,000, not formed for the specific purpose of acquiring the shares offered, whose purchase
is directed by a sophisticated person as described in Rule 506(b)(2)(ii) of Regulation D;

&nbsp;&nbsp;&nbsp;&nbsp;· Any entity in which all of the equity owners are accredited investors (as defined above).

&nbsp;&nbsp;&nbsp;&nbsp;· Any entity, of a type not listed above, not formed for the specific purpose of acquiring the securities offered, owning investments
in excess of $5,000,000:

&nbsp;&nbsp;&nbsp;&nbsp;· Any natural person holding in good standing one or more professional certifications or designations or credentials from an accredited
educational institution that the SEC has designated as qualifying an individual for accredited investor status;

&nbsp;&nbsp;&nbsp;&nbsp;· Any natural person who is a "knowledgeable employee," as defined in Rule 3c-5(a)(4) under the Investment Company
Act of 1940, of the issuer of the securities being offered or sold where the issuer would be an investment company, as defined in Section 3
of such Act, but for the exclusion provided by either section 3(c)(1) or section 3(c)(7) of such Act;

&nbsp;&nbsp;&nbsp;&nbsp;· Any "family office" as defined in Rule 202(a)(11)(G)-1 under the Investment Advisers Act of 1940 with assets under
management in excess of $5,000,000, that is not formed for the specific purpose of acquiring the securities offered, and whose prospective
investment is directed by a person who has such knowledge and experience in financial and business matters that such family office is
capable of evaluating the merits and risks of the prospective investment; and

&nbsp;&nbsp;&nbsp;&nbsp;· Any "family client" as defined in Rule 202(a)(G)-1 under the Investment Advisers Act of 1940, of a family office
meeting the requirements of a family office and whose prospective investment in the issuer is directed by such family office.

Each subscriber will represent and warrant to the Bancorp in such subscriber's subscription agreement that such subscriber is an accredited investor and shall designate in the subscription agreement the specific section or sections of the above description of the definition of accredited investor which applies to the subscriber.

**Section 25102(f) of the California Corporations Code**

Under Section 25102(f) of the California Corporations Code the following transactions are exempt from the qualification requirements under Section 25110 of the Code:

"(f) Any offer or sale of any security in a transaction (other than an offer or sale to a pension or profit-sharing trust of the issuer) that meets each of the following criteria:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) Sales of the security are not made to more than 35 persons, including persons not in this state.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) All purchasers either have a pre-existing personal or business relationship with the offeror or any of its partners, officers, directors
or controlling persons, or managers (as appointed or elected by the members) if the offeror is a limited liability company, or by reason
of their business or financial experience or the business or financial experience of their professional advisers who are unaffiliated
with and who are not compensated by the issuer or any affiliate or selling agent of the issuer, directly or indirectly, could be reasonably
assumed to have the capacity to protect their own interests in connection with the transaction.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) Each purchaser represents that the purchaser is purchasing for the purchaser's own account (or a trust account if the purchaser
is a trustee) and not with a view to or for sale in connection with any distribution of the security.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(4) The offer and sale of the security is not accomplished by the publication of any advertisement. The number of purchasers referred
to above is exclusive of any described in subdivision (i), any officer, director, or affiliate of the issuer, or manager (as appointed
or elected by the members) if the issuer is a limited liability company, and any other purchaser (together with any custodian or trustee
acting for the account of their minor children) are counted as one person and a partnership, corporation, or other organization that was
not specifically formed for the purpose of purchasing the security offered in reliance upon this exemption, is counted as one person.
The Commissioner may by rule require the issuer to file a notice of transaction under this subdivision."

The Commissioner has required by rule that a notice under Section 25102(f) shall be filed no later than 15 calendar days after the first sale of a security in this state.

Each subscriber will represent and warrant to the Bancorp in such subscriber's subscription agreement that such subscriber (1) has a pre-existing personal or business relationship with the Bancorp or one of its Executive Officers or directors, or by reason of their business or financial experience could be reasonably assumed to have the capacity to protect their own interests in connection with the transaction, (2) is purchasing for the purchaser's own account and not with a view to or for sale in connection with any distribution of the security, and (3) is not aware of any form of general solicitation or general advertising made by the Bancorp relating to the transaction.

Re-sales of the Shares purchased in the Offering in compliance with Section 25102(f) may be made in reliance on the non-issuer exemption provided by Section 25104(a) of the California Corporations Code. This exemption is self-executing so long as the re-sale does not involve any advertising or use of a broker-dealer as part of a public offering. Since the exemption is self-executing no documentation is required to be filed with the DFPI to rely on the exemption for resales under Section 25104(a).

**USE OF PROCEEDS**

If the Offering is consummated and all 800,000 Shares offered hereby are sold, the gross proceeds from the sale of those Shares at $12.50 per share would be $10,000,000, and the net proceeds would be approximately $9,952,000 after giving effect to estimated expenses in connection with the Offering of approximately $48,000, including, but not limited to, printing and copying costs, legal fees, accounting fees, filing fees, postage, and other miscellaneous costs and expenses, including meeting expenses. Notwithstanding the foregoing, the Bancorp can provide no assurances as to the total number of Shares that may be sold or the amount of expenses to be paid.

The estimated offering expenses of $48,000 include printing and copying costs of $700, legal fees of $25,000, accounting fees of $15,000, transfer agent fees of $2,500, filing fees of $300, postage and mailing costs of $2,000, and miscellaneous costs and expenses, including expenses for meals and meetings with possible investors, of $2,500. All of these expenses are estimates only and the actual offering expenses may be higher or lower than anticipated.

The net proceeds from the Offering of $9,952,000 will be used by the Bancorp as additional working capital to support the growth of the Bank. If less than $9,952,000 of net proceeds are received from the Offering, whatever amount is raised will be used by the Bancorp as additional working capital.

The Bancorp has significant discretion over the net proceeds of the Offering. As is the case with any business, it should be expected that certain expenses unforeseeable to management at this juncture will arise in the future. There can be no assurance that management's use of proceeds generated through this Offering will prove optimal or translate into revenue or profitability for the Bancorp.

A portion of the proceeds from this Offering may be used to compensate or otherwise make payments to officers or directors of the Bancorp. The officers and directors of the Bancorp may be paid salaries and receive benefits that are commensurate with similar companies, and a portion of the proceeds may be used to pay these ongoing business expenses.

The Bancorp reserves the right to change the use of proceeds set out herein based on the needs of the ongoing business of the Bancorp and the Bank and the discretion of the Bancorp's management. The Bancorp may reallocate the estimated use of proceeds among the various categories or for other uses if management deems such a reallocation to be appropriate.

---

| | | | | |
|:---|:---|:---|:---|:---|
| &nbsp;&nbsp;**Total Raised in Offering** | $**2500000** | $**5000000** | $**7500000** | $**10000000** |
| &nbsp;&nbsp;Working Capital<sup>1</sup> | 2452000 | 4952000 | 7452000 | 9952000 |
| &nbsp;&nbsp;Offering expenses | 48000 | 48000 | 48000 | 48000 |
| &nbsp;&nbsp;**Totals:** | $**2500000** | $**5000000** | $**7500000** | $**10000000** |

---

<sup>1</sup> The Bancorp cannot predict with any degree of certainty the specific amounts of Working Capital to be allocated to the payment of specific future expenses. As a result, the management of the Bancorp shall have wide latitude and discretion in the use of proceeds from this Offering. Management's allocation of Working Capital to specific uses shall be determined by management in its discretion, including increasing and decreasing such allocations from time to time. Such allocations of Working Capital shall be allocated by management among items such as, but not limited to, the following: Salaries and Wages, Marketing, Office Expenses, Technology-related expenses, repayment of principal or interest under the Bank's subordinated capital notes and Offering Expenses.

**PLAN OF DISTRIBUTION**

**General**

The Bancorp is hereby offering for sale (the "Offering") up to 800,000 shares of its common stock, no par value ("Shares") for a purchase price of $12.50 per Share, for a total offering amount of up to $10,000,000. The OTCQB Trading Symbol for the Bancorp's common stock is OTCQB: INFT.

The shares are being offered for sale by this Offering Circular only to accredited investors, as such term is defined in Regulation D of the Securities and Exchange Commission (the "SEC") under the Securities Act of 1933, as amended (the "Act"), and only to those investors who satisfy the requirements of Section 25102(f) of the California Corporations Code. See "WHO MAY INVEST IN THE OFFERING", beginning on page 21

There are no existing shareholders who are selling any shares of common stock of the Bancorp ("Selling Shareholders") in the Offering.

**Minimum Amount for Offering**

There is no minimum number of Shares that must be sold. Upon the close of the Offering, the Bancorp may accept subscriptions and add the subscription funds to the capital of the Bancorp.

**Minimum Amount Required to be Purchased by an Investor**

The minimum amount of Shares which must be purchased is 20,000 Shares for $250,000, unless a lesser amount is approved for any investor by the Board of Directors of Bancorp in its discretion (for executive officers and for others where special circumstances are involved).

**Maximum Amount Permitted to be Purchased by an Investor**

Unless all necessary regulatory approvals are first obtained, no subscriber shall be permitted to purchase that number of Shares which would result in the subscriber's ownership of more than 9.9% of the total shares outstanding after the completion of the Offering (maximum of 408,445 shares if all 800,000 Shares are sold, resulting in 4,125,716 outstanding shares.

**Closing Date**

**The Offering will close (the "Closing Date") at the earliest of (a) 4:00 p.m., Pacific time, on April 28, 2023,** **unless extended by the Bancorp in its discretion to a date which is not later than one year from the date this Offering is qualified by the SEC, (b) the date on which the maximum Offering of $10,000,000 has been sold, (c) the date which is one year from this Offering being qualified by the SEC, or (d) the date on which this Offering is earlier terminated by the Bancorp, in its sole discretion.**

After the Closing Date, the Bancorp may formally approve subscriptions received prior to the Closing Date, in whole or in part, or reject subscriptions, at any time up to the date which is 14 days after the Closing Date. The Bancorp will notify all investors no later than 14 days after the Offering is concluded whether their subscription has been accepted or rejected, in whole or in part. If the Bancorp does not approve, in whole or in part, any subscription, a refund will be mailed to the investor in an amount equal to the subscription price for the number of Shares as to which the subscription is not approved, without interest, by no later than 14 days after the Close of the Offering. The Bancorp reserves the right to cancel the Offering at any time and return all subscriptions.

**How to Subscribe for Shares**

To subscribe for Shares in the Offering, complete a subscription agreement (the form is included with this Offering Circular), and deliver it, together with the total subscription price for all the Shares you wish to purchase, before 4:00 p.m., Pacific time, on the Closing Date to:

Infinity Bank

Attention: Victor E. Guerrero II

President/Chief Operating Officer

6 Hutton Centre Drive, Suite 100

Santa Ana, California 92707

**Stock Subscription Account**

Your subscription funds will be held in a stock subscription account at the Bank until your subscription is approved by the Bancorp, which shall occur no later than 14 days after the Offering closes. Upon approval of your subscription by the Bancorp, your subscription funds shall be immediately released from the stock subscription account and added to the capital accounts of the Bancorp.

**Release of Subscription Funds to the Bancorp** 

**NO FUNDS SHALL BE RELEASED TO THE BANCORP FROM THE STOCK SUBSCRIPTION ACCOUNT FOR THE OFFERING UNTIL THE BANCORP HAS CLOSED THE OFFERING.**

**The method of delivery of subscription agreements and payment of the subscription price to the Bancorp will be at your own election and risk. If you send subscription agreements and payments by mail, you are urged to send the materials by registered mail, properly insured, with return receipt requested, and are urged to allow a sufficient number of days to ensure delivery to the Bancorp and clearance of payment prior to the Closing Date. Because uncertified personal checks may take at least seven business days to clear, you are strongly urged to pay, or arrange for payment, by means of bank check or wire transfer of funds.**

The Bancorp will determine all questions concerning the timeliness, validity, form and eligibility of any subscription agreements. Subscription agreements will not be deemed to have been received or accepted until all irregularities have been waived or cured within such time as the Bancorp determines, in its sole discretion. The Bancorp will not be under any duty to give notification of any defect or irregularity in connection with the submission of subscription agreements or incur any liability for failure to give such notification. The Bancorp reserves the right to reject any subscription agreement if such agreement is not in proper form or if the acceptance thereof or the issuance of Shares pursuant thereto could be deemed unlawful. See "Regulatory Limitations" below.

If any subscriber has questions about the Offering, the subscriber should direct those questions to Victor E. Guerrero, President/Chief Operating Officer, 6 Hutton Centre Drive, Suite 100, Santa Ana, California 92707 (telephone: 657-223-1000, email: victor@goinfinitybank.com).

**No Revocation; Commissions and Fees**

Once you have submitted a subscription agreement, you cannot revoke the agreement.

All commissions, fees and other expenses (including brokerage commissions and transfer taxes) incurred by a subscriber will be for the account of the subscriber, and none of such commissions, fees or expenses will be paid by the Bancorp or the Bank.

**Determination of Subscription Price**

The subscription price for the Shares has been determined by the Board. In approving the subscription price, the Board considered, without limitation, such factors as:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· the book value of the Bank's common stock,

· the Bank's profitability in 2021 and through September 30, 2022,

· lack of an active market for the Bancorp's stock resulting in very limited availability of the Bancorp's
stock in the marketplace,

· the Bancorp's and the Bank's strong management teams and boards, and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· the opportunities in the marketplace for growth.

The price of $12.50 per share represents 159.6% of the book value of $7.83 per share of the Bancorp's common stock as of September 30, 2022, or a 59.6% premium to book value as of that date.

The Bancorp's common stock is quoted in the OTCQB market tier of the Over-the-Counter Markets Group (the "OTC Markets") under the symbol OTCQB: INFT. On December 30, 2022, the Real Time Best Bid & Ask prices of the Bancorp's common stock were $8.70 Bid (volume of 500 shares) and $8.76 Ask (volume of 900 shares). Due to the limited market for the Bancorp's shares, the Board does not consider this price to be reflective of the actual value of the Bancorp's common stock.

**Issuance of Shares following the Close of the Offering**

No later than 21 days after the Close of the Offering, a book-entry record for the Shares you have purchased in the Offering will be made by the Bancorp's registrar and transfer agent. No paper stock certificates will be issued.

**Advertising and Other Promotional Materials**

The Bancorp will not be advertising the Offering. The Offering is made only by means of this Offering Circular and prospective investors must read and rely on the information provided in this Offering Circular in connection with their decision to invest in the Shares.

**Regulatory Limitations**

**Change in Control**

The Federal Change in Bank Control Act of 1978 prohibits a person or group of persons "acting in concert" or any company from acquiring "control" of a bank holding company unless the Federal Reserve Board (the "FRB") has been given 60 days' prior written notice of such proposed acquisition and within that time period the FRB has not issued a notice disapproving the proposed acquisition or extending for up to another 30 days the period during which such a disapproval may be issued. An acquisition may be made prior to the expiration of the disapproval period if the FRB issues written notice of its intent not to disapprove the action. Under a rebuttable presumption established by the FRB, the acquisition of more than 10% of a class of voting stock of a bank holding company would, under the circumstances set forth in the presumption, constitute an acquisition of control. The acquisition of control would also require the approval of the DFPI under California law.

Unless all necessary regulatory approvals are first obtained, no subscriber shall be permitted to purchase that number of Shares which would result in the subscriber's ownership of more than 9.9% of the total shares outstanding after the completion of the Offering (maximum of 408,445 shares if all 800,000 Shares are sold, resulting in 4,125,716 outstanding shares.

**No Board or Financial Advisor Recommendation**

An investment in the Shares must be made according to your own evaluation of your best interests. Accordingly, neither the Board of Directors of the Bancorp nor the Board of Directors of the Bank makes any recommendation to you about whether you should purchase Shares in the Offering.

**PRO FORMA**

**CAPITALIZATION**

The following table sets forth the pro forma capitalization and capital ratios of the Bank as of September 30, 2022, adjusted to give effect to the sale of 200,000 Shares (25%), 400,000 Shares (50%), 600,000 Shares (75%), and 800,000 Shares (100%) in the Offering.<sup>1</sup> The financial information included in this section and throughout this Offering Circular should be read in conjunction with our financial statements. See "Infinity Bancorp Reorganization" on page 7 concerning the impact of the Reorganization which was effective October 21, 2022.

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | September 30, 2022<sup>2,3</sup> | Pro Forma (As<br> Adjusted)<sup>3,4</sup><br> Assuming<br> 200,000<br> Shares are Sold<br> (25%) | Pro Forma<br> (As<br> Adjusted)<sup>3,5</sup><br> Assuming<br> 400,000<br> Shares are<br> Sold<br> (50%) | Pro Forma<br> (As<br> Adjusted)<sup>3,6</sup><br> Assuming<br> 600,000<br> Shares are<br> Sold<br> (75%) | Pro Forma<br> (As<br> Adjusted)<sup>3,7</sup><br> Assuming<br> 800,000<br> Shares are<br> Sold<br> (100%) |
| <u>Shareholders' Equity</u> |  |  |  |  |  |
| Common stock | $33423711 | $35875711 | $38375711 | $40875711 | $43375711 |
| Preferred stock |  |  |  |  |  |
| Additional Paid in Capital |  |  |  |  |  |
| Accumulated Deficit | (2383807) | (2383807) | (2383807) | (2383807) | (2383807) |
| Net securities valuation allowance | (5006564) | (5006564) | (5006564) | (5006564) | (5006564) |
| Total shareholders' equity | $26033340 | $28485340 | $30985340 | $43485340 | $35985340 |

---

<sup>1</sup> This table is provided for illustrative purposes only. This table does not take into account any common stock that may be issued pursuant to the exercise of outstanding stock options or pursuant to the vesting of Restricted Stock Units after September 30, 2022.

<sup>2</sup> The Bancorp has 20,000,000 authorized shares of common stock, with no par value, of which 3,325,716 shares were issued and outstanding as of September 30, 2022, resulting in a book value of approximately $<u>7.83</u> per share as of that date.

<sup>3</sup> The figures shown are net of estimated expenses in connection with this Offering of approximately $48,000. See "USE OF PROCEEDS" above on page 24.

<sup>4</sup> If 200,000 Shares are sold in the Offering, the Bancorp will have 3,525,716 shares of common stock outstanding, each having a book value of approximately $<u>8.08</u> per share.

<sup>5</sup> If 400,000 Shares are sold in the Offering, the Bancorp will have 3,725,716 shares of common stock outstanding, each having a book value of approximately $<u>8.32</u> per share.

<sup>6</sup> If 600,000 Shares are sold in the Offering, the Bancorp will have 3,925,716 shares of common stock outstanding, each having a book value of approximately $<u>8.53</u> per share.

<sup>7</sup> If 800,000 Shares are sold in the Offering, the Bancorp will have 4,125,716 shares of common stock outstanding, each having a book value of approximately $<u>8.72</u> per share.

**PRO FORMA**

**CAPITAL RATIOS**

**AS OF SEPTEMBER 30, 2022**

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | September 30, 2022<sup>1</sup> | Pro Forma<br> Assuming<br> 200,000<br> Shares are<br> Sold<br> (25%)<sup>2</sup> | Pro Forma<br> Assuming<br> 400,000<br> Shares are<br> Sold<br> (50%)<sup>3</sup> | Pro Forma<br> Assuming<br> 600,000<br> Shares are<br> Sold<br> (75%)<sup>4</sup> | Pro Forma<br> Assuming<br> 800,000<br> Shares are<br> Sold<br> (100%)<sup>5</sup> |
| <u>Capital Ratios</u> |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total risk-based capital<br> (to risk-weighted assets)<br>| 17.4% | 18.6% | 19.7% | 20.9% | 22.1% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Tier 1 risk-based capital<br> (to risk-weighted assets)<br>| 14.3% | 15.5% | 16.7% | 17.8% | 19.0% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Tier 1 leveraged capital<br> (to average assets) | 9.3% | 10.0% | 10.8% | 11.5% | 12.3% |

---

<sup>1</sup> This table is provided for illustrative purposes only. This table does not take into account any common stock that may be issued pursuant to the exercise of outstanding stock options or pursuant to the vesting of Restricted Stock Units after September 30, 2022. The Bank had 20,000,000 authorized shares of common stock, with no par value, of which 3,325,716 shares were issued and outstanding as of September 30, 2022. The figures shown are net of estimated expenses in connection with this Offering of approximately $48,000. See "USE OF PROCEEDS" above on page 24.

See also "Infinity Bancorp Reorganization" on page 7 concerning the impact of the Reorganization which was effective October 21, 2022.

<sup>2</sup> If 200,000 Shares are sold in the Offering, the Bancorp will have 3,525,716 shares of common stock outstanding.

<sup>3</sup> If 400,000 Shares are sold in the Offering, the Bancorp will have 3,725,716 shares of common stock outstanding.

<sup>4</sup> If 600,000 Shares are sold in the Offering, the Bancorp will have 3,925,716 shares of common stock outstanding.

<sup>5</sup> If 800,000 Shares are sold in the Offering, the Bancorp will have 4,125,716 shares of common stock outstanding.

**DILUTION**

The Articles of Incorporation of the Bancorp authorize the issuance of 20,000,000 shares of common stock and 10,000,000 shares of preferred stock. See "SECURITIES BEING OFFERED" on page 61 below. As of September 30, 2022, the Bank had 3,325,716 shares of common stock issued and outstanding, and no shares of preferred stock outstanding. See "Infinity Bancorp Reorganization" on page 7 concerning the impact of the Reorganization which was effective October 21, 2022.

After the Offering, if all 800,000 shares of common stock are sold, the Bancorp will have 4,125,716 shares of common stock issued and outstanding, assuming no exercise of any outstanding stock options or issuance of restricted stock. The balance of 15,874,284 shares of common stock which will be authorized but unissued after the Offering, would be available for future stock option exercises, issuance of shares upon the vesting of Restricted Stock Units, and issuance for proper corporate purposes. The preferred stock is not affected by the Offering and there is no present intention to issue any preferred stock.

If all 800,000 Shares are sold in the Offering, existing shareholders of the Bancorp will have their percentages of ownership reduced by 19.391%. Thus, a shareholder who owns 100,000 shares of the Bancorp as of the date of the Offering (3.07% of the outstanding 3,325,716 shares) and who does not participate in the Offering would own 100,000 shares upon completion of the Offering (2.42% of the 4,125,716 shares outstanding) after the issuance of 800,000 Shares in the Offering, a 19.391% reduction in voting power. The following tables illustrate the per Share dilution which would occur under each of the "Use of Proceeds" scenarios shown on page 24 (after deducting the offering expenses of $48,000 for each scenario:

**If the total capital raised is $2,500,000:**

---

| | |
|:---|:---|
| &nbsp;&nbsp;Offering Price per Share | &nbsp;&nbsp;$12.50 |
| &nbsp;&nbsp;Net Tangible Book Value per Share before Offering, (based on 3,325,716 shares of common stock outstanding) | &nbsp;&nbsp;$7.83 |
| &nbsp;&nbsp;Increase in Net Tangible Book Value per Share Attributable to Shares Offered Hereby (200,000 Shares) | &nbsp;&nbsp;$0.25 |
| &nbsp;&nbsp;Net Tangible Book Value per Share after Offering (based on 3,525,716 shares outstanding) | &nbsp;&nbsp;$8.08 |
| &nbsp;&nbsp;Dilution of Net Tangible Book Value per Share to subscribers in this Offering | &nbsp;&nbsp;$4.41 (35.28% dilution) |

---

**If the total capital raised is $5,000,000:**

---

| | |
|:---|:---|
| &nbsp;&nbsp;Offering Price per Share | &nbsp;&nbsp; $12.50 |
| &nbsp;&nbsp;Net Tangible Book Value per Share before Offering, (based on 3,325,716 shares of common stock outstanding) | &nbsp;&nbsp;$7.83 |
| &nbsp;&nbsp;Increase in Net Tangible Book Value per Share Attributable to Shares Offered Hereby (400,000 Shares) | &nbsp;&nbsp;$0.49 |
| &nbsp;&nbsp;Net Tangible Book Value per Share after Offering (based on 3,725,716 shares outstanding) | &nbsp;&nbsp;$8.32 |
| &nbsp;&nbsp;Dilution of Net Tangible Book Value per Share to subscribers in this Offering | &nbsp;&nbsp;$4.17 (33.36% dilution) |

---

**If the total capital raised is $7,500,000:**

---

| | |
|:---|:---|
| &nbsp;&nbsp;Offering Price per Share | &nbsp;&nbsp; $12.50 |
| &nbsp;&nbsp;Net Tangible Book Value per Share before Offering, (based on 3,325,716 shares of common stock outstanding) | &nbsp;&nbsp;$7.83 |
| &nbsp;&nbsp;Increase in Net Tangible Book Value per Share Attributable to Shares Offered Hereby (600,000 Shares) | &nbsp;&nbsp;$0.70 |
| &nbsp;&nbsp;Net Tangible Book Value per Share after Offering (based on 3,925,716 shares outstanding) | &nbsp;&nbsp;$8.53 |
| &nbsp;&nbsp;Dilution of Net Tangible Book Value per Share to subscribers in this Offering | &nbsp;&nbsp;$3.96 (31.68% dilution) |

---

**If the total capital raised is $10,000,000:**

---

| | |
|:---|:---|
| &nbsp;&nbsp;Offering Price per Share | &nbsp;&nbsp; $12.50 |
| &nbsp;&nbsp;Net Tangible Book Value per Share before Offering, as of the date of this Offering (based on 3,325,716 shares of common stock outstanding) | &nbsp;&nbsp; $7.83<br>|
| &nbsp;&nbsp;Increase in Net Tangible Book Value per Share Attributable to Shares Offered Hereby (800,000 Shares) | &nbsp;&nbsp;$0.89 |
| &nbsp;&nbsp;Net Tangible Book Value per Share after Offering (based on 4,125,716 shares outstanding) | &nbsp;&nbsp;$8.72 |
| &nbsp;&nbsp;Dilution of Net Tangible Book Value per Share to subscribers in this Offering | &nbsp;&nbsp;$3.77 (30.16% dilution) |

---

**DISQUALIFYING EVENTS AND BAD ACTOR DISCLOSURE**

Recent changes to Regulation A+ promulgated under the Securities Act prohibit an issuer from claiming an exemption from registration of its securities under such rule if the issuer, or any of its predecessors, any affiliated issuer, any director, executive officer, other officer participating in the offering of the interests, general partner or managing member of the issuer, any beneficial owner of 20% or more of the voting power of the issuer's outstanding voting securities, any promoter connected with the issuer in any capacity as of the date hereof, an investment manager of the issuer any person that has been or will be paid (directly or indirectly) remuneration for solicitation of purchasers in connection with such sale of the issuer's interests, any general partner or managing member of any such investment manager or solicitor, or any director, executive officer or other officer participating in the offering of any such investment manager or solicitor or general partner or managing member of such investment manager or solicitor has been subject to certain "Disqualifying Events" described in 17 CFR 230.262(a), subject to certain limited exceptions. The Bancorp is required to exercise reasonable care in conducting an inquiry to determine whether any such persons have been subject to such Disqualifying Events and is required to disclose any Disqualifying Events that occurred prior to September 23, 2013 to investors in the Bancorp.

The Bancorp believes that it has exercised reasonable care in conducting an inquiry into Disqualifying Events by the foregoing persons and is aware of no such Disqualifying Events. Under 17 CFR 230.262(d), the Bancorp is also required to include in this Offering Circular a description of any matters that would have triggered disqualification that occurred before June 19, 2015. The Bancorp hereby gives notice that there are no matters of which it is aware, after exercising reasonable care to investigate, that would have triggered disqualification that occurred before June 19, 2015.

It is possible that (a) Disqualifying Events may exist of which the Bancorp is not aware, and (b) the SEC, a court or other finder of fact may determine that the steps that the Bancorp has taken to conduct its inquiry were inadequate and did not constitute reasonable care. If such a finding were made, the Bancorp may lose its ability to rely upon exemptions under Regulation A+, and, depending on the circumstances, may be required to register the Offering of the Shares with the SEC and under applicable state securities laws or conduct a rescission offer with respect to the Shares sold in the Offering.

**TRADING HISTORY**

Trading in the Bank's common stock before October 21, 2022 and in the Bancorp's common stock since that date has been limited and such trades cannot be characterized as constituting an active market. The common stock of the Bancorp is traded under the symbol "OTCQB: INFT" on the OTCQB market system.

Any investment in the Bancorp's common stock should be considered a long-term investment. Sale of the Bancorp's common stock may not be possible, even in the event of an emergency. In addition, the price you may obtain is unpredictable. If a large block of shares is placed for sale, this may cause the price to decline for a period of time.

As of September 30, 2022, the common stock of the Bancorp was held by approximately 80 beneficial holders. The shares of the Bank were exchanged for shares of the Bancorp on October 21, 2022 on a one-for-one basis.

The Bancorp's common stock is quoted in the OTCQB market tier of the Over-the-Counter Markets Group (the "OTC Markets") under the symbol OTCQB:INFT. On December 30, 2022, the Real Time Best Bid & Ask prices of the Bancorp's common stock were $8.70 Bid (volume of 500 shares) and $8.76 Ask (volume of 900 shares). Due to the limited market for the Bancorp's shares, the Board does not consider this price to be reflective of the actual value of the Bancorp's common stock.

**DIVIDENDS**

The payment of cash dividends by the Bancorp is subject to restrictions set forth in the California Corporations Code (the "Code"). The shareholders of the Bancorp will be entitled to receive dividends, on a pro rata basis, when and as declared by the Board, out of funds legally available for the payment of dividends, as provided in the California General Corporation Law. Under California law, the Bancorp would be prohibited from paying dividends unless: (1) its retained earnings immediately prior to the dividend equals or exceeds the sum of (A) the amount of the proposed dividend plus (B) the cumulative dividends in arrears on all shares having a preference with respect to payment of dividends over the common stock; or (2) immediately after the dividend, its assets would equal or exceed the sum of its total liabilities plus the amount that would be needed if it were to be dissolved at the time of the dividend to satisfy the preferential rights, including accrued but unpaid dividends, of other shareholders upon dissolution that are superior to the rights of the common stock shareholders. In certain circumstances, the Bancorp may also be required to obtain the prior approval of the Federal Reserve Board to make capital distributions to shareholders.

**Although the Bank has not previously paid dividends, the Bancorp intends to pay dividends to its shareholders, in amounts to be determined by the Board in its discretion, subject to the requirements of California law.**

Whether or not dividends, either cash or stock, will be paid in the future will be determined by the Board of Directors of Bancorp after consideration of various factors. The Bancorp's and the Bank's profitability and regulatory capital ratios, providing a reasonable return to shareholders, in addition to other financial conditions will be key factors considered by the Board of Directors of Bancorp in making such determinations regarding the payment of dividends.

**BUSINESS**

**Infinity Bancorp**

Infinity Bancorp was incorporated as a California corporation on June 16, 2022. On July 6, 2022, the Bancorp, the Bank, and Infinity Merger Co., a California corporation organized on June 16, 2022 for the sole purpose of effecting the Reorganization, entered into a Plan of Reorganization and Merger Agreement (the "Merger Agreement"). The Merger Agreement provided for a reverse triangular merger transaction (the "Reorganization") pursuant to which the Bank became a wholly owned subsidiary of the Bancorp. The Merger Agreement provides that upon completion of the Merger, the Bank's outstanding shares of common stock were exchanged for an equal number of shares of the Bancorp's common stock, and the shareholders of the Bank become shareholders of the Bancorp. The Reorganization was subject to approval by the DFPI, the FDIC, the Federal Reserve Bank of San Francisco, and by shareholders of the Bank holding a majority of the issued and outstanding shares of the Bank. All regulatory approvals were received and the shareholders of the Bank approved the reorganization on September 29, 2022. The Effective Date of the Merger and the Reorganization was the date the Merger Agreement was filed with the California Secretary of State, which was October 21, 2022. As of the Effective Date, the Bancorp owned 100% of the issued and outstanding shares of the Bank, and all former shareholders of the Bank became shareholders of the Bancorp with the same number of shares they previously owned in the Bank.

As of the date of this Offering Circular, the Bancorp has 3,325,716 shares of common stock issued and outstanding. If 800,000 Shares are sold in this Offering, there will be 4,125,716 total shares issued and outstanding. The common stock of the Bancorp is traded under the symbol "INFT" on the OTCQB market system.

The Bancorp's headquarters office is located at 6 Hutton Centre Drive, Suite 100, Santa Ana, California 92707. Presently, the sole business of the Bancorp is to operate its subsidiary Bank.

The current members of the Board of Directors of the Bancorp are Karkutla P. ("Bala") Balkrishna (Chairman), Cary D. Bren, Curtis E. Campbell, Raymond J. Gagnon, Victor E. Guerrero II, Katherine T. Le, Richard H. Schlatter and Glenn B. Stearns. The Bancorp's executive officers are Bala Balkrishna (Chairman and Chief Executive Officer), Victor E. Guerrero II (President/Chief Operating Officer), Elaine Crouch (Executive Vice President/Risk Management/Director of HR/Corporate Secretary), and Allison Duncan (Executive Vice President/Chief Financial Officer).

The Bancorp's telephone number is: (657) 223-1000. Elaine Crouch, the Bancorp's Corporate Secretary, may be reached at Infinity Bank, 6 Hutton Centre Drive, Suite 100, Santa Ana, California 92707, Telephone: (657) 223-1000, facsimile: (714) 619-7456, or email: <u>elaine@goinfinitybank.com</u>.

**Infinity Bank**

Infinity Bank is a California state-chartered bank headquartered in Santa Ana, California. The Bank was incorporated as a California banking corporation on January 27, 2017 and commenced business on February 1, 2018. Upon opening for business in 2018, the Bank focused its lending efforts on small to medium-sized businesses, high-net-worth individuals, and professionals in its market area. The Bank has one full-service office in Santa Ana, Orange County, California: the Bank's headquarters office is located at 6 Hutton Centre Drive, Suite 100, Santa Ana, California 92707. The Bank engages in substantially all the business operations customarily conducted by state-chartered banks in California. Its deposits are insured by the Federal Deposit Insurance Corporation up to the maximum legal limit.

The Bank became a wholly owned subsidiary of Infinity Bancorp on October 21, 2022.

The current members of the Board of Directors of the Bank are Karkutla P. ("Bala") Balkrishna, Cary D. Bren, Curtis E. Campbell, Raymond J. Gagnon (Chairman), Victor E. Guerrero II, Katherine T. Le, Richard H. Schlatter and Glenn B. Stearns. The Bank's executive officers are Bala Balkrishna (Chief Executive Officer), Victor E. Guerrero II (President/Chief Operating Officer), Elaine Crouch (Executive Vice President/Risk Management/Director of HR/Corporate Secretary), Allison Duncan (Executive Vice President/Chief Financial Officer), and Patty Staples (Executive Vice President/Chief Credit Officer).

The Bank's telephone number is: (657) 223-1000. Elaine Crouch, the Bank's Corporate Secretary, may be reached at Infinity Bank, 6 Hutton Centre Drive, Suite 100, Santa Ana, California 92707, Telephone: (657) 223-1000, facsimile: (714) 619-7456, or email: <u>elaine@goinfinitybank.com</u>.

On October 22, 2021, the Bank issued $4 million of subordinated capital notes (the "Subordinated Notes") in a non-public offering to accredited investors only pursuant to a Permit issued by the DFPI, subject to the requirements of Section 1211 of the California Financial Code. The Subordinated Notes are fixed to floating rate notes due in 10 years, are callable by the Bank after five years at par, are not callable by the holders, are structured to satisfy the requirements for Tier 2 capital and are not convertible into shares of common stock of the Bank. Payments under the Subordinated Notes are due semi-annually in arrears.

**The Business Strategy of the Bank**

The Bank's business strategy is to operate a client-focused, well-capitalized and profitable Southern California bank dedicated to providing personal service to its business and individual customers. The Bank believes that stable, long-term growth and profitability are the result of building strong customer relationships while maintaining disciplined credit underwriting standards.

The Bank's loan portfolio consists primarily of loans to borrowers within Orange County and its surrounding areas. Although the Bank seeks to avoid concentrations of loans to a single industry or based upon a single class of collateral, real estate and real estate associated businesses are among the principal industries in the Bank's market area and, as a result, the Bank's loan and collateral portfolios are, to some degree, concentrated in those industries.

The composition of the Bank's loan portfolio as of September 30, 2022 is: Construction and land development ($37.4 million or 24.8% of total loans of $150.7 million), Real Estate – Commercial and Residential ($34.9 million or 23.2%), Commercial & Industrial ($78.3 million or 51.9%), and Consumer ($0.1 million or 0.1%). This compares to the following totals at September 30, 2021: Construction and land development ($27.5 million or 17.9% of total loans of $153.6 million), Real Estate – Commercial and Residential ($40.3 million or 26.3%), Commercial & Industrial ($81.0 million or 52.7%), and Consumer ($4.8 million or 3.1%).

**Bank Services**

The Bank, as an independent community bank, offers a full range of banking services primarily to the business and professional community and individuals located in and around Orange County and neighboring communities. Since commencing operations in 2018, the Bank has focused on funding and placing into portfolio commercial and industrial loans, commercial real estate, and construction and land development loans.

The Bank offers a wide range of deposit instruments. These include personal and business checking accounts and savings accounts, interest-bearing negotiable orders of withdrawal ("NOW") accounts, money market accounts, and time certificates of deposit.

**Competition**

The banking business in California, generally, and in the Bank's market area, in particular, is highly competitive with respect to both deposits and loans and is dominated by a relatively small number of major banks, which have many offices operating over a wide geographic area. Among the advantages that some of these institutions have over the Bank is their ability to undertake extensive advertising campaigns and to allocate their investment assets to areas of highest yield and demand.

The Bank competes for deposits and loans, principally with these banks, as well as with savings and loan associations, thrift and loan associations, credit unions, mortgage companies, insurance companies, other financial service institutions, and money market mutual funds. In competing for deposits, the Bank is subject to certain limitations not applicable to non-bank financial institutions. Deregulation of interest rate ceilings payable on deposits has increased, and will continue to increase, competition for deposits. In addition, other entities (both public and private) seeking to raise capital through the issuance and sale of debt or equity securities will also compete with the Bank for deposits.

Many of the major commercial banks operating in the Bank's market area offer certain services such as trust services and international banking which the Bank does not offer directly. By virtue of their greater total capitalization, such major banks have substantially higher lending limits than the Bank. Savings and loan associations and credit unions are continuing to offer products and services which compete with the products and services offered by banking institutions, including the Bank. Other community banks also represent a competitive force.

To compete effectively, the Bank has assembled an experienced staff of bankers who operate as a team under the leadership and direction of Karkutla P. Balkrishna (CEO), Victor E. Guerrero II (President/Chief Operating Officer), Elaine Crouch (Executive Vice President/Risk Management/Director of HR/Corporate Secretary), Allison Duncan (Executive Vice President/Chief Financial Officer), and Patty Staples (Executive Vice President/Chief Credit Officer). Each of the Bank's executive officers has extensive banking experience in Orange County and its surrounding areas. The Bank's entire management team and staff are familiar with the financial needs of the businesses in the Bank's market area and are acquainted with the products and services that serve those needs.

The Bank provides its customers with the convenience of technological access services; however, the Bank believes and emphasizes face-to-face, personalized service, with the goal of creating long-term relationships.

**Description of Property**

Neither the Bancorp nor the Bank owns any real property. In February 2018, the Bank entered into a seven-year lease agreement (the "Lease") for its corporate headquarters and branch, approximately 8,850 rentable square feet of space in Suite 100 located on the ground floor of the 14-story building located at 6 Hutton Centre Drive, Santa Ana, CA 92707 (the "Building"). The Building is one of the two building towers in the Hutton Centre and is easily accessible to the 55 and 405 freeways.

The Lease includes two three-year renewal options. The starting base monthly rental rate was $2.85 per rentable square foot (RSF) or $25,288.05 per month, full-service gross. Rent for the first five months of the term of the Lease was free. The monthly rental rate increases annually by approximately 3.5% percent with the first adjustment made at the beginning of the thirteenth month. The Bank is also responsible for the pro rata share of any operating expense increase in excess of the actual expenses incurred by the landlord during each fiscal year. The total expense under the Lease was approximately $320,000 for each of the years ended December 31, 2021 and December 31, 2020.

**Additional Branches and Expansion Plans**

At this time, there are no plans to open additional branches. The Bank's goal is to maximize profitable operations and impactful market penetration while keeping overhead expense at reasonable levels. Additionally, there are no plans at this time for the Bank to be involved in a merger or other form of acquisition.

**Employees**

As of September 30, 2022, the Bancorp and the Bank had a total of 30 full-time equivalent employees, including our executive officers. The Bank believes its employee relations are excellent. The Bank is not a party to any collective bargaining agreement.

**Litigation**

In the ordinary course of business, the Bancorp and the Bank are subject to claims, counter actions and other litigation of a non-material nature that are typical in the business of banking. To the best of the knowledge of the Bancorp and the Bank, neither the Bancorp nor the Bank is currently a party to any pending legal proceedings adverse to the Bancorp or the Bank.

**MANAGEMENT'S DISCUSSION AND ANALYSIS OF**

**FINANCIAL CONDITION AND RESULTS OF OPERATIONS**

**Introduction**

The following discussion is designed to provide a better understanding of significant trends related to the Bancorp's and the Bank's financial condition, results of operations, liquidity, capital resources and interest rate sensitivity. It is derived from the Bank's audited financial statements and notes thereto for the years ended December 31, 2021 and 2020 and the Bank's unaudited financial statements and notes hereto for the 9-month periods ended September 30, 2022 and 2021, which are included in this Offering Circular beginning after page 64, as well as other financial information appearing in this Offering Circular. Please see "Infinity Bancorp Reorganization" on page 7 concerning the impact of the Reorganization which was effective October 21, 2022.

The Bancorp's and the Bank's future results of operations could materially differ from those suggested by the forward-looking statements contained in this Offering Circular or the results of the Bancorp's and the Bank's operations, depending upon changes such as:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· competition within the banking industry;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· changes in the interest rate environment;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· general economic conditions, nationally, regionally and in our market areas, including changes in real estate values;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· the general regulatory environment;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· business conditions and inflation;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· the securities markets;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· technology;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· unanticipated loan losses;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· unanticipated provisions to the Bank's ALLL;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· unanticipated increases in operating expenses; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· the ability to generate fee and other non-interest income.

Therefore, the information set forth in this discussion should be carefully considered when evaluating the Bancorp's and the Bank's business prospects and whether you should invest in the Shares. This discussion should be read in conjunction with the Bank's financial statements and notes referenced above, as well as the section entitled "RISK FACTORS" herein.

This discussion, as well as disclosures included elsewhere in this Offering Circular, is based upon the Bank's audited financial statements for the years ended December 31, 2021 and 2020 and the Bank's unaudited financial statements for the 9-month periods ended September 30, 2022 and 2021, which were prepared in accordance with accounting principles generally accepted in the United States of America. The preparation of these financial statements requires the Bancorp's and the Bank's management to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues, expenses and related disclosure of contingencies. A summary of the more significant accounting policies of the Bank can be found in Note A to the financial statements, which is incorporated herein by this reference. Additionally, because it involves some of the more significant judgments and estimates used in preparation of the financial statements, reference should be made to the sections covering the allowance and provision for loan loss and credit risk management.

**Financial Summary**

The Bank reported net income of $1.6 million for the 9 months ended September 30, 2022, compared to net income of $2.7 million for the first 9 months of 2021. For the years ended December 31, 2021and 2020, the Bank's net income (loss) was $3.2 million and ($0.3)_million, respectively. The Basic Earnings (Loss) Per Share (EPS) was $0.96_for 2021 compared to ($0.10) for 2020, and $0.49 and $0.82 for the 9-month periods ended September 30, 2022 and 2021, respectively.

Total assets at December 31, 2021 were $296.8 million, compared to $204.9 million at December 31, 2020, an increase of 44.9%. Total assets at September 30, 2022 were $322.3 million, compared to $329.3 million at September 30, 2021, a decrease of (2.1%). Net loans increased from $134.3 million as of December 31, 2020 to $147.8_million as of December 31, 2021, an increase of 10.1%. Net loans decreased from $151.5 million as of September 30, 2021 to $148.0 million as of September 30, 2022, a decrease of (2.3%). Total deposits increased from $172.4 million as of December 31, 2020 to $262.5 million as of December 31, 2021, an increase of 52.3%. Total deposits decreased from $299.4 million as of September 30, 2021 to $291.0 million as of September 30, 2022, a decrease of (2.8%).

Shareholders' equity stood at $28.6 million as of December 31, 2021, an increase of $2.8 million or 10.8%, compared to $25.8 million at December 31, 2020. Shareholders' equity stood at $26.0 million as of September 30, 2022, compared to $28.5 million at September 30, 2021, a decrease of $2.5 million or (8.5%). The return on average assets was 1.29% and (0.18%) for the years ended December 31, 2021 and 2020, respectively. The return on average assets was 0.70% and 1.63% at September 30, 2022 and 2021, respectively. The return on average equity was 11.65% and (1.24%) for the years ended December 31, 2021 and 2020, respectively. The return on average equity was 7.90% and 13.62% at September 30, 2022 and 2021, respectively.

**Executive Summary**

Management considers the following to be the most significant items affecting net income during 2021 compared to 2020:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· Increasing provisions to the Bank's Allowance for Loan and Lease Losses ("ALLL") and the adequacy of the ALLL

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· Level of the Bank's capital

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· Cost of the Bank's deposits and the Bank's ability
to retain deposits

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;· Increase in expenses

**Analysis of the Statements of Financial Condition**

**Loans**

At December 31, 2021, the Bank reported net loans of $147.8 million. This represents an increase of $13.5 million (or 10.1%) over the comparable figure for December 31, 2020 of $134.3 million. Net loans at September 30, 2022 were $148.0 million, compared to $151.5 million at September 30, 2021. The following table presents the distribution of the Bank's loan portfolio at the dates indicated.

**Distribution of Loan Portfolio by Type**

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **December 31,** | **December 31,** | **December 31,** | **December 31,** |
| | **2021** | **2021** | **2020** | **2020** |
| <br>**(Dollars in thousands)** |<br>**Amount** | **Percent**<br>**of Total** |<br>**Amount** | **Percent**<br>**of Total** |
| Commercial and Industrial/Non-Real Estate | $79134 | 53.5% | $85081 | 63.3% |
| Real Estate-1-4 Residential Properties | 6185 | 4.2% | 1155 | 0.8% |
| Commercial Real Estate-Owner Occupied | 8477 | 5.7% | 16624 | 12.4% |
| Commercial Real Estate-Non-Owner Occupied | 18869 | 12.8% | 11410 | 8.5% |
| Construction | 28688 | 19.4% | 17680 | 13.2% |
| Overdraft line | 78 | 0.1% | 0 | 0% |
| Multi-Family | 3840 | 2.6% | 400 | 0.3% |
| Consumer | 5504 | 3.7% | 4268 | 3.2% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total Gross Loans | 150775 | 102.0% | 136618 | 101.7% |
| Deferred Loan Cost, Net of Fees | (662) | (0.5)% | (752) | (0.5)% |
| Allowance for Loan Losses | (2273) | (1.5)% | (1582) | (1.2)% |
| Total Net Loans | $147840 | 100.0% | $134284 | 100.0% |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **September 30,** | **September 30,** | **September 30,** | **September 30,** |
| | **2022** | **2022** | **2021** | **2021** |
| <br>**(Dollars in thousands)** |<br>**Amount** | **Percent**<br>**of Total** |<br>**Amount** | **Percent**<br>**of Total** |
| Commercial and Industrial/Non-Real Estate | $78538 | 53.1% | $81426 | 53.7% |
| Real Estate-1-4 Residential Properties | 6261 | 4.2% | 5757 | 3.8% |
| Commercial Real Estate-Owner Occupied | 9261 | 6.3% | 12088 | 8.0% |
| Commercial Real Estate-Non-Owner Occupied | 16644 | 11.2% | 18887 | 12.5% |
| Construction | 37601 | 25.4 | 27806 | 18.3% |
| Overdraft line | 0 | 0% | 107 | 0.1% |
| Multi-Family | 2915 | 2.0% | 3840 | 2.5% |
| Consumer | 67 | 0% | 4655 | 3.1% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total Gross Loans | 151287 | 102.2% | 154566 | 102.0% |
| Deferred Loan Cost, Net of Fees | (569) | (0.4)% | (972) | (0.6)% |
| Allowance for Loan Losses | (2731) | (1.8)% | (2124) | (1.4)% |
| Total Net Loans | 147987 | 100.0% | 151470 | 100.0% |

---

A summary of maturities and sensitivities of loans to changes in interest rates at December 31, 2021 is shown in the table below. These loans are classified according to the earlier of their contractual maturity or, if variable, to the first available opportunity to have the current rate modified.

**Distribution of Loan Portfolio by Maturity/Re-pricing Opportunity**

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **Re-pricing or Maturing In** | **Re-pricing or Maturing In** | **Re-pricing or Maturing In** | **Re-pricing or Maturing In** |
| <br>**(Dollars in thousands)** | **1 year or Less** | **Over 1 to 5 Years** | **Over 5 Years** | **Total** |
| **Fixed Rate Loans** |  |  |  |  |
| Commercial - Unsecured | $- | $- | $- | $- |
| Commercial - Secured by Real Estate |  |  |  |  |
| Real Estate - Construction |  |  |  |  |
| Real Estate - Other |  |  |  |  |
| Consumer |  |  | 46 | 46 |
| Total | $- | $- | $46 | $46 |
| **Variable Rate Loans** |  |  |  |  |
| Commercial - Unsecured | $40018 | $23952 | $356 | $64326 |
| Commercial - Secured by Real Estate | 9301 | 6689 |  | 15990 |
| Real Estate - Construction | 32489 | 5112 |  | 37601 |
| Real Estate - Other | 9657 | 13901 | 9745 | 33303 |
| Consumer | 21 |  |  | 21 |
| Total | $91486 | $49654 | $10101 | $151241 |
| Total Loans Gross (excludes allowance for loan losses, and net deferred loan fees) | $91486 | $49654 | $10147 | $151287 |

---

**Nonperforming Assets**

Nonperforming assets include non-accrual loans, loans contractually past due as to interest or principal for 90 days or more, restructured loans and other real estate owned. The Bank's nonperforming assets totaled $0.2 million and $0.2 million at December 31, 2021 and December 31, 2020, respectively, and $4.6 million and $0.2 million at September 30, 2022 and 2021, respectively.

**Allowance for Loan Losses**

The Bank's allowance for loan and lease losses (ALLL) is available to absorb future loan losses. The level of the allowance is a result of management's assessment of the risk within the loan portfolio, based on the information obtained in the credit underwriting process and the ongoing loan management process. The Bank utilizes a risk-rating system on loans as well as a monthly credit review and reporting process. This process is expanded on a quarterly basis, with detailed reports prepared by management and presented to the Board of Directors . The ALLL is also reviewed by an outside independent loan review company and our external accounting firm. The assessment of risk takes into account the composition of the loan portfolio, review of specific problem loans, the Bank's previous loss experience, current and anticipated economic conditions and other factors which, in management's judgment, deserve recognition or reserves under applicable accounting pronouncements and requirements . The following table is provided to recap activity in the Allowance for Loan and Lease Losses Account for the last two years.

**Allowance for Loan Losses**

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **Year Ended** | **Year Ended** | **9 months Ended** | **9 months Ended** |
| | **December 31,** | **December 31,** | **September 30,** | **September 30,** |
| <br>**(Dollars in thousands)** | **2021** | **2020** | **2022** | **2021** |
| Allowance for loan losses beginning of year | $1582 | $923 | $2273 | $923 |
| Allowance for loan losses-unfunded commitments | 25 | 27 | 32 | 25 |
| Provision charged to loan loss expense | 691 | 659 | 610 | 542 |
| Provision charged for unfunded commitments | 7 | (2) | 6 | 9 |
| Loans charged off: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Commercial-unsecured |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Commercial real estate |  |  | 152 |  |
| &nbsp;&nbsp;&nbsp;Real estate-construction |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Real estate-other |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Consumer |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Unfunded commitments |  |  |  |  |
| Recoveries of loans previously charged off: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Commercial-unsecured |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Commercial real estate |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Real estate-construction |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Real estate-other |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Consumer | - | - | - | - |
| Total allowance for loan losses | $2305 | $1607 | $2769 | $1499 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Allocation of allowance for loan losses |  |  |  |  |
| Allowance for loan losses | $2273 | $1582 | $2731 | $1465 |
| Allowance for loan losses-unfunded commitments<sup>1</sup> | 32 | 25 | 38 | 34 |
| Total allowance for loan losses | $2305 | $1607 | $2769 | $1499 |
| &nbsp;&nbsp;&nbsp;Ratio of net Loan Losses (Recoveries) to Total Loans Outstanding | 0% | 0% | 0.10% | 0% |

---

<sup>1</sup> For off-balance sheet unfunded loan commitments, the contingent reserve is included within other liabilities on the balance sheet and the provision is included in other non-interest expenses.

As of December 31, 2021, the allowance for loan losses as a percentage of total gross loans was 1.5% and as of September 30, 2022 was 1.8%. The Bank's management believes that the reserve level was adequate for the Bank's loan portfolio at these reporting dates. However, management cannot predict the extent to which the deterioration in general economic conditions, real estate values, increase in general interest rates, changes in the financial conditions or business of a borrower may adversely affect a borrower's ability to pay.

**Investment Portfolio**

The Bank maintains a portfolio of investment securities that consists of U.S. Agencies and Mortgage-Backed Securities. Currently, the Bank classifies its security portfolio as "Available-for-Sale." "Available-for-Sale" portfolios are carried at market, with changes in market value reflected in comprehensive income. As of December 31, 2021, the Bank reported $66.8 million in "Available-for-Sale" securities, which reflected an unrealized loss of approximately $839.8 million, compared to $23.0 million in "Available-for-Sale" securities as of December 31, 2020, which reflected an unrealized gain of approximately $67.9 million as of that date.

In addition to investment information available in Note 2 to the 2021 audited financial statements, the following table presents a summary of yields and contractual maturities for the investment portfolio as of December 31, 2021. Expected maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. Maturity information for Mortgage-Backed Securities shown below is based upon estimated contractual payment reduction over the remaining life of the instrument as demonstrated over recent actual payment history.

**Analysis of Investment Yields and Maturities as of December 31, 2021**

---

| | | | | |
|:---|:---|:---|:---|:---|
| <br>**(Dollars in thousands)** |<br>**One Year**<br>**Or Less** | **After One**<br>**Year to**<br>**Five Years** |<br>**Mortgage-Backed**<br>**Securities** |<br>**Total** |
| **Dollars:** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Available for Sale (at amortized cost) |  |  |  |  |
| U. S. Government-Sponsored Entities and Agencies | $140 | $2500 | $- | $2640 |
| Mortgage-Backed Securities | - | - | 64964 | 64694 |
| Total | $140 | $2500 | $64151 | $67604 |
| **Weighted Average Yield:** |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Available for Sale (at amortized cost) |  |  |  |  |
| U. S. Government-Sponsored Entities and Agencies | 0.82% | 0.49% |  | 0.51% |
| Mortgage-Backed Securities | - | - | 0.85% | 0.85% |
| Total | 0.82% | 0.49% | 0.85% | 0.84% |

---

**Deposits**

A source of funds to support earning assets is the generation of deposits from the Bank's customer base. The ability to grow the Bank's earning assets is a crucial element in the performance of the Bank. The Bank reported total deposits of $262.5 million as of December 31, 2021, an increase of approximately $90.1 million (or 52.3%) over the comparable figure of $172.4 million as of December 31, 2020. Total deposits were $291.0 million at September 30, 2022, compared to $299.4 million at September 30, 2021 a decrease of (2.8%).

The Bank is competitive with other local financial institutions in terms of its structure of interest rates on deposit products offered. A comparison of the rates paid on the Bank's deposits products at December 31, 2021 and 2020, and as of September 30, 2022 and 2021 is as follows:

**Interest Rates**

---

| | | | |
|:---|:---|:---|:---|
| | **At December 31,** | **At December 31,** | |
| <br>**Selected Quoted Interest Rates** | **2021** | **2020** |<br>**Change** |
| NOW Accounts | 0.00% | 0.00% |  |
| Savings | 0.03% | 0.03% |  |
| Money Market Deposits over $50,000 | 0.05% | 0.05% |  |
| Wall Street Journal Prime Rate | 3.25% | 3.25% |  |

---

---

| | | | |
|:---|:---|:---|:---|
|  | **At September 30,** | **At September 30,** | |
|  | **2022** | **2021** |<br>**Change** |
| NOW Accounts | 0.00% | 0.00% |  |
| Savings | 0.18% | 0.03% | 0.15 |
| Money Market Deposits over $50,000 | 0.20% | 0.05% | 0.15 |
| Wall Street Journal Prime Rate | 6.25% | 3.25% | 3.00 |

---

The amount of non-interest-bearing demand deposits is an integral element in achieving a low cost of funds for the Bank. As of December 31, 2021, non-interest-bearing demand deposits represented 56.9% of total deposit dollars, compared to 58.4% at December 31, 2020. At September 30, 2022, non-interest-bearing demand deposits represented 61.5% of total deposits, compared to 65.2% at September 30, 2021.

A comparison of year-end balances in non-time deposit shows increases in all categories with non-interest-bearing demand accounts reflecting the largest increase, approximately $48.8 million from $100.7 million as of December 31, 2020 to $149.5 million as of December 31, 2021. Average deposits reflect a large increase over the two comparable periods.

**Distribution of Assets, Liabilities, and Stockholders' Equity; Interest Rates and Interest Differential**

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| | **2021** | **2021** | **2021** | **2020** | **2020** | **2020** |
| <br>**(Dollars in thousands)** | **Average**<br>**Balance** |<br>**Interest** |<br>**Rate** | **Average**<br>**Balance** |<br>**Interest** |<br>**Rate** |
| **Assets** |  |  |  |  |  |  |
| Loans, net | $145690 | $9161 | 6.29% | $108084 | $6107 | 5.65% |
| Investment Securities | 31140 | 173 | 0.56% | 18355 | 144 | 0.79% |
| Federal Funds sold & Other | 62816 | 131 | 0.21% | 41519 | 140 | 0.34% |
| &nbsp;&nbsp;&nbsp;Total interest-earning assets | 239646 | 9465 | 3.95% | 167958 | 6391 | 3.81% |
| Non-interest earning assets | 5617 |  |  | 4339 |  |  |
| &nbsp;&nbsp;&nbsp;Total assets | $245263 |  |  | $172297 |  |  |
| **LIABILITIES AND STOCKHOLDERS' EQUITY** |  |  |  |  |  |  |
| Now deposits | $216 | $0 | 0.05% | $385 | $0 | 0.05% |
| Savings & Money market deposits | 83264 | 486 | 0.58% | 59052 | 442 | 0.75% |
| Brokered CD's | 5984 | 3 | 0.06% | 10019 | 111 | 1.10% |
| Other borrowings | 3.142 | 37 | 1.18% | 7565 | 4 | 0.05% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total interest-bearing liabilities | 92606 | 526 | 0.57% | 77021 | 557 | 0.72% |
| Non-interest-bearing deposits | 123856 |  |  | 67784 |  |  |
| Other liabilities | 1559 |  |  | 1758 |  |  |
| Stockholders' equity | 27242 |  |  | 25734 |  |  |
| &nbsp;&nbsp;&nbsp;Total Liabilities and Stockholders' | $245263 |  |  | $172297 |  |  |
| **Net interest income** |  |  | $8939 |  |  | $5834 |
| **Net interest spread** |  |  | 3.38% |  |  | 3.08% |
| **Net interest margin** |  |  | 3.73% |  |  | 3.47% |

---

**Distribution of Average Assets, Liabilities, and Shareholders' Equity**

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| | **For the 9 months Ended September 30,** | **For the 9 months Ended September 30,** | **For the 9 months Ended September 30,** | **For the 9 months Ended September 30,** | **For the 9 months Ended September 30,** | **For the 9 months Ended September 30,** |
| | **2022** | **2022** | **2022** | **2021** | **2021** | **2021** |
| <br>**(Dollars in thousands)** | **Average**<br>**Balance** |<br>**Interest** |<br>**Rate\*** | **Average**<br>**Balance** |<br>**Interest** |<br>**Rate\*** |
| **Assets** |  |  |  |  |  |  |
| Loans, net | $147230 | $7570 | 6.87% | $142628 | $6418 | 6.02% |
| Investment Securities | 62667 | 483 | 1.03% | 18717 | 46 | 0.33% |
| Federal Funds sold & Other | 92920 | 898 | 1.29% | 57265 | 90 | 0.21% |
| &nbsp;&nbsp;&nbsp;Total interest-earning assets | 302817 | 8951 | 3.95% | 218048 | 6554 | 4.01% |
| Non-interest earning assets | 7855 |  |  | 5664 |  |  |
| &nbsp;&nbsp;&nbsp;Total assets | $310672 |  |  | $223712 |  |  |
| **LIABILITIES AND STOCKHOLDERS' EQUITY** |  |  |  |  |  |  |
| Now deposits | $139 | $0 | 0.05% | $265 | $0 | 0.05% |
| Savings & Money market deposits | 108475 | 525 | 0.65% | 79563 | 344 | 0.58% |
| Brokered CD's | 11294 | 5 | 0.06% | 3152 | 1 | 0.06% |
| Other borrowings | 3915 | 141 | 4.82% | 3183 | 1 | 0.03% |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total interest-bearing liabilities | 123823 | 671 | 0.72% | 86163 | 346 | 0.54% |
| Non-interest bearing deposits | 157802 |  |  | 109129 |  |  |
| Other liabilities | 1512 |  |  | 1588 |  |  |
| Stockholders' equity | 27535 |  |  | 26832 |  |  |
| &nbsp;&nbsp;&nbsp;Total Liabilities and Stockholders' | $310672 |  |  | $223712 |  |  |
| **Net interest income** |  |  | $8280 |  |  | $6208 |
| **Net interest spread** |  |  | 3.23% |  |  | 3.47% |
| **Net interest margin** |  |  | 3.66% |  |  | 3.80% |

---

\* Rates are calculated using annualized interest income and expense

Fundamental to the positive operating results of the Bank is net interest income, the difference between the interest earned on loans and investments less the interest paid on deposits accounts and borrowed funds. Net interest income before provision for loan losses totaled approximately $8.9 million for the year of 2021. This compared to the previous year's figure of $5.8 million in 2020. This decrease is more fully analyzed in the below table: Rate, Volume & Period Analysis for Changes in Interest Income, Interest Expense, and Net Interest Income.

The Bank's net interest income before provision or for loan losses totaled approximately $8.3 million for the 9-month period ended September 30, 2022, compared to approximately $6.2 million for the 9-month period ended September 30, 2021.

The net interest margin measures net interest income as a percentage of average earning assets. The net interest margin can be affected by changes in the yield on earning assets and the cost of interest-bearing liabilities, as well as changes in the mix of earning assets and the mix of interest bearing and non-interest-bearing liabilities. The Bank's net interest margin was 3.73% in 2021, compared to 3.47% for 2020, an increase of 64 basis points, or 18.4%.

The net interest spread is the difference between the yield on average earning assets less the cost of average interest-bearing liabilities. The Bank's net interest spread increased to 3.38% in 2021compared with 3.08% for 2020, an increase of 30 basis points.

The comparison of actual interest income and interest expense between 2021 and 2020, and between September 30, 2022 and 2021, is described in the following table: Rate, Volume & Period Analysis for Changes in Interest Income, Interest Expense, and Net Interest Income. The most significant impact on our net interest income between periods is derived from the interaction of changes in the volume of, and rate earned or paid on, interest-earning assets and interest-bearing liabilities. Changes in interest income or expense attributable to volume changes are calculated by multiplying the change in volume by the initial average interest rate. Changes in interest income or expense attributable to changes in interest rates are calculated by multiplying the changes in interest rates by the initial volume. Changes in interest income and expense, which are not attributable specifically to either volume or rate, are allocated proportionately between both variances.

**Rate/Volume Analysis for Changes in Interest Income, Interest Expense and Net Interest Income**

**Twelve months ended December 31, 2021**

**compared with December 31, 2020**

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
| | **Average Volume** | **Average Volume** | **Average Rate** | **Average Rate** | | | |
| <br>**(Dollars in thousands)** | **2021** | **2020** | **2021** | **2020** |<br>**Volume** |<br>**Rate** |<br>**Total** |
| Loans, net | $145690 | $108084 | 6.29% | 5.65% | $2290 | $764 | $3054 |
| Investments/FHLB Stock/Fed Funds | 93956 | 59874 | 0.32% | 0.47% | 276 | (257) | 19 |
|  | $239646 | $167958 | 3.95% | 3.81% | $2566 | $507 | $3073 |
| Deposits | $89464 | 69456 | 0.55% | 0.80% | $(7) | $(58) | $(65) |
| Borrowings | 3142 | 7565 | 1.18% | 0.05% | 1 | 32 | $33 |
|  | $92606 | $77016 | 0.57% | 0.72% | $(6) | $(26) | $(32) |
|  |  |  |  |  | $2572 | $533 | 3105 |

---

**9 months ended September 30, 2022**

**compared with September 30, 2021**

---

| | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **Average Volume** | **Average Volume** | **Average Rate** | **Average Rate** | | | |
|  | **2022** | **2021** | **2022** | **2021** |<br>**Volume** |<br>**Rate** |<br>**Total** |
| Loans, net | $147230 | $142628 | 6.87% | 6.02% | $295 | $1244 | $1539 |
| Investments/FHLB Stock/Fed Funds | 155587 | 75982 | 1.19% | 0.24% | 323 | 1343 | 1666 |
|  | $302817 | $218610 | 3.95% | 4.01% | $618 | $2587 | $3205 |
| Deposits | $119908 | $82980 | 0.59% | 0.56% | $186 | $61 | 247 |
| Borrowings | 3915 | 3183 | 4.82% | 0.03% | - | 188 | 188 |
|  | $123823 | $86163 | 0.72% | 0.54% | $186 | 249 | $435 |
|  |  |  |  |  | $432 | $2338 | $2770 |

---

**Noninterest Expense Analysis**

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| | **For the year ended** | **For the year ended** | **For the year ended** | **For the 9 months ended** | **For the 9 months ended** | **For the 9 months ended** |
| | **December 31,** | **December 31,** | **December 31,** | **September 30,** | **September 30,** | **September 30,** |
| <br>**(Dollars in thousands)** | **2021** | **2020** | **Increase**<br>**(Decrease)** | **2022** | **2021** | **Increase**<br>**(Decrease)** |
| Salaries and Employee Benefits | $4971 | $3872 | $799 | $3944 | $3282 | $662 |
| Occupancy and Equipment Expenses | 518 | 538 | (20) | 380 | 388 | (8) |
| Data Processing | 411 | 330 | 81 | 277 | 306 | (29) |
| Marketing and Business Promotion | 93 | 55 | 38 | 53 | 48 | 5 |
| Professional Fees | 472 | 387 | 85 | 341 | 314 | 27 |
| Other Expenses | 642 | 524 | 118 | 605 | 473 | 132 |
| Total Non-Interest Expenses | $6807 | $5706 | $1101 | $5600 | $4811 | 789 |

---

Salaries and related expenses comprise the largest component of non-interest expense. The recorded expense for 2021 was approximately $5.0 million, compared to the 2020 expense of approximately $3.9 million, an increase of 14.0%. The increase was attributed to the increase in the number of employees needed to support the Bank's growth. Between 2021 and 2020 the average full-time equivalent number of individuals provided with compensation for the year increased from 24 to 27, a 12.5% increase.

Occupancy and equipment expenses for 2021 were approximately $518 thousand, a decrease of approximately $20 thousand over 2020, a (0.4%) decrease.

Data processing expense comprises the costs of providing, capturing, and processing customer and accounting information through electronic means. Included in this group of expenditures are licensing fees for both general and industry related software, costs associated with the processing of customer information from both paper and electronic formats, maintenance costs associated with both software and hardware management, ATM and debit card processing charges, as well as depreciation expenses for computer and computer-related hardware. The recorded expense for 2021 was approximately $411 thousand, an increase of approximately $81 thousand, or 1.42%.

Marketing and business promotion expense was recorded at approximately $93 thousand for 2021 and in addition to advertising, marketing, and business development expenses, included expenditures for conferences and seminars, transportation and charitable donations. The Bank incurred approximately $38 thousand more in this category of expenses in 2021 than in 2020, an increase of 0.7%. The marketing and business expense for the first 9 months of 2022 was $53 thousand compared to $48 thousand for the same period in 2021.

Professional fees comprise expenditures for audits, (including financial, operational and loan reviews), legal fees, stock transfer fees, safekeeping fees and other services provided by correspondent banks and consultants. The recorded expense for 2021 was approximately $472 thousand, an increase of approximately $85 thousand or 1.5% compared to the recorded expense for 2020. Professional fees for the first 9 months of 2022 were $341 thousand, compared to $314 thousand for the same period of 2021.

**Risk Management**

The Bank's management has adopted a Risk Management Plan to ensure the proper control and management of all risk factors inherent in the operations of the Bank. Specifically, credit risk, interest rate risk, liquidity risk, transaction risk, compliance risk, strategic risk, reputation risk, and price risk, can all affect the market risk exposure of the Bank. These specific risk factors are not mutually exclusive. It is recognized that any product or service offered by the Bank may expose the Bank to one or more of these risks.

**Credit Risk**

Credit Risk is defined as the risk to earnings or capital from an obligor's failure to meet the terms of any contract or to otherwise fail to perform as agreed. Credit risk is found in all activities where success depends on counter party, issuer or borrower performance. Credit risk arises through the extension of loans and leases, certain securities, and letters of credit.

Credit Risk in the investment portfolio and correspondent bank accounts is addressed through defined limits in the Bank's Asset Liability Management Policy. In addition, certain securities carry insurance to enhance credit quality of the bond. Limitations on industry concentration, geographic boundaries, and contract maturities are designed to reduce credit risk. The Asset/Liability & Investment Committee and the Board of Directors are provided with information to appropriately identify measure, control and monitor the credit risk of the Bank.

Credit Risk in the loan portfolio is also addressed through defined limits in the Bank's Credit Policy. Limitations on industry concentration, geographic boundaries, aggregate customer borrowings and standards on loan quality also are designed to reduce loan credit risk The Bank's Management and Board Loan Committees and the Board of Directors are provided with information to appropriately identify, measure, control and monitor the credit risks within the loan portfolio.

Implicit in lending activities is the risk that losses will occur and that the amount of such losses will vary over time. Consequently, the Bank maintains an allowance for loan losses by charging a provision for loan losses to earnings. When a loan is determined to be a loss, the balance is charged against the allowance for loan losses. The Bank's allowance for loan losses is maintained at a level considered by the Bank's management to be adequate to provide for estimated probable losses inherent in the existing portfolio, as well as unused commitments to provide financing, including commitments under commercial and standby letters of credit. The process by which the Bank determines the appropriate allowance for loan losses requires the exercise of considerable judgment. The amount of losses that actually occur can vary significantly from these estimated amounts. The Bank employs a systematic methodology that is intended to reduce the differences between estimated and actual losses.

Central to the Bank's credit risk management is its credit risk rating system. Each credit is assigned an initial credit rating, which is reviewed periodically by the Bank's Chief Credit Officer, independent credit reviewers and regulatory examiners. Risk ratings are adjusted as necessary.

Based on the risk rating system, specific allowances are established in cases where management has identified significant conditions or circumstances related to that credit that heighten the need for closer monitoring or increase the likelihood that the full and timely repayment of both the loan's principal and interest may be at doubt.

The Bank considers a loan to be impaired when it is probable that the Bank will be unable to collect all amounts due (principal and interest) according to the contractual terms of the loan agreement. Measurement of impairment is based upon the expected future cash flows of an impaired loan which are discounted at the loan's effective interest rate, or measured by reference to an observable market value, if one exists, or the fair value of the collateral for a collateral-dependent loan. The Bank selects the measurement method on a loan-to-loan basis except that collateral-dependent loans, for which foreclosure is probable, are measured at the fair value of the collateral.

Included in the Bank's methodology for assessing the appropriateness of the allowance is management's consideration of all known relevant internal and external factors that may affect the loan's collectability. This includes management's estimates of the amount necessary for concentrations, economic uncertainties, the volatility of the market value of the collateral, and other relevant factors. The conditions evaluated in connection with the periodic analysis of allowance include, but are not limited to, the following conditions that existed as of the balance sheet date:

&nbsp;&nbsp;&nbsp;&nbsp;· Changes in lending policies and procedures, including underwriting standards and collection, charge-off, and recovery practices.

&nbsp;&nbsp;&nbsp;&nbsp;· Changes in national and local economic and business conditions and developments, including the condition of various market segments.

&nbsp;&nbsp;&nbsp;&nbsp;· Changes in the nature and volume of the portfolio.

&nbsp;&nbsp;&nbsp;&nbsp;· Changes in the experience, ability, and depth of lending management and staff.

&nbsp;&nbsp;&nbsp;&nbsp;· Changes in the trend of the volume and severity of past due and classified loans; and trends in the volume of non-accrual loans, troubled
debt restructurings and other loan modifications.

&nbsp;&nbsp;&nbsp;&nbsp;· Changes in the quality of the institution's loan review system and the degree of oversight by the institution's board
of directors.

&nbsp;&nbsp;&nbsp;&nbsp;· The existence and effect of any concentrations of credit, and changes in the level of such concentrations.

&nbsp;&nbsp;&nbsp;&nbsp;· The effect of external factors such as competition and legal and regulatory requirements on the level of estimated credit losses on
the loan portfolio.

Also considered as factors in determining the adequacy of the reserves are each of the types of risk described below:

**Interest Rate Risk**

During periods of changing interest rates, the ability to re-price interest-earning assets and interest-bearing liabilities can influence net interest income, the net interest margin, and consequently the Bank's ability to produce net earnings and to maintain adequate capital levels. Interest rate risk is managed by attempting to control the spread between rates earned on interest-earning assets and the rates paid on interest-bearing liabilities within the constraints imposed by market competition in the Bank's service area.

The Bank expects its risk exposure to changes in interest rates to remain manageable and well within acceptable policy ranges. The Bank employs a risk model that assists management in the measurement, monitoring and management of its interest rate risk. Management will continue to strive for an optimal trade-off between risk and earnings.

**Liquidity Risk**

Liquidity risk is the risk to earnings or capital resulting from the Bank's inability to meet its obligations when they come due. The objective of liquidity management is to ensure the continuous availability of funds to meet the demands of depositors, investors and borrowers, without incurring unacceptable losses. The Bank's Asset/Liability & Investment Committee is responsible for structuring the balance sheet to meet these needs. On a daily basis liquidity is managed by maintaining acceptable levels of Federal funds in conjunction with cash flow from interest and principal payments from investment securities and loans. To meet unexpected demands, lines of credit are maintained with correspondent banks. Access to FHLB advances and the Federal Reserve Bank discount window are available to meet liquidity needs. Increases in deposit rates can serve as a contingent means of raising funds to increase liquidity.

For the Bank, sources of funds normally include payments of loans, interest payments on investments and growth in deposits. Uses of funds include withdrawal of deposits, interest paid on deposits, increases in loan balances, purchases of investments, repayment of borrowings and other operating expenses.

By reference to the Statement of Cash Flows contained in the financial statements, comparisons can be made to the changes in the Bank's liquidity position. Net cash provided by operating activities totaled $3.1 million for 2021 compared with net cash provided by operating activities of $0.6 million for 2020. The positive cash flow reflects the Bank's current asset base provides adequate liquidity from its ongoing operations. Cash used for investing activities totaled $51.7 million for 2021, compared to $65.2 million for 2020. Cash provided by financing activities totaled $89.0 million for 2021, compared to $88.4 million for 2020.

Since the primary sources and uses of funds for the Bank are deposits and loans, the relationship between net loans and total deposits provides a useful measure of the Bank's liquidity. Typically, the closer the ratio of loans-to-deposits is to 100%, the more reliant the Bank is on its loan portfolio to provide for short-term liquidity needs. Since repayment of loans tends to be less predictable than the maturity of investments and other liquid resources, the higher the ratio of loans-to-deposits, the less liquid are the Bank's assets and the more reliance the Bank places on wholesale funds, such as FHLB borrowings to meet its liquidity needs. For 2021, the Bank's average loan-to-deposit ratio was 57.2%, while for 2020 the comparable ratio was 78.8%. The month-end ratio at September 30, 2022 was 51.8% compared to 51.3% at September 30, 2021.

**SUPERVISION AND REGULATION**

***General***

Infinity Bancorp (the "Bancorp") is a bank holding company within the meaning of the Bank Holding Company Act of 1956, as amended (the "Bank Holding Company Act"), and is registered as such with, and subject to the supervision of, the Board of Governors of the Federal Reserve (the "Board of Governors"). The Bancorp is required to obtain the approval of the Board of Governors before it may acquire all or substantially all of the assets of any bank, or ownership or control of the voting shares of any bank if, after giving effect to such acquisition of shares, the Bancorp would own or control more than 5% of the voting shares of such bank. The Bank Holding Company Act prohibits the Bancorp from acquiring any voting shares of, or interest in, all or substantially all of the assets of a bank located outside the State of California unless such an acquisition is specifically authorized by the laws of the state in which such bank is located. Any such interstate acquisition is also subject to applicable California and federal law.

The common stock of the Bancorp is subject to the registration requirements of the Securities Act of 1933, as amended, and the qualification requirements of the California Corporate Securities Act of 1968, as amended.

The Bancorp and the Bank are subject to extensive regulation under federal and state banking laws that establish a comprehensive framework for their operations. Such regulation is intended to, among other things, protect the interests of customers, including depositors, and the federal deposit insurance fund, as well as to minimize risk to the banking system as a whole. These regulations are not, however, generally charged with protecting the interests of the Bancorp's stockholders or other creditors. Described below are elements of selected laws and regulations applicable to the Bancorp and the Bank. The descriptions are not intended to be complete and are qualified in their entirety by reference to the full text of the statutes and regulations described. Changes in applicable law or regulations, particularly in the current U.S. political environment, and in their application by regulatory agencies, cannot be predicted, and they may have a material effect on the business, operations, and results of the Bancorp and the Bank.

***Recent Legislation and Regulation***

***COVID-19 Pandemic Legislation***

On March 27, 2020, the Coronavirus Aid, Relief and Economic Security Act (the "CARES Act") was enacted to address the economic impact resulted from the COVID-19 pandemic. Under Section 4013 of the CARES Act, optional troubled debt restructurings ("TDR's") accounting relief was provided to financial institutions, allowing the temporary suspension of U.S. Generally Accepted Accounting Principles ("GAAP") requirements and regulatory determinations for loan modifications related to the COVID-19 pandemic that would otherwise be categorized as TDR's from March 1, 2020, through the earlier of 60 days after the date of the COVID-19 National Emergency comes to an end or December 31, 2020.

On December 27, 2020, the Economic Aid Act was signed into law, which extended the applicable period of the temporary relief from TDR's under the CARES Act to the earlier of 60 days after the date of the COVID-19 National Emergency comes to an end or January 1, 2022.

On April 7, 2020, the federal banking regulators also issued the "Interagency Statement on Loan Modifications and Reporting for Financial Institutions Working with Customer Affected by the Coronavirus (Revised)" to encourage banks to work prudently with borrowers and describe the banking regulators' interpretation of how accounting rules for TDR apply to certain modifications related to the COVID-19 pandemic.

The Bank granted payment deferments related to the COVID-19 pandemic to borrowers with loan balances totaling $9.6 million. Loan modifications related to the COVID-19 pandemic were accounted for under Section 4013 of the CARES Act and not considered TDR's. As of December 31, 2021, all modified loans have reverted back to previous contractual payment terms. All granted payment deferrals were six months or less in aggregate.

***Small Business Administration ("SBA") Paycheck Protection Program ("PPP")***

The SBA launched the PPP to provide a direct incentive for small businesses to keep their workers on the payroll in response to the COVID-19 pandemic. The SBA guarantees 100% of the PPP loans made to eligible borrowers, and the loans are eligible to be forgiven if certain conditions are met, at which point the SBA will make payments to the Bank for the forgiven amounts. These loans are included in the commercial & industrial portfolio and have an interest rate of 1%. As of December 31, 2021, total SBA PPP loans were approximately $2.3 million. As of September 30, 2022, there were no SBA PPP loans remaining on the Bank's books.

The SBA guarantee on PPP loans cannot be separated from the loan and therefore is not a separate unit of account. The Bank considered the SBA guarantee in the allowance for loan losses evaluation and determined that it was not required to reserve an allowance on SBA PPP loans at December 31, 2020, December 31, 2021, or September 30, 2022.

***Current Expected Credit Loss ("CECL") Model for Measuring Credit Losses***

In June 2016, the Financial Accounting Standards Board ("FASB") issued ASU (Accounting Standards Update) No. 2016-13, *Measurement of Credit Losses on Financial Instruments* (Topic 326). This ASU significantly changes how entities will measure credit losses for most financial assets and certain other instruments that aren't measured at fair value through net income. In issuing the standard, the FASB is responding to criticism that today's guidance delays recognition of credit losses. The standard will replace today's "incurred loss" approach with an "expected loss" model. The new model, referred to as the current expected credit loss ("CECL") model, will apply to (1) financial assets subject to credit losses and measured at amortized cost, and (2) certain off-balance sheet credit exposures. This includes, but is not limited to, loans, leases held-to-maturity securities, loan commitments, and financial guarantees. The CECL model does not apply to available-for-sale ("AFS") debt securities. For AFS debt securities with unrealized losses, entities will measure credit losses in a manner similar to what they do today, except that the losses will be recognized as allowances rather than reductions in the amortized cost of the securities. As a result, entities will recognize improvements to estimated credit losses immediately in earnings rather than as interest income over time, as they do today. ASU No. 2016-13 is effective for interim and annual reporting periods beginning after December 31, 2022 for all entities, including the Bank. Entities will apply the standard's provisions as a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period in which the guidance is effective (i.e., modified retrospective approach). The Bank is currently evaluating the provisions of ASU No. 2016-13 for potential impact on its financial statements and disclosures.

***Capital Requirements***

The Bancorp and the Bank are subject to the comprehensive capital framework for U.S. banking organizations known as Basel III. Basel III, among other things, (i) implemented increased capital levels for the Bancorp and the Bank, (ii) introduced a new capital measure called Common Equity Tier 1 (" CET1") and related regulatory capital ratio of CET1 to risk-weighted assets, (iii) specified that Tier 1 capital consists of CET1 and "Additional Tier 1 capital" instruments meeting certain revised requirements, (iv) mandated that most deductions/adjustments to regulatory capital measures be made to CET1 and not to the other components of capital, and (v) expanded the scope of the deductions from and adjustments to capital as compared to existing regulations. Under Basel III, for most banking organizations the most common form of Additional Tier 1 capital is non-cumulative perpetual preferred stock and the most common form of Tier 2 capital is subordinated notes and a portion of the allowance for credit losses, in each case, subject to Basel III specific requirements.

Pursuant to Basel III, the minimum capital ratios are as follows:

· 4.5% CET1 to risk-weighted assets;

· 6.0% Tier 1 capital (that is, CET1 *plus* Additional
Tier 1 capital) to risk-weighted assets;

· 8.0% Total capital (that is, Tier 1 capital *plus* Tier
2 capital) to risk-weighted assets; and

· 4.0% Tier 1 capital to average consolidated assets as reported
on regulatory financial statements (known as the "leverage ratio").

Basel III also introduced a new "capital conservation buffer", composed entirely of CET1, on top of the minimum risk-weighted asset ratios. The capital conservation buffer is designed to absorb losses during periods of economic stress. Banking institutions with a ratio of CET1 to risk-weighted assets, Tier 1 to risk-weighted assets or total capital to risk-weighted assets above the minimum but below the capital conservation buffer will face constraints on dividends, equity repurchases and compensation based on the amount of the shortfall and the institution's "eligible retained income" (that is, four quarter trailing net income, net of distributions and tax effects not reflected in net income). As of January 1, 2019, the capital conservation buffer is fully phased-in and the Bank is required to maintain an additional capital conservation buffer of 2.5% of CET1, effectively resulting in minimum ratios of (i) CET1 to risk-weighted assets of at least 7%, (ii) Tier 1 capital to risk-weighted assets of at least 8.5%, and (iii) total capital to risk-weighted assets of at least 10.5%.

As of December 31, 2021, the FDIC categorized the Bank as well capitalized under the regulatory framework for prompt corrective action (there are no conditions or events since that notification that management believes have changed the Bank's capital category). To be categorized as well capitalized, the Bank must maintain minimum ratios as set forth in the table below. The following table sets forth the Bank's actual capital amounts and ratios at December 31, 2021 (dollar amounts in thousands):

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | | | Amount of Capital Required | Amount of Capital Required | Amount of Capital Required | Amount of Capital Required |
|  | | | | | To Be | To Be |
|  | | | | | Well Capitalized | Well Capitalized |
|  | | | For Capital | For Capital | Under Prompt | Under Prompt |
|  | | | Adequacy | Adequacy | Corrective | Corrective |
|  | Actual | Actual | Purposes | Purposes | Provisions | Provisions |
|  | Amount | Ratio | Amount | Ratio | Amount | Ratio |
| Total capital (to risk-weighted assets) | $27342 | 16.4% | $13304 | 8.00% | $9033 | 10.00% |
| Tier 1 capital (to risk-weighted assets) | 25760 | 15.5% | 9978 | 6.00% | 13304 | 8.00% |
| CET1 capital (to risk-weighted assets) | 25760 | 15.5% | 7483 | 4.50% | 10809 | 6.50% |
| Tier 1 capital (to average assets) | 25760 | 12.0% | 8579 | 4.00% | 10724 | 5.00% |

---

The following table sets forth the Bank's total capital accounts and ratios at September 30, 2022 (dollar amounts in thousands):

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | | | Amount of Capital Required | Amount of Capital Required | Amount of Capital Required | Amount of Capital Required |
|  | | | | | To Be | To Be |
|  | | | | | Well Capitalized | Well Capitalized |
|  | | | For Capital | For Capital | Under Prompt | Under Prompt |
|  | | | Adequacy | Adequacy | Corrective | Corrective |
|  | Actual | Actual | Purposes | Purposes | Provisions | Provisions |
|  | Amount | Ratio | Amount | Ratio | Amount | Ratio |
| Total capital (to risk-weighted assets) | $37450 | 17.4% | $17200 | 8.00% | $21500 | 10.00% |
| Tier 1 capital (to risk-weighted assets) | 30839 | 14.3% | 12900 | 6.00% | 17200 | 8.00% |
| CET1 capital (to risk-weighted assets) | 30839 | 14.3% | 9675 | 4.50% | 13975 | 6.50% |
| Tier 1 capital (to average assets) | 30839 | 9.3% | 13297 | 4.00% | 16621 | 5.00% |

---

***Safety and Soundness Standards***

As required by the Federal Deposit Insurance Act ("FDIA"), guidelines adopted by the federal bank regulatory agencies establish general standards relating to internal controls and information systems, internal audit systems, loan documentation, credit underwriting, interest rate exposure, asset growth and quality, and compensation, fees and benefits. The agencies have adopted regulations and interagency guidelines which set forth the safety and soundness standards used to identify and address problems at insured depository institutions before capital becomes impaired. If an agency determines that a bank fails to satisfy any standard, it may require the bank to submit an acceptable plan to achieve compliance, consistent with deadlines for the submission and review of such safety and soundness compliance plans. If an institution fails to submit an acceptable compliance plan or fails in any material respect to implement an acceptable compliance plan, the agency must issue an order directing action to correct the deficiency and may issue an order directing other actions of the types to which an undercapitalized institution is subject under the FDIA.

***Deposit Insurance***

The Bank is a state-chartered, "non-member" bank regulated by the DFPI and the FDIC. The Bank accepts deposits, and those deposits have the benefit of FDIC insurance up to the applicable limits. The applicable limit for FDIC insurance for most types of accounts is $250,000.

Under the FDIC's risk-based deposit premium assessment system, the assessment rates for an insured depository institution are determined by an assessment rate calculator, which is based on a number of elements that measure the risk each institution poses to the Deposit Insurance Fund. The calculated assessment rate is applied to average consolidated assets less the average tangible equity of the insured depository institution during the assessment period to determine the dollar amount of the quarterly assessment. Under the current system, premiums are assessed quarterly and could increase if, for example, criticized loans and leases and/or other higher risk assets increase or balance sheet liquidity decreases.

During the first quarter of 2016, the FDIC issued a final rule implementing a 4.5 basis points surcharge on the quarterly FDIC insurance assessments of insured depository institutions with more than $10 billion in total consolidated assets. The surcharge continued through September 30, 2018, when the Deposit Insurance Fund reserve ratio reached 1.36% of insured deposits, exceeding the statutorily required minimum reserve ratio of 1.35%. For the year ended December 31, 2021, the Bank incurred approximately $203,000 of FDIC assessment expense.

Under the FDIA, the FDIC may terminate deposit insurance upon a finding that the institution has engaged in unsafe and unsound practices, is in an unsafe or unsound condition to continue operations, or has violated any applicable law, regulation, rule, order or condition imposed by the FDIC.

**DIRECTORS, EXECUTIVE OFFICERS AND SIGNIFICANT EMPLOYEES**

As of September 30, 2022, the Bancorp and the Bank had a total of 30 full-time equivalent employees, including our executive officers. The Bank believes its employee relations are excellent. The Bank is not a party to any collective bargaining agreement.

The directors, and executive officers and significant employees<sup>1</sup> of the Bancorp and the Bank as of the date of this filing are as follows:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| **Name** | **Position** | **Age** | **Term of<br> Office<sup>2</sup>** | **Part Time Hours** | **Full-Time Hours** |
| **Executive Officers** |  |  |  |  |  |
| Karkutla P. ("Bala")Balkrishna | Chairman and Chief Executive Officer of the Bancorp and Chief Executive Officer of the Bank | 77 | 01-30-2017 to present | 0 | 40 |
| Victor E. Guerrero II | President/Chief Operating Officer of the Bancorp and the Bank | 51 | 01-30-2017 to present | 0 | 40 |
| Elaine Crouch | Executive Vice President/ Risk Management/Director of Human Resources/Corporate Secretary of the Bancorp and the Bank | 73 | 02-26-2018 to present | 0 | 40 |
| Allison Duncan | Executive Vice President/Chief Financial Officer of the Bancorp and the Bank | 58 | 06-15-2020 to present | 0 | 40 |
| Patty Staples | Executive Vice President/Chief Credit Officer of the Bank | 59 | 10-4-2021 to present | 0 | 40 |

---

<sup>1</sup> Neither the Bancorp nor the Bank had "significant employees" as defined under applicable regulations.

<sup>2</sup> The term of office for Executive Officers includes time of service for prior positions.

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| **Name** | **Position** | **Age** | **Term of<br> Office** | **Part Time Hours** | **Full-Time Hours** |
| **Directors** |  |  |  |  |  |
| Karkutla P. ("Bala")Balkrishna | Director of the Bancorp and the Bank | 77 | 01-30-2017 to present | Not applicable | Not applicable |
| Victor E. Guerrero II | Director of the Bancorp and the Bank | 51 | 05-26-2022 to present | Not applicable | Not applicable |
| Raymond J. Gagnon | Director of the Bancorp and the Bank | 83 | 01-30-2017 to present | Not applicable | Not applicable |
| Cary D. Bren | Director of the Bancorp and the Bank | 63 | 01-30-2017 to present | Not applicable | Not applicable |
| Curtis E. Campbell | Director of the Bancorp and the Bank | 58 | 01-30-2017 to present | Not applicable | Not applicable |
| Katherine T. Le | Director of the Bancorp and the Bank | 60 | 10-1-2018 to present | Not applicable | Not applicable |
| Richard H. Schlatter | Director of the Bancorp and the Bank | 82 | 01-30-2017 to present | Not applicable | Not applicable |
| Glenn B. Stearns | Director of the Bancorp and the Bank | 58 | 01-30-2017 to present | Not applicable | Not applicable |

---

**Business Experience of Directors**

**Raymond J. Gagnon**

***Director of the Bancorp and the Bank and Chairman of the Board of the Bank***

Mr. Gagnon is a retired banker with over 40 years of experience in the community banking industry. Mr. Gagnon began his career in 1967 with First Interstate Bank where he spent nearly 16 years. He left First Interstate Bank to become the Chief Credit Officer at Bank of Irvine, before joining Cerritos Valley Bank as Executive Vice President, Chief Credit Officer in 1984. In 1987, he was promoted to President and Chief Executive Officer of Cerritos Valley Bank. He also became a member of the board of directors of Cerritos Valley Bank starting in 1985 until 1993.

From 1993 to 1997, Mr. Gagnon was engaged in bank consulting. His last consulting job led to his becoming President at Bank of Whittier, where he remained as President and Chief Executive Officer, as well as a director, for over a year, until a change occurred in the ownership of the bank. In 1998, Mr. Gagnon took a position as Senior Vice President, Commercial Lending Manager at First American Bank in Rosemead and after seven years at that bank he accepted an offer from Fullerton Community Bank as a Senior Vice President, Business Banking Manager in 2005. Mr. Gagnon retired in 2010.

**Karkutla P. ("Bala") Balkrishna**

***Chairman of the Board and*** ***Chief Executive Officer and Director of the Bancorp***

***Chief Executive Officer and Director of the Bank***

Mr. Balkrishna has 50 years of banking experience in the Southern California area. His banking career has spanned a wide range of responsibilities, commencing with an assignment as a teller at Bank of America in 1972, working through the various clerical positions, middle management, lending officer positions (including consumer lending, real estate, and commercial/corporate lending), a community banking career, management position at a regional bank, and ultimately reaching the Chief Executive Officer position at a *de novo* bank.

Before joining the Bank, Mr. Balkrishna was the founding Chief Executive Officer ("CEO") and President of Irvine-based Commercial Bank of California ("CBC"). He successfully formed the bank in 2003 and served as the CEO and President until 2013. He was promoted to Chairman in 2014 and retired in December 2014. Prior to the establishment of CBC, Mr. Balkrishna was Executive Vice President and the Orange County Regional Manager for First Bank in Newport Beach from 1994 to 2001.

Mr. Balkrishna has a Master of Business Administration degree from California State University, Fullerton.

**Cary D. Bren**

***Director of the Bancorp and the Bank***

Mr. Bren is the Owner, President and Chief Executive Officer of California Pacific Homes, an Irvine-based company founded in 1958. Mr. Bren joined the company in 1981 and held numerous roles before becoming the company's President in 1997. In 2000, he purchased the company and became Owner, President, and Chief Executive Officer.

**Curtis E. Campbell**

***Director of the Bancorp and the Bank***

Mr. Campbell is a Certified Public Accountant ("CPA") and Partner at Eide Bailly LLP and was a CPA and shareholder of HMWC CPA's & Business Advisors ("HMWC") until July 2020, when HMWC was acquired by Eide Bailly LLP. Mr. Campbell had been with HMWC since 1995.

**Victor E. Guerrero II**

***President/Chief Operating Officer and Director of the Bancorp and the Bank***

Mr. Guerrero has more than 30 years of experience in the banking industry, including 20 years as a Chief Financial Officer of several Southern California-based community banks. He was appointed President and Chief Operating Officer of the Bank as of June 1, 2020 after serving as EVP/Chief Operating Officer & Chief Financial Officer since the Bank's inception.

Before joining the Bank, Mr. Guerrero was the founding EVP/Chief Financial Officer of Orange County Business Bank beginning in 2001, where he was instrumental in organizing, opening and directing the strategic growth of this $200 million community bank, culminating in its sale to HomeStreet Bank in 2016. While at Orange County Business Bank, Mr. Guerrero was responsible for overseeing all areas of operations, information technology, loan servicing, compliance, finance, accounting, and financial reporting. Mr. Guerrero also served as the Chief Financial Officer for South Bay Bank, a $200 million bank headquartered in Torrance, California from 1999 to 2001.

Mr. Guerrero has a Master of Business Administration degree from California State University, Fullerton.

**Katherine T. Le**

***Director of the Bancorp and the Bank***

Ms. Le has served as Chief Executive Officer ("CEO") of Mortgage Service Providers, Santa Ana, California since January 2017, and as President and CEO of United Housing Services, Santa Ana, California since January 2017. Ms. Le served as President of Stearns Lending from October 1995 to September 2016 when the company was sold to the Blackstone Group.

**Richard H. Schlatter**

***Director of the Bancorp and the Bank***

Mr. Schlatter is a retired Certified Public Accountant with over 40 years of experience in finance and public accounting. Early in his career, Mr. Schlatter worked in public accounting for seven years, including five years with Touche Ross & Company (which later became Deloitte & Touche) where he focused on corporate audits, financial reporting and tax advisory services.

Following his public accounting experience, Mr. Schlatter joined MacSteel Service Centers, USA from 1984 to 2000 and during his tenure served in a variety of roles within the finance function at the firm, including Corporate Controller, Vice President–Corporate Controller, and Senior Vice President of Credit and Collections.

**Glenn B. Stearns**

***Director of the Bancorp and the Bank***

Mr. Stearns is the Founder and Chief Executive Officer of Kind Lending, LLC, a Santa Ana-based mortgage company he established in November 2019.

Mr. Stearns is also the Founder of Stearns Lending, LLC (established 1989), Stearns Wholesale, Stearns Holdings, Stearns Ventures, Artemis Holdings, TriVerify, TriMavin, United Housing Services, Inc., Mortgage Service Providers Holdings, Stearns Insurance Services, El Dorado Residential Partners I & II, GS Management Services, Desert Sky Properties, and Shaffer Street Properties. In addition, he is a significant shareholder in the entertainment startup, Indi.com.

**Involvement in Legal Proceedings**

For each of the directors listed above, none of the following events has occurred during the past five years: a petition under the federal bankruptcy laws or any state insolvency law has not been filed by or against, or a receiver, fiscal agent or similar officer was appointed by a court for the business or property of such person, or any partnership in which he or she was general partner at or within two years before the time of such filing, or any corporation or business association of which he or she was an executive officer at or within two years before the time of such filing, and during the past five years, none of the directors listed above was convicted in a criminal proceeding (excluding traffic violations and other minor offenses).

**Business Experience of Executive Officers**

The discussion below provides information concerning the backgrounds and business experience of the executive officers of the Bancorp and the Bank as of September 30, 2022 (the "Record Date"). The business address of all executive officers is Infinity Bank, 6 Hutton Centre Drive, Suite 100, Santa Ana, California 92707.

**Karkutla P. ("Bala") Balkrishna**

***Chairman of the Board and*** ***Chief Executive Officer and Director of the Bancorp***

***Chief Executive Officer and Director of the Bank***

Mr. Balkrishna's business experience is described above under Business Experience of Directors.

**Victor E. Guerrero II**

***President/Chief Operating Officer and Director of the Bancorp and the Bank***

Mr. Guerrero's business experience is described above under Business Experience of Directors.

**Elaine Crouch**

***Executive Vice President/Risk Management/Director of Human Resources/Corporate Secretary of the Bancorp and the Bank***

Ms. Crouch, age 73 as of the Record Date, has 50 years of banking experience in Southern California. She began her career at Infinity Bank as Senior Vice President/Risk Management & Director of Human Resources in February 2018 and was promoted to Executive Vice President/Risk Management & Director of Human Resources in September 2021.

Before joining the Bank, Ms. Crouch served as Vice President/Human Resources Manager-California Region for HomeStreet Bank, a $2 billion bank, from 2016 to 2018 and Senior Vice President/Corporate Secretary & Director of Human Resources for Orange County Business Bank from 2001 to 2016. While at Orange County Business Bank, Ms. Crouch was part of the executive management team and had responsibilities in Corporate Governance, Human Resources, Risk Management, and Audit. Prior to 2001 Ms. Crouch held various management roles at Eldorado Bank and California Bank & Trust.

Ms. Crouch has a Master of Business Administration degree from The Claremont Graduate School, Claremont.

**Allison Duncan**

***Executive Vice President/Chief Financial Officer of the Bancorp and the Bank***

Ms. Duncan, age 58 as of the Record Date, began her banking career at Infinity Bank as the Senior Vice President of Finance in June 2020. In December 2021, she was promoted to Executive Vice President/Chief Financial Officer.

Ms. Duncan has 20 years of experience in public accounting, primarily with RSM McGladrey from October 1993 to October 2009, with a specialization in community banking and financial services, and experience in auditing, financial reporting and mergers/acquisitions. Ms. Duncan also served as the Chief Financial Officer for Carl Warren & Company, a third-party claims administration company, from October 2009 to July 2019 overseeing finance, accounting, payroll, human resources, and financial reporting until the sale of the company.

Ms. Duncan has a Bachelor of Business Administration in Accounting from the University of Wisconsin and has maintained an active license as a Certified Public Accountant for over 30 years.

**Patty Staples**

***Executive Vice President/Chief Credit Officer of the Bank***

Ms. Staples, age 59 as of the Record Date, has more than 30 years of experience in the banking industry, including 14 years as a Chief Credit Officer of several Southern California-based community banks. She was hired as Chief Credit Officer of the Bank in October 2021. In her positions as a Chief Credit Officer, Ms. Staples has been responsible for overseeing all areas of lending, including lending platform implementation, credit administration, loan servicing, lending compliance, problem loan administration, portfolio management, policies, and board reporting.

Before joining the Bank, Ms. Staples served as the Chief Credit Officer for California Business Bank, a $100 million bank headquartered in Irvine, California from 2020 to 2021, and as the Chief Credit Officer for Evangelical Christian Credit Union, a $500 million credit union from 2017 to 2019. Her banking career has spanned a wide range of responsibilities, commencing with a position in new accounts at Security Pacific Bank in 1984 then transitioning to the community banking arena in 1986, working through various officer and management positions in lending with an emphasis in small business and SBA lending programs.

Ms. Staples has a Bachelor of Science degree in Economics from San Diego State University, San Diego, and a is a graduate of the Stonier Graduate School of Banking, University of Pennsylvania, Philadelphia, Pennsylvania.

**COMPENSATION OF DIRECTORS AND EXECUTIVE OFFICERS**

The following table describes the annual compensation of each of the two highest paid persons who were executive officers or directors during the Bank's last completed fiscal year (2021):

---

| | | | |
|:---|:---|:---|:---|
| &nbsp;&nbsp; <br> **Name** | &nbsp;&nbsp; <br> **Capacities in which<br> compensation was<br> received** | &nbsp;&nbsp; <br> **Cash<br> Compensation<br> ($)** | &nbsp;&nbsp; <br> **Total compensation<br> ($)** |
| &nbsp;&nbsp; Karkutla P. Balkrishna<br>| &nbsp;&nbsp; Chairman and Chief Executive Officer and Director of Infinity Bancorp and CEO and Director of Infinity Bank<br>| &nbsp;&nbsp; $310,000 salary<br>$100,000 bonus<br>&nbsp;&nbsp;$15415<sup>1</sup> | &nbsp;&nbsp;$425415 |
| &nbsp;&nbsp;Victor E. Guerrero II | &nbsp;&nbsp; President/Chief Operating Officer and Director of Infinity Bancorp and Infinity Bank<br>| &nbsp;&nbsp; $265,000 salary<br>$50,000 bonus<br>&nbsp;&nbsp;$24752<sup>2</sup> | &nbsp;&nbsp;$339752 |
| &nbsp;&nbsp;Non-officer Directors of the Bank as a Group (6 in number in 2021)<sup>3</sup> | &nbsp;&nbsp;Non-officer Directors of the Bank | &nbsp;&nbsp;$87250 |  |

---

**Infinity Bank 401(k) Plan**

The Board of Directors of the Bank has established the Infinity Bank 401(k) Plan (the "Plan"). The purpose of the Plan is to provide eligible Bank employees with the ability to make voluntary contributions to their 401k Plan account not to exceed the annual dollar limit which is set by law. These contributions defer the taxability of such funds allowing the participant to save for retirement and the participant may select from various investment options available in the Plan. The Plan provides for a discretionary matching contribution by the Bank and Plan participants are 100% vested in these matching contributions.

<sup>1</sup> This amount includes $2,843.00 taxable cost of group term life insurance and $12,572.00 for the Bank's matching contribution to Mr. Balkrishna's 401k account in 2021.

<sup>2</sup> This amount includes $11,750.00 for auto allowance, $731.00 taxable cost of group term life insurance, and $12,271.00 for the Bank's matching contribution to Mr. Guerrero's 401k account in 2021.

<sup>3</sup> Mr. Balkrishna and Mr. Guerrero are executive officers of the Bank and do not receive separate compensation for their Board service. Mr. Guerrero was not a director of the Bank or the Bancorp in 2021. The Bank does not reimburse Board members for expenses incurred in their Board service. Board members are not compensated separately for committees which are comprised of the entire Board.

**2018 Stock Incentive Plan**

The Board of Directors of the Bank approved the Infinity Bank 2018 Stock Incentive Plan (the "Stock Incentive Plan" or the "Plan"), on April 13, 2018, subject to approval of the Plan by the affirmative vote of the holders of at least a majority of the issued and outstanding shares of the Bank. The Plan was approved by the shareholders on May 24, 2018.

As of the Effective Date of the Reorganization on October 21, 2022, the obligations of the Bank under the Stock Incentive Plan and under all award agreements under the Plan were assumed by the Bancorp.

The Plan provides for the issuance of both incentive stock options ("Incentive Options") as defined by Section 422 of the Internal Revenue Code of 1986, as amended, and "non-statutory" stock options ("Non-statutory Options"). The Plan also provides for the granting of Restricted Stock, Restricted Stock Units, Performance Awards, Stock Awards and other Stock-Based Awards, which, together with incentive stock options and non-statutory stock options are referred to herein as "Awards."

The primary purpose of the Stock Incentive Plan is to attract and retain the best available personnel for positions of substantial responsibility, and to provide participating directors, officers and employees with an additional incentive to contribute to the success of the Bank and to increase their equity interests in the Bank.

**Award Agreements**

Pursuant to the Plan, each Award will be documented in a written award agreement. With regard to stock options, the award agreements will entitle the Awardee to purchase shares pursuant to the vesting period specified in the award agreement. Stock options will be granted with an option price equal to 100% of the fair market value of the Bank's outstanding Common Stock at the time of grant (as determined by the Board of Directors of Bancorp) or $10.00 per share whichever is greater. Stock options will be exercisable over a term of up to 10 years, as determined by the Board in its discretion. In the case of persons employed by the Bank, the stock options may qualify as incentive stock options under Section 422 of the Internal Revenue Code. Such options entitle the holder to certain income tax benefits.

**SECURITY OWNERSHIP OF MANAGEMENT AND CERTAIN SECURITYHOLDERS**

**Beneficial Ownership Table**

The table on the next page shows the beneficial ownership of certain persons as of August 1, 2022.

The Bancorp first had shares outstanding (other than 50 shares issued as of June 16, 2022 in connection with the organization of the Bancorp as of that date) on October 21, 2022, the date when all the shares of the Bank were exchanged for shares of the Bancorp on a one-for-one basis. August 1, 2022 was the record date used in the proxy statement for the 2022 Annual Meeting of Shareholders held on September 29, 2022, which was the meeting at which the shareholders of the Bank approved the Reorganization. August 1, 2022 was the record date used in the following table since the shareholder ownership was last confirmed by the Bank's transfer agent as of that date. Unless otherwise indicated, each person listed has sole investment and voting power with respect to the shares listed. None of the persons listed has any family relationship with any other person listed.

The table on the next page sets forth the number and percentages of shares of the common stock of the Bank (and subsequently the Bancorp) beneficially owned, directly or indirectly, as of August 1, 2022 (the "Record Date") by (a) all executive officers and directors as a group, (b) each director or officer who owns more than 10% of any class of the Bancorp's voting securities as such beneficial ownership would be calculated if the Bancorp were subject to Rule 13d-3(d)(1) of the Securities Exchange Act of 1934 ("Rule 13d"), and (c) any other securityholder who beneficially owns more than 10% of any class of the Bancorp's voting securities as such beneficial ownership would be calculated if the Bancorp were subject to Rule 13d.

Rule 13d provides, in part, that a person shall be deemed to be the beneficially owner of a security if that person has the right to acquire beneficial ownership of such security, as defined in Rule 13d, within 60 days through, among other means, the right to acquire securities through the exercise of any stock option. Any securities not outstanding which are subject to such options shall be deemed to be outstanding for the purpose of computing the percentage of outstanding shares of the class owned by such person but shall not be deemed to be outstanding for the purpose of computing the percentage of the class by any other person.

Unless otherwise indicated, each person or entity listed has sole investment and voting power with respect to the shares listed.

---

| | | | | |
|:---|:---|:---|:---|:---|
| &nbsp;&nbsp; <br> **Title of Class** | &nbsp;&nbsp; <br> **Name and Address of<br> beneficial owner** | &nbsp;&nbsp;**Amount and<br> nature of<br> beneficial<br> ownership<sup>1</sup>** | &nbsp;&nbsp;**Amount and nature<br> of beneficial<br> ownership<br> acquirable<sup>2</sup>** | &nbsp;&nbsp; <br> **Percent of Class** |
| &nbsp;&nbsp;No par value Common Stock | &nbsp;&nbsp;All executive officers and directors as a group (11 in number)<sup>3</sup> | &nbsp;&nbsp;745561 | &nbsp;&nbsp;421000 | &nbsp;&nbsp; 1,166,561 total<br>31.14%<br>|
| &nbsp;&nbsp;No par value Common Stock | &nbsp;&nbsp; Each executive officer or director who owns more than 10% of the Class:<br>Glenn B. Stearns<br> Director | &nbsp;&nbsp;299000 | &nbsp;&nbsp;77000 | &nbsp;&nbsp; 376,000 total<br>11.05% |
| &nbsp;&nbsp;No par value Common Stock | &nbsp;&nbsp;Each other securityholder who owns more than 10% of the Class: | &nbsp;&nbsp;Not applicable | &nbsp;&nbsp;Not applicable | &nbsp;&nbsp;Not applicable |

---

<sup>1</sup> The total number of shares beneficially owned as of August 1, 2022 is shown in this column without including the shares of common stock subject to options exercisable within 60 days after the Record Date held by that person.

<sup>2</sup> This column shows the number of shares which may be purchased pursuant to stock options exercisable within 60 days of the Record Date. Any securities not outstanding which are subject to such options shall be deemed to be outstanding for the purpose of computing the percentage of outstanding shares of the class owned by such person but shall not be deemed to be outstanding for the purpose of computing the percentage of the class by any other person.

The 421,000 options that were exercisable within 60 days after the Record Date ("currently exercisable") by all 11 directors and executive officers of the Bancorp and the Bank as a group are treated as outstanding for the purpose of computing the number and percentage of outstanding shares beneficially owned by all 11 directors and executive officers as a group. The number of shares actually outstanding as of the Record Date was 3,325,716. When this number is increased by the 421,000 options which were currently exercisable as of the Record Date, the outstanding shares is assumed to be 3,746,716 shares for this calculation.

<sup>3</sup> The business address for each of the executive officers and directors of the Bancorp and the Bank is 6 Hutton Centre, Suite 100, Santa Ana, California 72707.

**INTEREST OF MANAGEMENT AND OTHERS IN CERTAIN TRANSACTIONS**

During its last completed fiscal years for the years ending December 31, 2020 and 2021, and through September 30, 2022, for amounts which exceed the lessor of $120,000 and one percent of the average of the Bank's total assets at year-end for the 2021 and 2020 fiscal years, none of the directors or executive officers of the Bancorp or the Bank, nor any securityholder who owns more than 10% of an class of the Bancorp's securities, nor any promoter of the Bancorp or the Bank, or any immediate family member of any of the listed persons, as been involved in any transaction or currently proposed transaction in which any of such persons had or is to have a direct or indirect material interest, except as follows:

(1) the salaries and other cash compensation of Karkutla P. Balkrishna and Victor E. Guerrero and as described under "COMPENSATION OF DIRECTORS AND EXECUTIVE OFFICERS" on page 57.

**SECURITIES BEING OFFERED**

The Articles of Incorporation of the Bancorp authorize the issuance of up to 20,000,000 shares of common stock and 10,000,000 shares of preferred stock. As of September 30, 2022, the Bank had 3,325,716 shares of common stock issued and outstanding, and no shares of preferred stock outstanding. All the shares of the Bank were exchanged for shares of the Bancorp on a one-for-one basis as of October 21, 2022. After the Offering, if all 800,000 shares of common stock are sold, there will be a new total of 4,125,716 shares of common stock issued and outstanding. The balance of 15,874,284 shares of common stock which will be authorized but unissued after the Offering, would be available for future stock option exercises, issuance of shares upon the vesting of Restricted Stock Units, and issuance for proper corporate purposes. The preferred stock is not affected by the Offering and there is no present intention to issue any preferred stock.

The designations and powers, preferences and rights and the qualifications, limitations or restrictions of the Bancorp's common stock offered hereby are described below.

**Common Stock**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*(1)* *Dividends.* 

The payment of cash dividends by the Bancorp is subject to restrictions set forth in the California Corporations Code (the "Code"). The shareholders of the Bancorp will be entitled to receive dividends, on a pro rata basis, when and as declared by the Board, out of funds legally available for the payment of dividends, as provided in the California General Corporation Law. Under California law, the Bancorp would be prohibited from paying dividends unless: (1) its retained earnings immediately prior to the dividend equals or exceeds the sum of (A) the amount of the proposed dividend plus (B) the cumulative dividends in arrears on all shares having a preference with respect to payment of dividends over the common stock; or (2) immediately after the dividend, its assets would equal or exceed the sum of its total liabilities plus the amount that would be needed if it were to be dissolved at the time of the dividend to satisfy the preferential rights, including accrued but unpaid dividends, of other shareholders upon dissolution that are superior to the rights of the common stock shareholders. In certain circumstances, the Bancorp may also be required to obtain the prior approval of the Federal Reserve Board to make capital distributions to shareholders.

**Although the Bank has not previously paid dividends, the Bancorp intends to pay dividends to its shareholders, in amounts to be determined by the Board of Directors of Bancorp in its discretion, subject to the requirements of California law.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*(2)* *Dissolution.* 

After the return of all funds to depositors and the payment of creditors and after distribution in full of the preferential amounts to be distributed to the holders of all classes and series of stock entitled thereto or the holders of capital notes, if any, in the event of a voluntary or involuntary liquidation, dissolution or winding up of the Bank, as provided for in the California Financial Code, the holders of our common stock shall be entitled to receive all the remaining assets of the Bank.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*(3)* *Voting Rights.* 

Each share of common stock is entitled to one vote at any meeting of shareholders (such as the election of directors, appointment of independent public accountant and auditor, approval of certain amendments to the Bank's 2018 Stock Incentive Plan, certain amendments to the Bank's articles of incorporation and bylaws, and certain mergers, sale of assets and other consolidation transactions), except in the election of directors. Shareholders have cumulative voting rights in the election of directors; that is, as to any candidates whose names are placed in nomination prior to voting, a shareholder has the right to vote the number of shares owned for as many persons as there are directors to be elected, or to cumulate such votes and give one candidate as many votes as the number of directors multiplied by the number of shares owned equals, or to distribute such votes on the same principle among as many candidates as the shareholder deems appropriate. However, cumulative voting will be dispensed with unless a shareholder gives notice at the shareholders' meeting of their intention to cumulate their votes

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*(4)* *Securities are not Registered.* 

As a Tier I issuer under Regulation A+ of the Securities and Exchange Commission (the "SEC"), the Bancorp will not have reporting obligations to the SEC under Sections 14 or 16 of the Securities Exchange Act of 1934 (the "Exchange Act"), nor will any shareholders have reporting requirements under Regulation 13D or 13G or Regulation 14D. So long as the Bancorp's common stock is not registered under the Exchange Act, the Bancorp's directors and executive officers and beneficial owners of 10% or more of the Bancorp's common stock will not be subject to Section 16 of the Exchange Act. Section 16(a) of the Exchange Act requires executive officers and directors and persons who beneficially own more than 10% of a registered class of equity securities to file with the SEC initial statements of beneficial ownership, reports of changes in ownership and annual reports concerning their ownership of common shares and other equity securities, on Form 3, 4, and 5, respectively. Such information about the Bancorp's directors, executive officers and beneficial holders will only be available through periodic reports filed with the OTC Markets.

The Bancorp's common stock is not registered under the Exchange Act and the Bancorp does not intend to register its common stock under the Exchange Act for the foreseeable future; provided, however, that the Bancorp will register its common stock under the Exchange Act if the Bancorp has, after the last day of any fiscal year, more than either (1) 2,000 persons, or (2) 500 shareholders of record who are not accredited investors, in accordance with Section 12(g) of the Exchange Act.

Further, so long as the Bancorp's common stock is not registered under the Exchange Act, the Bancorp will not be subject to Section 14 of the Exchange Act, which, among other things, prohibits companies that have securities registered under the Exchange Act, from soliciting proxies or consents from shareholders without furnishing to shareholders and filing with the SEC a proxy statement and form of proxy complying with the proxy rules.

In addition, so long as the Bancorp's common stock is not registered under the Exchange Act, the Bancorp will not be subject to the reporting requirements of Regulations 13D and Regulation 13G. which require the disclosure of any person who, after acquiring directly or indirectly the beneficial ownership of any equity securities of a class, becomes, directly or indirectly, the beneficial owner of more than 5% of the class.

Finally, as a non-listed company conducting an exempt offering pursuant to Regulation A+, the Bancorp is not subject to a number of corporate governance requirements, including but not limited to (a) the requirements for independent board members, (b) an independent audit committee operating under a written audit committee charter meeting the requirements of a national stock exchange, (c) a nominating/corporate governance committee composed entirely of independent directors and a written nominating/corporate governance committee charter meeting the requirements of a national stock exchange, (d) a compensation committee composed entirely of independent directors and a written compensation committee charter meeting the requirements of a national stock exchange, and (e) independent audits of the Bancorp's and the Bank's internal controls. The Bancorp and the Bank largely comply with these requirements voluntarily as "best practice" recommendations from their banking regulators, but to the extent they do not fully comply with these requirements, you may not have the same protections afforded to shareholders of companies that are subject to all of the corporate governance requirements of a national stock exchange.

**AUTHORIZATION FOR THE OFFERING**

The Shares are being sold by the Bancorp in an offering under Regulation A+ under the Securities Act of 1933 (the "Act").

**LEGAL OPINIONS**

Legal matters in connection with this Offering will be passed upon by Richard E. Knecht of the firm of Richard E. Knecht, A Professional Corporation, 120 Newport Center Drive, Newport Beach, California 92660-6916, as counsel for the Bancorp. Mr. Knecht has advised us that, to the best of his knowledge, there are no pending or threatened legal proceedings to which the Bancorp or the Bank is or may become a party or which may materially affect the Bancorp's or the Bank's property or proposed business.

**DESCRIPTION OF FINANCIAL STATEMENTS**

Included in this Offering Circular are copies of the Bank's audited financial statements as of and for the years ended December 31, 2021 and 2020 and unaudited financial statements as of and for the 9-month periods ended September 30, 2022 and 2021. Both the audited financial statements and the unaudited financial statements, beginning in this Offering Circular after page 64, are incorporated herein by this reference.

**INFINITY BANK**

**FINANCIAL STATEMENTS**

December 31, 2021 and 2020

INFINITY BANK

FINANCIAL STATEMENTS

December 31, 2021 and 2020

CONTENTS

---

| | |
|:---|:---|
| [INDEPENDENT AUDITOR'S REPORT](#ss_001) | [1](#ss_001) |
| FINANCIAL STATEMENTS |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;[STATEMENTS OF FINANCIAL CONDITION](#ss_002) | [3](#ss_002) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;[STATEMENTS OF OPERATIONS](#ss_003) | [4](#ss_003) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;[STATEMENTS OF COMPREHENSIVE INCOME (LOSS)](#ab_001) | [5](#ab_001) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;[STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY](#ab_002) | [6](#ab_002) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;[STATEMENTS OF CASH FLOWS](#ab_003) | [7](#ab_003) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;[NOTES TO FINANCIAL STATEMENTS](#ab_004) | [8](#ab_004) |

---

---

| | |
|:---|:---|
| ![](tm237204d1_1aimg001.jpg) | **Crowe LLP**<br> Independent Member Crowe Global |

---

INDEPENDENT AUDITOR'S REPORT

The Board of Directors

Infinity Bank

Santa Ana, California

***Opinion***

We have audited the financial statements of Infinity Bank, which comprise the statements of financial condition as of December 31, 2021 and 2020, and the related statements of operations, comprehensive income (loss), changes in shareholders' equity, and cash flows for the years then ended, and the related notes to the financial statements.

In our opinion, the accompanying financial statements present fairly, in all material respects, the financial position of Infinity Bank as of December 31, 2021 and 2020, and the results of its operations and its cash flows for the years then ended in accordance with accounting principles generally accepted in the United States of America.

***Basis for Opinion***

We conducted our audits in accordance with auditing standards generally accepted in the United States of America (GAAS). Our responsibilities under those standards are further described in the Auditor's Responsibilities for the Audit of the Financial Statements section of our report. We are required to be independent of Infinity Bank and to meet our other ethical responsibilities, in accordance with the relevant ethical requirements relating to our audits. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

***Responsibilities of Management for the Financial Statements***

Management is responsible for the preparation and fair presentation of the financial statements in accordance with accounting principles generally accepted in the United States of America, and for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, management is required to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about Infinity Bank's ability to continue as a going concern for one year from the date the financial statements are available to be issued*.*

(Continued)

***Auditor's Responsibilities for the Audit of the Financial Statements***

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with GAAS will always detect a material misstatement when it exists. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Misstatements are considered material if there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment made by a reasonable user based on the financial statements.

In performing an audit in accordance with GAAS, we:

· Exercise professional judgment and maintain professional skepticism throughout the audit.

· Identify and assess the risks of material misstatement of the financial statements, whether due to fraud
or error, and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence
regarding the amounts and disclosures in the financial statements.

· Obtain an understanding of internal control relevant to the audit in order to design audit procedures
that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of Infinity Bank's
internal control. Accordingly, no such opinion is expressed.

· Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting
estimates made by management, as well as evaluate the overall presentation of the financial statements.

· Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise
substantial doubt about Infinity Bank's ability to continue as a going concern for a reasonable period of time.

We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit, significant audit findings, and certain internal control–related matters that we identified during the audit.

---

| |
|:---|
| /s/ Crowe LLP |
| Crowe LLP |

---

Costa Mesa, California

May 13, 2022

INFINITY BANK

STATEMENTS OF FINANCIAL CONDITION

December 31, 2021 and 2020

---

| | | |
|:---|:---|:---|
|  | 2021 | 2020 |
| **ASSETS** |  |  |
| Cash and due from banks | $1916000 | $4384000 |
| Interest-bearing deposits at other banks | 75376000 | 32540000 |
| &nbsp;&nbsp;&nbsp;Total cash and cash equivalents | 77292000 | 36924000 |
| Interest-bearing time deposits at other banks |  | 7724000 |
| Investments |  |  |
| &nbsp;&nbsp;&nbsp;Securities available for sale, at fair value | 66764000 | 23013000 |
| Loans | 150113000 | 135866000 |
| Allowance for loan losses | (2273000) | (1582000) |
| &nbsp;&nbsp;&nbsp;Net loans | 147840000 | 134284000 |
| Federal Home Loan Bank ("FHLB") stock | 606000 | 490000 |
| Premises and equipment, net | 286000 | 317000 |
| Operating lease right-of-use asset | 949000 | 1244000 |
| Deferred tax asset, net | 2070000 |  |
| Accrued interest and other assets | 1019000 | 886000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total assets | $296826000 | $204882000 |
| **LIABILITIES AND SHAREHOLDERS' EQUITY** |  |  |
| Deposits |  |  |
| &nbsp;&nbsp;&nbsp;Noninterest-bearing | $149491000 | $100715000 |
| &nbsp;&nbsp;&nbsp;Interest-bearing | 98636000 | 71701000 |
| &nbsp;&nbsp;&nbsp;Brokered deposits | 14391000 | - |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total deposits | 262518000 | 172416000 |
| Federal Home Loan Bank advances |  | 5000000 |
| Subordinated debentures | 3908000 |  |
| Operating lease liability | 1075000 | 1385000 |
| Income taxes payable | 122000 | 1000 |
| Accrued interest and other liabilities | 596000 | 252000 |
| &nbsp;&nbsp;&nbsp;Total liabilities | 268219000 | 179054000 |
| Commitments and Contingencies - Note 10 |  |  |
| Shareholders' Equity |  |  |
| &nbsp;&nbsp;&nbsp;Preferred stock, 10,000,000 shares authorized, none issued |  |  |
| &nbsp;&nbsp;&nbsp;Common stock, no par value, 20,000,000 shares authorized; 3,319,287 and 3,312,858 shares issued and outstanding as of December 31, 2021 and 2020, respectively | 33210000 | 32944000 |
| &nbsp;&nbsp;&nbsp;Accumulated deficit | (4011000) | (7184000) |
| &nbsp;&nbsp;&nbsp;Accumulated other comprehensive (loss) income | (592000) | 68000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total shareholders' equity | 28607000 | 25828000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total liabilities and shareholders' equity | $296826000 | $204882000 |

---

See accompanying notes to financial statements.

INFINITY BANK

STATEMENTS OF OPERATIONS

For the years ended December 31, 2021 and 2020

---

| | | |
|:---|:---|:---|
|  | 2021 | 2020 |
| Interest income |  |  |
| &nbsp;&nbsp;&nbsp;Loans | $9161000 | $6107000 |
| &nbsp;&nbsp;&nbsp;Investment securities, taxable | 208000 | 163000 |
| &nbsp;&nbsp;&nbsp;Deposits with financial institutions | 96000 | 121000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total interest income | 9465000 | 6391000 |
| Interest expense |  |  |
| &nbsp;&nbsp;&nbsp;Deposits | 489000 | 553000 |
| &nbsp;&nbsp;&nbsp;Federal Home Loan Bank advances | 1000 | 4000 |
| &nbsp;&nbsp;&nbsp;Subordinated debt | 36000 | - |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total interest expense | 526000 | 557000 |
| Net interest income before provision for loan losses | 8939000 | 5834000 |
| Provision for loan losses | 691000 | 659000 |
| **Net interest income after provision for loan losses** | 8248000 | 5175000 |
| &nbsp;&nbsp;&nbsp;Noninterest income |  |  |
| &nbsp;&nbsp;&nbsp;Service charges on deposit accounts | 154000 | 98000 |
| &nbsp;&nbsp;&nbsp;Fees on loans | 104000 | 84000 |
| &nbsp;&nbsp;&nbsp;Gain on sale of securities available for sale |  | 9000 |
| &nbsp;&nbsp;&nbsp;Other income | 44000 | 23000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total noninterest income | 302000 | 214000 |
| Noninterest expense |  |  |
| &nbsp;&nbsp;&nbsp;Salaries and employee benefits | 4671000 | 3872000 |
| &nbsp;&nbsp;&nbsp;Occupancy expenses | 360000 | 356000 |
| &nbsp;&nbsp;&nbsp;Data processing expense | 411000 | 330000 |
| &nbsp;&nbsp;&nbsp;Professional fees | 327000 | 287000 |
| &nbsp;&nbsp;&nbsp;Furniture and equipment expense | 158000 | 182000 |
| &nbsp;&nbsp;&nbsp;FDIC and other insurance | 205000 | 144000 |
| &nbsp;&nbsp;&nbsp;Other expenses | 675000 | 535000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total noninterest expense | 6807000 | 5706000 |
| **Income (loss) before income taxes** | 1743000 | (317000) |
| Income tax (benefit) expense | (1430000) | 1000 |
| **Net income (loss)** | $3173000 | $(318000) |
| Net income (loss) per share - basic | $0.96 | $(0.10) |
| Net income (loss) per share - diluted | $0.96 | $(0.10) |

---

See accompanying notes to financial statements.

INFINITY BANK

STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

For the years ended December 31, 2021 and 2020

---

| | | |
|:---|:---|:---|
|  | 2021 | 2020 |
| Net income (loss) | $3173000 | $(318000) |
| Other Comprehensive Income |  |  |
| &nbsp;&nbsp;&nbsp;Unrealized gains on investment securities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Unrealized (loss) gain on investment securities | (908000) | 84000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Reclassification adjustment for gains included in the gain on sale of securities available for sale line on the statement of operations |  | (9000) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Tax effect | 248000 | - |
| Total other comprehensive (loss) income | (660000) | 75000 |
| Comprehensive income (loss) | $2513000 | $(243000) |

---

See accompanying notes to financial statements.

INFINITY BANK

STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY

For the years ended December 31, 2021 and 2020

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | Common Stock | Common Stock | | | |
|  | Number of<br>Shares |<br>Amount | Accumulated<br>Other<br>Comprehensive<br>(Loss) Income |<br>Accumulated<br>Deficit |<br><br>Total |
| Balance at January 1, 2020 | 3306429 | $32652000 | $(7000) | $(6866000) | $25779000 |
| Stock-based compensation |  | 292000 |  |  | 292000 |
| Vesting of restricted stock units | 6429 |  |  |  |  |
| Net loss |  |  |  | (318000) | (318000) |
| Other comprehensive income | - | - | 75000 | - | 75000 |
| Balance at December 31, 2020 | 3312858 | 32944000 | 68000 | (7184000) | 25828000 |
| Stock-based compensation |  | 266000 |  |  | 266000 |
| Vesting of restricted stock units | 6429 |  |  |  |  |
| Net income |  |  |  | 3173000 | 3173000 |
| Other comprehensive loss | - | - | (660000) | - | (660000) |
| Balance at December 31, 2021 | 3319287 | $33210000 | $(592000) | $(4011000) | $28607000 |

---

See accompanying notes to financial statements.

INFINITY BANK

STATEMENTS OF CASH FLOWS

For the years ended December 31, 2021 and 2020

---

| | | |
|:---|:---|:---|
|  | 2021 | 2020 |
| **Cash flows from operating activities** |  |  |
| &nbsp;&nbsp;&nbsp;Net income (loss) | $3173000 | $(318000) |
| &nbsp;&nbsp;&nbsp;Adjustments to reconcile net income (loss) to net cash provided by used in operating activities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Provision for loan losses | 691000 | 659000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amortization of net premium on securities available for sale | 357000 | 144000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amortization of debt issuance costs | 3000 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Stock-based compensation | 266000 | 292000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Depreciation and amortization | 106000 | 139000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Gain on sale of securities available for sale |  | (9000) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Deferred income taxes | (1822000) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net decrease (increase) in other assets | 162000 | (107000) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net increase (decrease) in other liabilities | 155000 | (197000) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net cash provided by operating activities | 3091000 | 603000 |
| **Cash flows used in investing activities** |  |  |
| &nbsp;&nbsp;&nbsp;Net change in time deposits in other banks | 7724000 | (7340000) |
| &nbsp;&nbsp;&nbsp;Purchase of FHLB stock | (116000) | (490000) |
| &nbsp;&nbsp;&nbsp;Purchase of premises and equipment | (75000) | (28000) |
| &nbsp;&nbsp;&nbsp;Net increase in loans | (14247000) | (62026000) |
| &nbsp;&nbsp;&nbsp;Purchase of securities available for sale | (63774000) | (25758000) |
| &nbsp;&nbsp;&nbsp;Proceeds from the sale of securities available for sale |  | 24868000 |
| &nbsp;&nbsp;&nbsp;Proceeds from calls, maturities and principal payments of securities available for sale | 18758000 | 5605000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net cash used in investing activities | (51730000) | (65169000) |
| **Cash flows from financing activities** |  |  |
| &nbsp;&nbsp;&nbsp;Net increase in deposits | 90102000 | 83398000 |
| &nbsp;&nbsp;&nbsp;(Repayment of) Proceeds from FHLB borrowings | (5000000) | 5000000 |
| &nbsp;&nbsp;&nbsp;Issuance of subordinated debt, net of capitalized costs | 3905000 | - |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net cash provided by financing activities | 89007000 | 88398000 |
| Increase in cash and cash equivalents | 40368000 | 23832000 |
| Cash and cash equivalents - beginning of year | 36924000 | 13092000 |
| **Cash and cash equivalents - end of year** | $77292000 | $36924000 |
| Supplemental Disclosures of Cash Flow Information |  |  |
| &nbsp;&nbsp;&nbsp;Interest paid | $488000 | $557000 |
| &nbsp;&nbsp;&nbsp;Income taxes paid | 271000 | 1000 |

---

See accompanying notes to financial statements.

INFINITY BANK

NOTES TO FINANCIAL STATEMENTS

December 31, 2021 and 2020

**NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES**

<u>Nature of Operations</u>: Infinity Bank (the "Bank") commenced business on February 1, 2018 after receiving the requisite approvals of regulatory authorities. The Bank has been incorporated in the State of California and organized as a single operating segment that operates one full-service branch in Santa Ana, California.

The Bank operates in the local market offering traditional products and services, serving the needs of small-to-medium sized businesses, business owners and professionals, and real estate owners and investors. The majority of deposits and loans are expected to be originated from within the Orange County and its surrounding areas. The Bank is considered a public business entity.

<u>Subsequent Events</u>: The Bank has evaluated subsequent events for recognition and disclosure through May 13, 2022, which is the date the financial statements were available to be issued.

<u>Use of Estimates</u>: To prepare financial statements in conformity with U.S. Generally Accepted Accounting Principles ("GAAP") management makes estimates and assumptions based on available information. These estimates and assumptions affect the amounts reported in the financial statements and the disclosures provided, and actual results could differ.

The outbreak of the coronavirus ("COVID-19") pandemic has negatively impacted the global economy and supply chains. There continues to be uncertainty around variants as well as the pace and sustainability of the economic recovery. As a result, management's estimates and assumptions may be subject to a higher degree of variability and volatility that may result in material differences from the current period.

<u>Cash Flows</u>: For purposes of reporting cash flows, cash and cash equivalents include cash, due from banks, federal funds sold and time deposits in other banks with original maturities of three months or less. Generally, federal funds are sold for one-day periods. Net cash flows are reported for customer loan and deposit transactions and interest-bearing time deposits at other banks.

<u>Cash and Due from Banks</u>: Banking regulations require that banks maintain a percentage of their deposits as reserves in cash or on deposit with the Federal Reserve Bank. The Bank complied with the reserve requirements as of December 31, 2021 and 2020. The Bank maintains amounts due from banks, which may exceed federally insured limits. The Bank has not experienced any losses in such accounts.

<u>Interest-Bearing Time Deposits at Other Banks</u>: Interest-bearing time deposits in other banks generally mature within one year and are carried at cost.

<u>Investment Securities</u>: Investment securities are classified as held to maturity and carried at amortized cost when management has the positive intent and ability to hold them to maturity. Investment securities are classified as available for sale when they might be sold before maturity. Securities available for sale are carried at fair value, with unrealized holding gains and losses reported in other comprehensive income (loss), net of tax.

Gains or losses on sales of investment securities are recorded on the trade date and determined using the specific identification method. Premiums and discounts are amortized or accreted using the interest method over the expected lives of the related securities.

(Continued)

INFINITY BANK

NOTES TO FINANCIAL STATEMENTS

December 31, 2021 and 2020

**NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES** (Continued)

Management evaluates securities for other-than-temporary impairment ("OTTI") on at least a quarterly basis and more frequently when economic or market conditions warrant such an evaluation. For securities in an unrealized loss position, management considers the extent and duration of the unrealized loss, and the financial condition and near-term prospects of the issuer. Management also assesses whether it intends to sell, or it is more likely than not that it will be required to sell, a security in an unrealized loss position before recovery of its amortized cost basis. If either of the criteria regarding intent or requirement to sell is met, the entire difference between amortized cost and fair value is recognized as impairment through earnings. For debt securities that do not meet the aforementioned criteria, the amount of impairment is split into two components as follows: OTTI related to credit loss, which must be recognized in the income statement and OTTI related to other factors, which is recognized in other comprehensive income. The credit loss is defined as the difference between the present value of the cash flows expected to be collected and the amortized cost basis.

<u>Loans</u>: Loans receivable that management has the intent and ability to hold for the foreseeable future or until maturity or payoff are reported at their outstanding unpaid principal balances reduced by any charge-offs and net of any deferred fees or costs on originated loans, or unamortized premiums or discounts on purchased loans.

Loan origination fees and certain direct origination costs are capitalized and recognized as an adjustment of the yield of the related loan. Amortization of deferred loan fees, net of origination costs are discontinued when a loan is placed on nonaccrual status.

Loans on which the accrual of interest has been discontinued are designated as nonaccrual loans. The accrual of interest on loans is discontinued when principal or interest is past due 90 days based on the contractual terms of the loan or when, in the opinion of management, there is reasonable doubt as to collectability. When loans are placed on nonaccrual status, all interest previously accrued but not collected is reversed against current period interest income. Income on nonaccrual loans is subsequently recognized only to the extent that cash is received and the loan's principal balance is deemed collectible. Interest accruals are resumed on such loans only when they are brought current with respect to interest and principal and when, in the judgment of management, the loans are estimated to be fully collectible as to all principal and interest.

<u>Allowance for Loan Losses</u>: The allowance for loan losses is a valuation allowance for probable incurred credit losses. Loan losses are charged against the allowance when management believes the uncollectibility of a loan balance is confirmed. Subsequent recoveries, if any, are credited to the allowance. Management estimates the allowance balance required using past loan loss experience, the nature and volume of the portfolio, information about specific borrower situations and estimated collateral values, economic conditions, and other factors. Allocations of the allowance may be made for specific loans, but the entire allowance is available for any loan that, in management's judgment, should be charged off. Amounts are charged off when available information confirms that specific loans or portions thereof, are uncollectible. This methodology for determining charge-offs is consistently applied to each portfolio segment.

(Continued)

INFINITY BANK

NOTES TO FINANCIAL STATEMENTS

December 31, 2021 and 2020

**NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES** (Continued)

The Bank determines a separate allowance for each portfolio segment. The allowance consists of specific and general reserves. Specific reserves relate to loans that are individually classified as impaired. A loan is impaired when, based on current information and events, it is probable that the Bank will be unable to collect all amounts due according to the contractual terms of the loan agreement. Factors considered in determining impairment include payment status, collateral value and the probability of collecting all amounts when due. Measurement of impairment is based on the expected future cash flows of an impaired loan, which are to be discounted at the loan's effective interest rate, or measured by reference to an observable market value, if one exists, or the fair value of the collateral for a collateral-dependent loan. The Bank selects the measurement method on a loan-by-loan basis except that collateral-dependent loans for which foreclosure is probable are measured at the fair value of the collateral.

The Bank recognizes interest income on impaired loans based on its existing methods of recognizing interest income on nonaccrual loans. Loans, for which the terms have been modified resulting in a concession, and for which the borrower is experiencing financial difficulties, are considered troubled debt restructurings ("TDRs") and classified as impaired with measurement of impairment as described above.

General reserves cover non-impaired loans and loans collectively evaluated for impairment and are based on historical loss rates for each portfolio segment, adjusted for the effects of qualitative or environmental factors that are likely to cause estimated credit losses as of the evaluation date to differ from the portfolio segment's historical loss experience. Because the Bank has not experienced any historical losses, the Bank performed a migration analysis to establish a quantitative framework, which allocates general reserves based on underlying risk factors, such as product type and collateral and risk category. Qualitative factors include consideration of the following: changes in lending policies and procedures; changes in economic conditions, changes in the nature and volume of the portfolio; changes in the experience, ability and depth of lending management and other relevant staff; changes in the volume and severity of past due, nonaccrual and other adversely graded loans; changes in the loan review system; changes in the value of the underlying collateral for collateral-dependent loans; concentrations of credit and the effect of other external factors such as competition; and, legal and regulatory requirements. Portfolio segments identified by the Bank include construction and land development, real estate, commercial & industrial, and consumer loans. Relevant risk characteristics for these portfolio segments generally include debt service coverage, loan-to-value ratios and financial performance on non-consumer loans, and credit scores, debt-to income, collateral type and loan-to-value ratios for consumer loans.

<u>Loan Modifications Related to COVID-19 Pandemic</u>: On March 27, 2020, the Coronavirus Aid, Relief and Economic Security Act ("CARES Act") was enacted to address the economic impact resulted from the COVID-19 pandemic. Under Section 4013 of the CARES Act, optional TDR accounting relief was provided to financial institutions, allowing the temporary suspension of U.S. GAAP requirements and regulatory determinations for loan modifications related to the COVID-19 pandemic that would otherwise be categorized as TDRs from March 1, 2020, through the earlier of 60 days after the date of the COVID-19 National Emergency comes to an end or December 31, 2020.

On December 27, 2020, the Economic Aid Act was signed into law, which extended the applicable period of the temporary relief from TDRs under the CARES Act to the earlier of 60 days after the date of the COVID-19 National Emergency comes to an end or January 1, 2022.

(Continued)

INFINITY BANK

NOTES TO FINANCIAL STATEMENTS

December 31, 2021 and 2020

**NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES** (Continued)

On April 7, 2020, the federal banking regulators also issued the "Interagency Statement on Loan Modifications and Reporting for Financial Institutions Working with Customer Affected by the Coronavirus (Revised)" to encourage banks to work prudently with borrowers and describe the banking regulators' interpretation of how accounting rules for TDR apply to certain modifications related to the COVID-19 pandemic.

The Bank granted payment deferments related to the COVID-19 pandemic to borrowers with loan balances totaling $9.3 million. Loans modifications related to the COVID-19 pandemic were accounted for under Section 4013 of the CARES Act and not considered TDRs. As of December 31, 2020, all modified loans have reverted back to previous contractual payment terms and no additional COVID-19 pandemic related deferments were granted during 2021. All granted payment deferrals were 6 months or less in aggregate.

<u>Small Business Administration ("SBA") Paycheck Protection Program ("PPP")</u>: The SBA launched the PPP to provide a direct incentive for small businesses to keep their workers on the payroll in response to the COVID-19 pandemic. The SBA guarantees 100% of the PPP loans made to eligible borrowers, and the loans are eligible to be forgiven if certain conditions are met, at which point the SBA will make payments to the Bank for the forgiven amounts. These loans are included in the commercial & industrial portfolio and have an interest rate of 1%. As of December 31, 2021 and 2020, total SBA PPP loans were approximately $2.3 million and $14.9 million, respectively.

The SBA guarantee on PPP loans cannot be separated from the loan and therefore is not a separate unit of account. The Bank considered the SBA guarantee in the allowance for loan losses evaluation and determined that it is not required to reserve an allowance on SBA PPP loans at December 31, 2021 and 2020.

<u>Allowance for Credit Losses on Off-Balance Sheet Credit Exposures</u>: The Bank also maintains a separate allowance for off-balance sheet commitments. Management estimates anticipated losses using historical data and utilization assumptions. The allowance for off-balance sheet commitments totaled $32,000 and $25,000 at December 31, 2021 and 2020, respectively, and is included in other liabilities on the statements of financial condition.

<u>Premises and Equipment</u>: Premises and equipment are carried at cost less accumulated depreciation and amortization. Depreciation is computed using the straight-line method over the estimated useful lives, which ranges from three to seven years for furniture, equipment and computer equipment. Leasehold improvements are amortized using the straight-line method over an estimated useful life of seven years or the remaining lease term, whichever is shorter. Expenditures for betterments or major repairs are capitalized and those for ordinary repairs and maintenance are charged to operations as incurred.

<u>FHLB Stock</u>: The Bank is a member of the FHLB system. Members are required to own a certain amount of stock based on the level of borrowings and other factors, and may invest in additional amounts. FHLB stock is carried at cost, classified as restricted security, and periodically evaluated for impairment based on ultimate recovery of par value. Both cash and stock dividends are reported as income.

(Continued)

INFINITY BANK

NOTES TO FINANCIAL STATEMENTS

December 31, 2021 and 2020

**NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES** (Continued)

<u>Leases</u>: The Bank determines if an arrangement contains a lease at contract inception and recognize right-of-use ("ROU") assets and operating lease liabilities based on the present value of lease payments over the lease term. While operating leases may include options to extend the term, the Bank does not take into account the options in calculating the ROU asset and lease liability unless it is reasonably certain such options will be reasonably exercised. The present value of lease payments is determined based on the Bank's incremental borrowing rate and other information available at lease commencement. Leases with an initial term of 12 months or less are not recorded in the statements of financial condition. Lease expense is recognized on a straight-line basis over the lease term. The Bank has elected to account for lease agreements with lease and non-lease components as a single lease component.

<u>Loss Contingencies</u>: Loss contingencies, including claims and legal actions arising in the ordinary course of business, are recorded as liabilities when the likelihood of loss is probable, and the amount or range of loss can be reasonably estimated. Management does not believe there are any such matters that will have a material effect on the financial statements.

<u>Revenue Recognition – Noninterest Income</u>: All of the Bank's revenue from contracts with customers within the scope of ASC 606 is recognized in noninterest income.

In accordance with Topic 606, revenues are recognized when control of promised goods or services is transferred to customers in an amount that reflects the consideration the Bank expects to be entitled to in exchange for those goods or services.

The following is a discussion of key revenues within the scope of Topic 606.

*Service Charges on Deposit Accounts* – The Bank earns fees from its deposit customers for account maintenance, transaction-based and overdraft services. Account maintenance fees consist primarily of account fees and analyzed account fees charged on deposit accounts on a monthly basis. The performance obligation is satisfied and the fees are recognized on a monthly basis as the service period is completed. Transaction-based fees on deposits accounts are charged to deposit customers for specific services provided to the customer, such as non-sufficient funds fees, overdraft fees, and wire transfer fees. The performance obligation is completed as the transaction occurs and the fees are recognized at the time each specific service is provided to the customer.

Other revenues within the scope of Topic 606 were not material for the years ended December 31, 2021 and 2020.

(Continued)

INFINITY BANK

NOTES TO FINANCIAL STATEMENTS

December 31, 2021 and 2020

**NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES** (Continued)

<u>Transfers of Financial Assets</u>: Transfers of financial assets are accounted for as sales, when control over the assets has been relinquished. Control over transferred assets is deemed to be surrendered when the assets have been isolated from the Bank, the transferee obtains the right (free of conditions that constrain it from taking advantage of that right) to pledge or exchange the transferred assets, and the Bank does not maintain effective control over the transferred assets through an agreement to repurchase them before their maturity.

<u>Stock-Based Compensation</u>: The Bank recognizes the cost of employee services received in exchange for awards of stock options, or other equity instruments, based on the grant-date fair value of those awards. A Black-Scholes model is used to estimate the fair value of stock options, while the market price of the Bank's stock at the date of grant is used for restricted stock units. This cost is recognized over the period which an employee is required to provide services in exchange for the award, generally the vesting period. The Bank treats each tranche of each stock option award as if it were a separate award with its own vesting date. Generally, for each tranche granted, compensation expense is recognized on a straight-line basis from the grant date until the vesting date of the respective tranche. The cost of other awards is generally recognized over the vesting period, on a straight-line basis.

The Bank has elected to account for forfeitures of stock-based awards as they occur. Excess tax benefits and tax deficiencies relating to stock-based compensation are recorded as income tax expense or benefit in the income statement when incurred.

See Note 12 for additional information on the Bank's equity incentive plan.

<u>Income Taxes</u>: Income tax expense is the total of the current year income tax due or refundable and the change in deferred tax assets and liabilities. Deferred income taxes are computed using the asset and liability method, which recognizes a liability or asset representing the tax effects, based on current tax law, of future deductible or taxable amounts attributable to events that have been recognized in the financial statements. A valuation allowance is established to reduce the deferred tax asset to the level at which it is "more likely than not" that the tax asset or benefits will be realized. Realization of tax benefits of deductible temporary differences and operating loss carry forwards depends on having sufficient taxable income of an appropriate character within the carry forward periods.

The Bank has adopted guidance issued by the Financial Accounting Standards Board ("FASB") that clarifies the accounting for uncertainty in tax positions taken or expected to be taken on a tax return and provides that the tax effects from an uncertain tax position can be recognized in the financial statements only if, based on its merits, the position is more likely than not to be sustained on audit by the taxing authorities. Interest and penalties related to uncertain tax positions are recorded as part of income tax expense.

<u>Earnings (Loss) Per Share ("EPS")</u>: Basic EPS excludes dilution and is computed by dividing income available to common shareholders by the weighted-average number of common shares outstanding for the period. Diluted EPS reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock or resulted in the issuance of common stock that then shared in the earnings of the entity. All of the outstanding stock options were not considered in computing diluted earnings per share for 2021 and 2020 because they were antidilutive. Weighted-average shares used in the computation of basic EPS were 3,316,073 in 2021 and 3,309,644 in 2020.

<u>Comprehensive Income (Loss)</u>: The change in unrealized gains and losses on available-for-sale securities is the only component of accumulated other comprehensive income (loss) for the Bank. The amount reclassified out of other accumulated comprehensive income (loss) relating to the net realized gain on securities available for sale was $0 and $9,000 for 2021 and 2020, respectively, with no related tax effect.

(Continued)

INFINITY BANK

NOTES TO FINANCIAL STATEMENTS

December 31, 2021 and 2020

**NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES** (Continued)

<u>Financial Instruments</u>: In the ordinary course of business, the Bank has entered into off-balance sheet financial instruments consisting of commitments to extend credit as described in Note 10. Such financial instruments are recorded in the financial statements when they are funded, or related fees are incurred or received.

<u>Fair Value Measurement</u>: Fair value is the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Current accounting guidance establishes a fair value hierarchy, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The guidance describes three levels of inputs that may be used to measure fair value:

*Level 1* - Quoted prices (unadjusted) for identical assets or liabilities in active markets that the entity has the ability to access as of the measurement date.

*Level 2* - Significant other observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data.

*Level 3* - Significant unobservable inputs that reflect an entity's own assumptions about the assumptions that market participants would use in pricing an asset or liability.

See Note 14 for more information and disclosures relating to the Bank's fair value measurements.

<u>Recent Accounting Guidance Not Yet Effective</u>: In June 2016, the FASB issued ASU No. 2016-13, *Measurement of Credit Losses on Financial Instruments* (Topic 326). This ASU significantly changes how entities will measure credit losses for most financial assets and certain other instruments that aren't measured at fair value through net income. In issuing the standard, the FASB is responding to criticism that today's guidance delays recognition of credit losses. The standard will replace today's "incurred loss" approach with an "expected loss" model. The new model, referred to as the current expected credit loss ("CECL") model, will apply to: (1) financial assets subject to credit losses and measured at amortized cost, and (2) certain off-balance sheet credit exposures. This includes, but is not limited to, loans, leases, held-to-maturity securities, loan commitments, and financial guarantees. The CECL model does not apply to available-for-sale ("AFS") debt securities. For AFS debt securities with unrealized losses, entities will measure credit losses in a manner similar to what they do today, except that the losses will be recognized as allowances rather than reductions in the amortized cost of the securities. As a result, entities will recognize improvements to estimated credit losses immediately in earnings rather than as interest income over time, as they do today. The ASU also simplifies the accounting model for purchased credit-impaired debt securities and loans. ASU 2016-13 also expands the disclosure requirements regarding an entity's assumptions, models, and methods for estimating the allowance for loan and lease losses. In addition, public business entities will need to disclose the amortized cost balance for each class of financial asset by credit quality indicator, disaggregated by the year of origination. ASU No. 2016-13 is effective for interim and annual reporting periods beginning after December 15, 2022 for all entities, other than SEC filers that do not qualify as a Smaller Reporting Company as defined by the SEC. Entities will apply the standard's provisions as a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period in which the guidance is effective (i.e., modified retrospective approach). The Bank is currently evaluating the provisions of ASU No. 2016-13 for potential impact on its financial statements and disclosures.

(Continued)

INFINITY BANK

NOTES TO FINANCIAL STATEMENTS

December 31, 2021 and 2020

**NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES** (Continued)

<u>Reclassifications</u>: Some items in the prior year financial statements were reclassified to conform to the current presentation. Reclassification had no effect on prior year net income or total shareholders' equity.

**NOTE 2 – SECURITIES**

The amortized cost and fair values of securities with gross unrealized gains and losses as of December 31 are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | | Gross | Gross | |
|  | Amortized | Unrealized | Unrealized | Fair |
| Available-for-Sale Securities | Cost | Gains | Losses | Value |
| December 31, 2021 |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Mortgage-backed securities | $64964000 | $4000 | $(817000) | $64151000 |
| &nbsp;&nbsp;&nbsp;U.S. government-sponsored entities and agencies | 2640000 | - | (27000) | 2613000 |
|  | $67604000 | $4000 | $(844000) | $66764000 |
| December 31, 2020 |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Mortgage-backed securities | $12756000 | $74000 | $(9000) | $12821000 |
| &nbsp;&nbsp;&nbsp;U.S. government-sponsored entities and agencies | 10189000 | 3000 | - | 10192000 |
|  | $22945000 | $77000 | $(9000) | $23013000 |

---

During 2021, the Bank did not sell any available-for-sale investment securities. During 2020, the Bank sold various available-for-sale investment securities totaling $24.9 million. The gross gains on the sales of these securities were $25,000 and the gross losses on the sales of these securities were $16,000. Because the Bank had a full valuation allowance against its net deferred tax asset during 2020, there was no tax impact on the net gains from sales.

The amortized cost and fair value of debt securities by contractual maturity at December 31, 2021 are shown below. Securities not due at a single maturity date are presented separately.

---

| | | |
|:---|:---|:---|
|  | Available-for-Sale | Available-for-Sale |
|  | Amortized<br>Cost | Fair<br>Value |
| Due in one year or less | $140000 | $140000 |
| Due from one to five years | 2500000 | 2473000 |
| Mortgage-backed securities | 64964000 | 64151000 |
|  | $67604000 | $66764000 |

---

(Continued)

INFINITY BANK

NOTES TO FINANCIAL STATEMENTS

December 31, 2021 and 2020

**NOTE 2 – SECURITIES** (Continued)

At December 31, 2021, the Bank had 80 securities where estimated fair value had declined from the Bank's amortized cost as compared to 10 securities where estimated fair value had declined from the Bank's amortized cost as of December 31, 2020. These securities are guaranteed either explicitly or implicitly by the U.S. Government and therefore no credit loss is expected. As the Bank does not intend to sell these securities, and it is likely that it will not be required to sell the securities before their anticipated recovery, no declines are deemed to be other-than-temporary.

The gross unrealized losses and related estimated fair value of investment securities that have been in a continuous loss position for less than twelve months and over twelve months at December 31 are as follows:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | Less than Twelve Months | Less than Twelve Months | Twelve Months or More | Twelve Months or More | Total | Total |
|  | Unrealized<br>Losses |<br>Fair Value | Unrealized<br>Losses |<br>Fair Value | Unrealized<br>Losses |<br>Fair Value |
| <u>December 31, 2021</u> |  |  |  |  |  |  |
| Mortgage-backed securities | $(811000) | $61109000 | $(6000) | $893000 | $(817000) | $62002000 |
| U.S. government-sponsored entities and agencies | (27000) | 2473000 | - | - | (27000) | 2473000 |
|  | $(838000) | $63582000 | $(6000) | $893000 | $(844000) | $64475000 |
| <u>December 31, 2020</u> |  |  |  |  |  |  |
| Mortgage-backed securities | $(9000) | $3662000 | $- | $- | $(9000) | $3662000 |

---

Securities pledged at year-end 2021 had a carrying amount of $66,764,000 and were pledged to secure FHLB advances.

**NOTE 3 – LOANS**

The Bank's loan portfolio consists primarily of loans to borrowers within Orange County and its surrounding areas. Although the Bank seeks to avoid concentrations of loans to a single industry or based upon a single class of collateral, real estate and real estate associated businesses are among the principal industries in the Bank's market area and, as a result, the Bank's loan and collateral portfolios are, to some degree, concentrated in those industries.

The composition of the Bank's loan portfolio as of December 31 is as follows:

---

| | | |
|:---|:---|:---|
|  | 2021 | 2020 |
| Construction and land development | $28440000 | $17426000 |
| Real estate - commercial and residential | 37235000 | 29438000 |
| Commercial & industrial | 78852000 | 84747000 |
| Consumer | 5586000 | 4255000 |
| &nbsp;&nbsp;&nbsp;Total loans | 150113000 | 135866000 |
| &nbsp;&nbsp;&nbsp;Allowance for loan losses | (2273000) | (1582000) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net loans | $147840000 | $134284000 |

---

The balance of unamortized loan fees, net of loan origination costs included in total loans was $662,000 and $752,000 as of December 31, 2021 and 2020, respectively.

(Continued)

INFINITY BANK

NOTES TO FINANCIAL STATEMENTS

December 31, 2021 and 2020

**NOTE 3 – LOANS** (Continued)

The following table presents the activity in the allowance for loan losses for the years ended December 31, 2021 and 2020 and the recorded investment in loans and impairment method as of December 31, 2021 and 2020 by portfolio segment:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | Construction and<br>land<br>development | Real estate -<br>commercial and<br>residential |<br>Commercial &<br>industrial |<br>Consumer |<br>Total |
| December 31, 2021 |  |  |  |  |  |
| Allowance for Loan Losses: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Beginning of period | $230000 | $385000 | $912000 | $55000 | $1582000 |
| &nbsp;&nbsp;&nbsp;Provisions | 264000 | 47000 | 374000 | 6000 | 691000 |
| &nbsp;&nbsp;&nbsp;Charge-offs |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Recoveries | - | - | - | - | - |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;End of year | $494000 | $432000 | $1286000 | $61000 | $2273000 |
| Reserves: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Specific | $- | $- | $202000 | $- | $202000 |
| &nbsp;&nbsp;&nbsp;General | 494000 | 432000 | 1084000 | 61000 | 2071000 |
|  | $494000 | $432000 | $1286000 | $61000 | $2273000 |
| Loans Evaluated: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Individually | $- | $- | $1009000 | $- | $1009000 |
| &nbsp;&nbsp;&nbsp;Collectively | 28440000 | 37235000 | 77843000 | 5586000 | 149104000 |
|  | $28440000 | $37235000 | $78.852000 | $5586000 | $150113000 |
| December 31, 2020 |  |  |  |  |  |
| Allowance for Loan Losses: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Beginning of period | $65000 | $198000 | $649000 | $11000 | $923000 |
| &nbsp;&nbsp;&nbsp;Provisions | 165000 | 187000 | 263000 | 44000 | 659000 |
| &nbsp;&nbsp;&nbsp;Charge-offs |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Recoveries | - | - | - | - | - |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;End of year | $230000 | $385000 | $912000 | $55000 | $1582000 |
| Reserves: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Specific | $- | $- | $- | $- | $- |
| &nbsp;&nbsp;&nbsp;General | 230000 | 385000 | 912000 | 55000 | 1582000 |
|  | $230000 | $385000 | $912000 | $55000 | $1582000 |
| Loans Evaluated: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Individually | $- | $- | $1098000 | $- | $1098000 |
| &nbsp;&nbsp;&nbsp;Collectively | 17426000 | 29438000 | 83649000 | 4255000 | 134768000 |
|  | $17426000 | $29438000 | $84747000 | $4255000 | $135866000 |

---

(Continued)

INFINITY BANK

NOTES TO FINANCIAL STATEMENTS

December 31, 2021 and 2020

**NOTE 3 – LOANS** (Continued)

The Bank categorizes loans into risk categories based on relevant information about the ability of borrowers to service their debt such as current financial information, historical payment experience, collateral adequacy, credit documentation, and current economic trends, among other factors. The Bank analyzes loans individually by classifying the loans as to credit risk. This analysis typically includes larger, non-homogeneous loans such as commercial real estate and commercial and industrial loans. This analysis is performed on an ongoing basis as new information is obtained.

The Bank uses the following definitions for risk ratings:

*Special Mention* – Loans classified as special mention have potential weaknesses that deserve management's close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or of the institution's credit position at some future date.

*Substandard* – Loans classified as substandard are inadequately protected by the current net worth and paying capacity of the obligor or of the collateral pledged, if any. Loans so classified have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that the institution will sustain some loss if the deficiencies are not corrected.

*Doubtful* – Loans classified as doubtful have all the weaknesses inherent in those classified as substandard, with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions, and values, highly questionable and improbable.

The recorded investment of loans by risk category and class of loans as of December 31, 2021 and 2020 was as follows:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  |<br>Pass | Special<br>Mention |<br>Substandard |<br>Doubtful |<br>Total |
| December 31, 2021 |  |  |  |  |  |
| Construction and land development | $28440000 | $- | $- | $- | $28440000 |
| Real estate - commercial and residential | 34235000 | 3000000 |  |  | 37235000 |
| Commercial & industrial | 75499000 |  | 3353000 |  | 78852000 |
| Consumer | 5586000 | - | - | - | 5586000 |
|  | $146760000 | $3000000 | $3353000 | $- | $150113000 |
| December 31, 2020 |  |  |  |  |  |
| Construction and land development | $17426000 | $- | $- | $- | $17426000 |
| Real estate - commercial and residential | 29438000 |  |  |  | 29438000 |
| Commercial & industrial | 83299000 | 350000 | 1098000 |  | 84747000 |
| Consumer | 4255000 | - | - | - | 4255000 |
|  | $134418000 | $350000 | $1098000 | $- | $135866000 |

---

(Continued)

INFINITY BANK

NOTES TO FINANCIAL STATEMENTS

December 31, 2021 and 2020

**NOTE 3 – LOANS** (Continued)

The following table presents information related to impaired loans as of and for the years ended December 31, 2021 and 2020:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | Unpaid<br>Principal<br>Balance |<br>Recorded<br>Investment |<br>Related<br>Allowance | Average<br>Recorded<br>Investment | Interest<br>Income<br>Recognized |
| December 31, 2021 |  |  |  |  |  |
| With an Allowance: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Commercial & industrial | $1056000 | $1009000 | $202000 | $1076000 | $- |
|  | $1056000 | $1009000 | $202000 | $1076000 | $- |
| December 31, 2020 |  |  |  |  |  |
| With an Allowance: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Commercial & industrial | $1110000 | $1098000 | $- | $1129000 | $17000 |
|  | $1110000 | $1098000 | $- | $1129000 | $17000 |

---

There were no impaired loans without a specific reserve as of December 31, 2021. There was no specific reserve on the impaired loans as of December 31, 2020 as none was required per the impairment analysis.

Impaired loans as of December 31, 2021 and 2020 were on nonaccrual status. These loans were past due greater than 90 days at December 31, 2021. No other loans were past due at December 31, 2021 and no loans were past due at December 31, 2020.

The Bank had no past due loans or loans classified as TDRs as of December 31, 2021 or 2020. During the years ended December 31, 2021 and 2020, the Bank did not modify any loans that were classified as TDRs.

**NOTE 4 – PREMISES AND EQUIPMENT**

A summary of premises and equipment as of December 31 is as follows:

---

| | | |
|:---|:---|:---|
|  | 2021 | 2020 |
| Leasehold improvements | $11000 | $2000 |
| Furniture, fixtures, and equipment | 767000 | 700000 |
|  | 778000 | 702000 |
| Less accumulated depreciation and amortization | (492000) | (385000) |
|  | $286000 | $317000 |

---

**NOTE 5 – LEASES**

In February 2018, the Bank entered into a seven-year lease agreement for its corporate office and branch with beginning monthly rent of $25,000 which had a 100% abatement for an initial period of five months. The Bank is also responsible for the pro rata share of any operating expense increase in excess of the actual expenses incurrent by the landlord during the fiscal year. Total lease expense under the operating lease was approximately $320,000 and $320,000 for the years ended December 31, 2021 and 2020, respectively.

(Continued)

INFINITY BANK

NOTES TO FINANCIAL STATEMENTS

December 31, 2021 and 2020

**NOTE 5 – LEASES** (Continued)

The Bank elected, for all classes of underlying assets, not to separate lease and non-lease components and instead to account for them as a single lease component. Variable lease cost primarily represents variable payments such as common area maintenance and utilities. These amounts were not material for the years ended December 31, 2021 and 2020.

Under the lease agreement, there are options to renew. The exercise of renewal options is at the sole discretion of the Bank. Renewal option periods were not included in the measurement of ROU assets and lease liabilities as they are not considered reasonably certain of exercise.

Supplemental lease and other information at and for the years ended December 31, 2021 and 2020 are as follows:

---

| | | |
|:---|:---|:---|
|  | 2021 | 2020 |
| Supplemental Lease Information |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Weighted average remaining lease term | 3.1 years | 4.1 years |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Weighted Average Discount Rate | 2.00% | 2.00% |
| Other Information |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Cash paid for amounts included in the measurement of lease liabilities | $336000 | $324000 |

---

Future lease payments of the Bank's operating lease as of December 31, 2021 are as follows:

---

| | |
|:---|:---|
| 2022 | $347000 |
| 2023 | 360000 |
| 2024 | 372000 |
| 2025 | 31000 |
| Total lease payments | 1110000 |
| Less imputed interest | (35000) |
| Total operating lease liability | $1075000 |

---

**NOTE 6 – DEPOSITS**

As of December 31, 2021, the Bank had 11 deposit relationships that exceeded 2.0% of total deposits, collectively aggregating approximately $190.0 million and representing 72.4% of the total deposits of the Bank. At December 31, 2021, the Bank had $14.4 million in brokered deposits which mature in 2022. The Bank did not have any brokered deposits as of December 31, 2020. At December 31, 2021 and 2020, the Bank did not have any time deposits other than the brokered deposits.

**NOTE 7 – FHLB ADVANCES, OTHER BORROWINGS AND SUBORDINATED DEBENTURES**

As of December 31, 2021, the Bank did not have any outstanding borrowings with the FHLB. The average outstanding balance for 2021 was $2.4 million at an average interest rate of 0.02%. The maximum outstanding under this line was $20 million. As of December 31, 2021, the Bank's remaining borrowing capacity with the FHLB was approximately $79.6 million.

As of December 31, 2020, the Bank had $5.0 million in borrowings with the FHLB with an interest rate of 0%. The advance matured in May 2021.

(Continued)

INFINITY BANK

NOTES TO FINANCIAL STATEMENTS

December 31, 2021 and 2020

**NOTE 7 – FHLB ADVANCES, OTHER BORROWINGS AND SUBORDINATED DEBENTURES** (Continued)

The Bank may borrow up to $9.0 million with unsecured lines of credit with two outside correspondent banks. There were no amounts outstanding under these arrangements as of December 31, 2021 and 2020.

In 2021, the Bank obtained a permit from the Department of Financial Protection and Innovation (DFPI) to issue $5 million of subordinated debentures ("debentures"). On October 22, 2021, the Bank issued $4.0 million, net of issuance costs of $95,000, of subordinated debentures to three investors, in exchange for cash. These debentures are shown as a liability in the Bank's financial statements and mature on November 1, 2031. The permit to issue the remaining $1.0 million of subordinated debentures expires on July 11, 2022.

The Bank has the option to redeem the subordinated debentures, in whole plus accrued and unpaid interest, on November 1, 2026. The subordinated debentures are also redeemable in whole or in part with integral multiples of $1,000 at any interest payment date subsequent to November 1, 2026 at the Bank's discretion.

The subordinated debentures may be included in Tier I capital (with certain limitation applicable) under current regulatory guidelines and interpretations. The subordinated debentures have a fixed rate of interest of 4.25% through November 1, 2026. If not redeemed at that time, the interest rate becomes variable based on the three-month term SOFR Conventions plus 3.36%. Interest is due and payable quarterly beginning in May 2022.

**NOTE 8 – INCOME TAXES**

The income tax expense for the year ended December 31 is comprised of the following:

---

| | | |
|:---|:---|:---|
|  | 2021 | 2020 |
| Current income taxes: |  |  |
| &nbsp;&nbsp;&nbsp;Federal | $4000 | $- |
| &nbsp;&nbsp;&nbsp;State | 388000 | 1000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total current income taxes | 392000 | 1000 |
| Deferred | 161000 | (25000) |
| Valuation allowance | (1983000) | 25000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total income tax expense | $(1430000) | $1000 |

---

Effective tax rates differ from the federal statutory rate of 21% for 2021 and 2020 applied to income before income taxes due to the following:

---

| | | |
|:---|:---|:---|
|  | 2021 | 2020 |
| Federal statutory rate times financial statement income | $366000 | $(67000) |
| Effect of: |  |  |
| &nbsp;&nbsp;&nbsp;State taxes, net federal benefit | 159000 | 1000 |
| &nbsp;&nbsp;&nbsp;Share awards | 22000 | 30000 |
| &nbsp;&nbsp;&nbsp;Change in valuation allowance | (1983000) | 25000 |
| &nbsp;&nbsp;&nbsp;Other, net | 6000 | 12000 |
| &nbsp;&nbsp;&nbsp;Total | $(1430000) | $1000 |

---

(Continued)

INFINITY BANK

NOTES TO FINANCIAL STATEMENTS

December 31, 2021 and 2020

**NOTE 8 – INCOME TAXES** (Continued)

Deferred taxes are a result of differences between income tax accounting and generally accepted accounting principles with respect to income and expense recognition. The following is a summary of the components of the net deferred tax asset accounts recognized in the accompanying statements of financial condition at December 31:

---

| | | |
|:---|:---|:---|
|  | 2021 | 2020 |
| Deferred Tax Assets |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Start-up costs | $309000 | $337000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Organization expenses | 90000 | 99000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Allowance for loan losses due to tax limitations | 597000 | 419000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Premises and equipment | 28000 | 34000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Stock-based compensation | 111000 | 84000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net operating loss carryovers | 811000 | 1237000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Operating lease liability | 318000 | 409000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Unrealized loss on available for sale securities | 248000 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other items | 194000 | 62000 |
|  | 2706000 | 2681000 |
| Deferred Tax Liabilities |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Right of use asset | (281000) | (368000) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Unrealized gains on available for sale securities |  | (20000) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other items | (355000) | (310000) |
|  | (636000) | (698000) |
| Valuation Allowance | - | (1983000) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net deferred tax assets | $2070000 | $- |
| NOL carryforward - Federal | $2148000 | $4182000 |
| NOL carryforward - State | $4208000 | $4208000 |

---

A valuation allowance for deferred tax assets is recorded when it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income and tax planning strategies which will create taxable income during the periods in which those temporary differences become deductible. At December 31, 2021, the Bank's management evaluated whether the valuation allowance is required based on the assessment of all positive and negative evidence that existed at the time. Management concluded from its assessment that it was more likely than not that the deferred tax assets would be realizable as a result of sufficient current and projected future taxable income. The Bank reversed the entire $2.0 million valuation allowance during the year ended December 31, 2021. At December 31, 2020, the Bank had a full valuation allowance in place.

The Bank has net operating loss carryforwards of approximately $2,148,000 for federal income purposes and $4,208,000 for California franchise tax purposes. Federal net operating loss carryforwards do not expire and California net operating loss carryforwards, to the extent not used will begin to expire in 2039.

(Continued)

INFINITY BANK

NOTES TO FINANCIAL STATEMENTS

December 31, 2021 and 2020

**NOTE 8 – INCOME TAXES** (Continued)

The Bank records interest and penalties related to uncertain tax positions as part of income tax expense. There was no penalty or interest expense recorded as of December 31, 2021 and 2020. The Bank does not expect the total amount of unrecognized tax benefits to significantly increase or decrease within the next twelve months.

The Bank is subject to federal income tax and California franchise tax. Federal and California income tax returns for years ended on or after December 31, 2018 are open to audit by the federal and California authorities.

**NOTE 9 – OTHER EXPENSES**

Other expenses for the period ended December 31 are comprised of the following:

---

| | | |
|:---|:---|:---|
|  | 2021 | 2020 |
| Legal expense | $145000 | $100000 |
| Director fees | 93000 | 106000 |
| Advertising and marketing expense | 93000 | 55000 |
| Other | 344000 | 274000 |
|  | $675000 | $535000 |

---

**NOTE 10 – COMMITMENTS AND CONTINGENCIES**

<u>Commitments to Extend Credit</u>: In the ordinary course of business, the Bank enters into financial commitments to meet the financing needs of its customers. These financial commitments include commitments to extend credit. Those instruments involve to varying degrees, elements of credit and interest rate risk not recognized in the Bank's financial statements.

The Bank's exposure to loan loss in the event of nonperformance on commitments to extend credit and standby letters of credit is represented by the contractual amount of those instruments. The Bank uses the same credit policies in making commitments as it does for loans reflected in the financial statements.

As of December 31, the Bank had the following approximate outstanding financial commitments whose contractual amounts represent credit risk:

---

| | | |
|:---|:---|:---|
|  | 2021 | 2020 |
| Commitments to extend credit | $70575000 | $50139000 |

---

Commitments to extend credit are agreements to lend to a customer as long as there is no violation of any condition established in the contract. Since many of the commitments are expected to expire without being drawn upon, the total amounts do not necessarily represent future cash requirements. The Bank evaluates each client's credit worthiness on a case-by-case basis. The amount of collateral obtained if deemed necessary by the Bank is based on management's credit evaluation of the customer. The majority of the Bank's commitments to extend credit generally are secured by real estate or other commercial business assets.

(Continued)

INFINITY BANK

NOTES TO FINANCIAL STATEMENTS

December 31, 2021 and 2020

**NOTE 10 – COMMITMENTS AND CONTINGENCIES** (Continued)

<u>Standby Letters of Credit/Bank Guarantees</u>: Standby letters of credit and Bank Guarantees (collectively, "guarantees") are conditional commitments issued by the Bank to guarantee the performance of a client to a third party. Those guarantees are primarily issued to support public and private borrowing arrangements. The credit risk involved in issuing letters is essentially the same as that involved in extending loan facilities to clients. Collateral held varies as specified above and is required in instances that the Bank deems necessary. The Bank had no financial standby letters of credit as of December 31, 2021 and 2020.

<u>Data Processing Commitment</u>: The Bank processes its data and check items under a non-cancelable agreement expiring in January 2025. The monthly payment will increase as the Bank's volume of transactions increases. The agreement contains a termination clause whereby the Bank would be liable to the service bureau for an immediate lump sum payment based on the average monthly billings over the number of months remaining on the contract unless certain contractual obligations are not met by the processor. In April 2022, the Bank extended its agreement through January 2027.

**NOTE 11 - RELATED PARTY TRANSACTIONS**

In the ordinary course of business, certain executive officers, directors and companies with which they are associated may have loans and deposits with the Bank. At December 31, 2021 and 2020, related party deposits were approximately $18,783,000 and $8,177,000 respectively, and total outstanding balance of related party loans at December 31, 2021 and 2020 was $0 and approximately $1,426,000, respectively.

**NOTE 12 – STOCK-BASED COMPENSATION**

The Board of Directors of the Bank approved the 2018 Stock Incentive Plan ("2018 Plan"). The 2018 plan was approved in May 2018 by the shareholders. Under the terms of the 2018 Plan, officers and key employees may be granted both nonqualified and incentive stock options, and directors and other consultants, who are not also an officer or employee, may only be granted nonqualified stock options. The 2018 Plan also permits the granting of restricted stock, restricted stock units, performance awards, stock awards and other stock-based awards. The 2018 Plan provides for the total number of awards of common stock that may be issued over the term of the plan not to exceed 990,000 shares, of which a maximum of 891,000 shares may be granted as incentive stock options. Stock options are granted at a price not less than 100% of the fair market value of the stock on the date of grant. The 2018 plan provides for accelerated vesting if there is a change of control as defined in the 2018 Plan. Equity awards generally vest over five to seven years. Stock options expire no later than ten years from the date of grant.

(Continued)

INFINITY BANK

NOTES TO FINANCIAL STATEMENTS

December 31, 2021 and 2020

**NOTE 12 – STOCK-BASED COMPENSATION** (Continued)

The Bank recognized stock-based compensation costs of $202,000 and $228,000 related to stock options and $64,000 and $64,000 related to restricted stock units for the years ended December 31, 2021 and 2020, respectively. Stock options were estimated on the date of grant using the Black-Scholes option pricing model with the following weighted-average assumptions:

---

| | | |
|:---|:---|:---|
|  | 2021 | 2020 |
| Expected volatility | 4.61% | 4.30% |
| Expected term | 6.5 Years | 6.5 Years |
| Expected dividends |  |  |
| Risk-free rate | 0.75% | 0.61% |
| Grant date fair value | $0.06 | $0.34 |

---

Since the Bank has a limited amount of historical stock activity, the expected volatility is based on the historical volatility of similar banks that have a longer trading history. The expected term represents the estimated average period of time that the options remain outstanding. Since the Bank does not have sufficient historical data on the exercise of stock options, the expected term is based on the "simplified" method that measures the expected term as the average of the vesting period and the contractual term, adjusted for management's estimate on the period of time that options granted are expected to be outstanding. The risk-free rate of the return reflects the grant date interest rate offered for zero coupon U.S. Treasury bonds over the expected term of the options.

A summary of the status of the Bank's stock option plan as of December 31, 2021 and changes during the year ended thereon is presented below:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  |<br><br>Shares |<br>Weighted-<br>Average<br>Exercise<br>Price | Weighted-<br>Average<br>Remaining<br>Contractual<br>Term |<br>Aggregate<br>Intrinsic<br>Value |
| &nbsp;&nbsp;&nbsp;Outstanding at beginning of period | 399050 | $10.00 |  |  |
| &nbsp;&nbsp;&nbsp;Granted | 438000 | 10.00 |  |  |
| &nbsp;&nbsp;&nbsp;Exercised |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Forfeited or expired | (72300) | 10.00 |  |  |
| &nbsp;&nbsp;&nbsp;Outstanding at end of year | 764750 | $10.00 | 7.9 years | $- |
| Options exercisable | 569700 | $10.00 | 8.1 years | $- |

---

As of December 31, 2021, there was $312,000 of total unrecognized compensation cost related to the outstanding stock options that will be recognized over a weighted average period of 2.3 years.

(Continued)

INFINITY BANK

NOTES TO FINANCIAL STATEMENTS

December 31, 2021 and 2020

**NOTE 12 – STOCK-BASED COMPENSATION** (Continued)

<u>Restricted Stock Units</u>: Restricted stock units ("RSU") amortization totaled $64,000 and $64,000 for the period ended December 31, 2021 and 2020, respectively. The amount of unrecognized compensation expense related to all unvested RSUs as of December 31, 2021 totaled $225,000. Such expense is expected to be recognized over a weighted average period of 3.5 years. The intrinsic value of the RSUs that vested in 2021 was approximately $64,000, and was approximately $64,000 in 2020.

The following table presents a summary of restricted stock transactions during the year ended December 31, 2021:

---

| | | |
|:---|:---|:---|
|  |<br>Number<br>of<br>Units | Weighted<br>Average<br>Grant Date<br>Fair Value<br>(per share) |
| Unvested restricted stock units, beginning of year | 32142 | $10.00 |
| Granted |  |  |
| Vested | (6429) | $10.00 |
| Forfeited or Expired | - |  |
| Unvested restricted stock units, end of year | 25713 | $10.00 |

---

**NOTE 13 – EMPLOYEE 401K PLAN**

The Bank has adopted a 401(k) for its employees. Under the plan, eligible employees may defer a portion of their salaries. The plan provides for a discretionary matching contribution. The Bank made contributions of $137,000 and $122,000 for the periods ended December 31, 2021 and 2020, respectively.

**NOTE 14 – FAIR VALUE OF FINANCIAL INSTRUMENTS**

The fair value of a financial instrument is the amount at which the asset or obligation could be exchanged in a current transaction between willing parties, other than in a forced or liquidation sale. Fair value estimates are made at a specific point in time based on relevant market information and information about the financial instrument. These estimates do not reflect any premium or discount that could result from offering for sale at one time the entire holdings of a particular financial instrument. Because no market value exists for a significant portion of the financial instruments, fair value estimates are based on judgments regarding future expected loss experience, current economic conditions, risk characteristics of various financial instruments, and other factors. These estimates are subjective in nature, involve uncertainties and matters of judgment and, therefore, cannot be determined with precision. Changes in assumptions could significantly affect the estimates.

Fair value estimates are based on financial instruments both on and off the balance sheet without attempting to estimate the value of anticipated future business and the value of assets and liabilities that are not considered financial instruments. Additionally, tax consequences related to the realization of the unrealized gains and losses can have a potential effect on fair value estimates and have not been considered in many of the estimates.

(Continued)

INFINITY BANK

NOTES TO FINANCIAL STATEMENTS

December 31, 2021 and 2020

**NOTE 14 – FAIR VALUE OF FINANCIAL INSTRUMENTS** (Continued)

The fair value hierarchy level and estimated fair value of significant financial instruments at December 31 are summarized as follows:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | | 2021 | 2021 | 2020 | 2020 |
|  | <br>Fair Value<br>Hierarchy | Carrying<br>Value | Fair<br>Value | Carrying<br>Value | Fair<br>Value |
| Financial assets |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Cash and cash equivalents | Level 1 | $77292000 | $77292000 | $36924000 | $36924000 |
| &nbsp;&nbsp;&nbsp;Time deposits at other banks | Level 1 |  |  | 7724000 | 7724000 |
| &nbsp;&nbsp;&nbsp;Securities, available for sale | Level 2 | 66764000 | 66764000 | 23013000 | 23013000 |
| &nbsp;&nbsp;&nbsp;Loans, net | Level 3 | 147840000 | 148183000 | 134284000 | 135153000 |
| Financial liabilities |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Total deposits | Level 1 | $248127000 | $248127000 | $172416000 | $172416000 |
| &nbsp;&nbsp;&nbsp;Brokered deposits | Level 2 | 14391000 | 14391000 |  |  |
| &nbsp;&nbsp;&nbsp;FHLB advances | Level 2 |  |  | 5000000 | 5000000 |
| &nbsp;&nbsp;&nbsp;Subordinated debt | Level 2 | 3908000 | 3908000 |  |  |

---

**NOTE 15 – REGULATORY MATTERS**

The Bank is subject to various regulatory capital requirements administered by the federal banking agencies. Failure to meet minimum capital requirements can initiate certain mandatory - and possibly additional discretionary - actions by regulators that, if undertaken, could have a direct material effect on the Bank's financial statements. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Bank must meet specific capital guidelines that involve quantitative measures of the Bank's assets, liabilities, and certain off-balance-sheet items as calculated under regulatory accounting practices. The Bank's capital amounts and classification are also subject to qualitative judgments by the regulators about components, risk weightings, and other factors. Management believes, as of December 31, 2021 and 2020, that the Bank meets all capital adequacy requirements to which it is subject.

In July 2013, the federal bank regulatory agencies approved the final rules implementing the Basel Committee on Banking Supervision's capital guidelines for U.S. banks (Basel III rules). The new rules became effective on January 1, 2015, with certain of the requirements phased-in over a multi-year schedule, and fully phased in by January 1, 2019. Under the Basel III rules, the Bank must hold a capital conservation buffer of 2.50% above the adequately capitalized risk-based capital ratios. The net unrealized gain or loss on available for sale securities, if any, is not included in computing regulatory capital.

Quantitative measures established by regulation to ensure capital adequacy require the Bank to maintain minimum amounts and ratios (set forth in the table below) of total, Tier 1 and CET1 capital (as defined in the regulations) to risk-weighted assets (as defined), and of Tier 1 capital (as defined) to average assets (as defined).

(Continued)

INFINITY BANK

NOTES TO FINANCIAL STATEMENTS

December 31, 2021 and 2020

**NOTE 15 – REGULATORY MATTERS** (Continued)

As of December 31, 2021 and 2020, the most recent notification from the FDIC categorized the Bank as well capitalized under the regulatory framework for prompt corrective action (there are no conditions or events since that notification that management believes have changed the Bank's category). To be categorized as well capitalized, the Bank must maintain minimum ratios as set forth in the table below. The following table sets forth the Bank's actual capital amounts and ratios at December 31, 2021 and 2020 (dollar amounts in thousands):

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | | | Amount of Capital Required | Amount of Capital Required | Amount of Capital Required | Amount of Capital Required |
|  | | | | | To Be | To Be |
|  | | | | | Well-Capitalized | Well-Capitalized |
|  | | | For Capital | For Capital | Under Prompt | Under Prompt |
|  | | | Adequacy | Adequacy | Corrective | Corrective |
|  | Actual | Actual | Purposes | Purposes | Provisions | Provisions |
|  | Amount | Ratio | Amount | Ratio | Amount | Ratio |
| <u>2021</u> |  |  |  |  |  |  |
| Total capital (to risk-weighted assets) | $30674 | 15.7% | $15670 | 8.0% | $19587 | 10.0% |
| Tier 1 capital (to risk-weighted assets) | 28401 | 14.5% | 11752 | 6.0% | 15670 | 8.0% |
| CET1 capital (to risk-weighted assets) | 28401 | 14.5% | 8814 | 4.5% | 12732 | 6.5% |
| Tier 1 capital (to average assets) | 28401 | 9.2% | 12363 | 4.0% | 15454 | 5.0% |
| <u>2020</u> |  |  |  |  |  |  |
| Total capital (to risk-weighted assets) | $27342 | 16.4% | $13304 | 8.0% | $9033 | 10.0% |
| Tier 1 capital (to risk-weighted assets) | 25760 | 15.5% | 9978 | 6.0% | 13304 | 8.0% |
| CET1 capital (to risk-weighted assets) | 25760 | 15.5% | 7483 | 4.0% | 10809 | 6.5% |
| Tier 1 capital (to average assets) | 25760 | 12.0% | 8579 | 4.0% | 10724 | 5.0% |

---

The California Financial Code also provides that a bank may not make a cash distribution to its shareholders in excess of the lesser of the bank's undivided profits or the bank's net income for its last three fiscal years less the amount of any distribution made by the bank's shareholders during the same period.

INFINITY BANK

STATEMENTS OF FINANCIAL CONDITION

(UNAUDITED)

---

| | | |
|:---|:---|:---|
|  | September 30,<br>2022 | December 31,<br>2021 |
| **ASSETS** |  |  |
| Cash and due from banks | $5247000 | $1916000 |
| Interest-bearing deposits at other banks | 107803000 | 75376000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total cash and cash equivalents | 113050000 | 77292000 |
| Investments |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Securities available for sale, at fair value | 54735000 | 66764000 |
| Loans | 150718000 | 150113000 |
| Allowance for loan losses | (2731000) | (2273000) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net loans | 147987000 | 147840000 |
| Federal Home Loan Bank ("FHLB") stock | 1043000 | 606000 |
| Premises and equipment, net | 220000 | 286000 |
| Accrued interest and other assets | 5274000 | 4038000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total assets | $322309000 | $296826000 |
| **LIABILITIES AND SHAREHOLDERS' EQUITY** |  |  |
| Deposits |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Noninterest-bearing | $178939000 | $149491000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Interest-bearing | 112050000 | 98636000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Brokered deposits | - | 14391000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total deposits | 290989000 | 262518000 |
| Subordinated debentures | 3923000 | 3908000 |
| Accrued interest and other liabilities | 1364000 | 1793000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total liabilities | 296276000 | 268219000 |
| Commitments and Contingencies - Note 6 |  |  |
| Shareholders' Equity |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Preferred stock, 10,000,000 shares authorized, none issued |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Common stock, no par value, 20,000,000 shares authorized; 3,325,716 and 3,319,287 shares issued and outstanding as of September 30, 2022 and December 31, 2021, respectively | 33424000 | 33210000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accumulated deficit | (2384000) | (4011000) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accumulated other comprehensive loss | (5007000) | (592000) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total shareholders' equity | 26033000 | 28607000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total liabilities and shareholders' equity | $322309000 | $296826000 |

---

See accompanying notes to unaudited financial statements.

INFINITY BANK

STATEMENTS OF OPERATIONS

For the nine months ended September 30, 2022 and 2021

(Unaudited)

---

| | | |
|:---|:---|:---|
|  | 2022 | 2021 |
| Interest income |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Loans | $7570000 | $6419000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Investment securities, taxable | 522000 | 71000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Deposits with financial institutions | 859000 | 64000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total interest income | 8951000 | 6554000 |
| Interest expense |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Deposits | 530000 | 345000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Federal Home Loan Bank advances |  | 1000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Subordinated debt | 141000 | - |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total interest expense | 671000 | 346000 |
| Net interest income before provision for loan losses | 8280000 | 6208000 |
| Provision for loan losses | 610000 | 542000 |
| **Net interest income after provision for loan losses** | 7670000 | 5666000 |
| Noninterest income |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Service charges on deposit accounts | 129000 | 110000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Fees on loans | 78000 | 82000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other income | 34000 | 32000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total noninterest income | 241000 | 224000 |
| Noninterest expense |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Salaries and employee benefits | 3944000 | 3282000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Occupancy expenses | 265000 | 270000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Data processing expense | 277000 | 306000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Professional fees | 341000 | 314000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;FDIC and other insurance | 212000 | 142000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other expenses | 561000 | 497000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total noninterest expense | 5600000 | 4811000 |
| **Income before income taxes** | 2311000 | 1079000 |
| Income tax expense (benefit) | 684000 | (1654000) |
| **Net income** | $1627000 | $2733000 |
| Net income (loss) per share - basic | $0.49 | $0.82 |
| Net income (loss) per share - diluted | $0.49 | $0.82 |

---

See accompanying notes to unaudited financial statements.

INFINITY BANK

STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

For the nine months ended September 30, 2022 and 2021

(Unaudited)

---

| | | |
|:---|:---|:---|
|  | 2022 | 2021 |
| Net income | $1627000 | $2733000 |
| Other Comprehensive Income |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Unrealized gains on investment securities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Unrealized (loss) on investment securities | (6267000) | (428000) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Tax effect | 1852000 | 127000 |
| Total other comprehensive loss | (4415000) | (301000) |
| Comprehensive (loss) income | $(2788000) | $2432000 |

---

See accompanying notes to unaudited financial statements.

INFINITY BANK

STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY

For the nine months ended September 30, 2022 and 2021

(Unaudited)

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | Common Stock | Common Stock | | | |
|  | Number of<br> Shares | Amount | Accumulated<br> Other<br>Comprehensive<br> (Loss) Income |<br>Accumulated<br> Deficit |<br>Total |
| Balance at January 1, 2021 | 3312858 | 32944000 | 68000 | (7184000) | 25828000 |
| Stock-based compensation |  | 200000 |  |  | 200000 |
| Vesting of restricted stock units | 6429 |  |  |  |  |
| Net income |  |  |  | 2733000 | 2733000 |
| Other comprehensive loss | - | - | (301000) | - | (301000) |
| Balance at September 30, 2021 | 3319287 | $33144000 | $(233000) | $(4451000) | $28460000 |
| Stock-based compensation |  | 66000 |  |  | 66000 |
| Vesting of restricted stock units |  |  |  |  |  |
| Net income |  |  |  | 440000 | 440000 |
| Other comprehensive loss | - | - | (359000) | - | (359000) |
| Balance at December 31, 2021 | 3319287 | $33210000 | $(592000) | $(4011000) | $28607000 |
| Stock-based compensation |  | 214000 |  |  | 214000 |
| Vesting of restricted stock units | 6429 |  |  |  |  |
| Net income |  |  |  | 1627000 | 1627000 |
| Other comprehensive loss | - | - | (4415000) | - | (4415000) |
| Balance at September 30, 2022 | 3325716 | $33424000 | $(5007000) | $(2384000) | $26033000 |

---

See accompanying notes to unaudited financial statements.

INFINITY BANK

STATEMENTS OF CASH FLOWS

For the nine months ended September 30, 2022 and 2021

(Unaudited)

---

| | | |
|:---|:---|:---|
|  | 2022 | 2021 |
| **Cash flows from operating activities** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net income | $1627000 | $2733000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Adjustments to reconcile net income to net cash provided by used in operating activities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Provision for loan losses | 610000 | 542000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amortization of net premium on securities available for sale | 487000 | 159000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amortization of debt issuance costs | 15000 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Stock-based compensation | 214000 | 200000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Depreciation and amortization | 89000 | 78000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Deferred income taxes | 596000 | (1833000) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net decrease in other assets | 20000 | 18000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net decrease in other liabilities | (429000) | (195000) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net cash provided by operating activities | 3229000 | 1702000 |
| **Cash flows used in investing activities** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net change in time deposits in other banks |  | 7724000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Purchase of FHLB stock | (437000) | (116000) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Purchase of premises and equipment | (23000) | (62000) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net increase in loans | (757000) | (17727000) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Purchase of securities available for sale | (7401000) | (56448000) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Proceeds from calls, maturities and principal payments of securities available for sale | 12676000 | 13911000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net cash provided by (used in) investing activities | 4058000 | (52718000) |
| **Cash flows from financing activities** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net increase in deposits | 28471000 | 126992000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Repayment of FHLB borrowings | - | (5000000) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net cash provided by financing activities | 28471000 | 121992000 |
| Increase in cash and cash equivalents | 35758000 | 70976000 |
| Cash and cash equivalents - beginning of year | 77292000 | 36924000 |
| **Cash and cash equivalents - end of year** | $113050000 | $107900000 |
| Supplemental Disclosures of Cash Flow Information |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Interest paid | $600000 | $346000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Income taxes paid | 209000 | 201000 |

---

See accompanying notes to unaudited financial statements.

INFINITY BANK

STATEMENTS OF CASH FLOWS

For the nine months ended September 30, 2022 and 2021

(Unaudited)

**NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES**

<u>Nature of Operations</u>: Infinity Bank (the "Bank") commenced business on February 1, 2018 after receiving the requisite approvals of regulatory authorities. The Bank has been incorporated in the State of California and organized as a single operating segment that operates one full-service branch in Santa Ana, California.

The Bank operates in the local market offering traditional products and services, serving the needs of small-to-medium sized businesses, business owners and professionals, and real estate owners and investors. The majority of deposits and loans are expected to be originated from within the Orange County and its surrounding areas. The Bank is considered a public business entity.

<u>Basis of Presentation</u>: The accounting and reporting policies of the Company are in accordance with accounting principles generally accepted in the United States ("GAAP") and conform to practices within the financial services industry. The accounts of the Bank are included in these financial statements.

<u>Interim Financial Information</u>: The accompanying unaudited interim financial statements as of September 30, 2022 and for the nine months ended September 30, 2022 and 2021, have been prepared in a condensed format, and therefore do not include all of the information and footnotes required by GAAP for complete financial statements. These unaudited financial statements have been prepared on a basis that is substantially consistent with the accounting principles applied to the Banks's audited consolidated financial statements for the year ended December 31, 2021.

The information furnished in these interim statements reflects all adjustments which are, in the opinion of management, necessary for a fair statement of the results for each respective period presented. Such adjustments are of a normal recurring nature. The results of operations in the interim statements are not necessarily indicative of the results that may be expected for any other period or for the full year. The interim financial information should be read in conjunction with the Bank's audited financial statements for the year ended December 31, 2021.

<u>Subsequent Events</u>: A single bank holding company, Infinity Bancorp (the"Bancorp"), was formed and 100% of the Bank's stock was assumed by the Bancorp effective October 31, 2022. The Bank has evaluated subsequent events for recognition and disclosure through _________, 2023.

<u>Use of Estimates</u>: To prepare financial statements in conformity with U.S. Generally Accepted Accounting Principles ("GAAP") management makes estimates and assumptions based on available information. These estimates and assumptions affect the amounts reported in the financial statements and the disclosures provided, and actual results could differ.

<u>Loans</u>: Loans receivable that management has the intent and ability to hold for the foreseeable future or until maturity or payoff are reported at their outstanding unpaid principal balances reduced by any charge-offs and net of any deferred fees or costs on originated loans, or unamortized premiums or discounts on purchased loans.

Loan origination fees and certain direct origination costs are capitalized and recognized as an adjustment of the yield of the related loan. Amortization of deferred loan fees, net of origination costs are discontinued when a loan is placed on nonaccrual status.

INFINITY BANK

STATEMENTS OF CASH FLOWS

For the nine months ended September 30, 2022 and 2021

(Unaudited)

**NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES** (Continued)

Loans on which the accrual of interest has been discontinued are designated as nonaccrual loans. The accrual of interest on loans is discontinued when principal or interest is past due 90 days based on the contractual terms of the loan or when, in the opinion of management, there is reasonable doubt as to collectability. When loans are placed on nonaccrual status, all interest previously accrued but not collected is reversed against current period interest income. Income on nonaccrual loans is subsequently recognized only to the extent that cash is received and the loan's principal balance is deemed collectible. Interest accruals are resumed on such loans only when they are brought current with respect to interest and principal and when, in the judgment of management, the loans are estimated to be fully collectible as to all principal and interest.

<u>Allowance for Loan Losses</u>: The allowance for loan losses is a valuation allowance for probable incurred credit losses. Loan losses are charged against the allowance when management believes the uncollectibility of a loan balance is confirmed. Subsequent recoveries, if any, are credited to the allowance. Management estimates the allowance balance required using past loan loss experience, the nature and volume of the portfolio, information about specific borrower situations and estimated collateral values, economic conditions, and other factors. Allocations of the allowance may be made for specific loans, but the entire allowance is available for any loan that, in management's judgment, should be charged off. Amounts are charged off when available information confirms that specific loans or portions thereof, are uncollectible. This methodology for determining charge-offs is consistently applied to each portfolio segment.

The Bank determines a separate allowance for each portfolio segment. The allowance consists of specific and general reserves. Specific reserves relate to loans that are individually classified as impaired. A loan is impaired when, based on current information and events, it is probable that the Bank will be unable to collect all amounts due according to the contractual terms of the loan agreement. Factors considered in determining impairment include payment status, collateral value and the probability of collecting all amounts when due. Measurement of impairment is based on the expected future cash flows of an impaired loan, which are to be discounted at the loan's effective interest rate, or measured by reference to an observable market value, if one exists, or the fair value of the collateral for a collateral-dependent loan. The Bank selects the measurement method on a loan-by-loan basis except that collateral-dependent loans for which foreclosure is probable are measured at the fair value of the collateral.

The Bank recognizes interest income on impaired loans based on its existing methods of recognizing interest income on nonaccrual loans. Loans, for which the terms have been modified resulting in a concession, and for which the borrower is experiencing financial difficulties, are considered troubled debt restructurings ("TDRs") and classified as impaired with measurement of impairment as described above.

General reserves cover non-impaired loans and loans collectively evaluated for impairment and are based on historical loss rates for each portfolio segment, adjusted for the effects of qualitative or environmental factors that are likely to cause estimated credit losses as of the evaluation date to differ from the portfolio segment's historical loss experience. Because the Bank has not experienced any historical losses, the Bank performed a migration analysis to establish a quantitative framework, which allocates general reserves based on underlying risk factors, such as product type and collateral and risk category. Qualitative factors include consideration of the following: changes in lending policies and procedures; changes in economic conditions, changes in the nature and volume of the portfolio; changes in the experience, ability and depth of lending management and other relevant staff; changes in the volume and severity of past due, nonaccrual and other adversely graded loans; changes in the loan review system; changes in the value of the underlying collateral for collateral-dependent loans; concentrations of credit and the effect of other external factors such as competition; and, legal and regulatory requirements. Portfolio segments identified by the Bank include construction and land development, real estate, commercial & industrial, and consumer loans.

INFINITY BANK

STATEMENTS OF CASH FLOWS

For the nine months ended September 30, 2022 and 2021

(Unaudited)

**NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES** (Continued)

Relevant risk characteristics for these portfolio segments generally include debt service coverage, loan-to-value ratios and financial performance on non-consumer loans, and credit scores, debt-to income, collateral type and loan-to-value ratios for consumer loans.

<u>Allowance for Credit Losses on Off-Balance Sheet Credit Exposures</u>: The Bank also maintains a separate allowance for off-balance sheet commitments. Management estimates anticipated losses using historical data and utilization assumptions. The allowance for off-balance sheet commitments totaled $38,000 and $32,000 at September 30, 2022 and December 31, 2021, respectively, and is included in other liabilities on the statements of financial condition.

<u>Loss Contingencies</u>: Loss contingencies, including claims and legal actions arising in the ordinary course of business, are recorded as liabilities when the likelihood of loss is probable, and the amount or range of loss can be reasonably estimated. Management does not believe there are any such matters that will have a material effect on the financial statements.

<u>Revenue Recognition – Noninterest Income</u>: All of the Bank's revenue from contracts with customers within the scope of ASC 606 is recognized in noninterest income.

In accordance with Topic 606, revenues are recognized when control of promised goods or services is transferred to customers in an amount that reflects the consideration the Bank expects to be entitled to in exchange for those goods or services.

The following is a discussion of key revenues within the scope of Topic 606.

*Service Charges on Deposit Accounts* – The Bank earns fees from its deposit customers for account maintenance, transaction-based and overdraft services. Account maintenance fees consist primarily of account fees and analyzed account fees charged on deposit accounts on a monthly basis. The performance obligation is satisfied and the fees are recognized on a monthly basis as the service period is completed. Transaction-based fees on deposits accounts are charged to deposit customers for specific services provided to the customer, such as non-sufficient funds fees, overdraft fees, and wire transfer fees. The performance obligation is completed as the transaction occurs and the fees are recognized at the time each specific service is provided to the customer.

Other revenues within the scope of Topic 606 were not material for the nine months ended September 30, 2022 and 2021.

<u>Transfers of Financial Assets</u>: Transfers of financial assets are accounted for as sales, when control over the assets has been relinquished. Control over transferred assets is deemed to be surrendered when the assets have been isolated from the Bank, the transferee obtains the right (free of conditions that constrain it from taking advantage of that right) to pledge or exchange the transferred assets, and the Bank does not maintain effective control over the transferred assets through an agreement to repurchase them before their maturity.

INFINITY BANK

STATEMENTS OF CASH FLOWS

For the nine months ended September 30, 2022 and 2021

(Unaudited)

**NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES** (Continued)

<u>Income Taxes</u>: Income tax expense is the total of the current year income tax due or refundable and the change in deferred tax assets and liabilities. Deferred income taxes are computed using the asset and liability method, which recognizes a liability or asset representing the tax effects, based on current tax law, of future deductible or taxable amounts attributable to events that have been recognized in the financial statements. A valuation allowance is established to reduce the deferred tax asset to the level at which it is "more likely than not" that the tax asset or benefits will be realized. Realization of tax benefits of deductible temporary differences and operating loss carry forwards depends on having sufficient taxable income of an appropriate character within the carry forward periods.

The Bank has adopted guidance issued by the Financial Accounting Standards Board ("FASB") that clarifies the accounting for uncertainty in tax positions taken or expected to be taken on a tax return and provides that the tax effects from an uncertain tax position can be recognized in the financial statements only if, based on its merits, the position is more likely than not to be sustained on audit by the taxing authorities. Interest and penalties related to uncertain tax positions are recorded as part of income tax expense.

<u>Earnings (Loss) Per Share ("EPS")</u>: Basic EPS excludes dilution and is computed by dividing income available to common shareholders by the weighted-average number of common shares outstanding for the period. Diluted EPS reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock or resulted in the issuance of common stock that then shared in the earnings of the entity. All of the outstanding stock options were not considered in computing diluted earnings per share for the nine months ended September 30, 2022 and 2021 because they were antidilutive. Weighted-average shares used in the computation of basic EPS were 3,321,454 in 2022 and 3,315,025 in 2021.

<u>Comprehensive Income (Loss)</u>: The change in unrealized gains and losses on available-for-sale securities is the only component of accumulated other comprehensive income (loss) for the Bank. The amount reclassified out of other accumulated comprehensive income (loss) relating to the net realized gain on securities available for sale was $0 for the nine months ended September 30, 2022 and 2021, with no related tax effect.

<u>Financial Instruments</u>: In the ordinary course of business, the Bank has entered into off-balance sheet financial instruments consisting of commitments to extend credit as described in Note 10. Such financial instruments are recorded in the financial statements when they are funded, or related fees are incurred or received.

INFINITY BANK

STATEMENTS OF CASH FLOWS

For the nine months ended September 30, 2022 and 2021

(Unaudited)

**NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES** (Continued)

<u>Fair Value Measurement</u>: Fair value is the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Current accounting guidance establishes a fair value hierarchy, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The guidance describes three levels of inputs that may be used to measure fair value:

*Level 1* - Quoted prices (unadjusted) for identical assets or liabilities in active markets that the entity has the ability to access as of the measurement date.

*Level 2* - Significant other observable inputs other than Level 1 prices such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data.

*Level 3* - Significant unobservable inputs that reflect an entity's own assumptions about the assumptions that market participants would use in pricing an asset or liability.

<u>Recent Accounting Guidance Not Yet Effective</u>:

The Bank is not an issuer, as defined under section 2(a) of the Sarbanes-Oxley Act of 2002 (15 U.S.C. 7201(a)),. Therefore, the Bank has elected to delay compliance with new or revised financial accounting standards until the date such compliance is required.

In June 2016, the FASB issued ASU No. 2016-13, *Measurement of Credit Losses on Financial Instruments* (Topic 326). This ASU significantly changes how entities will measure credit losses for most financial assets and certain other instruments that aren't measured at fair value through net income. In issuing the standard, the FASB is responding to criticism that today's guidance delays recognition of credit losses. The standard will replace today's "incurred loss" approach with an "expected loss" model. The new model, referred to as the current expected credit loss ("CECL") model, will apply to: (1) financial assets subject to credit losses and measured at amortized cost, and (2) certain off-balance sheet credit exposures. This includes, but is not limited to, loans, leases, held-to-maturity securities, loan commitments, and financial guarantees. The CECL model does not apply to available-for-sale ("AFS") debt securities. For AFS debt securities with unrealized losses, entities will measure credit losses in a manner similar to what they do today, except that the losses will be recognized as allowances rather than reductions in the amortized cost of the securities. As a result, entities will recognize improvements to estimated credit losses immediately in earnings rather than as interest income over time, as they do today. The ASU also simplifies the accounting model for purchased credit-impaired debt securities and loans. ASU 2016-13 also expands the disclosure requirements regarding an entity's assumptions, models, and methods for estimating the allowance for loan and lease losses. In addition, public business entities will need to disclose the amortized cost balance for each class of financial asset by credit quality indicator, disaggregated by the year of origination. ASU No. 2016-13 is effective for interim and annual reporting periods beginning after December 15, 2022 for all entities, other than SEC filers that do not qualify as a Smaller Reporting Company as defined by the SEC. Entities will apply the standard's provisions as a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period in which the guidance is effective (i.e., modified retrospective approach). The Bank adopted ASU 2016-13 as of January 1, 2023 and performing their final evaluation of the impact on its financial statements and disclosures.

<u>Reclassifications</u>: Some items in the prior year financial statements were reclassified to conform to the current presentation. Reclassification had no effect on prior year net income or total shareholders' equity.

INFINITY BANK

STATEMENTS OF CASH FLOWS

For the nine months ended September 30, 2022 and 2021

(Unaudited)

**NOTE 2 – SECURITIES**

The amortized cost and fair values of securities with gross unrealized gains and losses as of September 30 are as follows:

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | | Gross | Gross | |
|  | Amortized | Unrealized | Unrealized | Fair |
| Available-for-Sale Securities | Cost | Gains | Losses | Value |
| September 30, 2022 |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Mortgage-backed securities | $58342000 | $- | $(6799000) | $51543000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;U.S. government-sponsored entities and agencies | 3500000 | - | (308000) | 3192000 |
|  | $61842000 | $- | $(7107000) | $54735000 |
| December 31, 2021 |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Mortgage-backed securities | $64964000 | $4000 | $(817000) | $64151000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;U.S. government-sponsored entities and agencies | 2640000 | - | (27000) | 2613000 |
|  | $67604000 | $4000 | $(844000) | $66764000 |

---

During the nine months ended September 30, 2022 and the year ended December 31, 2021, the Bank did not sell any available-for-sale investment securities.

The amortized cost and fair value of debt securities by contractual maturity at September 30, 2022 are shown below. Securities not due at a single maturity date are presented separately.

---

| | | |
|:---|:---|:---|
|  | Available-for-Sale | Available-for-Sale |
|  | Amortized<br>Cost | Fair<br>Value |
| Due in one year or less | $500000 | $496000 |
| Due from one to five years | 3000000 | 2696000 |
| Mortgage-backed securities | 58342000 | 51543000 |
|  | $61842000 | $54735000 |

---

At September 30, 2022, the Bank had 108 securities where estimated fair value had declined from the Bank's amortized cost as compared to 80 securities where estimated fair value had declined from the Bank's amortized cost as of December 31, 2021. These securities are guaranteed either explicitly or implicitly by the U.S. Government and therefore no credit loss is expected. As the Bank does not intend to sell these securities, and it is likely that it will not be required to sell the securities before their anticipated recovery, no declines are deemed to be other-than-temporary.

INFINITY BANK

STATEMENTS OF CASH FLOWS

For the nine months ended September 30, 2022 and 2021

(Unaudited)

**NOTE 2 – SECURITIES** (Continued)

The gross unrealized losses and related estimated fair value of investment securities that have been in a continuous loss position for less than twelve months and over twelve months are as follows:

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  | Less than Twelve Months | Less than Twelve Months | Twelve Months or More | Twelve Months or More | Total | Total |
|  | Unrealized<br>Losses |<br>Fair Value | Unrealized<br>Losses |<br>Fair Value | Unrealized<br>Losses |<br>Fair Value |
| <u>September 30, 2022</u> |  |  |  |  |  |  |
| Mortgage-backed securities | $(2191000) | $20069000 | $(4608000) | $31474000 | $(6799000) | $51543000 |
| U.S. government-sponsored entities and agencies | (308000) | 3192000 | - | - | (308000) | 3192000 |
|  | $(2499000) | $23261000 | $(4608000) | $31474000 | $(7107000) | $54735000 |
| <u>December 31, 2021</u> |  |  |  |  |  |  |
| Mortgage-backed securities | $(811000) | $61109000 | $(6000) | $893000 | $(817000) | $62002000 |
| U.S. government-sponsored entities and agencies | (27000) | 2473000 | - | - | (27000) | 2473000 |
|  | $(838000) | $63582000 | $(6000) | $893000 | $(844000) | $64475000 |

---

Securities pledged at September 30, 2022 had a carrying amount of $54,735,000 and were pledged to secure FHLB advances.

The Bank's loan portfolio consists primarily of loans to borrowers within Orange County and its surrounding areas. Although the Bank seeks to avoid concentrations of loans to a single industry or based upon a single class of collateral, real estate and real estate associated businesses are among the principal industries in the Bank's market area and, as a result, the Bank's loan and collateral portfolios are, to some degree, concentrated in those industries.

**NOTE 3 – LOANS**

The composition of the Bank's loan portfolio is as follows:

---

| | | |
|:---|:---|:---|
|  | September 30,<br>2022 | December 31,<br>2021 |
| Construction and land development | $37435000 | $28440000 |
| Real estate - commercial and residential | 34945000 | 37235000 |
| Commercial & industrial | 78269000 | 78852000 |
| Consumer | 69000 | 5586000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total loans | 150718000 | 150113000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Allowance for loan losses | (2731000) | (2273000) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net loans | $147987000 | $147840000 |

---

The balance of unamortized loan fees, net of loan origination costs included in total loans was $570,000 and $662,000 as of September 30, 2022 and December 31, 2021, respectively.

INFINITY BANK

STATEMENTS OF CASH FLOWS

For the nine months ended September 30, 2022 and 2021

(Unaudited)

**NOTE 3 – LOANS** (Continued)

The following table presents the activity in the allowance for loan losses for the nine months ended September 30, 2022 and the year ended December 31, 2021 and the recorded investment in loans and impairment method as of September 30, 2022 and December 31, 2021 by portfolio segment:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | Construction and<br>land<br>development | Real estate -<br>commercial and<br>residential |<br>Commercial &<br>industrial |<br>Consumer |<br>Total |
| <u>September 30, 2022</u> |  |  |  |  |  |
| Allowance for Loan Losses: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Beginning of period | $494000 | $432000 | $1286000 | $61000 | $2273000 |
| &nbsp;&nbsp;&nbsp;Provisions | 112000 | 246000 | 306000 | (54000) | 610000 |
| &nbsp;&nbsp;&nbsp;Charge-offs |  |  | (152000) |  | (152000) |
| &nbsp;&nbsp;&nbsp;Recoveries | - | - | - | - | - |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Ending balance | $606000 | $678000 | $1440000 | $7000 | $2731000 |
| Reserves: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Specific | $- | $280000 | $441000 | $- | $721000 |
| &nbsp;&nbsp;&nbsp;General | 606000 | 398000 | 999000 | 7000 | 2010000 |
|  | $606000 | $678000 | $1440000 | $7000 | $2731000 |
| Loans Evaluated: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Individually | $- | $2914000 | $1677000 | $- | $4591000 |
| &nbsp;&nbsp;&nbsp;Collectively | 37435000 | 32031000 | 76592000 | 69000 | 146127000 |
|  | $37435000 | $34945000 | $78269000 | $69000 | $150718000 |
| <u>December 31, 2021</u> |  |  |  |  |  |
| Allowance for Loan Losses: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Beginning of period | $230000 | $385000 | $912000 | $55000 | $1582000 |
| &nbsp;&nbsp;&nbsp;Provisions | 264000 | 47000 | 374000 | 6000 | 691000 |
| &nbsp;&nbsp;&nbsp;Charge-offs |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Recoveries | - | - | - | - | - |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;End of year | $494000 | $432000 | $1286000 | $61000 | $2273000 |
| Reserves: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Specific | $- | $- | $202000 | $- | $202000 |
| &nbsp;&nbsp;&nbsp;General | 494000 | 432000 | 1084000 | 61000 | 2071000 |
|  | $494000 | $432000 | $1286000 | $61000 | $2273000 |
| Loans Evaluated: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Individually | $- | $- | $1009000 | $- | $1009000 |
| &nbsp;&nbsp;&nbsp;Collectively | 28440000 | 37235000 | 77843000 | 5586000 | 149104000 |
|  | $28440000 | $37235000 | $78852000 | $5586000 | $150113000 |

---

INFINITY BANK

STATEMENTS OF CASH FLOWS

For the nine months ended September 30, 2022 and 2021

(Unaudited)

**NOTE 3 – LOANS** (Continued)

The Bank categorizes loans into risk categories based on relevant information about the ability of borrowers to service their debt such as current financial information, historical payment experience, collateral adequacy, credit documentation, and current economic trends, among other factors. The Bank analyzes loans individually by classifying the loans as to credit risk. This analysis typically includes larger, non-homogeneous loans such as commercial real estate and commercial and industrial loans. This analysis is performed on an ongoing basis as new information is obtained.

The Bank uses the following definitions for risk ratings:

*Special Mention* – Loans classified as special mention have potential weaknesses that deserve management's close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or of the institution's credit position at some future date.

*Substandard* – Loans classified as substandard are inadequately protected by the current net worth and paying capacity of the obligor or of the collateral pledged, if any. Loans so classified have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that the institution will sustain some loss if the deficiencies are not corrected.

*Doubtful* – Loans classified as doubtful have all the weaknesses inherent in those classified as substandard, with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently existing facts, conditions, and values, highly questionable and improbable.

The recorded investment of loans by risk category and class of loans as of September 30, 2022 and December 31, 2021 was as follows:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | <br>Pass | Special<br>Mention | <br>Substandard | <br>Doubtful | <br>Total |
| <u>September 30, 2022</u> |  |  |  |  |  |
| Construction and land development | $37435000 | $- | $- | $- | $37435000 |
| Real estate - commercial and residential | 32031000 |  | 2914000 |  | 34945000 |
| Commercial & industrial | 73247000 |  | 5022000 |  | 78269000 |
| Consumer | 69000 | - | - | - | 69000 |
|  | $142782000 | $- | $7936000 | $- | $150718000 |
| <u>December 31, 2021</u> |  |  |  |  |  |
| Construction and land development | $28440000 | $- | $- | $- | $28440000 |
| Real estate - commercial and residential | 34235000 | 3000000 |  |  | 37235000 |
| Commercial & industrial | 75499000 |  | 3353000 |  | 78852000 |
| Consumer | 5586000 | - | - | - | 5586000 |
|  | $146760000 | $3000000 | $3353000 | $- | $150113000 |

---

INFINITY BANK

STATEMENTS OF CASH FLOWS

For the nine months ended September 30, 2022 and 2021

(Unaudited)

**NOTE 3 – LOANS** (Continued)

The following table presents information related to impaired loans as of and for the years ended September 30, 2022 and December 31, 2021:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | Unpaid<br>Principal<br>Balance |<br>Recorded<br>Investment |<br>Related<br>Allowance | Average<br>Recorded<br>Investment | Interest<br>Income<br>Recognized |
| <u>September 30, 2022</u> |  |  |  |  |  |
| With an Allowance: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Real Estate - Multifamily | $3000000 | $2914000 | $280000 | $2977000 | $61000 |
| &nbsp;&nbsp;&nbsp;Commercial & industrial | 1683000 | 1677000 | 441000 | 2170000 | 27000 |
|  | $4683000 | $4591000 | $721000 | $5147000 | $88000 |
| <u>December 31, 2021</u> |  |  |  |  |  |
| With an Allowance: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Commercial & industrial | $1056000 | $1009000 | $202000 | $1076000 | $- |
|  | $1056000 | $1009000 | $202000 | $1076000 | $- |

---

There were no impaired loans without a specific reserve as of September 30, 2022 and December 31, 2021.

Impaired loans as of September 30, 2022 and December 31, 2021 were on nonaccrual status. The commercial & industrial loans were past due greater that 90 days while the multifamily loan was current. No other loans were past due greater than 90 days as of September 30, 2022 and December 31, 2021.

The Bank had one loan classified as TDR as of September 30, 2022 with a carrying value of $2,914,000. During the nine months ended September 30, 2022, the borrower was unable to pay-off the loan at maturity so the Bank modified the loan to extend the maturity for 18 months, monthly interest payments at Prime plus 2% (minimum 7%) and a $500,000 payment in October 2022. As of September 30, 2022, the loan was performing in accordance with the modified terms. Subsequent to September 30, 2022, the Bank sold this note to an unrelated third party and recorded a charge off of $252,000.

The Bank had no loans classified as TDRs as of and for the year ended December 31, 2021.

**NOTE 4 – LEASES**

In February 2018, the Bank entered into a seven-year lease agreement for its corporate office and branch with beginning monthly rent of $25,000 which had a 100% abatement for an initial period of five months. The Bank is also responsible for the pro rata share of any operating expense increase in excess of the actual expenses incurrent by the landlord during the fiscal year. Total lease expense under the operating lease was approximately $239,000 for the nine months ended September 30, 2022 and 2021, respectively.

The Bank elected, for all classes of underlying assets, not to separate lease and non-lease components and instead to account for them as a single lease component. Variable lease cost primarily represents variable payments such as common area maintenance and utilities. These amounts were not material for the nine months ended September 30, 2022 and 2021.

INFINITY BANK

STATEMENTS OF CASH FLOWS

For the nine months ended September 30, 2022 and 2021

(Unaudited)

**NOTE 4 – LEASES** (Continued)

Under the lease agreement, there are options to renew. The exercise of renewal options is at the sole discretion of the Bank. Renewal option periods were not included in the measurement of ROU assets and lease liabilities as they are not considered reasonably certain of exercise.

Supplemental lease and other information at and for the nine months ended September 30, 2022 and 2021 are as follows:

---

| | | |
|:---|:---|:---|
|  | 2022 | 2021 |
| Supplemental Lease Information |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Weighted average remaining lease term | 2.4 years | 3.4 years |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Weighted Average Discount Rate | 2.00% | 2.00% |
| Other Information |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Cash paid for amounts included in the measurement of lease liabilities | $260000 | $251000 |

---

Future lease payments of the Bank's operating lease as of September 30, 2022 are as follows:

---

| | |
|:---|:---|
| 2022 | $87000 |
| 2023 | 359000 |
| 2024 | 372000 |
| 2025 | 31000 |
| 2026 | - |
| Total lease payments | 849000 |
| Less imputed interest | (20000) |
| Total operating lease liability | $829000 |

---

**NOTE 5 – FHLB ADVANCES, OTHER BORROWINGS AND SUBORDINATED DEBENTURES**

As of and for the nine months ended September 30, 2022, the Bank did not have any advances or outstanding borrowings with the FHLB. As of September 30, 2022, the Bank's remaining borrowing capacity with the FHLB was approximately $59.5 million.

As of December 31, 2021, the Bank did not have any outstanding borrowings with the FHLB. The average outstanding balance for 2021 was $2.4 million at an average interest rate of 0.02%. The maximum outstanding under this line was $20 million.

The Bank may borrow up to $14 million with unsecured lines of credit with two outside correspondent banks. There were no amounts outstanding under these arrangements as of September 30, 2022 and December 31, 2021.

In 2021, the Bank obtained a permit from the Department of Financial Protection and Innovation (DFPI) to issue $5 million of subordinated debentures ("debentures"). On October 22, 2021, the Bank issued $4.0 million, net of issuance costs of $95,000, of subordinated debentures to three investors, in exchange for cash. These debentures are shown as a liability in the Bank's financial statements and mature on November 1, 2031. The permit to issue the remaining $1.0 million of subordinated debentures expires on July 11, 2022.

INFINITY BANK

STATEMENTS OF CASH FLOWS

For the nine months ended September 30, 2022 and 2021

(Unaudited)

**NOTE 5 – FHLB ADVANCES, OTHER BORROWINGS AND SUBORDINATED DEBENTURES** (Continued)

The Bank has the option to redeem the subordinated debentures, in whole plus accrued and unpaid interest, on November 1, 2026. The subordinated debentures are also redeemable in whole or in part with integral multiples of $1,000 at any interest payment date subsequent to November 1, 2026 at the Bank's discretion.

The subordinated debentures may be included in Tier I capital (with certain limitation applicable) under current regulatory guidelines and interpretations. The subordinated debentures have a fixed rate of interest of 4.25% through November 1, 2026. If not redeemed at that time, the interest rate becomes variable based on the three-month term SOFR Conventions plus 3.36%. Interest is due and payable quarterly beginning in May 2022.

**NOTE 6 – COMMITMENTS AND CONTINGENCIES**

<u>Commitments to Extend Credit</u>: In the ordinary course of business, the Bank enters into financial commitments to meet the financing needs of its customers. These financial commitments include commitments to extend credit. Those instruments involve to varying degrees, elements of credit and interest rate risk not recognized in the Bank's financial statements.

The Bank's exposure to loan loss in the event of nonperformance on commitments to extend credit and standby letters of credit is represented by the contractual amount of those instruments. The Bank uses the same credit policies in making commitments as it does for loans reflected in the financial statements.

The Bank had the following approximate outstanding financial commitments whose contractual amounts represent credit risk:

---

| | | |
|:---|:---|:---|
|  | September 30,<br>2022 | December 31,<br>2021 |
| Commitments to extend credit | $75283000 | $70575000 |

---

Commitments to extend credit are agreements to lend to a customer as long as there is no violation of any condition established in the contract. Since many of the commitments are expected to expire without being drawn upon, the total amounts do not necessarily represent future cash requirements. The Bank evaluates each client's credit worthiness on a case-by-case basis. The amount of collateral obtained if deemed necessary by the Bank is based on management's credit evaluation of the customer. The majority of the Bank's commitments to extend credit generally are secured by real estate or other commercial business assets.

<u>Standby Letters of Credit/Bank Guarantees</u>: Standby letters of credit and Bank Guarantees (collectively, "guarantees") are conditional commitments issued by the Bank to guarantee the performance of a client to a third party. Those guarantees are primarily issued to support public and private borrowing arrangements. The credit risk involved in issuing letters is essentially the same as that involved in extending loan facilities to clients. Collateral held varies as specified above and is required in instances that the Bank deems necessary. The Bank had no financial standby letters of credit as of September 30, 2022 and December 31, 2021.

INFINITY BANK

STATEMENTS OF CASH FLOWS

For the nine months ended September 30, 2022 and 2021

(Unaudited)

**NOTE 6 – COMMITMENTS AND CONTINGENCIES** (Continued)

<u>Data Processing Commitment</u>: The Bank processes its data and check items under a non-cancelable agreement expiring in January 2025. The monthly payment will increase as the Bank's volume of transactions increases. The agreement contains a termination clause whereby the Bank would be liable to the service bureau for an immediate lump sum payment based on the average monthly billings over the number of months remaining on the contract unless certain contractual obligations are not met by the processor. In April 2022, the Bank extended its agreement through January 2027.

**NOTE 7 – FAIR VALUE OF FINANCIAL INSTRUMENTS**

The fair value of a financial instrument is the amount at which the asset or obligation could be exchanged in a current transaction between willing parties, other than in a forced or liquidation sale. Fair value estimates are made at a specific point in time based on relevant market information and information about the financial instrument. These estimates do not reflect any premium or discount that could result from offering for sale at one time the entire holdings of a particular financial instrument. Because no market value exists for a significant portion of the financial instruments, fair value estimates are based on judgments regarding future expected loss experience, current economic conditions, risk characteristics of various financial instruments, and other factors. These estimates are subjective in nature, involve uncertainties and matters of judgment and, therefore, cannot be determined with precision. Changes in assumptions could significantly affect the estimates.

Fair value estimates are based on financial instruments both on and off the balance sheet without attempting to estimate the value of anticipated future business and the value of assets and liabilities that are not considered financial instruments. Additionally, tax consequences related to the realization of the unrealized gains and losses can have a potential effect on fair value estimates and have not been considered in many of the estimates.

The fair value hierarchy level and estimated fair value of significant financial instruments are summarized as follows:

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
|  | | September 30, | September 30, | December 31, | December 31, |
|  | | 2022 | 2022 | 2021 | 2021 |
|  | <br>Fair Value<br>Hierarchy<br>Value | Carrying<br>Value | Fair<br>Value |<br>Carrying | Fair<br>Value |
| Financial assets |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Cash and cash equivalents | Level 1 | $113050000 | $113050000 | $77292000 | $77292000 |
| &nbsp;&nbsp;&nbsp;Securities, available for sale | Level 2 | 54735000 | 54735000 | 66764000 | 66764000 |
| &nbsp;&nbsp;&nbsp;Loans, net | Level 3 | 147987000 | 151185000 | 147840000 | 148183000 |
| Financial liabilities |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;Total deposits | Level 1 | $290989000 | $290989000 | $248127000 | $248127000 |
| &nbsp;&nbsp;&nbsp;Brokered deposits | Level 2 |  |  | 14391000 | 14391000 |
| &nbsp;&nbsp;&nbsp;Subordinated debt | Level 2 | 3923000 | 3923000 | 3098000 | 3098000 |

---

INFINITY BANK

STATEMENTS OF CASH FLOWS

For the nine months ended September 30, 2022 and 2021

(Unaudited)

**NOTE 8 – REGULATORY MATTERS**

The Bank is subject to various regulatory capital requirements administered by the federal banking agencies. Failure to meet minimum capital requirements can initiate certain mandatory - and possibly additional discretionary - actions by regulators that, if undertaken, could have a direct material effect on the Bank's financial statements. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Bank must meet specific capital guidelines that involve quantitative measures of the Bank's assets, liabilities, and certain off-balance-sheet items as calculated under regulatory accounting practices. The Bank's capital amounts and classification are also subject to qualitative judgments by the regulators about components, risk weightings, and other factors. Management believes, as of September 30, 2022 and December 31 2021, that the Bank meets all capital adequacy requirements to which it is subject.

In July 2013, the federal bank regulatory agencies approved the final rules implementing the Basel Committee on Banking Supervision's capital guidelines for U.S. banks (Basel III rules). The new rules became effective on January 1, 2015, with certain of the requirements phased-in over a multi-year schedule, and fully phased in by January 1, 2019. Under the Basel III rules, the Bank must hold a capital conservation buffer of 2.50% above the adequately capitalized risk-based capital ratios. The net unrealized gain or loss on available for sale securities, if any, is not included in computing regulatory capital.

Quantitative measures established by regulation to ensure capital adequacy require the Bank to maintain minimum amounts and ratios (set forth in the table below) of total, Tier 1 and CET1 capital (as defined in the regulations) to risk-weighted assets (as defined), and of Tier 1 capital (as defined) to average assets (as defined).

As of September 30, 2022 and December 31, 2021, the most recent notification from the FDIC categorized the Bank as well capitalized under the regulatory framework for prompt corrective action (there are no conditions or events since that notification that management believes have changed the Bank's category). To be categorized as well capitalized, the Bank must maintain minimum ratios as set forth in the table below. The following table sets forth the Bank's actual capital amounts and ratios (dollar amounts in thousands):

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
|  |  |  | Amount of Capital Required | Amount of Capital Required | Amount of Capital Required | Amount of Capital Required |
|  |  |  |  |  | To Be | To Be |
|  |  |  |  |  | Well-Capitalized | Well-Capitalized |
|  |  |  | For Capital | For Capital | Under Prompt | Under Prompt |
|  |  |  | Adequacy | Adequacy | Corrective | Corrective |
|  | Actual | Actual | Purposes | Purposes | Provisions | Provisions |
|  | Amount | Ratio | Amount | Ratio | Amount | Ratio |
| <u>September 30, 2022</u> |  |  |  |  |  |  |
| Total capital (to risk-weighted assets) | $37450 | 17.4% | $17200 | 8.0% | $21500 | 10.0% |
| Tier 1 capital (to risk-weighted assets) | 30839 | 14.3% | 12900 | 6.0% | 17200 | 8.0% |
| CET1 capital (to risk-weighted assets) | 30839 | 14.3% | 9675 | 4.5% | 13975 | 6.5% |
| Tier 1 capital (to average assets) | 30839 | 9.3% | 13297 | 4.0% | 16621 | 5.0% |
| <u>December 31, 2021</u> |  |  |  |  |  |  |
| Total capital (to risk-weighted assets) | $30674 | 15.7% | $15670 | 8.0% | $19587 | 10.0% |
| Tier 1 capital (to risk-weighted assets) | 28401 | 14.5% | 11752 | 6.0% | 15670 | 8.0% |
| CET1 capital (to risk-weighted assets) | 28401 | 14.5% | 8814 | 4.5% | 12732 | 6.5% |
| Tier 1 capital (to average assets) | 28401 | 9.2% | 12363 | 4.0% | 15454 | 5.0% |

---

INFINITY BANK

STATEMENTS OF CASH FLOWS

For the nine months ended September 30, 2022 and 2021

(Unaudited)

**NOTE 8 – REGULATORY MATTERS** (Continued)

The California Financial Code also provides that a bank may not make a cash distribution to its shareholders in excess of the lesser of the bank's undivided profits or the bank's net income for its last three fiscal years less the amount of any distribution made by the bank's shareholders during the same period.

**PART III - EXHIBITS**

**Exhibit Index:**

[**2.**](tm237204d1_ex2.htm) [**Articles and Bylaws**](tm237204d1_ex2.htm)

[**4.**](tm237204d1_ex4.htm) [**Subscription Agreement**](tm237204d1_ex4.htm)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**6.** **Material Contracts** 

---

| | |
|:---|:---|
| [**6.1**](tm237204d1_ex6-1.htm) | [**Lease for Headquarters Office**](tm237204d1_ex6-1.htm) |

---

---

| | |
|:---|:---|
| [**6.2**](tm237204d1_ex6-2.htm) | [**2018 Infinity Bank Stock Incentive Plan**](tm237204d1_ex6-2.htm) |

---

---

| | |
|:---|:---|
| [**6.3**](tm237204d1_ex6-3.htm) | [**Employment Agreement with Karkutla P. Balkrishna**](tm237204d1_ex6-3.htm) |

---

---

| | |
|:---|:---|
| [**6.4**](tm237204d1_ex6-4.htm) | [**Employment Agreement with Victor E. Guerrero II**](tm237204d1_ex6-4.htm) |

---

---

| | |
|:---|:---|
| [**6.5**](tm237204d1_ex6-5.htm) | [**Tax Sharing Agreement between Infinity Bancorp and Infinity Bank**](tm237204d1_ex6-5.htm) |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**[6.6](tm237204d1_ex6-6.htm) [Form of Subordinated Capital Notes signed by Infinity Bank for $4 million of 4.25% fixed to floating rate subordinated notes of the Bank, dated October 22, 2021 and due November 1, 2031, with interest payments due on May 1 and November 1 of each year, commencing May 1, 2022 and continuing through May 1, 2026 (names of lenders redacted](tm237204d1_ex6-6.htm)**

[**7.**](tm237204d1_ex7.htm) [**Plan of Reorganization and Merger Agreement dated July 6, 2022**](tm237204d1_ex7.htm)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**11. Consents**

**Accountants – Crowe LLP\***

**Legal Counsel – Richard E. Knecht A Professional Corporation\***

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**12. Opinion re Legality of the Securities covered by the Offering\***

**\*To be filed by Amendment**

**SIGNATURES**

Pursuant to the requirements of Regulation A+, Infinity Bancorp certifies that it has reasonable grounds to believe that it meets all of the requiremens for filing on Form 1-A and has duly caused this offering statement to be signed on its behalf by the undersigned, thereunto duly authorized in the City of Santa Ana, State of California, on February 17, 2023.

INFINITY BANCORP

---

| | |
|:---|:---|
| By: | /s/ Victor E. Guerrero |
|  | Victor E. Guerrero II |
|  | President/Chief Operating Officer |

---

This Offering Statement has been signed by the following persons in the capacities and on the dates indicated:

---

| |
|:---|
| /s/ Karkutla P. Balkrishna |
| Karkutla P. Balkrishna |
| Chairman/Chief Executive Officer |
| (Principal Executive Officer) |
| February 17, 2023 |

---

---

| |
|:---|
| /s/ Elaine Crouch |
| Elaine Crouch |
| Executive Vice President/Risk Management/ |
| Director of Human Resources/Corporate Secretary |
| February 17, 2023 |
| /s/ Allison Duncan |
| Allison Duncan |
| Executive Vice President/Chief Financial Officer |
| (Principal Financial Officer) |
| February 17, 2023 |
| /s/ Allison Duncan |
| Allison Duncan |
| Executive Vice President/Chief Financial Officer |
| (Principal Accounting Officer) |
| February 17, 2023 |
| Majority of Directors: |
| /s/ Karkutla P. Balkrishna |
| Karkutla P. Balkrishna |
| Director |
| February 17, 2023 |
| /s/ Cary D. Bren |
| Cary D. Bren |
| Director |
| February 17, 2023 |
| /s/ Curtis E. Campbell |
| Curtis E. Campbell |
| Director |
| February 17, 2023 |
| /s/ Raymond J. Gagnon |
| Raymond J. Gagnon |
| Director |
| February 17, 2023 |
| /s/ Victor E. Guerrero II |
| Victor E. Guerrero II |
| Director |
| February 17, 2023 |
| /s/ Katherine T. Lee |
| Katherine T. Le |
| Director |
| February 17, 2023 |
| /s/ Richard H, Schlatter |
| Richard H. Schlatter |
| Director |
| February 17, 2023 |
| /s/ Glenn B. Stearns |
| Glenn B. Stearns |
| Director |
| February 17, 2023 |

---

**ACKNOWLEDGEMENT ADOPTING TYPES SIGNATURES**

**The undersigned hereby authenticatem acknowledge and otherwise adopt the typed signatures above and as otherwise appear in this filing and Offering.**

---

| | |
|:---|:---|
| By: | /s/ Karkutla P. Balkrishna |
|  | Chairman/Chief Executive Officer and Director |
|  | February 17, 2023 |
| By: | /s/ Victor E. Guerrer II |
|  | President/Chief Operating Officer and Director |
|  | February 17, 2023 |
| By: | Elaine Crouch |
|  | Executive Vice President/Risk Management and |
|  | Director of Human Resources and |
|  | Corporate Secretary |
|  | February 17, 2023 |

---

## Ex1A-2A

**Exhibit 2**

**BYLAWS OF**

**INFINITY BANCORP**

**a California Corporation ("the Corporation")**

**As Adopted by the Sole Shareholder of INFINITY BANCORP on June 17, 2022**

**and Approved by the Board of Directors**

**of INFINITY BANCORP on January 26, 2023**

January 26, 2023

**BYLAWS**

**OF**

**INFINITY BANCORP**

(a California banking corporation)

(the **"Corporation")**

**ARTICLE I**

**CORPORATE OFFICES**

---

| | |
|:---|:---|
| **<u>Section 1.1</u>** | **<u>Headquarters Office</u>.** |

---

The headquarters office of the Corporation shall be located at 6 Hutton Centre, Suite 100, Santa Ana, CA 92707.

---

| | |
|:---|:---|
| **<u>Section 1.2</u>** | **<u>Other Offices</u>.** |

---

The Board of Directors may at any time establish other offices at any place or places where the Corporation is qualified to do business.

**ARTICLE II**

**MEETINGS OF SHAREHOLDERS**

**<u>Section 2.1</u>** ANNUAL MEETINGS. The annual meeting of shareholders shall be held on the last Thursday of September of each year at 3:00 p.m. or such other date and time and at such place within or without the State of California as fixed by the resolution of the Board of Directors **("Board").** At such meeting, directors shall be elected, reports of the affairs of the Corporation shall be considered, and any other business may be transacted which is within the powers of the shareholders. Except as otherwise provided in these Bylaws, meetings of shareholders shall be held in accordance with the provisions of the California General Corporation Law as codified in Division 1 of the California Corporations Code (the **"Corporations Code"**) addressing meetings of shareholders.

**<u>Section 2.2</u>** SPECIAL MEETINGS. Special meetings of the shareholders, for any purpose or purposes whatsoever, may be called at any time by the Board, the Chairman of the Board, the Chief Executive Officer, the President/Chief Operating Officer, or by the holders of shares entitled to cast not less than 10% of the votes at the meeting or by such other persons as may be provided in the Articles or in these Bylaws.

Page 2 of 24

**<u>Section 2.3</u>** NOTICE. Written notice of each meeting shall be given to each shareholder entitled to vote, either personally or by mail or electronically, or by other means of written communication, charges prepaid, addressed to such shareholder at such shareholder's address appearing on the books of the Corporation or given by such shareholder to the Corporation for the purpose of notice. If no such address appears or is given, notice shall be deemed to have been given to such shareholder if sent by mail or other means of written communication addressed to the place where the principal executive office of the Corporation is situated, or by publication of notice at least once in some newspaper of general circulation in the county in which said office is located. All such notices shall be sent to each shareholder entitled thereto not less than 10 (or if sent by third-class mail 30) nor more than 60 days before such meeting. Such notice shall specify the place, the date and the hour of such meeting.

In the case of a special meeting, the notice shall state the general nature of business to be transacted and no other business shall be transacted at such meeting.

In the case of an annual meeting, the notice shall state those matters which the Board, at the time of the mailing of the notice, intends to present for action by the shareholders. However, any proper matter may be presented at the meeting for action but action on the following matters shall be valid only if the general nature of the proposal so approved was stated in the notice of the meeting or in a written waiver of notice, unless the matter was unanimously approved by those entitled to vote:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) the approval of a contract
 or other transaction between the Corporation and one or more of its directors or with any
 corporation, firm or association in which one or more of its directors has a material financial
 interest; whether any matter is "material" under any provision of these Bylaws
 shall be determined by the Board in its discretion on a case-by-case basis.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) an
 amendment to the Articles of Incorporation of the Corporation (**"Articles"**);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) a
 plan to convert to a domestic other business entity pursuant to §1152 of the Corporations
 Code;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) a
 reorganization (as defined in Corporations Code §181) required to be approved by Corporations
 Code §120 1;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) the
 voluntary winding up and dissolution of the Corporation; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) a
 plan of distribution under §2007 of the Corporations Code in respect of a corporation
 in the process of winding up.

The notice of any meeting at which directors are to be elected shall include the names of the nominees intended at the time of the notice to be presented by the Board for election. The notice shall state such other matters, if any, as may be expressly required by statute.

Any meeting of shareholders, regular or special, may be held by conference telephone, electronic video screen communication, or electronic transmission by and to the Corporation; and all such shareholders shall be deemed to be present in person at the meeting so long as each shareholder can hear each other in the case of meetings by conference telephone or electronic video screen communication, or can communicate with all other members concurrently in the case of meetings by electronic transmission by and to the Corporation. Participation in a meeting through electronic transmission by and to the Corporation (other than conference telephone and electronic video screen communication) constitutes presence in person at that meeting if both of the following apply: (i) each shareholder participating in the meeting can communicate with all of the other members concurrently; and (ii) each shareholder IS ADVISED BEFORE THE MEETING OF THE PROCEDURE FOR PARTICIPATING IN THE ELECTRONIC MEETING.

Page 3 of 24

**<u>Section 2.4</u>** ADJOURNED MEETING AND NOTICE THEREOF. When a shareholders' meeting is adjourned to another time or place, notice need not be given of the adjourned meeting if the time and place thereof are announced at the meeting at which the adjournment is taken. At the adjourned meeting, the Corporation may transact any business which might have been transacted at the original meeting. If the adjournment is for more than 45 days or if after the adjournment a new record date is fixed for the adjourned meeting, a notice of the adjourned meeting shall be given to each shareholder of record entitled to vote at the meeting.

**<u>Section 2.5</u>** QUORUM. Unless otherwise provided in the Articles, the presence in person or by proxy of the persons entitled to vote a majority of the voting shares at any meeting shall constitute a quorum for the transaction of business. The shareholders present at a duly called or held meeting at which a quorum is present may continue to transact business until adjournment notwithstanding the withdrawal of enough shareholders to leave less than a quorum, if any action taken (other than adjournment) is approved by at least a majority of the shares required to constitute a quorum or, if required by the Corporations Code or the Articles, the vote of a greater number or voting by classes. In the absence of a quorum, any meeting of shareholders may be adjourned from time to time by the vote of a majority of the shares represented either in person or by proxy, but no other business may be transacted, except as provided above.

**<u>Section 2.6</u>** CONSENT OF ABSENTEES. The transactions of any meeting of shareholders, however called and noticed and wherever held are as valid as though had at a meeting duly held after regular call and notice, if a quorum is present either in person or by proxy, and if, either before or after the meeting, each of the persons entitled to vote, not present in person or by proxy, signs a written waiver of notice, or a consent to the holding of the meeting. or an approval of the minutes thereof. All such waivers, consents and approvals shall be filed with the corporate records or made a part of the minutes of the meeting. Attendance of a person at a meeting shall constitute a waiver of notice of and presence at the meeting, except where a person objects, at the beginning of the meeting, to the transaction of any business because the meeting is not lawfully called or convened and except that attendance at a meeting is not a waiver of any right to object to the consideration of matters required by the Corporations Code to be included in the notice meeting.

**<u>Section 2.7</u>** ACTION WITHOUT MEETING. Unless otherwise provided in the Articles, any action which may be taken at any annual or special meeting of shareholders may be taken without a meeting and without prior notice, if a consent in writing, setting forth the action so taken, shall be signed by the holders of outstanding shares having not less than the minimum number of votes that would be necessary to authorize or take such action at a meeting at which all shares entitled to vote thereon were present and voted; provided, however, that:

Page 4 of 24

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) unless
 the consents of all shareholders entitled to vote have been solicited in writing, notice
 of any shareholder approval:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) of
 a contract or other transaction between the Corporation and one or more of its directors
 or with any corporation, firm or association in which one or more of its directors has a
 material financial interest;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) of
 an indemnity pursuant to Corporations Code §317;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) of
 a plan to convert to a domestic other business entity pursuant to Corporations Code §1152;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(4) of
 a reorganization (as defined in Corporations Code §181) required to be approved by Corporations
 Code §1201; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(5) of
 a plan of distribution under Corporations Code §2007 in respect of a corporation in
 the process of winding up, which approval was obtained without a meeting by less than unanimous
 written consent, shall be given at least 10 days before the consummation of the action authorized
 by such approval; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) prompt
 notice shall be given of the taking of any other corporate action approved by shareholders
 without a meeting by less than unanimous written consent, to those shareholders entitled
 to vote who have not consented in writing. Notice of such approval shall be given in the
 same manner as required by Section 2.3 of these Bylaws.

Any shareholder giving a written consent, or the shareholder's proxy holder or proxy holders, or a transferee of the shares, or a personal representative of the shareholder, or their respective proxy holder or proxy holders, may revoke the consent by a writing received by the Corporation prior to the time that written consents of the number of shares required to authorize the proposed action have been filed with the Secretary of the Corporation, but may not do so thereafter. Such revocation is effective upon its receipt by the Secretary of the Corporation.

**<u>Section 2.8</u>** RECORD DATES. For purposes of determining the shareholders entitled to notice of any meeting or to vote or entitled to exercise any other rights, the Board may fix, in advance, a record date, which shall not be more than 60 nor less than 10 days prior to the date of such meeting nor more than 60 days prior to any other action. If no record date is fixed by the Board:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) the record date for
 determining shareholders entitled to notice of or to vote at a meeting of shareholders shall
 be at the close of business on the business day next preceding the day on which notice is
 given or, if notice is waived, at the close of business on the business day next preceding
 the day on which the meeting is held;

Page 5 of 24

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) the
 record date for determining shareholders entitled to give consent to corporate action in
 writing without a meeting, when no prior action by the Board has been taken, shall be the
 day on which the first written consent is given; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) the
 record date for determining shareholders for any other purpose shall be at the close of business
 on the day on which the Board adopts the resolution relating thereto, or the 60th day prior
 to the date of such other action, whichever is later. A determination of shareholders of
 record entitled to notice of or to vote at a meeting of shareholders shall apply to any adjournment
 of the meeting unless the Board fixes a new record date for the adjourned meeting, but the
 Board shall fix a new record date if the meeting is adjourned for more than 45 days from
 the date set for the original meeting.

**<u>Section 2.9</u>** PROXIES. Every person entitled to vote shares may authorize another person or persons to act by proxy with respect to such shares. Any proxy purporting to be executed in accordance with the provisions of the Corporations Code shall be presumptively valid. However, no proxy shall be valid after the expiration of 11 months from the date thereof unless otherwise provided in the proxy. Every proxy continues in full force and effect for up to 11 months from the date thereof (unless the proxy provides for a longer period) unless earlier revoked as specified in §705(b) of the Corporations Code or unless it states that it is irrevocable. A proxy which states that it is irrevocable is irrevocable for the period specified therein when it is held by a person specified in §705(e) of the Corporations Code. A proxy may be revoked, notwithstanding a provision making it irrevocable, by a transferee of shares without knowledge of the existence of the provision unless the existence of the proxy and its irrevocability appears, in the case of certificated securities, on the certificate representing such shares, or in the case of uncertificated securities, on the initial transaction statement and written statements.

**<u>Section 2.10</u>** VOTING; CUMULATIVE VOTING AND NOTICE THEREOF. No shareholder shall be entitled to cumulate votes for election of directors (i.e., cast for any candidate for election as directors a number of votes greater than the number of votes which such shareholder normally is entitled to cast) unless such candidate or candidates' names have been placed in nomination prior to the voting and the shareholder has given notice at the meeting prior to the voting of the shareholder's intention to cumulate the shareholder's votes. If any shareholder has given such notice, all shareholders may cumulate their votes for candidates in nomination. If cumulative voting is proper, every shareholder entitled to vote at any election of directors may cumulate such shareholder's votes and give one candidate a number of votes equal to the number of directors to be elected multiplied by the number of votes to which the shareholder's shares are normally entitled or distribute the shareholder's votes on the same principle among as many candidates as the shareholder thinks fit. In any election of directors, the candidates receiving the highest number of affirmative votes of the shares entitled to be voted for them up to the number of directors to be elected by such shares are elected; votes against the director and votes withheld shall have no legal effect.

Except for election of directors, provided above, votes on other substantive and procedural matters shall be taken on the basis of one vote for each share represented at the meeting.

Page 6 of 24

Fractional shares shall not be entitled to any voting rights.

**<u>Section 2.11</u>** CHAIRMAN OF MEETING. The Board may select any person to preside as Chairman of any meeting of shareholders, and if such person shall be absent from the meeting, or fail or be unable to preside, the Board shall select another person to preside as Chairman. In the absence of an express selection by the Board of a chairman, the Chief Executive Officer shall preside as Chairman. If the Chief Executive Officer shall be absent, fail or be unable to preside, the President/Chief Operating Officer shall preside as Chairman. If the President/Chief Operating Officer shall also be absent, fail or be unable to preside, the Executive Vice President/Corporate Secretary or the Executive Vice President/Chief Financial Officer, shall preside as Chairman, in that order. The Chairman of the meeting shall designate a secretary for such meeting, who shall take and keep or cause to be taken and kept minutes of the proceedings thereof.

The conduct of all shareholders' meetings shall at all times be within the discretion of the Chairman of the meeting and shall be conducted under such rules as the Chairman may prescribe. The Chairman shall have the right and power to adjourn any meeting at any time, without a vote of the shares present in person or represented by proxy, if the Chairman shall determine such action to be in the best interests of the Corporation and its shareholders.

**<u>Section 2.12</u>** INSPECTORS OF ELECTION. In advance of any meeting of shareholders, the Board may appoint any persons other than nominees for office as inspectors of election to act at the meeting and any adjournment thereof. If inspectors of election are not so appointed, or if any such persons fail to appear or refuse to act, the Chairman of any such meeting may, and on the request of any shareholder or such shareholder's proxy shall, make such appointment at the meeting. The number of inspectors shall be either one or three. If appointed at a meeting on the request of one or more shareholders or proxies, the majority of shares present in person or by proxy shall determine whether one or three inspectors are to be appointed.

The inspectors of election shall determine the number of shares outstanding and the voting power of each, the shares represented at the meeting, the existence of a quorum, the authenticity, validity and effect of proxies, receive votes, ballots or consents, hear and determine all challenges and questions in any way arising in connection with the right to vote, count and tabulate all votes or consents, determine when the polls shall close, determine the result and do such acts as may be proper to conduct the election or vote with fairness to all shareholders.

If there are three inspectors of election, the decision, act or certificate of a majority is effective in all respects as the decision, act or certificate of all. Any report or certificate made by the inspectors of election is prima facie evidence of the facts stated therein.

Page 7 of 24

**<u>Section 2.13</u>** NOMINATION OF DIRECTORS. Nominations for election of directors may be made by the Board or by a Nominating Committee of the Board or by any shareholder of any outstanding class of capital stock of the Corporation entitled to vote for the election of directors. Notice of intention to make any nominations (other than for persons named in the notice of the meeting at which such nomination is to be made) shall be made in writing and shall be delivered to the Chief Executive Officer of the Corporation by the later of the close of business twenty-one (21) days prior to any meeting of shareholders called for the election of directors or seven (7) days after the date of mailing of notice of the meeting to shareholders. Such notification shall contain the following information to the extent known to the notifying shareholder: (a) the name and address of each proposed nominee; (b) the principal occupation of each proposed nominee; (c) the number of shares of capital stock of the Corporation owned by each proposed nominee; (d) the name and residence address of the notifying shareholder; (f) with the written consent of the proposed nominee, a copy of which shall be furnished with the notification, whether the proposed nominee has ever been convicted of or pleaded nolo contendere to any criminal offence involving dishonesty or breach of trust, filed a petition in bankruptcy, or been adjudged bankrupt. The notice shall be signed by the nominating shareholder and by the nominee. Nominations not made in accordance herewith shall be disregarded by the Chairman of the meeting and upon his instructions, the inspectors of election shall disregard all votes cast for each such nominee. A copy of this Section shall be set forth in the notice to shareholders of any meeting at which directors are to be elected.

**ARTICLE III**

**DIRECTORS**

**<u>Section 3.1</u>** POWERS. Subject to any limitations in the Articles or these Bylaws and to any provision of the Corporations Code relating to action required to be approved by the shareholders under Section 53 of the Corporations Code or by the outstanding shares under Section 52 of the Corporations Code, or by less than a majority vote of a class or series of preferred shares, the business and affairs of the Corporation shall be managed, and all corporate powers shall be exercised by or under the direction of the Board.

**<u>Section 3.2</u>** NUMBER. The authorized number of directors of the Corporation shall be not less than six (6) nor more than eleven (11). The exact number of directors shall be fixed, from time-to-time by a vote of a majority of the directors then holding office or by a majority of the outstanding voting shares of the Corporation. The exact number of directors shall be deemed to be increased by the same number of directors as the number of additional directors appointed by a vote of a majority of the directors then holding office, provided that total number of directors after such deemed increase remain within the limit of authorized directors. The exact number of directors shall be EIGHT (8) until changed, within the limits specified above, by a resolution amending this Article III, Section 3.2, duly adopted by the Board of Directors or by the shareholders. The range in the number of directors may be changed, or a definite number within the range may be fixed, by a duly adopted amendment to the Articles of Incorporation or by an amendment to this bylaw duly adopted by the vote or, in accordance with the applicable provisions of the Corporations Code, written consent of holders of a majority of the outstanding shares entitled to vote. No reduction of the authorized number of directors shall have the effect of removing any director before that director's term of office expires.

**<u>Section 3.3</u>** ELECTION AND TERM OF OFFICE. The directors shall be elected at each annual meeting of shareholders, but if any annual meeting is not held or the directors are not elected thereat, the directors may be elected at any special meeting of shareholders held for that purpose. Each director, including a director elected to fill a vacancy, shall hold office until the next annual meeting and until a successor has been elected and qualified.

Page 8 of 24

**<u>Section 3.4</u>** ORGANIZATION RESOLUTIONS. Following each annual meeting of shareholders, at the next following regular meeting of the Board, the Board shall adopt such organization resolutions as the Board shall deem appropriate.

**<u>Section 3.5</u>** REGULAR MEETINGS. Regular meetings of the Board shall be held at such times and dates designated by resolution of the Board, at such places within or without the state as may be designated in the notice of the meeting or which are designated by resolution of the Board. In the absence of designation of place, regular meetings shall be held at the headquarters office of the Corporation. Once the date and time for regular meetings has been established by the Board, notice of such meetings shall not be required unless there is a change in the date and time of the regular meeting.

**<u>Section 3.6</u>** SPECIAL MEETINGS. Special meetings of the Board for any purpose or purposes may be called at any time by the Chairman of the Board, the Chief Executive Officer, the President/Chief Operating Officer, or by the Secretary or any two directors. Special meetings of the Board may be held at such times and places within or without the state as may be designated in the notice of the meeting or which are designated by resolution of the Board.

**<u>Section 3.7</u>** NOTICE OF MEETINGS. When notice of a meeting of the Board is required, at least four days' notice by mail or 48 hours' notice delivered personally or by telephone, including a voice messaging system or other system or technology designed to record and communicate messages, telegraph, facsimile, electronic mail, or other electronic means, shall be given to each director. Such notice need not specify the purpose of the meeting. Notice of a meeting need not be given to any director who signs a waiver of notice or consent to holding the meeting or an approval of the minutes thereof, whether before or after the meeting, or who attends the meeting without protesting, prior thereto or at its commencement, the lack of notice to such director. All such waivers, consents and approvals shall be filed with the corporate records or made a part of the minutes of the meeting.

**<u>Section 3.8</u>** PARTICIPATION BY TELEPHONE OR OTHER ELECTRONIC MEANS. Any meeting of the Board, regular or special, may be held by conference telephone, electronic video screen communication, or electronic transmission by and to the Corporation; and all such directors shall be deemed to be present in person at the meeting so long as each director can hear each other in the case of meetings by conference telephone or electronic video screen communication, or can communicate with all other members concurrently in the case of meetings by electronic transmission by and to the Corporation. Participation in a meeting through electronic transmission by and to the Corporation (other than conference telephone and electronic video screen communication) constitutes presence in person at that meeting if both of the following apply: (i) each member participating in the meeting can communicate with all of the other members concurrently; and (ii) each member is provided the means of participating in all matters before the Board, including, without limitation, the capacity to propose, or to interpose an objection to, a specific action to be taken by the Corporation.

Page 9 of 24

**<u>Section 3.9</u>** QUORUM. A majority of the actual number of directors constitutes a quorum of the Board for the transaction of business. A meeting at which a quorum is initially present may continue to transact business notwithstanding the withdrawal of directors, if any action taken is approved by at least a majority of the required quorum for such meeting. A majority of the directors present, whether or not a quorum is present, may adjourn any meeting to another time and place.

**<u>Section 3.10</u>** VOTING. Every act or decision done or made by a majority of the directors present at a meeting duly held at which a quorum is present is the act of the Board, subject to Section 3.9 of this Article and to:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) the
 provisions of §310 of the Corporations Code regarding votes in respect of a contract
 or other transaction between the Corporation and one or more of its directors or with any
 corporation, firm or association in which one or more of its directors has a material financial
 interest, and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) the
 provisions of §317 of the Corporations Code regarding votes in respect of indemnification
 of agents of the Corporation who are members of the Board.

For the purposes of these Bylaws, "agent" has the meaning in Section 317 of the Corporations Code, which provides that "agent" means "any person who is or was a director, officer, employee or other agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another foreign or domestic corporation, partnership, joint venture, trust or other enterprise, or was a director, officer, employee or agent of a foreign or domestic corporation which was a predecessor corporation of the corporation or of another enterprise at the request of the predecessor corporation."

**<u>Section 3.11</u>** ACTION WITHOUT MEETING. Any action required or permitted to be taken by the Board may be taken without a meeting if all members of the Board shall individually or collectively consent in writing to such action in a single writing or by emails. Such written consent or consents shall be filed with the minutes of the proceedings of the Board. Such action by written consent shal have the same force and effect as a unanimous vote of such directors.

**<u>Section 3.12</u>** RESIGNATION. Any director may resign effective upon giving written notice to the Chairman of the Board, the Chief Executive Officer, the President/Chief Operating Officer, the Corporate Secretary or the Board of the Corporation, unless the notice specifies a later time for the effectiveness of such resignation. If the resignation is effective at a future time, a successor may be elected to take office when the resignation becomes effective.

**<u>Section 3.13</u>** REMOVAL OF DIRECTORS. The entire Board or any individual director may, subject to any voting requirements set forth in the Articles, be removed from office as provided by Corporations Code §§ 302, 303, and 304. In such a case, the remaining Board members may elect a successor director to fill such vacancy for the removed director's remaining unexpired term. No director may be removed (unless the entire Board is removed) when the votes cast against removal or not consenting in writing to such removal would be sufficient to elect such director if voted cumulatively at an election at which the same total number of votes were cast (or, if such action is taken by written consent, all shares entitled to vote were voted) and the entire number of directors authorized at the time of the directors most recent election were then being elected; and when by the provisions of the Articles the holders of the shares of any class or series voting as a class or series are entitled to elect one or more directors, any director so elected may be removed only by the applicable vote of the holders of the shares of that class or series.

Page 10 of 24

**<u>Section 3.15</u>** ADJOURNMENT. A majority of the directors present, whether or not a quorum is present, may adjourn any meeting to another time and place. If the meeting is adjourned for more than 24 hours, notice of any adjournment to another time or place shall be given prior to the time of the adjourned meeting to the directors who were not present at the time of the adjournment. Such notice need not comply with the time in which notice must be given prior to a meeting as required by Section 3.7 of Article III of the Bylaws, but should be given as far in advance as is reasonably practicable under all the circumstances existing at the time of adjournment.

**<u>Section 3.16</u>** VISITORS. No person other than a director or an officer invited by the Chairman and Chief Executive Officer, or the President/Chief Operating Officer, or an attorney, accountant, auditor, vendor or consultant representing the Corporation and invited by the Chairman and Chief Executive Officer or the President/Chief Operating Officer, may attend any meeting of the Board without the consent of a majority of the directors present.

**<u>Section 3.17</u>** FEES AND COMPENSATION. Directors and members of committees may receive such compensation for their services and such reimbursement for expenses as may be fixed or determined by resolution of the Board. Nothing herein shall be construed to preclude any director from serving the Corporation in any other capacity as an officer, employee or otherwise, and receiving compensation for such services.

Page 11 of 24

**<u>Section 3.18</u>** C O M M I T T E E S . The Board may, by resolution adopted by a majority of the authorized number of directors, designate one or more committees, each consisting of two or more directors, to serve at the pleasure of the Board. The Board may designate one or more directors as alternate members of any committee, who may replace any absent member at any meeting of the committee. The appointment of members or alternate members of a committee requires the vote of a majority of the authorized directors. Any such committee, to the extent provided in the resolution of the Board or in the Bylaws, shall have all the authority of the Board, except with respect to:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) the
 approval of any action for which the Corporations Code also requires shareholders'
 approval or approval of the outstanding shares;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) the
 filling of vacancies on the Board or in any committee of the Board;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) the
 fixing of compensation of the directors for serving on the Board or on any committee of the
 Board, which may be recommended to the Board by a committee but must be approved by the Board;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) the
 amendment or repeal of Bylaws or the adoption of new Bylaws;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) the
 amendment or repeal of any resolution of the Board which by its express terms is not so amendable
 or repealable;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) a distribution to the
 shareholders of the Corporation (as defined in § 166 of the Corporations Code), except
 at a rate, in the periodic amount or within a price range set forth in the Articles or determined
 by the Board; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) the
 appointment of other committees of the Board or the members thereof.

**<u>Section 3.19</u>** MEETINGS AND ACTION OF COMMITTEES. Meetings and action of committees shall be governed by, and held and taken in accordance with, the provisions of Sections 3.5, 3.6, 3.7, 3.8, 3.9, 3.10, 3.11 and 3.15 of this Article III. The Board may adopt rules for the governance of any committee not inconsistent with the provisions of these Bylaws.

**ARTICLE IV**

**OFFICERS**

**<u>Section 4.1</u>** OFFICERS. The executive officers of the Corporation shall be a Chairman and Chief Executive Officer, President/Chief Operating Officer, an Executive Vice President ("**EVP**")/Risk Management/Director of HR/Corporate Secretary, and an EVP/Chief Financial Officer. The Board, in its discretion, may also appoint one or more additional Executive Vice Presidents. One person may hold two or more offices, except that no person shall serve as both Chief Executive Officer or President/Chief Operating Officer, and Secretary.

**<u>Section 4.2</u>** ELECTION. The officers of the Corporation, except such officers as may be appointed in accordance with the provisions of Section 4.3 or Section 4.5 of this Article IV shall be chosen by the Board and serve at the pleasure of the Board, subject to the rights, if any, of an officer under any contract of employment, and each shall hold office until resignation or removal or other disqualification to serve, or the election of a successor.

**<u>Section 4.3</u>** SUBORDINATE OFFICERS. The Chairman and Chief Executive Officer and the President/Chief Operating Officer shall each have the power to appoint such assistant vice presidents, assistant secretaries, assistant treasurers or assistant financial officers, and such other officers as the business of the Corporation may require, each of whom shall hold office for such period, have such authority and perform such duties as the appointing officer may from time to time determine.

Page 12 of 24

**<u>Section 4.4</u>** REMOVAL AND RESIGNATION. Subject to the rights, if any, of an officer under any contract of employment, any officer may be removed, either with or without cause, by action of the Board duly taken, or, except in case of an officer chosen by the Board, by any officer upon whom such power of removal may be conferred by the Board.

Any officer may resign at any time by giving written notice to the Corporation, to the attention of the Secretary. Any such resignation shall take effect at the date of the receipt of such notice or at any later time specified therein; and, unless otherwise specified therein, the acceptance of such resignation shall not be necessary to make it effective.

**<u>Section 4.5</u>** VACANCIES. A vacancy in any office shall be filled in the manner prescribed in the Bylaws for regular appointments to such office.

**<u>Section 4.6</u>** CHAIRMAN OF THE BOARD. The Chairman of the Board and Chief Executive Officer shall, if present, preside at all meetings of the Board, cause minutes thereof to be taken, and exercise and perform such other powers and duties as may be from time to time assigned to the Chairman of the Board and Chief Executive Officer by the Board or prescribed by the Bylaws. The Chairman of the Board and Chief Executive Officer shall be an executive officer of the Corporation.

**<u>Section 4.7</u>** CHIEF EXECUTIVE OFFICER. In addition to his responsibilities as Chairman of the Board, the Chief Executive Officer shall see that all orders and resolutions of the Board are carried into effect. He shall have general supervision, direction and control of the business and affairs of the Corporation. The Chief Executive Officer shall be a member or an ex officio member of all the standing committees, other than the Audit and Compensation Committee, but including the Executive Committee, if any, and shall have the general powers and duties of management usually vested in the office of Chief Executive Officer of a corporation and shall have such other powers and duties as may be prescribed by the Board or the Bylaws.

**<u>Section 4.8</u>** PRESIDENT/CHIEF OPERATING OFFICER. In the absence or disability of the Chief Executive Officer, the President/Chief Operating Officer shall perform all the duties of the Chief Executive Officer, and when so acting shall have all the authority of and be subject to all the restrictions upon the Chief Executive Officer. The President/Chief Operating Officer shall be a member or an ex officio member of all the standing committees, other than the Audit and Compensation Committee, but including the Executive Committee, if any. In addition, the President/Chief Operating Officer shall have such other authority and perform such other duties as may be prescribed by the Chairman and Chief Executive Officer or the Board from time to time.

**<u>Section 4.9</u>** EXECUTIVE VICE PRESIDENTS. In the absence or disability of the Chairman and Chief Executive Officer and the President/Chief Operating Officer, the Executive Vice Presidents, if there shall be such officers designated by the Board, shall, in order of their rank as fixed by the Board or, if not ranked, the Executive Vice President designated by the Board, shall perform all the duties of the President/Chief Operating Officer, if there is none, or the Chairman and Chief Executive Officer, if there is none, and when so acting shall have all the powers of, and be subject to all the restrictions upon, the Chairman and Chief Executive Officer or the President/Chief Operating Officer, as applicable. The Executive Vice Presidents shall have such other powers and perform such other duties as from time to time may be prescribed for each of them by the Board, the Chairman and Chief Executive Officer, the President/Chief Operating Officer or the Bylaws.

Page 13 of 24

**<u>Section 4.10</u>** VICE PRESIDENTS. The Vice Presidents shall have such other powers and perform such duties as from time to time may be prescribed for each of them by the Chairman and Chief Executive Officer, the President/Chief Operating Officer, the Board, or the Bylaws.

**<u>Section 4.11</u>** SECRETARY. The Secretary, also known as the Corporate Secretary, shall keep or cause to be kept at the principal executive office of the Corporation or at the office of the Corporation's counsel a book of minutes of all meetings and consents to action without a meeting of directors, committees and shareholders, with the time and place of holding, whether regular or special, and, if special, how authorized, the notice thereof given, the names of those present at directors' and committee meetings, the number of shares present or represented at shareholders' meetings, and the proceedings thereof.

The Secretary shall keep, or cause to be kept, at the principal executive office or at the office of the Corporation's transfer agent, registrar or counsel, a record of its shareholders showing the names of the shareholders and their addresses, the number and classes of shares held by each, the number and date of certificates issued for the same, and the number and date of cancellation of every certificate surrendered for cancellation.

The Secretary shall give, or cause to be given, notice of all the meetings of the shareholders and of the Board required by the Bylaws or by law to be given.

**<u>Section 4.12</u>** CHIEF FINANCIAL OFFICER. The Chief Financial Officer shall keep and maintain, or cause to be kept and maintained, adequate and correct accounts of the properties and business transactions of the Corporation, including changes in financial position, accounts of its assets, liabilities, receipts, disbursements, gains, losses, capital, surplus and shares. Any surplus shall be classified according to source and shown in a separate account.

The Chief Financial Officer shall deposit all monies and other valuables in the name and to the credit of the Corporation with such depositaries as may be designated by the Board. The Chief Financial Officer shall disburse the funds of the Corporation as may be ordered by the Board or by any officer having authority therefor, shall render to the Chief Executive Officer, the President/Chief Operating Officer and directors, whenever they request it, an account of all of the Chief Financial Officer's transactions and of the financial condition of the Corporation, and shall have such other powers and perform such other duties as may be prescribed by the Chief Executive Officer, the President/Chief Operating Officer, the Board or the Bylaws.

Page 14 of 24

**ARTICLE V**

**REPORTS AND RECORDS**

**<u>Section 5.1</u>** The Corporation shall: (i) prepare the reports that the Corporation is required to prepare under and in accordance with the relevant provisions of the Corporations Code; and (ii) maintain the records that the Corporation is required to maintain under and in accordance with the relevant provisions of the Corporations Code. Additionally, if the Corporations Code requires the Corporation to provide access to or deliver copies of any reports or records to those entitled to access or receive copies of such reports or records under the Corporations Code, then the Corporation shall do so in accordance with the relevant provisions of the Corporations Code. With regard to the requirement under the Corporations Code to send annual reports to shareholders, this requirement shall be waived so long as the shares of the Corporation are held by fewer than one hundred (100) holders of record.

**ARTICLE VI**

**INDEMNIFICATION OF DIRECTORS, EXECUTIVE OFFICERS, OFFICERS, EMPLOYEES, AND OTHER AGENTS**

**<u>Section 6.1</u>** INDEMNIFICATION OF DIRECTORS AND EXECUTIVE OFFICERS: ACTIONS OTHER THAN BY OR IN THE RIGHT OF THE CORPORATION

The Corporation shall, to the maximum extent and in the manner permitted by the Corporations Code and other applicable law, indemnify each of its directors, and such executive officers as designated by the Board of Directors from time to time for indemnification purposes, who was or is a party, or is threatened to be made a party, to any proceeding (as defined in section 317(a) of the Corporations Code), other than an action by or in the right of this Corporation to procure a judgment in its favor, by reason of the fact that such person is or was a director or executive officer of this Corporation, against expenses (as defined in section 317(a) of the Corporations Code), judgments, fines, settlements, and other amounts actually and reasonably incurred in connection with such proceeding if the director or executive officer acted in good faith and in a manner that he or she reasonably believed to be in the best interests of this Corporation and, in the case of a criminal proceeding, had no reasonable cause to believe his or her conduct was unlawful. The termination of any proceeding by judgment, order, settlement, or conviction, or upon a plea of *nolo contendere* or its equivalent, will not, of itself, create a presumption either that the director or executive officer did not act in good faith and in a manner that he or she reasonably believed to be in the best interests of this Corporation or that the director or executive officer had reasonable cause to believe that his or her conduct was not unlawful.

Page 15 of 24

**<u>Section 6.2</u>** INDEMNIFICATION OF DIRECTORS AND EXECUTIVE OFFICERS: ACTIONS BY OR IN THE RIGHT OF THE CORPORATION

The Corporation will have the power to indemnify each of its directors, and such executive officers as designated by the Board of Directors from time to time for indemnification purposes, who was or is a party, or is threatened to be made a party, to any proceeding (as defined in section 317(a) of the Corporations Code) by or in the right of this Corporation to procure a judgment in its favor, by reason of the fact that such person is or was a director or executive officer of this Corporation, against expenses (as defined in section 317(a) of the Corporations Code), judgments, fines, settlements, and other amounts actually and reasonably incurred by such director or executive officer in connection with the defense or settlement of that action, if such person acted in good faith, in a manner he or she believed to be in the best interests of this Corporation and its shareholders. No indemnification will be made under this Section 6.2 for the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Any
 claim, issue, or matter on which such director or executive officer has been adjudged to
 be liable to this Corporation in the performance of his or her duty to the Corporation and
 its shareholders, unless and only to the extent that the court in which such proceeding is
 or was pending will determine on application that, in view of all the circumstances of the
 case, such director or executive officer is fairly and reasonably entitled to indemnity for
 expenses, and then only to the extent that the court will determine;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Amounts
 paid in settling or otherwise disposing of a pending action without court approval; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Expenses
 incurred in defending a pending action that is settled or otherwise disposed of without court
 approval.

**<u>Section 6.3</u>** INDEMNIFICATION OF OTHERS

The Corporation shall have the power, to the extent and in the manner permitted by the Corporations Code and other applicable law, to indemnify each of its officers, employees and agents (other than directors and executive officers subject to Sections 6.1 and 6.2) against expenses (as defined in section 317(a) of the Corporations Code), judgments, fines, settlements, and other amounts actually and reasonably incurred in connection with any proceeding (as defined in section 317(a) of the Corporations Code), arising by reason of the fact that such person is or was an officer, employee or agent of the Corporation. For purposes of this Article VI, an "officer," "employee" or "agent" of the Corporation (other than a director or executive officer subject to Sections 6.1 and 6.2) includes any person (i) who is or was an officer, employee or agent of the Corporation, (ii) who is or was serving at the request of the Corporation as an officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, or (iii) who was an officer, employee or agent of a corporation which was a predecessor corporation of the Corporation or of another enterprise at the request of such predecessor corporation.

**<u>Section 6.4</u>** PAYMENT OF EXPENSES IN ADVANCE

Expenses incurred in defending any civil or criminal action or proceeding for which indemnification is required pursuant to Section 6.1 or for which indemnification is permitted pursuant to Section 6.2 or Section 6.3 following authorization thereof by the Board of Directors shall be paid by the Corporation in advance of the final disposition of such action or proceeding upon receipt of an undertaking by or on behalf of the indemnified party to repay such amount if it shall ultimately be determined that the indemnified party is not entitled to be indemnified as authorized in this Article VI.

Page 16 of 24

**<u>Section 6.5</u>** INDEMNITY NOT EXCLUSIVE

The indemnification provided by this Article VI shall not be deemed exclusive of any other rights to which those seeking indemnification may be entitled under any bylaw, agreement, vote of shareholders or disinterested directors, or otherwise, both as to action in an official capacity and as to action in another capacity while holding such office, to the extent that such additional rights to indemnification are authorized in the Articles of Incorporation. Nothing in this Section 6.5 will affect any right to indemnification to which persons other than such directors and officers may be entitled by contract or otherwise.

**<u>Section 6.6</u>** INSURANCE INDEMNIFICATION

The Corporation shall have the power to purchase and maintain insurance on behalf of any person who is or was a director, officer, employee or agent of the Corporation against any liability asserted against or incurred by such person in such capacity or arising out of such person's status as such, whether or not the Corporation would have the power to indemnify them against such liability under the provisions of this Article VI.

**<u>Section 6.7</u>** CONFLICTS

No indemnification or advance shall be made under this Article VI, except where such indemnification or advance is mandated by law or the order, judgment or decree of any court of competent jurisdiction, in any circumstance where it appears:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) That
 it would be inconsistent with a provision of applicable law, the Articles of Incorporation,
 these bylaws, a resolution of the shareholders or an agreement in effect at the time of the
 accrual of the alleged cause of the action asserted in the proceeding in which the expenses
 were incurred or other amounts were paid, which prohibits or otherwise limits indemnification;
 or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) That
 it would be inconsistent with any condition expressly imposed by a court in approving a settlement.

**<u>Section 6.8</u>** SURVIVAL OF RIGHTS

The rights provided by this Article VI will continue for a person who has ceased to be an agent and will inure to the benefit of the heirs, executors, and administrators of such person.

**<u>Section 6.9</u>** EFFECT OF AMENDMENT

Any amendment, repeal, or modification of this Article VI will not adversely affect an agent's right or protection existing at the time of such amendment, repeal, or modification.

Page 17 of 24

**<u>Section 6.10</u>** SETTLEMENT OF CLAIMS

The Corporation will not be liable to indemnify any agent under this Article VI for (a) any amounts paid in settlement of any action or claim effected without the Corporation's written consent (which consent will not be unreasonably withheld), or (b) any judicial award, if the Corporation was not given a reasonable and timely opportunity to participate, at its expense, in the defense of such action.

**<u>Section 6.11</u>** SUBROGATION

In the event of payment under this Article VI, the Corporation will be subrogated, to the extent of such payment, to all of the rights of recovery of the agent, who will execute all papers required and will do everything that may be necessary to secure such rights, including the execution of such documents as may be necessary to enable the Corporation effectively to bring suit to enforce such rights.

**<u>Section 6.12</u>** NO DUPLICATION OF PAYMENTS

The Corporation will not be liable under this Article VI to make any payment in connection with any claim made against the agent to the extent the agent has otherwise actually received payment, whether under a policy of insurance, an agreement, or a vote of the Board or shareholders under this Article VI, or through other means, of the amounts otherwise indemnifiable under this Article VI.

**ARTICLE VII**

**CONSTRUCTION AND AMENDMENTS**

**<u>Section 7.1</u>** CONSTRUCTION; DEFINITIONS

Unless the context requires otherwise, the general provisions, rules of construction and definitions in the Corporations Code shall govern the construction of these Bylaws. Without limiting the generality of this provision, the singular number includes the plural, the plural number includes the singular and the term "person" includes both a corporation and a natural person.

"**Electronic transmission by the Corporation**" means a communication (a) delivered by (1) facsimile telecommunication or electronic mail when directed to the facsimile number or electronic mail address, respectively, for that recipient on record with the Corporation, (2) posting on an electronic message board or network which the Corporation has designated for those communications, together with a separate notice to the recipient of the posting, which transmission shall be validly delivered upon the later of the posting or delivery of the separate notice thereof, or (3) other means of electronic communication, (b) to a recipient who has provided an unrevoked consent to the use of those means of transmission for communications under or pursuant to the Corporations Code, and (c) that creates a record that is capable of retention, retrieval, and review, and that may thereafter be rendered into clearly legible tangible form. However, an electronic transmission by a corporation to an individual shareholder or member under the Corporations Code is not authorized unless, in addition to satisfying the requirements of this Section 7.1, the transmission satisfies the requirements applicable to consumer consent to electronic records as set forth in the Electronic Signatures in Global and National Commerce Act (15 U.S.C. Section 7001(c)(1)).

Page 18 of 24

"**Electronic transmission to the Corporation**" means a communication (a) delivered by (1) facsimile telecommunication or electronic mail when directed to the facsimile number or electronic mail address, respectively, which the Corporation has provided from time to time to shareholders or members and directors for sending communications to the Corporation, (2) posting on an electronic message board or network which the Corporation has designated for those communications, and which transmission shall be validly delivered upon the posting, or (3) other means of electronic communication, (b) as to which the Corporation has placed in effect reasonable measures to verify that the sender is the shareholder or member (in person or by proxy) or director purporting to send the transmission, and (c) that creates a record that is capable of retention, retrieval, and review, and that may thereafter be rendered into clearly legible tangible form.

"**Electronic transmission by and to the Corporation**" has the meanings set forth above under the definitions "electronic transmission by the Corporation" and "electronic transmission to the Corporation".

**<u>Section 7.2</u>** RELATIONSHIP TO GENERAL CORPORATION LAW

These Bylaws of the Corporation are adopted pursuant to the Corporations Code. The applicable provisions of the Corporations Code governing the matters addressed in these Bylaws are incorporated into these Bylaws. To the extent of any conflict between these Bylaws and the Corporations Code, and as long as any provisions of these Bylaws are not prohibited by applicable law, these Bylaws shall govern to the extent of the conflict.

**<u>Section 7.3</u>** AMENDMENT BY SHAREHOLDERS

New Bylaws may be adopted or these Bylaws may be amended or repealed by the vote or written consent of holders of a majority of the outstanding shares entitled to vote; provided, however, that if the Articles set forth the number of authorized directors of the Corporation, then the authorized number of directors may be changed only by an amendment of the Articles.

**<u>Section 7.4</u>** AMENDMENT BY DIRECTORS

Subject to the rights of the shareholders as provided in the Corporations Code to the extent modified by these Bylaws, Bylaws, other than a Bylaw or an amendment of a Bylaw changing the authorized number of directors (except to fix the authorized number of directors pursuant to a Bylaw providing for a variable number of directors), may be adopted, amended or repealed by the Board of Directors.

Page 19 of 24

**ARTICLE VIII**

**SHARES AND CERTIFICATES**

**<u>Section 8.1</u>** <u>SHARE CERTIFICATES</u>. The shares of stock of the Corporation may be issued in book-entry form or evidenced by certificates. However, every owner of stock of the Corporation shall be entitled upon request to have a certificate or certificates, to be in such form as the Board shall prescribe, certifying the number and class of shares of the stock of the Corporation owned by such owner. To the extent that shares of stock are represented by certificates, the certificates representing shares of such stock shall be numbered in the order in which they shall be issued and shall be signed by or in the name of the Corporation by the Chairman of the Board and Chief Executive Officer or by the President/Chief Operating Officer, and by the Chief Financial Officer or the Secretary or an assistant secretary. Any or all of the signatures on the certificates may be a facsimile. In case any officer, transfer agent or registrar who has signed or whose facsimile signature has been placed upon any such certificate shall thereafter have ceased to be such officer, transfer agent or registrar before such certificate is issued, such certificate may nevertheless be issued by the Corporation with the same effect as though the person who signed such certificate, or whose facsimile signature shall have been placed thereupon, were such officer, transfer agent or registrar at the date of issue. A record shall be kept of the respective names of the persons, firms or corporations owning the stock represented by such certificates or held in book-entry form, the number and class of shares represented by such certificates or held in book-entry form, respectively, and the respective dates thereof, and in case of cancellation the respective dates of cancellation. Every certificate surrendered to the Corporation for exchange or transfer shall be cancelled, and no new certificate or certificates shall be issued (or book entry made) in exchange for any existing certificate until such existing certificate shall have been so cancelled, except in cases provided for in Section 8.3 of this Article VIII.

No new certificate for shares shall be issued in lieu of an old certificate unless the latter is surrendered and cancelled at the same time; provided, however, that a new certificate will be issued without the surrender and cancellation of the old certificate if (1) the old certificate is lost, apparently destroyed or wrongfully taken; (2) the request for the issuance of the new certificate is made within a reasonable time after the owner of the old certificate has notice of its loss, destruction, or theft; (3) the request for the issuance of a new certificate is made prior to the receipt of notice by the Corporation that the old certificate has been acquired by a bona fide purchaser; (4) the owner of the old certificate files a sufficient indemnity bond with or provides other adequate security to the corporation, unless the Board and the Bank's transfer agent determine that such bond or other security is not required under the circumstances presented; and (5) the owner satisfies any other reasonable requirements imposed by the corporation. In the event of the issuance of a new certificate, the rights and liabilities of the corporation, and of the holders of the old and new certificates, shall be governed by the provisions of Section 8104 and 8405 of the California Commercial Code.

**<u>Section 8.2</u>** TRANSFERS OF STOCK. Transfers of shares of stock of the Corporation shall be made only on the books of the Corporation by the registered holder thereof, or by his or her attorney thereunto authorized by power of attorney duly executed and filed with the Secretary, or with a transfer clerk or a transfer agent appointed as provided in Section 8.3 of this Article VIII, and if such shares are represented by a certificate, upon surrender of the certificate or certificates for such shares properly endorsed and the payment of all taxes thereon. The person in whose name shares of stock stand on the books of the corporation shall be deemed the owner thereof for all purposes as regards the corporation. Whenever any transfer of shares shall be made for collateral security, and not absolutely, such fact shall be stated expressly in the entry of transfer if, when the certificate or certificates shall be presented to the corporation for transfer, both the transferor and the transferee request the corporation to do so.

Page 20 of 24

**<u>Section 8.3</u>** REGULATIONS. The Board may make such rules and regulations as it may deem expedient, not inconsistent with the Bylaws, concerning the issue, transfer and registration of certificated or uncertificated of the stock of the Corporation. It may appoint, or authorize any officer or officers to appoint, one or more transfer clerks or one or more transfer agents and one or more registrars, and may require all certificates for stock to bear the signature or signatures of any of them.

**<u>Section 8.4</u>** LOST, STOLEN, DESTROYED AND MUTILATED CERTIFICATES. In any case of loss, theft, destruction, or mutilation of any certificate of stock, another certificate or uncertificated shares may be issued in its place upon proof of such loss, theft, destruction, or mutilation and upon the giving of a bond of indemnity to the Corporation in such form and in such sum as the Board may direct; provided, however, that a new certificate or uncertificated shares may be issued without requiring any bond when, in the judgment of the Board, it is proper so to do.

**<u>Section 8.5</u>** LEGENDS AND OTHER STATEMENTS. Any stock certificate shall also contain such legend or other statement as may be required by Section 418 of the General Corporation Law, the Corporate Securities Law of 1968, the federal securities laws, and any agreement between the Corporation and the issuee thereof.

**<u>Section 8.6</u>** REPRESENTATION OF SHARES OF OTHER CORPORATIONS. The Chairman and Chief Executive Officer, the President/Chief Operating Officer or and the Secretary or any assistant secretary of this Corporation are authorized to vote, represent and exercise on behalf of this Corporation all rights incident to any and all shares of any other corporation or corporations standing in the name of this Corporation. The authority herein granted to said officers to vote or represent on behalf of this Corporation any and all shares held by this Corporation in any other corporation or corporations may be exercised either by such officers in person or by any other person authorized so to do by proxy or power of attorney duly executed by said officers.

**ARTICLE IX**

**MISCELLANEOUS**

**<u>Section 9.1</u>** LOANS TO OR GUARANTIES FOR THE BENEFIT OF OFFICERS OR DIRECTORS. The Corporation shall have the power to make loans, advance expenses and provide guarantees to officers and directors of the Corporation and their affiliates to the extent permitted by and in accordance with applicable law and regulation.

Page 21 of 24

**<u>Section 9.2</u>** RECORD DATE AND CLOSING STOCK BOOKS. When a record date is fixed, only shareholders of record on that date are entitled to notice of and to vote at the meeting or to receive a dividend, distribution, or allotment of rights, or to exercise the rights, as the case may be, notwithstanding any transfer of any shares on the books of the Corporation after the record date.

The Board may close the books of the Corporation against transfers of shares during the whole or any part of a period not more than 60 days prior to the date of a shareholders' meeting, the date when the right to any dividend, distribution, or allotment of rights vests, or the effective date of any change, conversion or exchange of shares.

**<u>Section 9.3</u>** EXECUTION OF CONTRACTS. Any contract or other instrument in writing entered into by the Corporation, when signed by the Chairman of the Board and Chief Executive Officer, the President/Chief Operating Officer or any Executive Vice President and the Secretary or any Assistant Secretary, is not invalidated as to the Corporation by any lack of authority of the signing officers in the absence of actual knowledge on the part of the other party to the contract or other instrument that the signing officers had no authority to execute the same. Contracts or other instruments in writing made in the name of the Corporation which are authorized or ratified by the Board, or are done within the scope of authority, actual or apparent, conferred by the Board or within the agency power of the officer executing it except as the Board's authority is limited by law other than by the Corporations Code, binds the Corporation, and the Corporation acquires rights thereunder, whether the contract is executed wholly or in part executory.

**<u>Section 9.4</u>** INSPECTION OF BYLAWS. The Corporation shall keep at its headquarters office or at its administrative office in this state, the original or a copy of its Bylaws as amended to date, which shall be open to inspection by the shareholders at all reasonable times during office hours.

**<u>Section 9.5</u>** EMPLOYEE EQUITY INCENTIVE PLANS. The Corporation may adopt and carry out one or more equity incentive plans, stock purchase plans, stock option plans and other plans calling for the provision of equity or equity-related compensation. Participants in such plans may include, among others, directors, officers, employees, consultants and organizers of the Corporation. The eligibility, vesting and other terms of any awards under such plans shall be set according to the terms of such plans and involve consideration of such type as may be set forth in any such plan.

**<u>Section 9.6</u>** ANNUAL STATEMENT OF INFORMATION. The Corporation shall file, within 90 days after the filing of its original Articles and annually thereafter during the applicable filing period, with the Secretary of State of the State of California, on the prescribed form, a Statement of Information setting forth the number of vacancies on the Board, if any; the names and complete business or residence addresses of all incumbent directors, the Chairman and Chief Executive Officer, the President/Chief Operating Officer, the Secretary and Chief Financial Officer; the street address of its principal executive office or principal business office in this state; and the general type of business constituting the principal business activity of the Corporation, together with a designation of the agent of the Corporation for the purpose of service of process, all in compliance with §1502 of the Corporations Code.

**<u>Section 9.7</u>** CHECKS, DRAFTS, EVIDENCES OF INDEBTEDNESS. All checks, drafts or other orders for payment of money, notes or other evidences of indebtedness, issued in the name of or payable to the Corporation, shall be signed or endorsed by such person or persons and in such manner as, from time to time, shall be determined by resolution of the Board.

Page 22 of 24

**ARTICLE X**

**AMENDMENTS TO BYLAWS**

**AND EFFECTIVE DATE**

**<u>Section 10.1</u>** POWER OF SHAREHOLDERS. New Bylaws may be adopted or these Bylaws may be amended or repealed by the vote or written consent of shareholders entitled to exercise a majority of the voting power of the Corporation.

**<u>Section 10.2</u>** POWER OF DIRECTORS. Subject to the right of shareholders as provided in Section 10.1 of this Article X to adopt, amend or repeal Bylaws, and the limitation of Corporation Code §212, Bylaws may be adopted, amended or repealed by the Board, provided, however, that after the issuance of shares a Bylaw specifying or changing the range of the maximum or minimum number of directors or changing from a fixed to a variable Board or vice versa may only be adopted by the vote or written consent of shareholders entitled to exercise a majority of the voting power of the Corporation.

**<u>Section 10.3</u>** . EFFECTIVE DATE. These Bylaws shall be effective as of January 26, 2023.

Page 23 of 24

CERTIFICATE OF CORPORATE SECRETARY

I certify:

That I am the Corporate Secretary of INFINITY BANCORP, a California corporation, as of the date of this certification; and

That these Bylaws, consisting of twenty-four (24) pages, including this page, were approved by the Board of Directors as the Bylaws of such Corporation on January 26, 2023.

IN WITNESS WHEREOF, I have executed this Certificate to be effective as of January 26, 2023.

---

| |
|:---|
| /s/ Elaine Crouch |
| Elaine Crouch |
| Corporate Secretary |

---

Page 24 of 24

Certificate Verification No.: 024005615 Date: 06/22/2022

---

| |
|:---|
| For Office Use Only |
| **-FILED-** |
| File No.: 5130060 |
| Date Filed: 6/16/2022 |

---

**ARTICLES OF INCORPORATION**

**OF**

**INFINITY BANCORP**

**ARTICLE I: NAME**

The name of this corporation is: Infinity Bancorp

**ARTICLE II: PURPOSE**

The purpose of the corporation is to engage in any lawful act or activity for which a corporation may be organized under the General Corporation Law of California other than the banking business, the trust company business or the practice of a profession permitted to be incorporated by the California Corporations Code.

**ARTICLE III: ADDRESS OF CORPORATION**

The initial street address and mailing address of this corporation is:

6 Hutton Centre Drive, Suite 100

Santa Ana, California 92707

**ARTICLE IV: AUTHORIZED SHARES**

(a) This corporation is authorized to issue two classes of stock designated respectively as "Common Stock" and "Preferred Stock." "Preferred Stock" is also referred to herein as "Preferred Shares." The total number of shares of Common Stock that this corporation is authorized to issue is Twenty Million (20,000,000), and the total number of shares of Preferred Stock that this corporation is authorized to issue is Ten Million (10,000,000), for an aggregate of Thirty Million (30,000,000) shares.

(b) The Preferred Shares may be issued from time to time in one or more series. The board of directors of this corporation (the "Board of Directors") is authorized to determine and alter the rights, preferences, privileges and restrictions granted to and imposed upon any wholly unissued series of Preferred Stock, and to fix the number of shares of any series of Preferred Stock and the designation of any such series of Preferred Stock. The Board of Directors, within the limits and restrictions stated in any resolution or resolutions of the Board of Directors originally fixing the number of shares constituting any series, may increase or decrease (but not below the number of shares of such series then outstanding) the number of shares of any series subsequent to the issue of shares of that series.

**ARTICLE V: DIRECTOR LIABILITY**

The liability of the directors of this corporation for monetary damages shall be eliminated to the fullest extent permissible under California law. Any amendment, repeal or modification of the provisions of this Article shall not adversely affect any right or protection of a director of the corporation existing at the time of such amendment, repeal or modification.

Page 1 of 2

Certificate Verification No.: 024005615 Date: 06/22/2022

**ARTICLE VI: INDEMNIFICATION**

This corporation is authorized to provide indemnification of its agents (as defined in Section 317 of the California Corporations Code) to the fullest extent permissible under California law through bylaw provisions, agreements with its agents, vote of the shareholders or disinterested directors, or otherwise, in excess of the indemnification otherwise permitted by Section 317 of the California Corporations Code, subject to the limitations set forth in California Corporations Code Section 204. Any amendment, repeal or modification of the provisions of this Article shall not adversely affect any right or protection of an agent of this corporation existing at the time of such amendment, repeal or modification.

**ARTICLE VII: CONFLICTS, AMENDMENT AND APPEAL**

To the extent that there is any conflict between state and federal law, federal law shall supersede and control. Any amendment, repeal or modification of the foregoing provisions of Articles V and VI by the shareholders of the corporation shall not adversely affect any right or protection of an agent of this corporation existing at the time of such repeal or modification.

**ARTICLE VIII: AGENT FOR SERVICE OF PROCESS**

The name and complete address in the State of California of the corporation's initial agent for service of process is:

Richard E. Knecht

120 Newport Center Drive

Newport Beach, CA 92660

IN WITNESS WHEREOF, for the purpose of forming this corporation under the laws of the State of California, the undersigned, constituting the incorporator of this corporation, has executed these Articles of Incorporation.

Dated: June 16, 2022

---

| |
|:---|
| /s/ Richard E. Knecht |
| Richard E. Knecht |
| Sole Incorporator |

---

I hereby declare that I am the person who executed the foregoing Articles of Incorporation, which execution is my act and deed.

---

| |
|:---|
| /s/ Richard E. Knecht |
| Richard E. Knecht |

---

Page 2 of 2

## Ex1A-4

**Exhibit 4**

**Subscription Agreement**

**INFINITY BANCORP**

**6 Hutton Centre Drive, Suite 100**

**Santa Ana, California 92707**

**(657) 223-1000**

**800,000 Shares of Common Stock, No Par Value, $12.50 per Share**

**Offering Amount: Up to $10,000,000**

**Minimum Purchase Amount: 20,000 Shares for $250,000**

**Sales will be made to Accredited Investors Only**

**Under Tier 1 of Regulation A+ of the Securities and Exchange Commission**

Subscriber Full Name:   <br>

Number of Shares Subscribed For:  

**<u>INSTRUCTIONS</u>**

To purchase shares of no par value common stock (the "Shares") of INFINITY BANCORP, a California corporation (the "Bancorp") and bank holding company for INFINITY BANK, a state-chartered bank (the "Bank"), in the offering described above (the "Offering"), pursuant to the Regulation A+ Offering Circular dated<u> </u>, 2023 (the "Offering Circular"), please: (i) review this Subscription Agreement (this "Subscription Agreement" or "this Agreement"); (ii) complete Paragraph D under Representations and Warranties of Subscribers of this Subscription Agreement regarding accredited investor status; and (iii) complete, sign and date the appropriate signature pages (<u>individual subscribers</u> should complete, sign and date the individual signature page; <u>entity subscribers</u> should complete, sign and date the entity signature page); and (iv) email your completed and signed Subscription Agreement to the Bank, as impound agent for the Offering, at <u>victor@goinfinitybank.com</u>), or mail your Subscription Agreement to the Bank, Attention: Victor E. Guerrero, President/Chief Operating Officer, 6 Hutton Centre Drive, Suite 100, Santa Ana, California 92707.

Please make your check payable to "Infinity Bancorp Stock Subscription Account" and mail your check, with the completed Subscription Agreement, to Infinity Bank, Attention: Victor E. Guerrero, President/Chief Operating Officer, 6 Hutton Centre Drive, Suite 100, Santa Ana, California 92707, or wire the subscription funds to the Bank at ______________________________.

**THE BANCORP WILL NOT ACCEPT ANY SUBSCRIPTION AGREEMENT THAT IS NOT FULLY AND ACCURATELY COMPLETED, DATED AND SIGNED.**

***THIS IS AN IMPORTANT LEGAL DOCUMENT. READ EACH PART OF IT CAREFULLY.***

This subscription, submitted as of the date set forth on the signature page, is between Infinity Bancorp, a California corporation (the "Bancorp"), and the undersigned subscriber (the "Subscriber").

**<u>Offer to Purchase</u>** **.** The Subscriber hereby irrevocably offers to purchase that number of Shares of the Bancorp set forth on the signature page and hereby tenders the Subscriber's check payable to "Infinity Bancorp Stock Subscription Account" in the aggregate dollar amount set forth on the signature page at a per Share purchase price of $12.50, or hereby confirms that a wire for that amount has been sent to the Bank, as impound agent for the Offering, as provided above.

The Subscriber understands that a subscription for the Shares may be rejected for any reason and that, in the event that this subscription is rejected, the funds delivered herewith will be returned within 14 days after the close of the Offering, without interest thereon or deduction therefrom.

**All subscription funds shall be held in a non-interest-bearing STOCK subscription account at the Bank until THE OFFERING IS CLOSED BY THE BANCORP. thereafter, all subscriptions ACCEPTED BY THE BANCORP shall be paid into the capital accounts of the baNCORP, to be used by the banCORP without restriction.**

**<u>Representations and Warranties of Subscribers</u>** **.** By execution below, the Subscriber acknowledges that the Bancorp is relying upon the accuracy and completeness of the representations contained herein to comply with its obligations under applicable securities laws. The Subscriber hereby represents and warrants to the Bancorp and its officers, directors, managers, members, employees and agents as follows:

**A.** **<u>Information About the Bancorp and the Bank</u>.** The Subscriber has received and reviewed the Offering Circular, and has obtained all information about the Bancorp and the Bank as the Subscriber believes relevant to the decision to purchase the Shares. The Subscriber has read the Offering Circular and has also had the opportunity to ask questions of, and to receive answers from, the Bancorp and the Bank concerning the terms and conditions of the investment and the business and affairs of the Bancorp and the Bank and to obtain any additional information necessary to verify such information, and the Subscriber has received such information concerning the Bancorp and the Bank as the Subscriber considers necessary or advisable in order to from a decision concerning an investment in the Bancorp. The Subscriber is not relying on any representation regarding the Bancorp or the Bank except as set forth in the Offering Circular. The Subscriber has engaged such advisors as the Subscriber deems appropriate to evaluate the merits of an investment in the Bancorp.

Although the Bancorp is a bank holding company, its Shares are not bank deposits and are not insured by the Federal Deposit Insurance Corporation ("FDIC") or any other government agency. The sale of the Shares has not been approved or disapproved by the Securities and Exchange Commission (the "SEC"), the FDIC, the California Department of Financial Protection and Innovation (the "DFPI"), the California Department of Corporations (the "CDOC") or the Federal Reserve Board (the "FRB"), as defined in the Offering Circular. These organizations do not certify the accuracy or completeness of the information contained in the Offering Circular. It is a crime for anyone to tell you otherwise.

**B.** **<u>Forward-Looking Statements</u>.** The Subscriber acknowledges and understands that any information provided about the Bancorp's and the Bank's future plans and prospects is uncertain and subject to all of the uncertainties inherent in the future predictions, and that the Bancorp and the Bank, and their officers and directors shall not be liable for the accuracy thereof.

**C.** **<u>Regulation A+ Offering</u>.** The Shares are being sold by the Bancorp in an offering under an exemption from registration under Tier 1 of Regulation A+ of the Securities and Exchanged Commission (the "SEC") under the Securities Act of 1933 (the "Act") and the Limited Offering Exemption Notice pursuant to Section 25102(f) of the California Corporations Code.

**D.** **<u>Accredited Investor Status</u>.** To be an "accredited investor," an investor must come within any one of the following categories, or be a person who the issuer reasonably believes comes within any one of the following categories at the time of the sale of the shares to that investor:

&nbsp;&nbsp;&nbsp;&nbsp;1. Any bank as defined in Section 3(a)(2) of the Act, or any savings and loan association or other
institution as defined in Section 3(a)(5)(A) of the act whether acting in its individual or fiduciary capacity; any broker or
dealer registered pursuant to Section 15 of the Securities Exchange Act of 1934; any insurance company registered under the Investment
Company Act of 1940 or a business development company as defined in Section 2(a)(48) of that Act; any Small Business Investment Company
licensed by the U.S. Small Business Administration under Section 301(c) or (d) of the Small Business Investment Act of
1958; any plan established and maintained by a state, its political subdivisions, or any agency or instrumentality of a state or political
subdivisions, for the benefit of its employees, if such plan has total assets in excess of $5,000,000; any employee benefit plan within
the meaning of the Employee Retirement Income Security Act of 1974, if the investment decision is made by a plan fiduciary, as defined
in Section 3(21) of such Act, which is either a bank, savings and loan association, insurance company, or registered investment advisor,
or if the employee benefit plan has total assets in excess of $5,000,000, or, if a self-directed plan, with investment decisions made
solely by persons that are accredited investors;

&nbsp;&nbsp;&nbsp;&nbsp;2. Any private business development company as defined in Section 202(a)(22) of the Investment Advisers
Act of 1940;

&nbsp;&nbsp;&nbsp;&nbsp;3. Any organization described in Section 501(c)(3) of the Internal Revenue Code, or corporation,
Massachusetts or similar business trust, or partnership, not formed for the specific purpose of acquiring the shares offered, with total
assets in excess of $5,000,000;

&nbsp;&nbsp;&nbsp;&nbsp;4. Any director, executive officer, or general partner of the issuer of the securities being offered or sold,
or any director, executive officer, or general partner of a general partner of that issuer;

&nbsp;&nbsp;&nbsp;&nbsp;5. Any natural person whose individual net worth, or joint net worth with that person's spouse or spousal
equivalent, at the time of his purchase (excluding the value of the person's primary residence) exceeds $1,000,000;

&nbsp;&nbsp;&nbsp;&nbsp;6. Any natural person who had an individual income in excess of $200,000 in each of the two most recent years,
or joint income with that person's spouse or spousal equivalent in excess of $300,000 in each of those years and has a reasonable
expectation of reaching the same income level in the current year;

&nbsp;&nbsp;&nbsp;&nbsp;7. Any trust, with total assets in excess of $5,000,000, not formed for the specific purpose of acquiring
the shares offered, whose purchase is directed by a sophisticated person as described in Rule 506(b)(2)(ii) of Regulation D;

&nbsp;&nbsp;&nbsp;&nbsp;8. Any entity in which all of the equity owners are accredited investors (as defined above).

&nbsp;&nbsp;&nbsp;&nbsp;9. Any entity, of a type not listed above, not formed for the specific purpose of acquiring the securities
offered, owning investments in excess of $5,000,000:

&nbsp;&nbsp;&nbsp;&nbsp;10. Any natural person holding in good standing one or more professional certifications or designations or
credentials from an accredited educational institution that the SEC has designated as qualifying an individual for accredited investor
status;

&nbsp;&nbsp;&nbsp;&nbsp;11. Any natural person who is a "knowledgeable employee," as defined in Rule 3c-5(a)(4) under
the Investment Company Act of 1940, of the issuer of the securities being offered or sold where the issuer would be an investment company,
as defined in Section 3 of such Act, but for the exclusion provided by either section 3(c)(1) or section 3(c)(7) of such
Act;

&nbsp;&nbsp;&nbsp;&nbsp;12. Any "family office" as defined in Rule 202(a)(11)(G)-1 under the Investment Advisers
Act of 1940 with assets under management in excess of $5,000,000, that is not formed for the specific purpose of acquiring the securities
offered, and whose prospective investment is directed by a person who has such knowledge and experience in financial and business matters
that such family office is capable of evaluating the merits and risks of the prospective investment; and

&nbsp;&nbsp;&nbsp;&nbsp;13. Any "family client" as defined in Rule 202(a)(G)-1 under the Investment Advisers Act
of 1940, of a family office meeting the requirements of a family office and whose prospective investment in the issuer is directed by
such family office.

**INSTRUCTION: SUBSCRIBER REPRESENTS AND WARRANTS THAT SUBSCRIBER QUALIFIES AS AN ACCREDITED INVESTOR UNDER THE FOLLOWING PARAGRAPH NUMBER(S) FROM THE LIST ABOVE:**

If the Subscriber is an entity, the individual(s) signing on behalf of the Subscriber and the Subscriber, jointly and severally, agree and certify that this Agreement has been duly authorized by all necessary action on the part of the Subscriber, has been duly executed by an authorized representative of the Subscriber, and is a legal, valid, and binding obligation of the Subscriber enforceable in accordance with its terms.

<u>Entities</u>. **A REPRESENTATIVE OF AN ENTITY SUBSCRIBER MUST INITIAL HERE.**

**E.**  **<u>Limited Offering Exemption Notice under Section 25102(f) of the California Corporations Code</u>** 

**The undersigned Subscriber, by signing this Agreement, represents and warrants to the Bancorp that such Subscriber (1) has a pre-existing personal or business relationship with the Bancorp or one of its officers or directors, or by reason of such Subscriber's business or financial experience could be reasonably assumed to have the capacity to protect such Subscriber's own interests in connection with the transaction, (2) is purchasing for the Subscriber's own account and not with a view to or for sale in connection with any distribution of the security, and (3) is not aware of any form of general solicitation or general advertising made by the Bank or the Bancorp relating to the transaction.**

**F.** **<u>Investment Purpose in Acquiring the Shares</u>.** The Subscriber represents that the Subscriber is subscribing to acquire the Shares for the account of the Subscriber for investment purposes only and not with a view to their resale or distribution. The Subscriber has no present intention to divide the Subscriber's participation with others or to resell or otherwise dispose of all or any part of the Shares.

**G.** **<u>Representations to Survive Delivery</u>.** The representations, warranties and agreements of the Bancorp and of the Subscriber contained in this Agreement will remain operative and in full force and effect and will survive the receipt of funds by the Bancorp, and the issuance to the Subscriber of the Shares.

**H.** **<u>Indemnification</u>.** Subscriber agrees to indemnify the Bancorp and the Bank and each current and future officer, director, employee and agent of the Bancorp and the Bank against and hold them harmless from any damage, loss, liability, claim or expense including without limitation, reasonable attorney's fees resulting from or arising out of the inaccuracy or alleged inaccuracy of any of the representations, warranties or statements of the Subscriber contained in Paragraphs A through G above.

**I.** **<u>Revocation</u>.** Subscriber hereby acknowledges and agrees that except as specifically set forth herein, Subscriber is not entitled to cancel, terminate, or revoke this Agreement and that it shall survive the bankruptcy of Subscriber.

**<u>Additional Agreements</u>**

**<u>Delivery of Certificate for Shares</u>** **.** Following the successful closing of the Offering, a book-entry registration of the Shares purchased will be made in the records of the Transfer Agent for the Bancorp.

**<u>Governing Law; Venue</u>** **.** This Agreement shall be governed by, and construed in accordance with, the substantive laws of the State of California without reference to California conflict or choice of law provisions. Actions or proceedings litigated in connection with this Agreement, if any, shall have venue exclusively in the state and federal courts located in Orange County, California.

**<u>Additional Information</u>** **.** Subscriber shall supply such additional information and documentation relating to Subscriber and any persons who have any rights or interest in Subscriber as may be requested by the Bancorp in order to ensure compliance by the Bancorp with applicable laws. If at any time prior to the Bancorp's acceptance of this Agreement, an adverse change occurs with respect to the Subscriber such that the information, representations and warranties of the Subscriber set forth in this Agreement are no longer accurate, the Subscriber shall immediately notify the Bancorp of the inaccuracy in writing and shall deliver the updated, accurate information to the Bancorp.

**<u>Successors and Assigns</u>** **.** The representations and warranties made by the Subscriber in this Agreement are binding on the Subscriber's permitted successors and assigns and are made for the benefit of the Bancorp and any other person who may become liable for violations of applicable securities laws as a result of the inaccuracy or falsity of any of the Subscriber's representations or warranties. Subscriber shall not assign Subscriber's obligations hereunder without the consent of the Bancorp, which consent shall be granted, if at all, in the sole discretion of the Board of Directors of the Bancorp.

**<u>Counterparts</u>** **.** This Agreement may be executed by the Bancorp and by the Subscriber in separate counterparts, each of which shall be deemed an original.

**<u>Acceptance</u>** **.** This Agreement is not binding on the Bancorp until accepted in writing by the Bancorp.

**<u>Severability</u>** **.** Each provision of this Subscription Agreement shall be separate and severable and if for any reason any provision hereunder is found invalid or unenforceable under applicable law, such invalidity or unenforceability shall not affect the operation of the remaining provisions of this Subscription Agreement.

**INDIVIDUAL SIGNATURE PAGE**

All individual Subscribers must complete and sign this page. Where the Shares are to be held in joint tenancy or tenancy in common, both parties must sign and both Social Security numbers should be indicated.

**THIS AGREEMENT SHALL NOT BIND THE BANCORP UNTIL IT HAS COUNTERSIGNED THIS PAGE.**

---

| | |
|:---|:---|
| Subscriber's Name(s) (please print) | Social Security Number(s) |
| Residence Address | Form of Ownership (e.g., individual, Joint tenants with rights of survivor- Ship, tenants in common, community Property) |
| Mailing Address | The Shares subscribed for herein should be registered as follows.(Please print above the exact name(s) in which the Shares are to be held.) |
| Home: Tel. No. Facsimile No. | Business: Tel No. Facsimile No. |

---

**<u>SHARES SUBSCRIBED</u>**

Total Number of Shares subscribed for

<u>Total Purchase Price (No. of Shares times $12.50)</u>

Signature of Subscriber(s)

Dated:

------

Infinity Bancorp hereby accepts the Subscriber's offer to purchase ______Shares for a total purchase price of $__________.

By:   Dated as of:   ,2023

Victor E. Guerrero II

President/Chief Operating Officer

**ENTITY SIGNATURE PAGE**

All entity investors must complete and sign this page.

**THIS AGREEMENT SHALL NOT BIND THE BANCORP UNTIL IT HAS COUNTERSIGNED THIS PAGE.**

Entity Name(s) (please print) Employer Identification Number (also include Social Security Numbers if a Trust or Partnership) <br>Business (Residence) Address The Shares Subscribed for herein should be registered as follows. (Please print exact name(s) in which the Shares are to be held.)

**<u>SHARES SUBSCRIBED</u>**

Total Number of Shares subscribed for

<u>Total Purchase Price (No. of Shares times $12.50)</u>

Total Amount FOR ALL SHARES (Recommend remoding)

---

| | |
|:---|:---|
| **<u>SIGNATURE</u>** | **<u>SIGNATURE</u>** |
| By: |  |
|  | (print name) |
| Its: |  |
| Dated: |  |

---

------

Infinity Bancorp hereby accepts the Subscriber's offer to purchase ______Shares for a total purchase price of $__________.

By:   Dated as of:   ,2023

Victor E. Guerrero

President/Chief Operating Officer

## Ex1A-6

**Exhibit 6.1**

**<u>OFFICE LEASE</u>**

This Office Lease (this "**Lease**"), dated as of the date set forth in <u>Section 1.1</u>, is made by and between **BRE/OC GRIFFIN, L.L.C., a Delaware limited liability company** ("**Landlord**"), and **C&S BANKING GROUP LLC, a California limited liability company** ("**Tenant**"). The following exhibits are incorporated herein and made a part hereof: **<u>Exhibit A</u>** (Outline of Premises); **<u>Exhibit B</u>** (Work Letter); **<u>Exhibit C</u>** (Form of Confirmation Letter); **<u>Exhibit D</u>** (Rules and Regulations); **<u>Exhibit E</u>** (Judicial Reference); **<u>Exhibit F</u>** (Additional Provisions); **<u>Exhibit F-1</u>** (Form of Letter of Credit); **<u>Exhibit F-2</u>** (Location of Eyebrow Signage); and **<u>Exhibit G</u>** (Outline of Visitor Parking Spaces).

---

| | |
|:---|:---|
| **1** | **BASIC LEASE INFORMATION.** |

---

1.1 Date: November
 17, 2016

1.2 Premises.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.2.1 "**Building** ": 6
 Hutton Centre Drive, Santa Ana, California, 92707, commonly known as Griffin Towers.

1.2.2 "**Premises** ": Subject
 to <u>Section 2.1.1</u>, **8,873** rentable square feet of space located on the first
 floor of the Building and commonly known as Suite 100, the outline and location of which
 is set forth in  **<u>Exhibit A</u>** . If the Premises include any floor in its entirety,
 all corridors and restroom facilities located on such floor shall be considered part of the
 Premises.

1.2.3 "**Property** ": The
 Building, the parcel(s) of land upon which it is located, and,
 at Landlord's discretion, any parking facilities and other improvements serving
 the Building and the parcel(s) of land upon which such parking facilities and other
 improvements are located.

1.2.4 "**Project** ": The
 Property or, at Landlord ' s discretion, any project
 containing the Property and any other land, buildings or other improvements.

&nbsp;&nbsp;&nbsp;&nbsp;1.3 Term

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.3.1 Term: The
 term of this Lease (the "**Term** ")
 shall begin on the Commencement Date and expire on the Expiration Date (or any earlier date
 on which this Lease is terminated as provided herein).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.3.2 "**Commencement Date**" : The
 earlier of (i) the first date on which Tenant conducts business in the Premises, or
 (ii) February 1, 2017. Landlord shall cause the Delivery Date (defined below) to
 occur within one (1) business day after the mutual execution and delivery hereof. As
 used herein, "**Delivery Date**" means the date on which Landlord tenders possession of the Premises to Tenant free
 from occupancy by any party. During the period beginning on the Delivery Date and ending
 on the date immediately preceding the Commencement Date, all provisions of this Lease shall
 apply as if the Commencement Date had occurred; provided, however, that during such period
 (a) Tenant shall not be required to pay Monthly Rent (defined in <u>Section 3</u>),
 and (b) Tenant may not conduct business in the Premises.

Notwithstanding any contrary provision hereof, if for any reason Tenant fails, by November 30, 2016, to obtain, and provide Landlord with a copy of, preliminary written authorization from the California Department of Business Oversight for Tenant to organize as a banking business in the State of California (the "**Preliminary Approval**"), then Landlord shall have the right, by notifying Tenant not later than the date immediately preceding the date, if any, on which Tenant provides Landlord with a copy of the Preliminary Approval, to accelerate the expiration date of this Lease from the Expiration Date to the date occurring 10 business days after Landlord's delivery of such notice of acceleration (the "**First Accelerated Expiration Date**"). Tenant shall (a) use its best efforts to obtain the Preliminary Approval by November 30, 2016, (b) keep Landlord updated throughout the process, and (c) promptly notify Landlord if and when the Preliminary Approval is obtained.

Notwithstanding any contrary provision hereof, if the expiration date of this Lease is not accelerated pursuant to the preceding paragraph and, for any reason, Tenant fails, by January 1, 2017, to obtain from all regulatory authorities that have approval, chartering and/or oversight responsibility (including but, not limited to, the California Department of Business Oversight and the Federal Deposit Insurance Corporation), and provide copies to Landlord of, any and all federal and state approvals that are required for Tenant to lawfully open the bank that Tenant is organizing in California, currently called SoCal Bank ("**Tenant's New Bank**") (collectively, "**Final Regulatory Approvals**"), then each party shall have the right, by notifying the other party not later than the earlier of January 31, 2017 or the date immediately preceding the date, if any, on which Tenant provides copies of the Final Regulatory Approvals to Landlord, to accelerate the expiration date of this Lease from the Expiration Date to the date occurring 10 business days after the delivery of such notice of acceleration (together with the First Accelerated Expiration Date, each, an "**Accelerated Expiration Date**"). Tenant shall (a) use its best efforts to obtain the Final Regulatory Approvals by January 1, 2017, (b) keep Landlord updated throughout the process, and (c) promptly notify Landlord if and when the Final Regulatory Approvals are obtained.

If the expiration date of this Lease is accelerated by Landlord or Tenant in accordance with the foregoing provisions of this <u>Section 1.3.2</u>, then (a) this Lease shall expire on the Accelerated Expiration Date with same force and effect as if this Lease had originally been fixed to expire on the Accelerated Expiration Date (provided, however, that Tenant shall not be required under <u>Section 8</u>, to remove any Tenant-Insured Improvements (defined in <u>10.2.2</u>) existing when the applicable notice of acceleration was delivered), and (b) Tenant, not later than the Accelerated Expiration Date, shall pay to Landlord, in consideration of the terms and conditions hereof (the receipt and sufficiency of which are hereby acknowledged) and not as a penalty, the amount of $60,000.00.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.3.3 "**Expiration Date** "**:** The
 last day of the 84<sup>th</sup> full calendar month beginning on or after the Commencement
 Date.

&nbsp;&nbsp;&nbsp;&nbsp;1.4 "**Base Rent**" :

---

| | | | |
|:---|:---|:---|:---|
| **Period During Term** | **Annual Base Rent <br> Per Rentable <br> Square Foot <br> (rounded to the <br> nearest 100th of a <br> dollar)** | **Monthly Base <br> Rent Per Rentable <br> Square Foot <br> (rounded to the <br> nearest 100th of a <br> dollar)** | **Monthly <br> Installment <br> of Base Rent** |
| Commencement Date through last day of 12<sup>th</sup> full calendar month of Term | $34.20 | $2.85 | $25288.05 |
| 13<sup>th</sup> through 24<sup>th</sup> full calendar months of Term | $35.40 | $2.95 | $26175.35 |
| 25<sup>th</sup> through 36<sup>th</sup> full calendar months of Term | $36.64 | $3.05 | $27092.23 |
| 37<sup>th</sup> through 48<sup>th</sup> full calendar months of Term | $37.92 | $3.16 | $28038.68 |
| 49<sup>th</sup> through 60<sup>th</sup> full calendar months of Term | $39.25 | $3.27 | $29022.10 |
| 61<sup>st</sup> through 72<sup>nd</sup> full calendar months of Term | $40.62 | $3.39 | $30035.11 |
| 73<sup>rd</sup> full calendar month of Term through Expiration Date | $42.04 | $3.50 | $31085.08 |

---

Notwithstanding the foregoing, Base Rent shall be abated, in the amount of $25,288.05 per month, for the first five (5) full calendar months of the Term; provided, however, that if a Default (defined in <u>Section 19.1</u>) exists when any such abatement would otherwise apply, such abatement shall be deferred until the date, if any, on which such Default is cured.

---

| | | |
|:---|:---|:---|
| 1.5 | "**Base Year**" for Expenses: | Calendar year 2017. |
|  | "**Base Year**" for Taxes: | Calendar year 2017. |
| 1.6 | "**Tenant's Share**": | 1.5959% (based upon a total of 555,993 rentable square feet in the Building), subject to <u>Section 2.1.1</u>. |

---

Notwithstanding any contrary provision hereof, for purposes of the definition of Tenant's Share, the second sentence of <u>Section 2.1.1</u>, and <u>Sections 2.2</u> and <u>4</u>, "**Building**" means, collectively, the Related Buildings (defined below), and "**Property**" means, collectively, the Related Buildings, the parcel(s) of land upon which the Related Buildings are located and, at Landlord's discretion, the parking facilities and other improvements, if any, serving the Related Buildings and the parcels of land upon which such parking facilities and improvements are located. As used herein, "**Related Buildings**" means, collectively, the two (2) buildings located at 5 Hutton Centre Drive and 6 Hutton Centre Drive, in Santa Ana, California.

&nbsp;&nbsp;&nbsp;&nbsp;1.7 "**Permitted Use** ": General office use consistent
 with a first-class office building, together with any other use that: (a) is legally
 permitted; (b) is not a retail use (other than retail banking); (c) does not generate
 (i) foot traffic exceeding that normally associated with general office use, (ii) any
 noise, vibration or odor detectable outside the Premises that is not normally associated
 with general office use, (iii) any burden on any Building system exceeding that normally
 associated with general office use, or (iv) any risk to the Building or to the safety
 or health of its occupants that is not normally associated with general office use; (d) does
 not adversely affect Landlord's or Tenant's insurance coverage; (e) does
 not include a wet lab; (f) does not involve the introduction, use, storage or disposal
 of any type or quantity of hazardous material not customarily associated with general office
 use; and (i) in all other respects is consistent with a first-class office building.
 Notwithstanding any contrary provision hereof, the Permitted Use shall exclude (i) any
 operation of an executive office suites business (including any flexible workplace center
 consisting primarily of executive suites and shared office workspaces for use by third parties,
 with or without ancillary services), and (ii) any operation of a delicatessen, café
 or other food service.

&nbsp;&nbsp;&nbsp;&nbsp;1.8. "**Security Deposit** ": $60,000.00, as more
 particularly described in <u>Section 21</u>.

---

| | |
|:---|:---|
| Prepaid Base Rent: | $25,288.05, as more particularly described in <u>Section 3</u>. |

---

&nbsp;&nbsp;&nbsp;&nbsp;1.9 Parking: The Unreserved Number
 (defined below) of unreserved parking spaces, at the rate of (i) $0.00 per space per
 month during the first 18 months of the initial Term, (ii) 50.00 per space per month
 during the balance of the initial Term, and (iii) Landlord's prevailing rate during
 any extension or renewal Term.

The Reserved Number (defined below) of reserved parking space(s), at the rate of (i) $75.00 per space per month during the initial Term, and (ii) Landlord's prevailing rate during any extension or renewal Term.

As used herein, "**Unreserved Number**" means 26 and "**Reserved Number**" means zero (0); provided, however, that Tenant, upon at least 30 days' notice to Landlord from time to time, may (a) change the Unreserved Number to any whole number from zero (0) to 26, and/or (b) change the Reserved Number to any whole number from zero (0) to four (4); provided further, however, that the sum of the Unreserved Number plus the Reserved Number shall not exceed 26.

Five (5) reserved visitor parking spaces ("**Visitor Parking Spaces**") in the location shown on **<u>Exhibit G</u>**, at the rate of (i) $75.00 per space per month during the initial Term, and (ii) Landlord's prevailing rate during any extension or renewal Term. For the avoidance of doubt, use of the Visitor Parking Spaces by Tenant's visitors shall be subject to Landlord's standard visitor parking rates, except as provided below in this <u>Section 1.9</u>.

During the Term, provided that no Default exists, and subject to such reasonable rules and procedures as Landlord may establish from time to time, Landlord shall make available to Tenant, for use by Tenant's visitors in the Parking Facility, 30-minute parking validations.

---

| | | |
|:---|:---|:---|
| 1.1 | Address of Tenant: | <u>Before the Commencement Date</u>: |
|  |  | C&S Banking Group LLC<br> 6 Saros<br> Irvine, CA 92603<br><u>From and after the Commencement Date</u>: the Premises. |
| 1.11 | Address of Landlord: | BRE/OC Griffin, L.L.C. <br> c/o Equity Office |
|  |  | 970 W. 190th Street, Suite 110<br> Torrance, CA 90502<br> ATTN: Regional Finance Group - MLA<br><u>with copies to</u>:<br>|
|  |  | BRE/OC Griffin, L.L.C.<br> c/o Equity Office<br> 1810 Gateway Drive, Suite 230<br> San Mateo, CA 94404<br> Attn: Managing Counsel<br><u>and</u><br>|
|  |  | BRE/OC Griffin, L.L.C.<br> c/o Equity Office<br> 222 S. Riverside Plaza, Suite 2000<br> Chicago, IL 60606 – 6115<br> Attn: Lease Administration<br>|
| 1.12 | Broker(s): | Cresa Partners-West, Inc., a California corporation ("**Tenant's Broker**"), representing Tenant, and CBRE, Inc., a Delaware corporation ("**Landlord's Broker**"), representing Landlord. |
| 1.13 | Building HVAC Hours and Holidays: | "**Building HVAC Hours**" means 8:00 a.m. to 6:00 p.m., Monday through Friday, and 9:00 a.m. to 1:00 p.m. Saturday, excluding the day of observation of New Year's Day, Presidents Day, Memorial Day, Independence Day, Labor Day, Thanksgiving Day, Christmas Day, and, at Landlord's discretion, any other locally or nationally recognized holiday that is observed by other Comparable Buildings (defined in <u>Section 25.10</u>) (collectively, "**Holidays**"). |
| 1.14 | "**Transfer Radius**": | None. |
| 1.15 | "**Tenant Improvements":** | Defined in **<u>Exhibit B</u>**. |
| 1.16 | "**Letter of Credit**": | Defined in <u>Section 3.1</u> of **<u>Exhibit F</u>**. |

---

---

| | |
|:---|:---|
| **2** | **PREMISES AND COMMON AREAS.** |

---

&nbsp;&nbsp;&nbsp;&nbsp;2.1  **<u>The Premises</u>.** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.1.1 Subject to the terms hereof, Landlord hereby leases the Premises to Tenant and Tenant hereby leases the Premises from Landlord. Landlord and Tenant acknowledge that the rentable square footage of the Premises is as set forth in <u>Section 1.2.2</u> and the rentable square footage of the Building is as set forth in <u>Section 1.6</u>; provided, however, that Landlord may from time to time re-measure the Premises and/or the Building in accordance with any generally accepted BOMA measurement standards selected by Landlord and adjust Tenant's Share based on such re-measurement; provided further, however, that any such re-measurement shall not affect the amount of Base Rent payable for, or the amount of any tenant allowance applicable to, the initial Term. At any time Landlord may deliver to Tenant a notice substantially in the form of **<u>Exhibit C</u>**, as a confirmation of the information set forth therein. Tenant shall execute and return (or, by notice to Landlord, reasonably object to) such notice within five (5) days after receiving it, and if Tenant fails to do so, Tenant shall be deemed to have executed and returned it without exception.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.1.2 Except as expressly provided herein, the Premises are accepted by Tenant in their configuration and condition existing on the date hereof (or in such other configuration and condition as any existing tenant of the Premises may cause to exist in accordance with its lease), without any obligation of Landlord to perform or pay for any alterations to the Premises, and without any representation or warranty regarding the configuration or condition of the Premises, the Building or the Project or their suitability for Tenant's business.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2 **<u>Common Areas</u>.** Tenant may use, in common with Landlord and other parties and subject to the Rules and Regulations (defined in **<u>Exhibit D</u>**), any portions of the Property that are designated from time to time by Landlord for such use (the "**Common Areas**").

**3 RENT.** Tenant shall pay all Base Rent and Additional Rent (defined below) (collectively, "**Rent**") to Landlord or Landlord's agent, without prior notice or demand or any setoff or deduction, at the place Landlord may designate from time to time, in money of the United States of America that, at the time of payment, is legal tender for the payment of all obligations. As used herein, "**Additional Rent**" means all amounts, other than Base Rent, that Tenant is required to pay Landlord hereunder. Monthly payments of Base Rent and monthly payments of Additional Rent for Expenses (defined in <u>Section 4.2.2</u>), Taxes (defined in <u>Section 4.2.3</u>) and parking (collectively, "**Monthly Rent**") shall be paid in advance on or before the first day of each calendar month during the Term; provided, however, that the installment of Base Rent for the first full calendar month for which Base Rent is payable hereunder shall be paid upon Tenant's execution and delivery hereof. Except as otherwise provided herein, all other items of Additional Rent shall be paid within 30 days after Landlord's request for payment. Rent for any partial calendar month shall be prorated based on the actual number of days in such month. Without limiting Landlord's other rights or remedies, (a) if any installment of Rent is not received by Landlord or its designee within five (5) business days after its due date, Tenant shall pay Landlord a late charge equal to 5% of the overdue amount; and (b) any Rent that is not paid within 10 days after its due date shall bear interest, from its due date until paid, at the lesser of 18% per annum or the highest rate permitted by Law (defined in <u>Section 5</u>). Tenant's covenant to pay Rent is independent of every other covenant herein.

---

| | |
|:---|:---|
| **4** | **EXPENSES AND TAXES.** |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.1 **<u>General Terms</u>.** In addition to Base Rent, Tenant shall pay, in accordance with <u>Section 4.4</u>, for each Expense Year (defined in <u>Section 4.2.1</u>), an amount equal to the sum of (a) Tenant's Share of any amount (the "**Expense Excess**") by which Expenses for such Expense Year exceed Expenses for the Base Year, plus (b) Tenant's Share of any amount (the "**Tax Excess**") by which Taxes for such Expense Year exceed Taxes for the Base Year. No decrease in Expenses or Taxes for any Expense Year below the corresponding amount for the Base Year shall entitle Tenant to any decrease in Base Rent or any credit against amounts due hereunder. Tenant's Share of the Expense Excess and Tenant's Share of the Tax Excess for any partial Expense Year shall be prorated based on the number of days in such Expense Year.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.2 **<u>Definitions</u>.** As used herein, the following terms have the following meanings:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.2.1 "**Expense Year**" means each calendar year (other than the Base Year and any preceding calendar year) in which any portion of the Term occurs.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.2.2 "**Expenses**" means all expenses, costs and amounts that Landlord pays or accrues during the Base Year or any Expense Year because of or in connection with the ownership, management, maintenance, security, repair, replacement, restoration or operation of the Property. Landlord shall act in a reasonable manner in incurring Expenses. Expenses shall include (i) the cost of supplying all utilities, the cost of operating, repairing, maintaining and renovating the utility, telephone, mechanical, sanitary, storm-drainage, and elevator systems, and the cost of maintenance and service contracts in connection therewith; (ii) the cost of licenses, certificates, permits and inspections, the cost of contesting any Laws that may affect Expenses, and the costs of complying with any governmentally-mandated transportation-management or similar program; (iii) the cost of all insurance premiums and deductibles; (iv) the cost of landscaping and relamping; (v) the cost of parking-area operation, repair, restoration, and maintenance; (vi) a management fee in the amount (which is hereby acknowledged to be reasonable) of 3% of gross annual receipts from the Building (excluding the management fee), together with other fees and costs, including consulting fees, legal fees and accounting fees, of all contractors and consultants in connection with the management, operation, maintenance and repair of the Property; (vii) the fair rental value of any reasonable amount of management office space; (viii) wages, salaries and other compensation, expenses and benefits, including taxes levied thereon, of all persons engaged in the operation, maintenance and security of the Property, and costs of training, uniforms, and employee enrichment for such persons; (ix) the costs of operation, repair, maintenance and replacement of all systems and equipment (and components thereof) of the Property; (x) the cost of janitorial, alarm, security and other services, replacement of wall and floor coverings, ceiling tiles and fixtures in Common Areas, maintenance and replacement of curbs and walkways, repair to roofs and re-roofing; (xi) rental or acquisition costs of supplies, tools, equipment, materials and personal property used in the maintenance, operation and repair of the Property; (xii) the cost of capital improvements or any other items that are (A) intended to reduce current or future Expenses, enhance the safety or security of the Property or its occupants, or enhance the environmental sustainability of the Property's operations, (B) replacements or modifications of the nonstructural portions of the Base Building (defined in <u>Section 5</u>) or Common Areas that are required to keep the Base Building or Common Areas in good condition, or (C) required under any Law; (xiii) the cost of tenant-relation programs reasonably established by Landlord; and (xiv) payments under any existing or future reciprocal easement agreement, transportation management agreement, cost-sharing agreement or other covenant, condition, restriction or similar instrument affecting the Property.

Notwithstanding the foregoing, Expenses shall not include: (a) capital expenditures not described in clauses (xi) or (xii) above (in addition, any capital expenditure shall be included in Expenses only if paid or accrued after the Base Year and shall be amortized (including actual or imputed interest on the amortized cost) over such period of time as Landlord shall reasonably determine); (b) depreciation; (c) principal payments of mortgage or other non-operating debts of Landlord; (d) costs of repairs to the extent Landlord is reimbursed by insurance or condemnation proceeds; (e) except as provided in clause (xiii) above, costs of leasing space in the Building, including brokerage commissions, lease concessions, rental abatements and construction allowances granted to specific tenants; (f) costs of selling, financing or refinancing the Building; (g) fines, penalties or interest resulting from late payment of Taxes or Expenses; (h) organizational expenses of creating or operating the entity that constitutes Landlord; or (i) damages paid to Tenant hereunder or to other tenants of the Building under their respective leases.

If, during any portion of the Base Year or any Expense Year, the Building is less than 95% occupied (or a service provided by Landlord to Tenant is not provided by Landlord to a tenant that provides such service itself, or any tenant of the Building is entitled to free rent, rent abatement or the like), with the result that Expenses for such year are less than what they would have been if the Building had been 95% occupied (and all services provided by Landlord to Tenant had been provided by Landlord to all tenants, and no tenant of the Building had been entitled to free rent, rent abatement or the like) throughout such year (the "**95% Amount**"), then Expenses for such year shall be deemed to be the 95% Amount. Notwithstanding any contrary provision hereof, Expenses for the Base Year shall exclude (a) any market-wide cost increases resulting from extraordinary circumstances, including Force Majeure (defined in <u>Section 25.2</u>), boycotts, strikes, conservation surcharges, embargoes or shortages, and (b) at Landlord's option, the cost of any repair or replacement that Landlord reasonably expects will not recur on an annual or more frequent basis.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.2.3 "**Taxes**" means all federal, state, county or local governmental or municipal taxes, fees, charges, assessments, levies, licenses or other impositions, whether general, special, ordinary or extraordinary, that are paid or accrued during the Base Year or any Expense Year (without regard to any different fiscal year used by such governmental or municipal authority) because of or in connection with the ownership, leasing or operation of the Property. Taxes shall include (a) real estate taxes; (b) general and special assessments; (c) transit taxes; (d) leasehold taxes; (e) personal property taxes imposed upon the fixtures, machinery, equipment, apparatus, systems, appurtenances, furniture and other personal property used in connection with the Property; (f) any tax on the rent, right to rent or other income from any portion of the Property or as against the business of leasing any portion of the Property; (g) any assessment, tax, fee, levy or charge imposed by any governmental agency, or by any non-governmental entity pursuant to any private cost-sharing agreement, in order to fund the provision or enhancement of any fire-protection, street-, sidewalk- or road-maintenance, refuse-removal or other service that is (or, before the enactment of Proposition 13, was) normally provided by governmental agencies to property owners or occupants without charge (other than through real property taxes); and (h) payments in lieu of taxes under any tax increment financing agreement, abatement agreement, agreement to construct improvements, or other agreement with any governmental body or agency or taxing authority. Any costs and expenses (including reasonable attorneys' and consultants' fees) incurred in attempting to protest, reduce or minimize Taxes shall be included in Taxes for the year in which they are incurred. Notwithstanding any contrary provision hereof, Taxes shall be determined without regard to any "green building" credit and shall exclude (i) all excess profits taxes, franchise taxes, gift taxes, capital stock taxes, inheritance and succession taxes, transfer taxes, estate taxes, federal and state income taxes, and other taxes to the extent (x) applicable to Landlord's general or net income (as opposed to rents, receipts or income attributable to operations at the Property), or (y) measured solely by the square footage, rent, fees, services, tenant allowances or similar amounts, rights or obligations described or provided in or under any particular lease, license or similar agreement or transaction at the Building; (ii) any Expenses, and (iii) any items required to be paid or reimbursed by Tenant under <u>Section 4.5</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.3 **<u>Allocation</u>.** Landlord, in its reasonable discretion, may equitably allocate Expenses among office, retail or other portions or occupants of the Property. If Landlord incurs any Expense for the Property together with another property under a third-party contract that does not allocate such Expense between the Property and such other property, Landlord shall allocate such shared Expense between the Property and such other property in proportion to the rentable square footages of the Property and such other property; provided, however, that if such other property is not of a quality comparable to the Property, then such allocation shall be made on an equitable basis taking into account all relevant factors, including such difference in quality.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.4 **<u>Calculation and Payment of Expense Excess and Tax Excess</u>.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.4.1 **Statement of Actual Expenses and Taxes; Payment by Tenant.** Landlord shall give to Tenant, after the end of each Expense Year, a statement (the "**Statement**") setting forth the actual Expenses, Taxes, Expense Excess and Tax Excess for such Expense Year. Upon Tenant's request (if not earlier), Landlord shall provide Tenant with a breakdown of such actual Expenses by category. If the amount paid by Tenant for such Expense Year pursuant to <u>Section 4.4.2</u> is less or more than the sum of Tenant's Share of the actual Expense Excess plus Tenant's Share of the actual Tax Excess (as such amounts are set forth in such Statement), Tenant shall pay Landlord the amount of such underpayment, or receive a credit in the amount of such overpayment, with or against the Rent then or next due hereunder; provided, however, that if this Lease has expired or terminated and Tenant has vacated the Premises, Tenant shall pay Landlord the amount of such underpayment, or Landlord shall pay Tenant the amount of such overpayment (less any Rent due), within 30 days after delivery of such Statement. Any failure of Landlord to timely deliver the Statement for any Expense Year shall not diminish either party's rights under this <u>Section 4</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.4.2 **Statement of Estimated Expenses and Taxes.** Landlord shall give to Tenant, for each Expense Year, a statement (the "**Estimate Statement**") setting forth Landlord's reasonable estimates of the Expenses, Taxes, Expense Excess (the "**Estimated Expense Excess**") and Tax Excess (the "**Estimated Tax Excess**") for such Expense Year. Upon Tenant's request (if not earlier), Landlord shall provide Tenant with a breakdown of such estimated Expenses by category. Upon receiving an Estimate Statement, Tenant shall pay, with its next installment of Base Rent, an amount equal to the excess of (a) the amount obtained by multiplying (i) the sum of Tenant's Share of the Estimated Expense Excess plus Tenant's Share of the Estimated Tax Excess (as such amounts are set forth in such Estimate Statement), by (ii) a fraction, the numerator of which is the number of months that have elapsed in the applicable Expense Year (including the month of such payment) and the denominator of which is 12, over (b) any amount previously paid by Tenant for such Expense Year pursuant to this <u>Section 4.4.2</u>. Until Landlord delivers a new Estimate Statement (which Landlord may do at any time), Tenant shall pay monthly, with the monthly Base Rent installments, an amount equal to one-twelfth (1/12) of the sum of Tenant's Share of the Estimated Expense Excess plus Tenant's Share of the Estimated Tax Excess, as such amounts are set forth in the previous Estimate Statement. Any failure of Landlord to timely deliver any Estimate Statement shall not diminish Landlord's rights to receive payments and revise any previous Estimate Statement under this <u>Section 4</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.4.3 **Retroactive Adjustment of Taxes.** Notwithstanding any contrary provision hereof, if, after Landlord's delivery of any Statement, an increase or decrease in Taxes occurs for the applicable Expense Year or for the Base Year (whether by reason of reassessment, error, or otherwise), Taxes for such Expense Year or the Base Year, as the case may be, and the Tax Excess for such Expense Year shall be retroactively adjusted. If, as a result of such adjustment, it is determined that Tenant has under- or overpaid Tenant's Share of such Tax Excess, Tenant shall pay Landlord the amount of such underpayment, or receive a credit in the amount of such overpayment, with or against the Rent then or next due hereunder; provided, however, that if this Lease has expired or terminated and Tenant has vacated the Premises, Tenant shall pay Landlord the amount of such underpayment, or Landlord shall pay Tenant the amount of such overpayment (less any Rent due), within 30 days after such adjustment is made.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.5 **<u>Charges for Which Tenant Is Directly Responsible</u>.** Notwithstanding any contrary provision hereof, Tenant, promptly upon demand, shall pay (or if paid by Landlord, reimburse Landlord for) each of the following to the extent levied against Landlord or Landlord's property: (a) any tax based upon or measured by (i) the cost or value of Tenant's trade fixtures, equipment, furniture or other personal property, or (ii) the cost or value of the Leasehold Improvements (defined in <u>Section 7.1</u>) to the extent such cost or value exceeds that of a Building-standard build-out, as determined by Landlord; (b) any rent tax, sales tax, service tax, transfer tax, value added tax, use tax, business tax, gross income tax, gross receipts tax, or other tax, assessment, fee, levy or charge measured solely by the square footage, Rent, services, tenant allowances or similar amounts, rights or obligations described or provided in or under this Lease; (c) any tax assessed upon the possession, leasing, operation, management, maintenance, alteration, repair, use or occupancy by Tenant of any portion of the Property; and (d) any tax assessed on this transaction or on any document to which Tenant is a party that creates an interest or estate in the Premises.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.6 **<u>Books and Records</u>.** Within 60 days after receiving any Statement (the "**Review Notice Period**"), Tenant may give Landlord notice ("**Review Notice**") stating that Tenant elects to review Landlord's calculation of the Expense Excess and/or Tax Excess for the Expense Year to which such Statement applies and identifying with reasonable specificity the records of Landlord reasonably relating to such matters that Tenant desires to review. Within a reasonable time after receiving a timely Review Notice (and, at Landlord's option, an executed confidentiality agreement as described below), Landlord shall deliver to Tenant, or make available for inspection at a location reasonably designated by Landlord, copies of such records. Within 60 days after such records are made available to Tenant (the "**Objection Period**"), Tenant may deliver to Landlord notice (an "**Objection Notice**") stating with reasonable specificity any objections to the Statement, in which event Landlord and Tenant shall work together in good faith to resolve Tenant's objections. Tenant may not deliver more than one Review Notice or more than one Objection Notice with respect to any Statement. If Tenant fails to give Landlord a Review Notice before the expiration of the Review Notice Period or fails to give Landlord an Objection Notice before the expiration of the Objection Period, Tenant shall be deemed to have approved the Statement. Notwithstanding any contrary provision hereof, Landlord shall not be required to deliver or make available to Tenant records relating to the Base Year more than one (1) time or in connection with any review performed by Tenant with respect to any Expense Year following the Last Eligible Expense Year (defined below). As used herein, "**Last Eligible Expense Year**" means the fourth (4th) Expense Year following the Base Year; provided, however, that if Expenses or Taxes for the Base Year are adjusted after Tenant receives the Statement for the first (1st) Expense Year following the Base Year, then, solely with respect to Landlord's records relating to such adjustment, the Last Eligible Expense Year shall be the fourth (4th) Expense Year beginning after Tenant receives notice of such adjustment. If Tenant retains an agent to review Landlord's records, the agent must be with a CPA firm licensed to do business in the State of California and its fees shall not be contingent, in whole or in part, upon the outcome of the review. Tenant shall be responsible for all costs of such review. The records and any related information obtained from Landlord shall be treated as confidential, and as applicable only to the Premises, by Tenant, its auditors, consultants, and any other parties reviewing the same on behalf of Tenant (collectively, "**Tenant's Auditors**"). Before making any records available for review, Landlord may require Tenant and Tenant's Auditors to execute a reasonable confidentiality agreement, in which event Tenant shall cause the same to be executed and delivered to Landlord within 30 days after receiving it from Landlord, and if Tenant fails to do so, the Objection Period shall be reduced by one day for each day by which such execution and delivery follows the expiration of such 30-day period. Notwithstanding any contrary provision hereof, Tenant may not examine Landlord's records or dispute any Statement if any Rent remains unpaid past its due date. If, for any Expense Year, Landlord and Tenant determine that the sum of Tenant's Share of the actual Expense Excess plus Tenant's Share of the actual Tax Excess is less or more than the amount reported, Tenant shall receive a credit in the amount of its overpayment, or pay Landlord the amount of its underpayment, against or with the Rent next due hereunder; provided, however, that if this Lease has expired or terminated and Tenant has vacated the Premises, Landlord shall pay Tenant the amount of its overpayment (less any Rent due), or Tenant shall pay Landlord the amount of its underpayment, within 30 days after such determination.

---

| | |
|:---|:---|
| **5** | **USE; COMPLIANCE WITH LAWS.** |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.1 Tenant shall not (a) use the Premises for any purpose other than the Permitted Use, or (b) do anything in or about the Premises that violates any of the Rules and Regulations, damages the reputation of the Project, interferes with, injures or annoys other occupants of the Project, or constitutes a nuisance. Tenant, at its expense, shall comply with all Laws relating to (i) the operation of its business at the Project, (ii) the use, condition, configuration or occupancy of the Premises, (iii) any Supplemental Systems (defined below) serving the Premises, whether located inside or outside of the Premises, or (iv) the portions of Base Building Systems (defined below) located in the Premises. If, in order to comply with any such Law, Tenant must obtain or deliver any permit, certificate or other document evidencing such compliance, Tenant shall provide a copy of such document to Landlord promptly after obtaining or delivering it. If a change to any Common Area or the Base Building (other than any portion of a Base Building System located in the Premises) becomes required under Law (or if any such requirement is enforced) as a result of any Tenant-Insured Improvement (defined in <u>Section 10.2.2</u>), the installation of any trade fixture, or any particular use of the Premises (as distinguished from general office use), then Tenant, upon demand, shall (x) at Landlord's option, either make such change at Tenant's cost or pay Landlord the cost of making such change, and (y) pay Landlord a coordination fee equal to 10% of the cost of such change. As used herein, "**Law**" means any existing or future law, ordinance, regulation or requirement of any governmental authority having jurisdiction over the Project or the parties. As used herein, "**Supplemental System**" means any Unit (defined in <u>Section 25.5</u>), supplemental fire-suppression system, kitchen (including any hot water heater, dishwasher, garbage disposal, insta-hot dispenser, or plumbing), shower or similar facility, or any other system that would not customarily be considered part of the base building of a first-class multi-tenant office building. As used herein, "**Base Building System**" means any mechanical (including HVAC), electrical, plumbing or fire/life-safety system serving the Building, other than a Supplemental System. As used herein, "**Base Building**" means the structural portions of the Building, together with the Base Building Systems.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.2 Landlord, at its expense (subject to <u>Section 4</u>), shall cause the Base Building (other than portions of Base Building Systems located in the Premises) and the Common Areas to comply with all Laws (including the Americans with Disabilities Act) to the extent that such compliance is necessary for Tenant to use the Premises for general office use in a normal and customary manner and for Tenant's employees and visitors to have reasonably safe access to and from the Premises; provided, however, that Landlord shall not be required to cause or pay for such compliance to the extent that Tenant is required to cause or pay for such compliance under <u>Section 5.1</u> or <u>7.3</u> or any other provision hereof. Notwithstanding the foregoing, Landlord may contest any alleged violation in good faith, including by applying for and obtaining a waiver or deferment of compliance, asserting any defense allowed by Law, and appealing any order or judgment to the extent permitted by Law; provided, however, that after exhausting any rights to contest or appeal, Landlord shall perform any work necessary to comply with any final order or judgment.

---

| | |
|:---|:---|
| **6** | **SERVICES.** |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.1 **<u>Standard Services</u>.** Landlord shall provide the following services on all days (unless otherwise stated below): (a) subject to limitations imposed by Law, customary heating, ventilation and air conditioning ("**HVAC**") in season during Building HVAC Hours, stubbed to the Premises; (b) electricity supplied by the applicable public utility, stubbed to the Premises, (i) during Building HVAC Hours for Building-standard overhead lighting, and (ii) at all times for all other purposes; (c) water supplied by the applicable public utility (i) for use in lavatories and any drinking facilities located in Common Areas within the Building, and (ii) stubbed to the Building core for use in any plumbing fixtures located in the Premises; (d) subject to <u>Section 6.4</u> below, customary janitorial services to the Premises, except on weekends and Holidays; and (e) elevator service (subject to scheduling by Landlord, and payment of Landlord's standard usage fee, for any freight service).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.2 **<u>Above-Standard Use</u>.** Landlord shall provide HVAC service and electricity for Building-standard overhead lighting, or, at Tenant's option, electricity for Building-standard overhead lighting only, outside of Building HVAC Hours, if Tenant gives Landlord such prior notice and pays Landlord such hourly cost per suite per floor as Landlord may require. The parties acknowledge that, as of the date hereof, (i) Landlord's charge for HVAC service and electricity for Building-standard overhead lighting outside of Building HVAC Hours is $75.00 per hour per suite per floor (with a one-hour minimum), subject to change from time to time; and (ii) Landlord's charge for electricity for Building-standard overhead lighting only, outside of Building HVAC Hours, is $25.00 per hour per suite per floor (with a one-hour minimum), subject to change from time to time. Tenant shall not, without Landlord's prior consent, use equipment that may affect the temperature maintained by the air conditioning system or consume above-Building-standard amounts of any water furnished for the Premises by Landlord pursuant to <u>Section 6.1</u>. If Tenant's consumption of electricity (other than electricity for Building-standard overhead lighting outside of Building HVAC Hours paid for by Tenant pursuant to the first sentence of this <u>Section 6.2</u>) or water exceeds the rate Landlord reasonably deems to be standard for the Building, Tenant shall pay Landlord, upon billing, the cost of such excess consumption, including any costs of installing, operating and maintaining any equipment that is installed in order to supply or measure such excess electricity or water. The connected electrical load of Tenant's incidental-use equipment shall not exceed the Building-standard electrical design load, and Tenant's electrical usage shall not exceed the capacity of the feeders to the Project or the risers or wiring installation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.3 **<u>Interruption</u>.** Subject to <u>Section 11</u>, any failure to furnish, delay in furnishing, or diminution in the quality or quantity of any service resulting from any application of Law, failure of equipment, performance of maintenance, repairs, improvements or alterations, utility interruption, or event of Force Majeure (each, a "**Service Interruption**") shall not render Landlord liable to Tenant, constitute a constructive eviction, or excuse Tenant from any obligation hereunder. Notwithstanding the foregoing, if all or a material portion of the Premises is made untenantable or inaccessible for more than five (5) consecutive business days after notice from Tenant to Landlord by a Service Interruption that (a) does not result from a Casualty (defined in <u>Section 11</u>), a Taking (defined in <u>Section 13</u>) or an Act of Tenant (defined in <u>Section 10.1</u>), and (b) can be corrected through Landlord's reasonable efforts, then, as Tenant's sole remedy, Monthly Rent shall abate for the period beginning on the day immediately following such 5-business-day period and ending on the day such Service Interruption ends, but only in proportion to the percentage of the rentable square footage of the Premises made untenantable or inaccessible and not occupied by Tenant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.4 **<u>Janitorial Service to Premises</u>.** Tenant, by notifying Landlord, may elect to provide janitorial service to the Premises, commencing on the date set forth in such notice to Landlord (which shall be the first day of a calendar month and shall be not earlier than 60 days after the date of delivery of such notice), in which event, from and after such date, (a) Landlord shall have no further obligation to provide janitorial services to the interior of the Premises, and the incremental cost of providing such services to the interiors of other tenant suites shall be excluded from Expenses; (b) Tenant, at its expense, shall provide all janitorial services to the interior of the Premises, on a regular basis, so that the Premises are kept in a reasonably neat, clean and pest-free condition; (c) without limiting the foregoing, (i) trash, garbage and other waste shall be kept only in sanitary containers installed by Tenant in the Premises, and all containers and equipment in the Premises for the storage or disposal of such materials shall be kept in a clean and sanitary condition, and (ii) all trash, garbage and other waste collected in the Premises, when removed by Tenant from the Premises, shall be deposited in containers provided by Landlord for such purpose in the Common Areas, subject to such reasonable rules and procedures as Landlord may establish from time to time; and (d) notwithstanding the foregoing, if a Default or an emergency exists by reason of Tenant's failure to perform the work described in the preceding clauses (b) and (c), Landlord may, at its option, perform such work on Tenant's behalf, in which case Tenant shall pay Landlord, upon demand, the cost of such services plus a coordination fee equal to 10% of such cost.

---

| | |
|:---|:---|
| **7** | **REPAIRS AND ALTERATIONS.** |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.1 **<u>Repairs</u>.** Subject to <u>Section 11</u>, Tenant, at its expense, shall perform all maintenance and repairs (including replacements) to the Premises, and keep the Premises in as good condition and repair as existed when Tenant took possession and as thereafter improved, except for reasonable wear and tear and repairs that are Landlord's express responsibility hereunder. Tenant's maintenance and repair obligations shall include (a) all leasehold improvements in the Premises, including any Tenant Improvements (other than trade fixtures), any Alterations (defined in <u>Section 7.2</u>) (other than trade fixtures), and any leasehold improvements installed pursuant to any prior lease (the "**Leasehold Improvements**"), but excluding the Base Building; (b) any Supplemental Systems serving the Premises, whether located inside or outside of the Premises; and (c) all Lines (defined in <u>Section 23</u>) and trade fixtures. Notwithstanding the foregoing, if a Default (defined in <u>Section 19.1</u>) or an emergency exists, Landlord may, at its option, perform such maintenance and repairs on Tenant's behalf, in which case Tenant shall pay Landlord, upon demand, the cost of such work plus a coordination fee equal to 10% of such cost. Landlord shall perform all maintenance and repairs to (i) the roof and exterior walls and windows of the Building, (ii) the Base Building, and (iii) the Common Areas.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.2 **<u>Alterations</u>.** Tenant may not make any improvement, alteration, addition or change to the Premises or to any mechanical, plumbing or HVAC facility or other system serving the Premises (an "**Alteration**") without Landlord's prior consent, which consent shall be requested by Tenant not less than 30 days before commencement of work and shall not be unreasonably withheld by Landlord. Notwithstanding the foregoing, Landlord's prior consent shall not be required for any Alteration that is decorative only (*e.g.,* carpet installation or painting) and not visible from outside the Premises, provided that Landlord receives 10 business days' prior notice. For any Alteration, (a) Tenant, before beginning work, shall deliver to Landlord, and obtain Landlord's approval of, plans and specifications; (b) Landlord, in its discretion, may require Tenant to obtain security for performance satisfactory to Landlord; (c) Tenant shall deliver to Landlord "as built" drawings (in CAD format, if requested by Landlord), completion affidavits, full and final lien waivers, and all governmental approvals; and (d) Tenant shall pay Landlord upon demand (i) Landlord's reasonable out-of-pocket expenses incurred in reviewing the work, and (ii) a coordination fee equal to 10% of the cost of the work; provided, however, that this clause (d) shall not apply to any Tenant Improvements.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.3 **<u>Tenant Work</u>.** Before beginning any repair or Alteration or any work affecting Lines (collectively, "**Tenant Work**"), Tenant shall deliver to Landlord, and obtain Landlord's approval of, (a) names of contractors, subcontractors, mechanics, laborers and materialmen; (b) evidence of contractors' and subcontractors' insurance; and (c) any required governmental permits. Tenant shall perform all Tenant Work (i) in a good and workmanlike manner using materials of a quality reasonably approved by Landlord; (ii) in compliance with any approved plans and specifications, all Laws, the National Electric Code, and Landlord's construction rules and regulations; and (iii) in a manner that does not impair the Base Building. If, as a result of any Tenant Work, Landlord becomes required under Law to perform any inspection, give any notice, or cause such Tenant Work to be performed in any particular manner, Tenant shall comply with such requirement and promptly provide Landlord with reasonable documentation of such compliance. Landlord's approval of Tenant's plans and specifications shall not relieve Tenant from any obligation under this <u>Section 7.3</u>. In performing any Tenant Work, Tenant shall not use contractors, services, labor, materials or equipment that, in Landlord's reasonable judgment, would disturb labor harmony with any workforce or trades engaged in performing other work or services at the Project.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.4 **<u>Tenant Security System</u>.** Any security system for the Premises ("**Tenant Security System**") shall be deemed a trade fixture and shall be subject to all provisions of this Lease applicable to trade fixtures. Landlord shall not withhold its consent, pursuant to <u>Section 7.2</u>, to Tenant's installation of an Alteration consisting of the installation of a Tenant Security System; provided, however, that Landlord impose reasonable conditions upon such consent. (For the avoidance of doubt, such Tenant Security System may include a card-key security system and video surveillance cameras at points of entry to the Premises, but Landlord may condition its approval of any surveillance cameras upon Tenant's posting of notices disclosing that such cameras are not being monitored by Landlord.) Any such Alteration shall be deemed a trade fixture and shall be subject to all provisions of this Lease applicable to trade fixtures. Tenant shall provide Landlord with such access cards, keys, code information and other materials and information as may be necessary for Landlord to access the Premises. If Landlord reasonably determines that such Tenant Security System adversely affects the Premises, the Base Building, the Building, or any other occupants of the Building, then, within a reasonable time after Landlord's written request, Tenant shall make reasonable changes to eliminate such adverse effect.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.5 **<u>Night Drop Box</u>.** Landlord shall not withhold its consent, pursuant to <u>Section 7.2</u>, to Tenant's installation of an Alteration consisting of a night drop box on left side of the entrance to the Premises (as viewed from immediately outside such entrance); provided, however, that Landlord impose reasonable conditions upon such consent. Any such Alteration shall be deemed a Tenant-Insured Improvement and shall be subject to all provisions of this Lease applicable to Tenant-Insured Improvements. Tenant, at its expense, shall keep and maintain the night drop box in good condition and shall keep the night drop box and surrounding area free of all trash or waste materials introduced by Tenant or its employees, agents, contractors or visitors. For the avoidance of doubt, when removing the night drop box at the expiration or earlier termination hereof, Tenant shall repair any damage caused by its installation, use or removal, including by patching any holes to match, as closely as possible, the color surrounding the area where the equipment and appurtenances were attached.

**8 LANDLORD'S PROPERTY.** All Leasehold Improvements shall become Landlord's property upon installation and without compensation to Tenant. Notwithstanding the foregoing, if any Tenant-Insured Improvements (other than any Unit, which shall be governed by <u>Section 25.5</u>) are not, in Landlord's reasonable judgment, Building-standard, then before the expiration or earlier termination hereof, Tenant shall, at Landlord's election, either (a) at Tenant's expense, and except as otherwise notified by Landlord, remove such Tenant-Insured Improvements, repair any resulting damage to the Premises or Building, and restore the affected portion of the Premises to its configuration and condition existing before the installation of such Tenant-Insured Improvements (or, at Landlord's election, to a Building-standard tenant-improved configuration and condition as determined by Landlord), or (b) pay Landlord an amount equal to the estimated cost of such work, as reasonably determined by Landlord. If Tenant fails to timely perform any work required under clause (a) of the preceding sentence, Landlord may perform such work at Tenant's expense.

**9 LIENS.** Tenant shall keep the Project free from any lien arising out of any work performed, material furnished or obligation incurred by or on behalf of Tenant. Tenant shall remove any such lien within 10 business days after notice from Landlord, and if Tenant fails to do so, Landlord, without limiting its remedies, may pay the amount necessary to cause such removal, whether or not such lien is valid. The amount so paid, together with reasonable attorneys' fees and expenses, shall be reimbursed by Tenant upon demand.

---

| | |
|:---|:---|
| **10** | **INDEMNIFICATION; INSURANCE.** |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.1 **<u>Waiver and Indemnification</u>.** Tenant waives all claims against Landlord, its Security Holders (defined in <u>Section 17</u>), Landlord's managing agent(s), their (direct or indirect) owners, and the beneficiaries, trustees, officers, directors, employees and agents of each of the foregoing (including Landlord, the "**Landlord Parties**") for any failure to prevent or control any criminal or otherwise wrongful conduct by any third party not acting as Landlord's agent or to apprehend any such third party who has engaged in such conduct. Tenant shall indemnify, defend, protect, and hold the Landlord Parties harmless from any obligation, loss, claim, action, liability, penalty, damage, cost or expense (including reasonable attorneys' and consultants' fees and expenses) (each, a "**Claim**") that is imposed or asserted by any third party and arises from (a) any cause in, on or about the Premises, or (b) any negligence, willful misconduct or breach of this Lease of or by Tenant, any party claiming by, through or under Tenant, their (direct or indirect) owners, or any of their respective beneficiaries, trustees, officers, directors, employees, agents, contractors, licensees or invitees (each, an "**Act of Tenant**"), except to the extent such Claim arises from gross negligence, willful misconduct or breach of this Lease of or by any Landlord Party. Landlord shall indemnify, defend, protect, and hold Tenant, its (direct or indirect) owners, and their respective beneficiaries, trustees, officers, directors, employees and agents harmless from any Claim that is imposed or asserted by any third party and arises from any negligence, willful misconduct or breach of this Lease of or by any Landlord Party, except to the extent such Claim arises from any Act of Tenant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.2 **<u>Tenant's Insurance</u>.** Tenant shall maintain the following coverages in the following amounts:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.2.1 Commercial General Liability Insurance covering claims of bodily injury, personal injury and property damage arising out of Tenant's operations and contractual liabilities, including coverage formerly known as broad form, on an occurrence basis, with combined primary and excess/umbrella limits of at least $3,000,000 each occurrence and $4,000,000 annual aggregate.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.2.2 Property Insurance covering (i) all office furniture, trade fixtures, office equipment, free-standing cabinet work, movable partitions, merchandise and all other items of Tenant's property in the Premises installed by, for, or at the expense of Tenant, and (ii) any Leasehold Improvements installed by or for the benefit of Tenant, whether pursuant to this Lease or pursuant to any prior lease or other agreement to which Tenant was a party ("**Tenant-Insured Improvements**"). Such insurance shall be written on a special cause of loss or all risk form for physical loss or damage, for the full replacement cost value (subject to reasonable deductible amounts) new without deduction for depreciation of the covered items and in amounts that meet any co-insurance clauses of the policies of insurance, and shall include coverage for damage or other loss caused by fire or other peril, including vandalism and malicious mischief, theft, water damage of any type, including sprinkler leakage, bursting or stoppage of pipes, and explosion, and providing business interruption coverage for a period of one year.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.2.3 Workers' Compensation statutory limits and Employers' Liability limits of $1,000,000.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.3 **<u>Form of Policies</u>.** The minimum limits of insurance required to be carried by Tenant shall not limit Tenant's liability. Such insurance shall be issued by an insurance company that has an A.M. Best rating of not less than A-VIII. Tenant's Commercial General Liability Insurance shall (a) name the Landlord Parties and any other party designated by Landlord ("**Additional Insured Parties**") as additional insureds; and (b) be primary insurance as to all claims thereunder and provide that any insurance carried by Landlord is excess and non-contributing with Tenant's insurance. Landlord shall be designated as a loss payee with respect to Tenant's Property Insurance on any Tenant-Insured Improvements. Tenant shall deliver to Landlord, on or before the Commencement Date and at least 15 days before the expiration dates thereof, certificates from Tenant's insurance company on the forms currently designated "ACORD 25" (Certificate of Liability Insurance) and "ACORD 28" (Evidence of Commercial Property Insurance) or the equivalent. Attached to the ACORD 25 (or equivalent) there shall be an endorsement (or an excerpt from the policy) naming the Additional Insured Parties as additional insureds, and attached to the ACORD 28 (or equivalent) there shall be an endorsement (or an excerpt from the policy) designating Landlord as a loss payee with respect to Tenant's Property Insurance on any Tenant-Insured Improvements, and each such endorsement (or policy excerpt) shall be binding on Tenant's insurance company.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.4 **<u>Subrogation</u>.** Each party waives, and shall cause its insurance carrier to waive, any right of recovery against the other party, any of its (direct or indirect) owners, or any of their respective beneficiaries, trustees, officers, directors, employees or agents for any loss of or damage to property which loss or damage is (or, if the insurance required hereunder had been carried, would have been) covered by the waiving party's property insurance. For purposes of this <u>Section 10.4</u> only, (a) any deductible with respect to a party's insurance shall be deemed covered by, and recoverable by such party under, valid and collectable policies of insurance, and (b) any contractor retained by Landlord to install, maintain or monitor a fire or security alarm for the Building shall be deemed an agent of Landlord.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.5 **<u>Additional Insurance Obligations</u>.** Tenant shall maintain such increased amounts of the insurance required to be carried by Tenant under this <u>Section 10</u>, and such other types and amounts of insurance covering the Premises and Tenant's operations therein, as may be reasonably requested by Landlord, but not in excess of the amounts and types of insurance then being required by landlords of Comparable Buildings.

**11 CASUALTY DAMAGE.** With reasonable promptness after discovering any damage to the Premises (other than trade fixtures), or to any Common Area or portion of the Base Building necessary for access to or tenantability of the Premises, resulting from any fire or other casualty (a "**Casualty**"), Landlord shall notify Tenant of Landlord's reasonable estimate of the time required to substantially complete repair of such damage (the "**Landlord Repairs**"). If, according to such estimate, the Landlord Repairs cannot be substantially completed within 180 days after they are commenced, either party may terminate this Lease upon 60 days' notice to the other party delivered within 10 days after Landlord's delivery of such estimate. Within 90 days after discovering any damage to the Project resulting from any Casualty, Landlord may, whether or not the Premises are affected, terminate this Lease by notifying Tenant if (i) any Security Holder terminates any ground lease or requires that any insurance proceeds be used to pay any mortgage debt; (ii) any damage to Landlord's property is not fully covered by Landlord's insurance policies; (iii) Landlord decides to rebuild the Building or Common Areas so that it or they will be substantially different structurally or architecturally; (iv) the damage occurs during the last 12 months of the Term; or (v) any owner, other than Landlord, of any damaged portion of the Project does not intend to repair such damage. If this Lease is not terminated pursuant to this <u>Section 11</u>, Landlord shall promptly and diligently perform the Landlord Repairs, subject to reasonable delays for insurance adjustment and other events of Force Majeure. The Landlord Repairs shall restore the Premises (other than trade fixtures) and any Common Area or portion of the Base Building necessary for access to or tenantability of the Premises to substantially the same condition that existed when the Casualty occurred, except for (a) any modifications required by Law or any Security Holder, and (b) any modifications to the Common Areas that are deemed desirable by Landlord, are consistent with the character of the Project, and do not materially impair access to or tenantability of the Premises. Notwithstanding <u>Section 10.4</u>, Tenant shall assign to Landlord (or its designee) all insurance proceeds payable to Tenant under Tenant's insurance required under <u>Section 10.2</u> with respect to any Tenant-Insured Improvements, and if the estimated or actual cost of restoring any Tenant-Insured Improvements exceeds the insurance proceeds received by Landlord from Tenant's insurance carrier, Tenant shall pay such excess to Landlord within 15 days after Landlord's demand. No Casualty and no restoration performed as required hereunder shall render Landlord liable to Tenant, constitute a constructive eviction, or excuse Tenant from any obligation hereunder; provided, however, that if the Premises (other than trade fixtures) or any Common Area or portion of the Base Building necessary for access to or tenantability of the Premises is damaged by a Casualty, then, during any time that, as a result of such damage, any portion of the Premises is inaccessible or untenantable and is not occupied by Tenant, Monthly Rent shall be abated in proportion to the rentable square footage of such portion of the Premises.

**12 NONWAIVER.** No provision hereof shall be deemed waived by either party unless it is waived by such party expressly and in writing, and no waiver of any breach of any provision hereof shall be deemed a waiver of any subsequent breach of such provision or any other provision hereof. Landlord's acceptance of Rent shall not be deemed a waiver of any preceding breach of any provision hereof, other than Tenant's failure to pay the particular Rent so accepted, regardless of Landlord's knowledge of such preceding breach at the time of such acceptance. No acceptance of payment of an amount less than the Rent due hereunder shall be deemed a waiver of Landlord's right to receive the full amount of Rent due, whether or not any endorsement or statement accompanying such payment purports to effect an accord and satisfaction. No receipt of monies by Landlord from Tenant after the giving of any notice, the commencement of any suit, the issuance of any final judgment, or the termination hereof shall affect such notice, suit or judgment, or reinstate or extend the Term or Tenant's right of possession hereunder.

**13 CONDEMNATION.** If any part of the Premises, Building or Project is taken for any public or quasi-public use by power of eminent domain or by private purchase in lieu thereof (a "**Taking**") for more than 120 consecutive days, Landlord may terminate this Lease. If more than 25% of the rentable square footage of the Premises, or any Common Area or portion of the Base Building necessary for access to or tenantability of the Premises, is Taken for more than 120 consecutive days, Tenant may terminate this Lease. Any such termination shall be effective as of the date possession must be surrendered to the authority, and the terminating party shall provide termination notice to the other party within 45 days after receiving written notice of such surrender date. Except as provided above in this <u>Section 13</u>, neither party may terminate this Lease as a result of a Taking. Tenant shall not assert, and hereby assigns to Landlord, any claim it may have for compensation because of any Taking; provided, however, that Tenant may file a separate claim for any Taking of Tenant's personal property or any trade fixtures that Tenant is entitled to remove upon the expiration hereof, and for moving expenses, so long as such claim does not diminish the award available to Landlord or any Security Holder and is payable separately to Tenant. If this Lease is terminated pursuant to this <u>Section 13</u>, all Rent shall be apportioned as of the date of such termination. If a Taking occurs and this Lease is not so terminated, Monthly Rent shall be abated for the period of such Taking in proportion to the percentage of the rentable square footage of the Premises, if any, that is subject to, or rendered inaccessible or untenantable by, such Taking and not occupied by Tenant.

---

| | |
|:---|:---|
| **14** | **ASSIGNMENT AND SUBLETTING.** |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.1 **<u>Transfers</u>.** Tenant shall not, without Landlord's prior consent, assign, mortgage, pledge, hypothecate, encumber, permit any lien to attach to, or otherwise transfer this Lease or any interest hereunder, permit any assignment or other transfer hereof or any interest hereunder by operation of law, enter into any sublease or license agreement, otherwise permit the occupancy or use of any part of the Premises by any persons other than Tenant and its employees and contractors, or permit a Change of Control (defined in <u>Section 14.6</u>) to occur (each, a "**Transfer**"). If Tenant desires Landlord's consent to any Transfer, Tenant shall provide Landlord with (i) notice of the terms of the proposed Transfer, including its proposed effective date (the "**Contemplated Effective Date**"), a description of the portion of the Premises to be transferred (the "**Contemplated Transfer Space**"), a calculation of the Transfer Premium (defined in <u>Section 14.3</u>), and a copy of all existing executed and/or proposed documentation pertaining to the proposed Transfer, and (ii) current financial statements of the proposed transferee (or, in the case of a Change of Control, of the proposed new controlling party(ies)) certified by an officer or owner thereof and any other information reasonably required by Landlord in order to evaluate the proposed Transfer (collectively, the "**Transfer Notice**"). Within 30 days after receiving the Transfer Notice, Landlord shall notify Tenant of (a) its consent to the proposed Transfer, (b) its refusal to consent to the proposed Transfer, or (c) its exercise of its rights under <u>Section 14.4</u>. Any Transfer made without Landlord's prior consent shall, at Landlord's option, be void and shall, at Landlord's option, constitute a Default. Tenant shall pay Landlord a fee of $1,500.00 for Landlord's review of any proposed Transfer, whether or not Landlord consents to it.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.2 **<u>Landlord's Consent</u>.** Subject to <u>Section 14.4</u>, Landlord shall not unreasonably withhold its consent to any proposed Transfer. Without limiting other reasonable grounds for withholding consent, it shall be deemed reasonable for Landlord to withhold its consent to a proposed Transfer if:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.2.1 The proposed transferee is not a party of reasonable financial strength in light of the responsibilities to be undertaken in connection with the Transfer on the date the Transfer Notice is received; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.2.2 The proposed transferee has a character or reputation or is engaged in a business that is not consistent with the quality of the Building or the Project; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.2.3 The proposed transferee is a governmental entity or a nonprofit organization; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.2.4 In the case of a proposed sublease, license or other occupancy agreement, the rent or occupancy fee charged by Tenant to the transferee during the term of such agreement, calculated using a present value analysis, is less than 95% of the rent being quoted by Landlord or its Affiliate (defined in <u>Section 14.6</u>) at the time of such Transfer for comparable space in the Project for a comparable term, calculated using a present value analysis; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.2.5 The proposed transferee or any of its Affiliates, on the date the Transfer Notice is received, leases or occupies (or, at any time during the 6-month period ending on the date the Transfer Notice is received, has negotiated with Landlord to lease) space in the Project.

Notwithstanding any contrary provision hereof, (a) if Landlord consents to any Transfer pursuant to this <u>Section 14.2</u> but Tenant does not enter into such Transfer within six (6) months thereafter, such consent shall no longer apply and such Transfer shall not be permitted unless Tenant again obtains Landlord's consent thereto pursuant and subject to the terms of this <u>Section 14</u>; and (b) if Landlord withholds its consent in breach of this <u>Section 14.2</u>, Tenant's sole remedies shall be contract damages (subject to <u>Section 20</u>) or specific performance, and Tenant waives all other remedies, including any right to terminate this Lease.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.3 **<u>Transfer Premium</u>.** If Landlord consents to a Transfer (other than a Change of Control), Tenant shall pay Landlord an amount equal to 50% of any Transfer Premium (defined below). As used herein, "**Transfer Premium**" means (a) in the case of an assignment, any consideration (including payment for Leasehold Improvements) paid by the assignee for such assignment, and (b) in the case of a sublease, license or other occupancy agreement, for each month of the term of such agreement, the amount by which all rent and other consideration paid by the transferee to Tenant pursuant to such agreement exceeds the Monthly Rent payable by Tenant hereunder with respect to the Contemplated Transfer Space. Payment of Landlord's share of the Transfer Premium shall be made (x) in the case of an assignment, within 10 days after Tenant receives the consideration described above, and (y) in the case of a sublease, license or other occupancy agreement, for each month of the term of such agreement, within five (5) business days after Tenant receives the rent and other consideration described above.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.4 **<u>Landlord's Right to Recapture</u>.** Notwithstanding any contrary provision hereof, except in the case of a Permitted Transfer (defined in <u>Section 14.8</u>), Landlord, by notifying Tenant within 30 days after receiving the Transfer Notice, may terminate this Lease with respect to the Contemplated Transfer Space as of the Contemplated Effective Date. If the Contemplated Transfer Space is less than the entire Premises, then Base Rent, Tenant's Share, and the number of parking spaces to which Tenant is entitled under <u>Section 1.9</u> shall be deemed adjusted on the basis of the percentage of the rentable square footage of the portion of the Premises retained by Tenant. Upon request of either party, the parties shall execute a written agreement prepared by Landlord memorializing such termination.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.5 **<u>Effect of Consent</u>.** If Landlord consents to a Transfer, (i) such consent shall not be deemed a consent to any further Transfer, (ii) Tenant shall deliver to Landlord, promptly after execution, an executed copy of all documentation pertaining to the Transfer in form reasonably acceptable to Landlord, and (iii) Tenant shall deliver to Landlord, upon Landlord's request, a complete statement, certified by an independent CPA or Tenant's chief financial officer, setting forth in detail the computation of any Transfer Premium. In the case of an assignment, the assignee shall assume in writing, for Landlord's benefit, all of Tenant's obligations hereunder. No Transfer, with or without Landlord's consent, shall relieve Tenant or any guarantor hereof from any liability hereunder. Notwithstanding any contrary provision hereof, Tenant, with or without Landlord's consent, shall not enter into, or permit any party claiming by, through or under Tenant to enter into, any sublease, license or other occupancy agreement that provides for payment based in whole or in part on the net income or profit of the subtenant, licensee or other occupant thereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.6 **<u>Change of Control</u>.** As used herein, "**Change of Control**" means (a) if Tenant is a closely held professional service firm, the withdrawal or change (whether voluntary, involuntary or by operation of law) of more than 25% of its equity owners within a 12-month period; and (b) in all other cases, any transaction(s) resulting in the acquisition of a Controlling Interest (defined below) in Tenant by one or more parties that neither owned, nor are Affiliates (defined below) of one or more parties that owned, a Controlling Interest in Tenant immediately before such transaction(s). As used herein, "**Controlling Interest**" means control over an entity, other than control arising from the ownership of voting securities listed on a recognized securities exchange. As used herein, "**control**" means the direct or indirect power to direct the ordinary management and policies of an entity, whether through the ownership of voting securities, by contract or otherwise. As used herein, "**Affiliate**" means, with respect to any party, a person or entity that controls, is under common control with, or is controlled by such party. (For the avoidance of doubt, Landlord acknowledges that, by operation of the definitions of "Transfer," "Change of Control" and "Controlling Interest," no stock of Tenant listed on a recognized securities exchange shall be deemed a Controlling Interest, and, therefore, no issuance of Tenant's stock in an offering or sale on a recognized securities exchange shall be deemed a Change of Control or a Transfer.)

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.7 **<u>Effect of Default</u>.** If Tenant is in Default, Landlord is irrevocably authorized, as Tenant's agent and attorney-in-fact, to direct any transferee under any sublease, license or other occupancy agreement to make all payments under such agreement directly to Landlord (which Landlord shall apply towards Tenant's obligations hereunder) until such Default is cured. Such transferee shall rely upon any representation by Landlord that Tenant is in Default, whether or not confirmed by Tenant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.8 **<u>Permitted Transfers</u>.** Notwithstanding any contrary provision hereof, if Tenant is not in Default, Tenant may, without Landlord's consent pursuant to <u>Section 14.1</u>, assign this Lease (a) other than pursuant to a merger or consolidation, to an Affiliate of Tenant (including any Affiliate of Tenant consisting of Tenant's New Bank), (b) to a successor to Tenant by merger or consolidation (including any such successor consisting of Tenant's New Bank), or (c) to a successor to Tenant by purchase of all or substantially all of Tenant's assets (including any such successor consisting of Tenant's New Bank), or permit the occurrence of a Change of Control in favor of Tenant's New Bank (a "**Permitted Transfer**"), provided that (i) at least 10 business days before the Transfer, Tenant notifies Landlord of the Transfer and delivers to Landlord any documents or information reasonably requested by Landlord relating thereto, including reasonable documentation that the Transfer satisfies the requirements of this <u>Section 14.8</u>; (ii) in the case of an assignment pursuant to clause (a) or (c) above, the assignee executes and delivers to Landlord, at least 10 business days before the assignment, a commercially reasonable instrument pursuant to which the assignee assumes, for Landlord's benefit, all of Tenant's obligations hereunder; (iii) in the case of an assignment pursuant to clause (b) above, (A) the successor entity has a net worth (as determined in accordance with GAAP, but excluding intellectual property and any other intangible assets ("**Net Worth**")) immediately after the Transfer that is not less than Tenant's Net Worth immediately before the Transfer, and (B) if Tenant is a closely held professional service firm, at least 75% of its equity owners existing 12 months before the Transfer are also equity owners of the successor entity; (iv) the transferee is qualified to conduct business in the State of California; and (v) the Transfer is made for a good faith operating business purpose and not in order to evade the requirements of this <u>Section 14</u>.

**15 SURRENDER.** Upon the expiration or earlier termination hereof, and subject to <u>Sections 8</u> and <u>11</u> and this <u>Section 15</u>, Tenant shall surrender possession of the Premises to Landlord in as good condition and repair as existed when Tenant took possession and as thereafter improved, except for reasonable wear and tear and repairs that are Landlord's express responsibility hereunder. Before such expiration or termination, Tenant, without expense to Landlord, shall (a) remove from the Premises all debris and rubbish and all furniture, equipment, trade fixtures, Lines, free-standing cabinet work, movable partitions and other articles of personal property that are owned or placed in the Premises by Tenant or any party claiming by, through or under Tenant (except for any Lines not required to be removed under <u>Section 23</u>), and (b) repair all damage to the Premises and Building resulting from such removal. If Tenant fails to timely perform such removal and repair, Landlord may do so at Tenant's expense (including storage costs). If Tenant fails to remove such property from the Premises, or from storage, within 30 days after notice from Landlord, any part of such property shall be deemed, at Landlord's option, either (x) conveyed to Landlord without compensation, or (y) abandoned.

**16 HOLDOVER.** If Tenant fails to surrender the Premises upon the expiration or earlier termination hereof, Tenant's tenancy shall be subject to the terms and conditions hereof; provided, however, that such tenancy shall be a tenancy at sufferance only, for the entire Premises, and Tenant shall pay Monthly Rent (on a per-month basis without reduction for any partial month) at a rate equal to 150% of the Monthly Rent applicable during the last calendar month of the Term. Nothing in this <u>Section 16</u> shall limit Landlord's rights or remedies or be deemed a consent to any holdover. If Landlord is unable to deliver possession of the Premises to, or perform improvements for, a new tenant as a result of Tenant's holdover, Tenant shall be liable for all resulting damages, including lost profits, incurred by Landlord.

**17 SUBORDINATION; ESTOPPEL CERTIFICATES.** This Lease shall be subject and subordinate to all existing and future ground or underlying leases, mortgages, trust deeds and other encumbrances against the Building or Project, all renewals, extensions, modifications, consolidations and replacements thereof (each, a "**Security Agreement**"), and all advances made upon the security of such mortgages or trust deeds, unless in each case the holder of such Security Agreement (each, a "**Security Holder**") requires in writing that this Lease be superior thereto. Upon any termination or foreclosure (or any delivery of a deed in lieu of foreclosure) of any Security Agreement, Tenant, upon request, shall attorn, without deduction or set-off, to the Security Holder or purchaser or any successor thereto and shall recognize such party as the lessor hereunder provided that such party agrees not to disturb Tenant's occupancy so long as Tenant timely pays the Rent and otherwise performs its obligations hereunder. Within 10 business days after Landlord's request, Tenant shall execute such further instruments as Landlord may reasonably deem necessary to evidence the subordination or superiority of this Lease to any Security Agreement. Tenant waives any right it may have under Law to terminate or otherwise adversely affect this Lease or Tenant's obligations hereunder upon a foreclosure. Within 10 business days after Landlord's request, Tenant shall execute and deliver to Landlord a commercially reasonable estoppel certificate in favor of such parties as Landlord may reasonably designate, including current and prospective Security Holders and prospective purchasers.

**18 ENTRY BY LANDLORD.** At all reasonable times and upon reasonable notice to Tenant, or in an emergency, Landlord may enter the Premises to (i) inspect the Premises; (ii) show the Premises to prospective purchasers, current or prospective Security Holders or insurers, or, during the last 12 months of the Term (or while an uncured Default exists), prospective tenants; (iii) post notices of non-responsibility; or (iv) perform maintenance, repairs or alterations. At any time and without notice to Tenant, Landlord may enter the Premises to perform required services. If reasonably necessary, Landlord may temporarily close any portion of the Premises to perform maintenance, repairs or alterations. In an emergency, Landlord may use any means it deems proper to open doors to and in the Premises. No entry into or closure of any portion of the Premises pursuant to this <u>Section 18</u> shall render Landlord liable to Tenant, constitute a constructive eviction, or excuse Tenant from any obligation hereunder.

**19 DEFAULTS; REMEDIES.**

19.1 **<u>Events of Default</u>.** The occurrence of any of the following shall constitute a "**Default**":

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;19.1.1 Any failure by Tenant to pay any Rent (or deliver any security deposit, letter of credit, or similar credit enhancement required hereunder) when due unless such failure is cured within five (5) business days after notice; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;19.1.2 Except where a specific time period is otherwise set forth for Tenant's cure herein (in which event Tenant's failure to cure within such time period shall be a Default), and except as otherwise provided in this <u>Section 19.1</u>, any breach by Tenant of any other provision hereof where such breach continues for 30 days after notice from Landlord; provided that if such breach cannot reasonably be cured within such 30-day period, Tenant shall not be in Default as a result of such breach if Tenant diligently commences such cure within such period, thereafter diligently pursues such cure, and completes such cure within 60 days after Landlord's notice; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;19.1.3 Abandonment or vacation of all or a substantial portion of the Premises by Tenant; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;19.1.4 Any breach by Tenant of <u>Section 17</u> or <u>18</u> where such breach continues for more than two (2) business days after notice from Landlord; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;19.1.5 Tenant becomes in breach of <u>Section 25.3(c)</u> or <u>(d)</u>.

If Tenant breaches a particular provision hereof (other than a provision requiring payment of Rent) on three (3) separate occasions during any 12-month period, Tenant's subsequent breach of such provision shall be, at Landlord's option, an incurable Default. The notice periods provided herein are in lieu of, and not in addition to, any notice periods provided by Law, and Landlord shall not be required to give any additional notice in order to be entitled to commence an unlawful detainer proceeding.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;19.2 **<u>Remedies Upon Default</u>.** Upon any Default, Landlord shall have, in addition to any other remedies available to Landlord at law or in equity (which shall be cumulative and nonexclusive), the option to pursue any one or more of the following remedies (which shall be cumulative and nonexclusive) without any notice or demand:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;19.2.1 Landlord may terminate this Lease, in which event Tenant shall immediately surrender the Premises to Landlord, and if Tenant fails to do so, Landlord may, without prejudice to any other remedy it may have for possession or arrearages in Rent, enter upon and take possession of the Premises and expel or remove Tenant and any other person who may be occupying the Premises or any part thereof, without being liable for prosecution or any claim of damages therefor; and Landlord may recover from Tenant the following:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The worth at the time of award of the unpaid Rent which had been earned at the time of such termination; plus

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The worth at the time of award of the amount by which the unpaid Rent which would have been earned after termination until the time of award exceeds the amount of such rental loss that Tenant proves could have been reasonably avoided; plus

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) The worth at the time of award of the amount by which the unpaid Rent for the balance of the Term after the time of award exceeds the amount of such Rent loss that Tenant proves could be reasonably avoided; plus

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Any other amount necessary to compensate Landlord for all the detriment proximately caused by Tenant's failure to perform its obligations hereunder or which in the ordinary course of things would be likely to result therefrom, including brokerage commissions, advertising expenses, expenses of remodeling any portion of the Premises for a new tenant (whether for the same or a different use), and any special concessions made to obtain a new tenant; plus

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) At Landlord's option, such other amounts in addition to or in lieu of the foregoing as may be permitted from time to time by Law.

As used in <u>Sections 19.2.1(a)</u> and <u>(b)</u>, the "**worth at the time of award**" shall be computed by allowing interest at a rate per annum equal to the lesser of (i) the annual "Bank Prime Loan" rate cited in the Federal Reserve Statistical Release Publication G.13(415), published on the first Tuesday of each calendar month (or such other comparable index as Landlord shall reasonably designate if such rate ceases to be published) plus two (2) percentage points, or (ii) the highest rate permitted by Law. As used in <u>Section 19.2.1(c)</u>, the "**worth at the time of award**" shall be computed by discounting such amount at the discount rate of the Federal Reserve Bank of San Francisco at the time of award plus 1%.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;19.2.2 Landlord shall have the remedy described in California Civil Code § 1951.4 (lessor may continue lease in effect after lessee's breach and abandonment and recover Rent as it becomes due, if lessee has the right to sublet or assign, subject only to reasonable limitations). Accordingly, if Landlord does not elect to terminate this Lease on account of any default by Tenant, Landlord may, from time to time, without terminating this Lease, enforce all of its rights and remedies hereunder, including the right to recover all Rent as it becomes due.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;19.2.3 Landlord shall at all times have the rights and remedies (which shall be cumulative with each other and cumulative and in addition to those rights and remedies available under <u>Sections 19.2.1</u> and <u>19.2.2</u>, or any Law or other provision hereof), without prior demand or notice except as required by Law, to seek any declaratory, injunctive or other equitable relief, and specifically enforce this Lease, or restrain or enjoin a violation or breach of any provision hereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;19.3 **<u>Efforts to Relet</u>.** Unless Landlord provides Tenant with express notice to the contrary, no re-entry, repossession, repair, maintenance, change, alteration, addition, reletting, appointment of a receiver or other action or omission by Landlord shall (a) be construed as an election by Landlord to terminate this Lease or Tenant's right to possession, or to accept a surrender of the Premises, or (b) operate to release Tenant from any of its obligations hereunder. Tenant waives, for Tenant and for all those claiming by, through or under Tenant, California Civil Code § 3275, California Code of Civil Procedure §§ 1174(c) and 1179, and any existing or future rights to redeem or reinstate, by order or judgment of any court or by any legal process or writ, this Lease or Tenant's right of occupancy of the Premises after any termination hereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;19.4 **<u>Landlord Default</u>.** Landlord shall not be in default hereunder unless it fails to begin within 30 days after notice from Tenant, or fails to pursue with reasonable diligence thereafter, the cure of any breach by Landlord of its obligations hereunder. Before exercising any remedies for a default by Landlord, Tenant shall give notice and a reasonable time to cure to any Security Holder of which Tenant has been notified.

**20 LANDLORD EXCULPATION.** Notwithstanding any contrary provision hereof, (a) the liability of the Landlord Parties to Tenant shall be limited to an amount equal to Landlord's interest in the Building; (b) Tenant shall look solely to Landlord's interest in the Building for the recovery of any judgment or award against any Landlord Party; (c) no Landlord Party shall have any personal liability for any judgment or deficiency, and Tenant waives and releases such personal liability on behalf of itself and all parties claiming by, through or under Tenant; and (d) no Landlord Party shall be liable for any loss of profits, loss of rents or other revenues, loss of business opportunity, loss of goodwill or loss of use, or for any form of special or consequential damage. For purposes of this <u>Section 20</u>, "Landlord's interest in the Building" shall include rents paid by tenants, insurance proceeds, condemnation proceeds, and proceeds from the sale of the Building (collectively, "**Owner Proceeds**"); provided, however, that Tenant shall not be entitled to recover Owner Proceeds from any Landlord Party (other than Landlord) or any other third party after they have been distributed or paid to such party; provided further, however, that nothing in this sentence shall diminish any right Tenant may have under Law, as a creditor of Landlord, to initiate or participate in an action to recover Owner Proceeds from a third party on the grounds that such third party obtained such Owner Proceeds when Landlord was, or could reasonably be expected to become, insolvent or in a transfer that was preferential or fraudulent as to Landlord's creditors.

**21 SECURITY DEPOSIT.** Concurrently with its execution and delivery hereof, Tenant shall deposit with Landlord the Security Deposit, if any, as security for Tenant's performance of its obligations hereunder. If Tenant breaches any provision hereof, Landlord may, at its option, without limiting its remedies and without notice to Tenant, apply all or part of the Security Deposit to cure such breach and compensate Landlord for any loss or damage caused by such breach, including any damage for which recovery may be made under California Civil Code § 1951.2. If Landlord so applies any portion of the Security Deposit, Tenant, within three (3) days after demand therefor, shall restore the Security Deposit to its original amount. The Security Deposit is not an advance payment of Rent or measure of damages. Any unapplied portion of the Security Deposit shall be returned to Tenant within 60 days after the latest to occur of (a) the expiration of the Term, (b) Tenant's surrender of the Premises as required hereunder, or (c) determination of the final Rent due from Tenant. Landlord shall not be required to keep the Security Deposit separate from its other accounts.

---

| | |
|:---|:---|
| **22** | [Intentionally Omitted.] |

---

**23 COMMUNICATIONS AND COMPUTER LINES.** All Lines installed pursuant to this Lease shall be (a) installed in accordance with <u>Section 7</u>; and (b) clearly marked with adhesive plastic labels (or plastic tags attached to such Lines with wire) to show Tenant's name, suite number, and the purpose of such Lines (i) every six (6) feet outside the Premises (including the electrical room risers and any Common Areas), and (ii) at their termination points. Landlord may designate specific contractors for work relating to vertical Lines. Sufficient spare cables and space for additional cables shall be maintained for other occupants, as reasonably determined by Landlord. Unless otherwise notified by Landlord, Tenant, at its expense and before the expiration or earlier termination hereof, shall remove all Lines and repair any resulting damage. As used herein, "**Lines**" means all communications or computer wires and cables serving the Premises, whenever and by whomever installed or paid for, including any such wires or cables installed pursuant to any prior lease.

**24 PARKING.** Tenant may park in the Building's parking facilities (the "**Parking Facility**"), in common with other tenants of the Building, upon the following terms and conditions. Tenant shall not use more than the number of unreserved and/or reserved parking spaces set forth in <u>Section 1.9</u>. Tenant shall pay Landlord, in accordance with <u>Section 3</u>, any fees for the parking spaces described in <u>Section 1.9</u>. Tenant shall pay Landlord any fees, taxes or other charges imposed by any governmental or quasi-governmental agency in connection with the Parking Facility, to the extent such amounts are allocated to Tenant by Landlord based on the number and type of parking spaces Tenant is entitled to use. Tenant shall comply with all rules and regulations established by Landlord from time to time for the orderly operation and use of the Parking Facility, including any sticker or other identification system and the prohibition of vehicle repair and maintenance activities in the Parking Facility. Landlord may, in its discretion, allocate and assign parking passes among Tenant and the other tenants in the Building. Tenant's use of the Parking Facility shall be at Tenant's sole risk, and Landlord shall have no liability for any personal injury or damage to or theft of any vehicles or other property occurring in the Parking Facility or otherwise in connection with any use of the Parking Facility by Tenant or its employees or invitees. Landlord may alter the size, configuration, design, layout or any other aspect of the Parking Facility, and, in connection therewith, temporarily deny or restrict access to the Parking Facility, in each case without abatement of Rent or liability to Tenant. Landlord may delegate its responsibilities hereunder to a parking operator, in which case (i) such parking operator shall have all the rights of control reserved herein by Landlord, (ii) Tenant shall enter into a parking agreement with such parking operator, (iii) Tenant shall pay such parking operator, rather than Landlord, any charge established hereunder for the parking spaces, and (iv) Landlord shall have no liability for claims arising through acts or omissions of such parking operator except to the extent caused by Landlord's any negligence or willful misconduct. Tenant's parking rights under this <u>Section 24</u> are solely for the benefit of Tenant's employees and invitees and such rights may not be transferred without Landlord's prior consent, except pursuant to a Transfer permitted under <u>Section 14</u>.

**25 MISCELLANEOUS.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;25.1 **<u>Notices</u>.** No notice, demand, statement, designation, request, consent, approval, election or other communication given hereunder ("**Notice**") shall be binding upon either party unless (a) it is in writing; (b) it is (i) sent by certified or registered mail, postage prepaid, return receipt requested, (ii) delivered by a nationally recognized courier service, or (iii) delivered personally; and (c) it is sent or delivered to the address set forth in <u>Section 1.10</u> or <u>1.11</u>, as applicable, or to such other place (other than a P.O. box) as the recipient may from time to time designate in a Notice to the other party. Any Notice shall be deemed received on the earlier of the date of actual delivery or the date on which delivery is refused, or, if Tenant is the recipient and has vacated its notice address without providing a new notice address, three (3) days after the date the Notice is deposited in the U.S. mail or with a courier service as described above. No provision of this Lease requiring a particular Notice to be in writing shall limit the generality of clause (a) of the first sentence of this <u>Section 25.1</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;25.2 **<u>Force Majeure</u>.** If either party is prevented from performing any obligation hereunder by any strike, act of God, war, terrorist act, shortage of labor or materials, governmental action, civil commotion or other cause beyond such party's reasonable control ("**Force Majeure**"), such obligation shall be excused during (and any time period for the performance of such obligation shall be extended by) the period of such prevention; provided, however, that this <u>Section 25.2</u> shall not (a) permit Tenant to hold over in the Premises after the expiration or earlier termination hereof, or (b) excuse (or extend any time period for the performance of) (i) any obligation to remit money or deliver credit enhancement, (ii) any obligation under <u>Section 10</u> or <u>25.3</u>, or (iii) any of Tenant's obligations whose breach would interfere with another occupant's use, occupancy or enjoyment of its premises or the Project or result in any liability on the part of any Landlord Party.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;25.3 **<u>Representations and Covenants</u>.** Tenant represents, warrants and covenants that (a) Tenant is, and at all times during the Term will remain, duly organized, validly existing and in good standing under the Laws of the state of its formation and qualified to do business in the state of California; (b) neither Tenant's execution of nor its performance under this Lease will cause Tenant to be in violation of any agreement or Law; (c) Tenant (and any guarantor hereof) has not, and at no time during the Term will have, (i) made a general assignment for the benefit of creditors, (ii) filed a voluntary petition in bankruptcy, (iii) suffered (A) the filing by creditors of an involuntary petition in bankruptcy that is not dismissed within 30 days, (B) the appointment of a receiver to take possession of all or substantially all of its assets, or (C) the attachment or other judicial seizure of all or substantially all of its assets, (iv) admitted in writing its inability to pay its debts as they come due, or (v) made an offer of settlement, extension or composition to its creditors generally; and (d) no party that (other than through the passive ownership of interests traded on a recognized securities exchange) constitutes, owns, controls, or is owned or controlled by Tenant, any guarantor hereof or any subtenant of Tenant is, or at any time during the Term will be, (i) in violation of any Laws relating to terrorism or money laundering, or (ii) among the parties identified on any list compiled pursuant to Executive Order 13224 for the purpose of identifying suspected terrorists or on the most current list published by the U.S. Treasury Department Office of Foreign Assets Control at its official website, http://www.treas.gov/ofac/tllsdn.pdf or any replacement website or other replacement official publication of such list.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;25.4 **<u>Signs</u>.** Landlord shall include Tenant's name in any tenant directory located in the lobby on the first floor of the Building. If any part of the Premises is located on a multi-tenant floor, Landlord, at Tenant's cost, shall provide identifying suite signage for Tenant comparable to that provided by Landlord on similar floors in the Building. Except as provided in <u>Sections 6</u>, 7 and 8 of **<u>Exhibit F</u>**, Tenant may not install (a) any signs outside the Premises, or (b) without Landlord's prior consent in its sole and absolute discretion, any signs, window coverings, blinds or similar items that are visible from outside the Premises.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;25.5 **<u>Supplemental HVAC</u>.** If the Premises are served by any supplemental HVAC unit (a "**Unit**"), then (a) Tenant shall pay the costs of all electricity consumed in the Unit's operation, together with the cost of installing a meter to measure such consumption; (b) Tenant, at its expense, shall (i) operate and maintain the Unit in compliance with all applicable Laws and such reasonable rules and procedures as Landlord may impose; (ii) keep the Unit in as good working order and condition as existed upon installation (or, if later, when Tenant took possession of the Premises), subject to normal wear and tear and damage resulting from Casualty; (iii) maintain in effect, with a contractor reasonably approved by Landlord, a contract for the maintenance and repair of the Unit, which contract shall require the contractor, at least once every three (3) months, to inspect the Unit and provide to Tenant a report of any defective conditions, together with any recommendations for maintenance, repair or parts-replacement; (iv) follow all reasonable recommendations of such contractor; and (v) promptly provide to Landlord a copy of such contract and each report issued thereunder; (c) the Unit shall become Landlord's property upon installation and without compensation to Tenant; provided, however, that upon Landlord's request at the expiration or earlier termination hereof, Tenant, at its expense, shall remove the Unit and repair any resulting damage (and if Tenant fails to timely perform such work, Landlord may do so at Tenant's expense); (d) the Unit shall be deemed (i) a Leasehold Improvement (except for purposes of <u>Section 8</u>), and (ii) for purposes of <u>Section 11</u>, part of the Premises; (e) if the Unit exists on the date of mutual execution and delivery hereof, Tenant accepts the Unit in its "as is" condition, without representation or warranty as to quality, condition, fitness for use or any other matter; (f) if the Unit connects to the Building's condenser water loop (if any), then Tenant shall pay to Landlord, as Additional Rent, Landlord's standard one-time fee for such connection and Landlord's standard monthly per-ton usage fee; and (g) if any portion of the Unit is located on the roof, then (i) Tenant's access to the roof shall be subject to such reasonable rules and procedures as Landlord may impose; (ii) Tenant shall maintain the affected portion of the roof in a clean and orderly condition and shall not interfere with use of the roof by Landlord or any other tenants or licensees; and (iii) Landlord may relocate the Unit and/or temporarily interrupt its operation, without liability to Tenant, as reasonably necessary to maintain and repair the roof or otherwise operate the Building.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;25.6 **<u>Attorneys' Fees</u>.** In any action or proceeding between the parties, including any appellate or alternative dispute resolution proceeding, the prevailing party may recover from the other party all of its costs and expenses in connection therewith, including reasonable attorneys' fees and costs. Tenant shall pay all reasonable attorneys' fees and other fees and costs that Landlord incurs in interpreting or enforcing this Lease or otherwise protecting its rights hereunder (a) where Tenant has failed to pay Rent when due, or (b) in any bankruptcy case, assignment for the benefit of creditors, or other insolvency, liquidation or reorganization proceeding involving Tenant or this Lease.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;25.7 **<u>Brokers</u>.** Tenant represents to Landlord that it has dealt only with Tenant's Broker as its broker in connection with this Lease. Tenant shall indemnify, defend, and hold Landlord harmless from all claims of any brokers, other than Tenant's Broker, claiming to have represented Tenant in connection with this Lease. Landlord shall indemnify, defend and hold Tenant harmless from all claims of any brokers, including Landlord's Broker, claiming to have represented Landlord in connection with this Lease. Tenant acknowledges that any Affiliate of Landlord that is involved in the negotiation of this Lease is representing only Landlord, and that any assistance rendered by any agent or employee of such Affiliate in connection with this Lease or any subsequent amendment or other document related hereto has been or will be rendered as an accommodation to Tenant solely in furtherance of consummating the transaction on behalf of Landlord, and not as agent for Tenant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;25.8 **<u>Governing Law; WAIVER OF TRIAL BY JURY</u>.** This Lease shall be construed and enforced in accordance with the Laws of the State of California. THE PARTIES WAIVE, TO THE FULLEST EXTENT PERMITTED BY LAW, THE RIGHT TO TRIAL BY JURY IN ANY LITIGATION ARISING OUT OF OR RELATING TO THIS LEASE, THE RELATIONSHIP OF LANDLORD AND TENANT, TENANT'S USE OR OCCUPANCY OF THE PREMISES, AND/OR ANY CLAIM FOR INJURY OR DAMAGE OR ANY EMERGENCY OR STATUTORY REMEDY.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;25.9 **<u>Waiver of Statutory Provisions</u>.** Each party waives California Civil Code §§ 1932(2), 1933(4) and 1945. Tenant waives (a) any rights under (i) California Civil Code §§ 1932(1), 1941, 1942, 1950.7 or any similar Law, or (ii) California Code of Civil Procedure §§ 1263.260 or 1265.130; and (b) any right to terminate this Lease under California Civil Code § 1995.310.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;25.10 **<u>Interpretation</u>.** As used herein, the capitalized term "Section" refers to a section hereof unless otherwise specifically provided herein. As used in this Lease, the terms "herein," "hereof," "hereto" and "hereunder" refer to this Lease and the term "include" and its derivatives are not limiting. Any reference herein to "any part" or "any portion" of the Premises, the Property or any other property shall be construed to refer to all or any part of such property. As used herein in connection with insurance, the term "deductible" includes self-insured retention. Wherever this Lease prohibits either party from engaging in any particular conduct, this Lease shall be deemed also to require such party to cause each of its employees and agents (and, in the case of Tenant, each of its licensees, invitees and subtenants, and any other party claiming by, through or under Tenant) to refrain from engaging in such conduct. Wherever this Lease requires Landlord to provide a customary service or to act in a reasonable manner (whether in incurring an expense, establishing a rule or regulation, providing an approval or consent, or performing any other act), this Lease shall be deemed also to provide that whether such service is customary or such conduct is reasonable shall be determined by reference to the practices of owners of buildings ("**Comparable Buildings**") that (i) are comparable to the Building in size, age, class, quality and location, and (ii) at Landlord's option, have been, or are being prepared to be, certified under the U.S. Green Building Council's Leadership in Energy and Environmental Design (LEED) rating system or a similar rating system. Tenant waives the benefit of any rule that a written agreement shall be construed against the drafting party.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;25.11 **<u>Entire Agreement</u>.** This Lease sets forth the entire agreement between the parties relating to the subject matter hereof and supersedes any previous agreements (none of which shall be used to interpret this Lease). Tenant acknowledges that in entering into this Lease it has not relied upon any representation, warranty or statement, whether oral or written, not expressly set forth herein. This Lease can be modified only by a written agreement signed by both parties.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;25.12 **<u>Other</u>.** Landlord, at its option, may cure any Default, without waiving any right or remedy or releasing Tenant from any obligation, in which event Tenant shall pay Landlord, upon demand, the cost of such cure. If any provision hereof is void or unenforceable, no other provision shall be affected. Submission of this instrument for examination or signature by Tenant does not constitute an option or offer to lease, and this instrument is not binding until it has been executed and delivered by both parties. If Tenant is comprised of two or more parties, their obligations shall be joint and several. Time is of the essence with respect to the performance of every provision hereof in which time of performance is a factor. So long as Tenant performs its obligations hereunder, Tenant shall have peaceful and quiet possession of the Premises against any party claiming by, through or under Landlord, subject to the terms hereof. Landlord may transfer its interest herein, in which event (a) to the extent the transferee assumes in writing Landlord's obligations arising hereunder after the date of such transfer (including the return of any Security Deposit), Landlord shall be released from, and Tenant shall look solely to the transferee for the performance of, such obligations; and (b) Tenant shall attorn to the transferee. If Tenant (or any party claiming by, through or under Tenant) pays directly to the provider for any energy consumed at the Property, Tenant, promptly upon request, shall deliver to Landlord (or, at Landlord's option, execute and deliver to Landlord an instrument enabling Landlord to obtain from such provider) any data about such consumption that Landlord, in its reasonable judgment, is required to disclose to a prospective buyer, tenant, Security Holder or governmental agency under applicable Law. Landlord reserves all rights not expressly granted to Tenant hereunder, including the right to make alterations to the Project. No rights to any view or to light or air over any property are granted to Tenant hereunder. The expiration or earlier termination hereof shall not relieve either party of any obligation that accrued before, or continues to accrue after, such expiration or termination. This Lease may be executed in counterparts.

**[SIGNATURES ARE ON THE FOLLOWING PAGE]**

IN WITNESS WHEREOF, Landlord and Tenant have caused this Lease to be executed the day and date first above written.

---

| | |
|:---|:---|
| <u>LANDLORD</u>: | <u>LANDLORD</u>: |
| **BRE/OC GRIFFIN, L.L.C., a Delaware limited liability company** | **BRE/OC GRIFFIN, L.L.C., a Delaware limited liability company** |
| By: |  |
| Name: |  |
| Title: |  |
| <u>TENANT</u>: | <u>TENANT</u>: |
| **C&S BANKING GROUP LLC, a California limited liability company** | **C&S BANKING GROUP LLC, a California limited liability company** |
| By: | /s/ K P Balkrishna |
| Name: | K P Balkrishna |
| Title: | Manager |
| By: | /s/ Curtis E. Campbell |
| Name: | Curtis E. Campbell |
| Title: | Managing Member |

---

**SECOND AMENDMENT**

**THIS SECOND AMENDMENT** (this **"Amendment")** is made and entered into as of March 8, 2017, by and between **BRE/OC GRIFFIN, L.L.C., a Delaware limited liability company ("Landlord"),** and **C&S BANKING GROUP LLC, a California limited liability company ("Tenant").**

**RECITALS**

A. Landlord and Tenant are parties to that certain
 lease dated November 17, 2016, as amended by that certain First Amendment dated February 24,
 2017 (as amended, the **"Lease"**). Pursuant to the Lease, Landlord has leased
 to Tenant space currently containing approximately **8,873** rentable square feet (the **"Premises")** described as Suite 100 on the first floor of the building
 commonly known as Griffin Towers located at 6 Hutton Centre Drive, Santa Ana, California
 (the **"Building").** 

B. Tenant and Landlord mutually desire that the
 Lease be amended on and subject to the following terms and conditions.

**NOW, THEREFORE,** in consideration of the above recitals which by this reference are incorporated herein, the mutual covenants and conditions contained herein and other valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Landlord and Tenant agree as follows:

1.  **<u>Regulatory Provisions.</u>** Landlord acknowledges and agrees that Landlord shall not have the right to take possession
 of any of Tenant's business records or the records or personal property located in the Premises
 of any customer of Tenant or of any other third party. Landlord further acknowledges that
 Tenant and the successor-in-interest bank (if any) under the Lease are subject to the powers
 of the DBO, FDIC and other bank regulatory agencies, under applicable Law, to enter into
 and assume control of the Premises and of any personal property located therein.

2.  **<u>Miscellaneous.</u>** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.1. This
 Amendment sets forth the entire agreement between the parties with respect to the matters
 set forth herein. There have been no additional oral or written representations or agreements.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2. Except
 as herein modified or amended, the provisions, conditions and terms of the Lease shall
 remain unchanged and in full force and effect.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.3. In
 the case of any inconsistency between the provisions of the Lease and this Amendment, the provisions of this Amendment shall govern and control.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.4. Submission
 of this Amendment by Landlord is not an offer to enter into this Amendment but rather
 is a solicitation for such an offer by Tenant. Landlord shall not be bound by this Amendment
 until Landlord has executed and delivered it to Tenant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.5. Capitalized
 terms used but not defined in this Amendment shall have the meanings given in the
 Lease.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.6. Tenant
 shall indemnify and hold Landlord, its trustees, members, principals, beneficiaries, partners, officers, directors, employees, mortgagee(s) and agents, and the respective
 principals and members of any such agents harmless from all claims of any brokers (other
 than Cresa Partners-West, Inc., a California corporation) claiming to have represented
 Tenant in connection with this Amendment. Landlord shall indemnify and hold Tenant, its trustees,
 members, principals, beneficiaries, partners, officers, directors, employees, and agents,
 and the respective principals and members of any such agents harmless from all claims of
 any brokers claiming to have represented Landlord in connection with this Amendment. Tenant
 acknowledges that any assistance rendered by any agent or employee of any affiliate of Landlord
 in connection with this Amendment has been made as an accommodation to Tenant solely in furtherance
 of consummating the transaction on behalf of Landlord, and not as agent for Tenant.

**[SIGNATURES ARE ON FOLLOWING PAGE]**

**IN WITNESS WHEREOF,** Landlord and Tenant have duly executed this Amendment as of the day and year first above written.

---

| | |
|:---|:---|
| **LANDLORD:** | **LANDLORD:** |
| **BRE/OC GRIFFIN, L.L.C., a Delaware limited liability company** | **BRE/OC GRIFFIN, L.L.C., a Delaware limited liability company** |
| By: | /s/ Brendan McCracken |
| Name: | Brendan McCracken |
| Title: | SVP-Leasing, Portfolio Director |
| **TENANT:** | **TENANT:** |
| **C&S BANKING GROUP LLC, a California limited liability company** | **C&S BANKING GROUP LLC, a California limited liability company** |
| By: | /s/ K P Balkrishna / Victor Guerrero |
| Name: | K P Balkrishna / Victor Guerrero |
| Title: | Managers |

---

**THIRD AMENDMENT**

**THIS THIRD AMENDMENT** (this **"Amendment") is** made and entered into as of<u> </u>, 2017, by and between **BRE/OC GRIFFIN, L.L.C., a Delaware limited liability company ("Landlord"),** and **C&S** **BANKING GROUP LLC, a California limited liability company ("Tenant").**

**RECITALS**

A. Landlord and Tenant are parties to **that** certain lease dated November 17, 2016, **as** amended **by that** certain First Amendment
 dated February 24, 2017 (the **"First Amendment")** and that certain Second Amendment dated March 8, 2017 (as amended, the **"Lease").** Pursuant to the Lease, Landlord has leased to Tenant space currently containing
 approximately **8,873** rentable square feet (the **"Premises")** described as **Suite** 100 on the
 first floor of the building commonly known as **Griffin Towers located** at 6 Hutton **Centre** Drive,
 Santa Ana, California (the **"Building").** 

B. Tenant and Landlord mutually desire that the
 Lease be amended on and subject to the following terms
 and conditions.

**NOW, THEREFORE,** in consideration of the above recitals which by this reference are incorporated herein, the mutual covenants and conditions contained herein and other valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Landlord and Tenant agree as follows:

1.  **<u>Commencement Date</u>** <u>.</u> Section 1.3.2
 of the Lease, entitled "Commencement Date", is hereby amended by replacing
 each instance of the date "June 30, 2017"
 with the date "August 31, 2017",

2.  **<u>Miscellaneous</u>** <u>.</u> 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.1. This Amendment sets
 forth the entire agreement between the parties with
 respect to the matters set forth herein. There
 have been no additional oral or written representations or agreements.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2. Except as herein modified
 or amended, the provisions, conditions and
 terms of the Lease shall remain unchanged and
 in full force and effect.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.3. In
 the case of any inconsistency between the provisions of the Lease and this Amendment, the provisions of this Amendment
 shall govern and control.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.4. Submission of this
 Amendment by Landlord is not an offer to enter into
 this Amendment but rather is a solicitation for such an offer by Tenant. Landlord shall not
 be bound by this Amendment until Landlord has executed
 and delivered it to Tenant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.5. Capitalized terms used but not defined in this Amendment shall have the
 meanings given in the Lease.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.6. Tenant shall
 indemnify and hold Landlord, its trustees, members, principals, beneficiaries, partners, officers, directors,
 employees, mortgagee(s) and agents, and the respective principals and members
 of any such agents harmless from all claims of any brokers (other than Cresa Partners-West, Inc.,
 a California corporation) claiming to have represented Tenant in connection with this Amendment.
 Landlord shall indemnify and hold Tenant, its trustees, members, principals, beneficiaries,
 partners, officers, directors, employees, and agents, and the respective principals and members
 of any such agents harmless from all claims of any brokers
 claiming to have represented Landlord in connection with this Amendment. Tenant acknowledges
 that any assistance rendered by any agent or employee
 of any affiliate of Landlord in connection with this Amendment has been made as an accommodation
 to Tenant solely in furtherance of consummating the transaction on behalf of Landlord, and
 not as agent for Tenant.

**[SIGNATURES ARE ON FOLLOWING PAGE]**

**IN WITNESS WHEREOF,** Landlord and Tenant have duly executed this Amendment as of the day and year first above written.

---

| | |
|:---|:---|
| **LANDLORD:** | **LANDLORD:** |
| **BRE/OC GRIFFIN, L.L.C., a Delaware limited liability company** | **BRE/OC GRIFFIN, L.L.C., a Delaware limited liability company** |
| By: |  |
| Name: |  |
| Title: |  |
| **TENANT:** | **TENANT:** |
| **C&S BANKING GROUP LLC, a California limited liability company** | **C&S BANKING GROUP LLC, a California limited liability company** |
| By: | /s/ Victor Guerrero / K P Balkrishna |
| Name: | Victor Guerrero / K P Balkrishna |
| Title: | Manager / Manager |

---

**FOURTH AMENDMENT**

**THIS FOURTH AMENDMENT** (this **"Amendment")** is made and entered into as of<u> </u>, 2017, by and between **BRE/OC GRIFFIN, L.L.C., a Delaware limited liability company ("Landlord"),** and **C&S BANKING GROUP LLC, a California limited liability company ("Tenant").**

**RECITALS**

A. Landlord and Tenant are parties to that certain
 lease dated November 17, 2016, as amended by that certain First Amendment dated February 24,
 2017, that certain Second Amendment dated March 8, 2017 and that certain Third Amendment
 dated August 1, 2017 (as amended, the **"Lease").** Pursuant to the Lease,
 Landlord has leased to Tenant space currently containing approximately **8,873** rentable
 square feet (the **"Premises")** described as Suite 100 on the first floor
 of the building commonly known as Griffin Towers located at 6 Hutton Centre Drive, Santa
 Ana, California (the **"Building").** 

B. Tenant and Landlord mutually desire that the
 Lease be amended on and subject to the following terms and conditions.

**NOW, THEREFORE,** in consideration of the above recitals which by this reference are incorporated herein, the mutual covenants and conditions contained herein and other valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Landlord and Tenant agree as follows:

1.  **<u>Commencement Date.</u>** Section 1.3.2 of the Lease, entitled "Commencement Date", is hereby amended
 by replacing each instance of the date "August 31, 2017" with the date "October 31,
 2017".

2.  **<u>Miscellaneous.</u>** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.1. This Amendment sets
 forth the entire agreement between the parties with respect to the matters set forth herein.
 There have been no additional oral or written representations or agreements.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2. Except as herein modified
 or amended, the provisions, conditions and terms of the Lease shall remain unchanged and
 in full force and effect.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.3. In the case of any
 inconsistency between the provisions of the Lease and this Amendment, the provisions of this
 Amendment shall govern and control.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.4. Submission of this
 Amendment by Landlord is not an offer to enter into this Amendment but rather is a solicitation
 for such an offer by Tenant. Landlord shall not be bound by this Amendment until Landlord
 has executed and delivered it to Tenant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.5. Capitalized terms used
 but not defined in this Amendment shall have the meanings given in the Lease.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.6. Tenant shall indemnify
 and hold Landlord, its trustees, members, principals, beneficiaries, partners, officers,
 directors, employees, mortgagee(s) and agents, and the respective principals and members
 of any such agents harmless from all claims of any brokers (other than Cresa Partners-West, Inc.,
 a California corporation) claiming to have represented Tenant in connection with this Amendment.
 Landlord shall indemnify and hold Tenant, its trustees, members, principals, beneficiaries,
 partners, officers, directors, employees, and agents, and the respective principals and members
 of any such agents harmless from all claims of any brokers claiming to have represented Landlord
 in connection with this Amendment. Tenant acknowledges that any assistance rendered by any
 agent or employee of any affiliate of Landlord in connection with this Amendment has been
 made as an accommodation to Tenant solely in furtherance of consummating the transaction
 on behalf of Landlord, and not as agent for Tenant.

**[SIGNATURES ARE ON FOLLOWING PAGE]**

**IN WITNESS WHEREOF,** Landlord and Tenant have duly executed this Amendment as of the day and year first above written.

---

| | |
|:---|:---|
| **LANDLORD:** | **LANDLORD:** |
| **BRE/OC GRIFFIN, L.L.C., a Delaware limited liability company** | **BRE/OC GRIFFIN, L.L.C., a Delaware limited liability company** |
| By: |  |
| Name: |  |
| Title: |  |
| **TENANT:** | **TENANT:** |
| **C&S BANKING GROUP LLC, a California limited liability company** | **C&S BANKING GROUP LLC, a California limited liability company** |
| By: | /s/ K P Balkrishna / Victor Guerrero |
| Name: | K P Balkrishna / Victor Guerrero |
| Title: | Manager / Manager |

---

**FIFTH AMENDMENT**

**THIS FIFTH AMENDMENT** (this **"Amendment")** is made and entered into as of<u> </u>,2017, by and between **BRE/OC GRIFFIN, L.L.C., a Delaware limited liability company ("Landlord"),** and **C&S BANKING GROUP LLC, a California limited liability company ("Tenant").**

**RECITALS**

A. Landlord
 and Tenant are parties to that certain lease dated November 17, 2016, as amended by
 that certain First Amendment dated February 24, 2017, that certain Second Amendment
 dated March 8, 2017, that certain Third Amendment dated August 1, 2017 and that
 certain Fourth Amendment dated September 12, 2017 (as amended, the **"Lease").** Pursuant to the Lease, Landlord has leased to Tenant space
 currently containing approximately **8,873** rentable
 square feet (the **"Premises")** described
 as Suite 100 on the first floor of the building commonly known as Griffin Towers located
 at 6 Hutton Centre Drive, Santa Ana, California (the **"Building").** 

B. Tenant and Landlord mutually desire that the
 Lease be amended on and subject to the following terms and conditions.

**NOW, THEREFORE,** in consideration of the above recitals which by this reference are incorporated herein, the mutual covenants and conditions contained herein and other valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Landlord and Tenant agree as follows:

1.  **<u>Commencement Date.</u>** Section 1.3.2 of the Lease, entitled "Commencement Date",
 is hereby amended by replacing each instance of the date "October 31, 2017" with the date "December 31,
 2017".

2.  **<u>Miscellaneous.</u>** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.1. This
 Amendment sets forth the entire agreement between the parties with respect to the matters
 set forth herein. There have been no additional oral or written representations or agreements.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2. Except
 as herein modified or amended, the provisions, conditions and terms of the Lease shall
 remain unchanged and in full force and effect.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.3. In
 the case of any inconsistency between the provisions of the Lease and this Amendment, the provisions of this Amendment shall govern and control.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.4. Submission
 of this Amendment by Landlord is not an offer to enter into this Amendment but rather
 is a solicitation for such an offer by Tenant. Landlord shall not be bound by this Amendment
 until Landlord has executed and delivered it to Tenant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.5. Capitalized
 terms used but not defined in this Amendment shall have the meanings given in the
 Lease.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.6. Tenant
 shall indemnify and hold Landlord, its trustees, members, principals, beneficiaries, partners, officers, directors, employees, mortgagee(s) and agents, and the respective
 principals and members of any such agents harmless from all claims of any brokers (other
 than Cresa Partners-West, Inc., a California corporation) claiming to have represented
 Tenant in connection with this Amendment. Landlord shall indemnify and hold Tenant, its trustees,
 members, principals, beneficiaries, partners, officers, directors, employees, and agents,
 and the respective principals and members of any such agents harmless from all claims of
 any brokers claiming to have represented Landlord in connection with this Amendment. Tenant
 acknowledges that any assistance rendered by any agent or employee of any affiliate of Landlord
 in connection with this Amendment has been made as an accommodation to Tenant solely in furtherance
 of consummating the transaction on behalf of Landlord, and not as agent for Tenant.

**[SIGNATURES ARE ON FOLLOWING PAGE]**

**IN WITNESS WHEREOF,** Landlord and Tenant have duly executed this Amendment as of the day and year first above written.

---

| | |
|:---|:---|
| **LANDLORD:** | **LANDLORD:** |
| **BRE/OC GRIFFIN, L.L.C., a Delaware limited liability company** | **BRE/OC GRIFFIN, L.L.C., a Delaware limited liability company** |
| By: |  |
| Name: |  |
| Title: |  |
| **TENANT:** | **TENANT:** |
| **C&S BANKING GROUP LLC, a California limited liability company** | **C&S BANKING GROUP LLC, a California limited liability company** |
| By: | /s/ K P Balkrishna / Victor Guerrero |
| Name: | K P Balkrishna / Victor Guerrero |
| Title: | Manager / Manager |

---

**SIXTH AMENDMENT**

**THIS SIXTH AMENDMENT** (this **"Amendment")** is made and entered into as of<u> </u>, 2017, by and between **BRE/OC GRIFFIN, L.L.C., a Delaware limited liability company ("Landlord"),** and **C&S BANKING GROUP LLC, a California limited liability company ("Tenant").**

**RECITALS**

A. Landlord
 and Tenant are parties to that certain lease dated November 17, 2016, as amended by
 that certain First Amendment dated February 24, 2017, that certain Second Amendment
 dated March 8, 2017, that certain Third Amendment dated August 1, 2017, that certain
 Fourth Amendment dated September 12, 2017 and that certain Fifth Amendment dated November 9,
 2017 (as amended, the **"Lease"),** Pursuant
 to the Lease, Landlord has leased to Tenant space currently containing approximately **8,873** rentable square feet (the **"Premises")** described as Suite 100 on the first floor of the building
 commonly known as Griffin Towers located at 6 Hutton Centre Drive, Santa Ana, California
 (the **"Building").** 

B. Tenant and Landlord mutually desire that the
 Lease be amended on and subject to the following terms and conditions.

**NOW, THEREFORE,** in consideration of the above recitals which by this reference are incorporated herein, the mutual covenants and conditions contained herein and other valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Landlord and Tenant agree as follows:

1.  **<u>Commencement Date.</u>** Section 1.3.2 of the Lease, entitled "Commencement Date",
 is hereby amended
 by replacing each instance of the date "December 31, 2017" with the
 date "March 1,
 2018".

2.  **<u>Miscellaneous.</u>** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.1. This
 Amendment sets forth the entire agreement between the parties with respect to the matters
 set forth herein. There have been no additional oral or written representations or agreements.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2. Except
 as herein modified or amended, the provisions, conditions and terms of the Lease shall remain
 unchanged and in full force and effect.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.3. In
 the case of any inconsistency between the provisions of the Lease and this Amendment, the provisions of this Amendment shall govern and control.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.4. Submission
 of this Amendment by Landlord is not an offer to enter into this Amendment but rather
 is a solicitation for such an offer by Tenant. Landlord shall not be bound by this Amendment
 until Landlord has executed and delivered it to Tenant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.5. Capitalized
 terms used but not defined in this Amendment shall have the meanings given in the
 Lease.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.6. Tenant
 shall indemnify and hold Landlord, its trustees, members, principals, beneficiaries, partners, officers, directors, employees, mortgagee(s) and agents, and the respective
 principals and members of any such agents harmless from all claims of any brokers (other
 than Cresa Partners-West, Inc., a California corporation) claiming to have represented
 Tenant in connection with this Amendment. Landlord shall indemnify and hold Tenant, its trustees,
 members, principals, beneficiaries, partners, officers, directors, employees, and agents,
 and the respective principals and members of any such agents harmless from all claims of
 any brokers claiming to have represented Landlord in connection with this Amendment. Tenant
 acknowledges that any assistance rendered by any agent or employee of any affiliate of Landlord
 in connection with this Amendment has been made as an accommodation to Tenant solely in furtherance
 of consummating the transaction on behalf of Landlord, and not as agent for Tenant.

**[SIGNATURES ARE ON FOLLOWING PAGE]**

**IN WITNESS WHEREOF**, Landlord and Tenant have duly executed this Amendment as of the day and year first above written.

---

| | |
|:---|:---|
| **LANDLORD:** | **LANDLORD:** |
| **BRE/OC GRIFFIN, L.L.C., a Delaware limited liability company** | **BRE/OC GRIFFIN, L.L.C., a Delaware limited liability company** |
| By: |  |
| Name: |  |
| Title: |  |
| **TENANT:** | **TENANT:** |
| **C&S BANKING GROUP LLC, a California limited liability company** | **C&S BANKING GROUP LLC, a California limited liability company** |
| By: | /s/ K P Balkrishna / Victor Guerrero |
| Name: | K P Balkrishna / Victor Guerrero |
| Title: | Manager / Manager |

---

---

| | |
|:---|:---|
| ![](tm237204d1_ex6-1img001.jpg) | Equity Office<br> 3200 Ocean Park Blvd., Suite 100<br> Los Angeles, California 90405<br> phone(310) 664-3887<br> **<u>www.equityoffice.com</u>** |

---

*<u>VIA OVERNIGHT DELIVERY</u>*

April 9, 2018

Mr. Victor Guerrero

C&S Banking Group LLC

6 Hutton Centre Drive, Suite 1040

Santa Ana, CA 92707

---

| | |
|:---|:---|
| **Re:** | **C&S Banking LLC ("Tenant") - Seventh Amendment <br> Griffin Towers - 6 Hutton Centre Drive, Santa Ana, CA** |

---

Dear Victor,

It is with great pleasure that I enclose one (1) fully executed Seventh Amendment between BRE/OC GRIFFIN, LLC and C&S BANKING LLC for your files.

Should you have any questions or require further assistance, please do not hesitate to contact Belen Lavin, Property Manager, at (949) 954-5743.

Sincerely,

**Equity Office Property Management Corporation**

---

| |
|:---|
| /s/ Christine Stump |
| Christine Stump |
| Leasing Assistant |

---

cc: Belen Lavin, Equity Office (w/enclosure)

**SEVENTH AMENDMENT**

**THIS SEVENTH AMENDMENT** (this **"Amendment")** is made and entered into as of April 4, 2018, by and between **BRE/OC GRIFFIN, L.L.C., a Delaware limited liability company ("Landlord"),** and **C&S BANKING GROUP LLC, a California limited liability company ("Tenant").**

**RECITALS**

A. Landlord and Tenant are parties to that certain lease dated November 17, 2016 (the **"Original Lease"),** as amended by that certain First Amendment dated February 24, 2017 (the **"First Amendment"),** that certain Second Amendment dated March 8, 2017 (the **"Second Amendment"),** that certain Third Amendment dated August
1, 2017 (the **"Third Amendment"),** that certain Fourth Amendment dated September 12, 2017 (the **"Fourth Amendment"),** that certain Fifth Amendment dated November 9, 2017 (the **"Fifth Amendment"),** and that certain Sixth Amendment dated
December 22, 2017 (the **"Sixth Amendment")** (as amended, the **"Lease").** Pursuant to the Lease, Landlord
has leased to Tenant space currently containing approximately **8,873** rentable square feet (the **"Premises")** described
as Suite 100 on the first floor of the building commonly known as Griffin Towers located at 6 Hutton Centre Drive, Santa Ana, California
(the **"Building").** 

B. Tenant and Landlord mutually desire that the Lease be amended
on and subject to the following terms and conditions.

**NOW, THEREFORE,** in consideration of the above recitals which by this reference are incorporated herein, the mutual covenants and conditions contained herein and other valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Landlord and Tenant agree as follows:

1.  **<u>Tenant's Broker.</u>** The words "Cresa Partners-West,
Inc., a California corporation" are hereby replaced with the words "Savills Studley, Inc., a New York corporation" in
each of the following provisions of the Lease:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Section 1.12 of the Original Lease;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Section 3.6 of the First Amendment;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Section 2.6 of the Second Amendment;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Section 2.6 of the Third Amendment;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) Section 2.6 of the Fourth Amendment;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) Section 2.6 of the Fifth Amendment; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) Section 2.6 of the Sixth Amendment.

2.  **<u>Miscellaneous.</u>** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.1. This Amendment sets forth the entire agreement between the
parties with respect to the matters set forth herein. There have been no additional oral or written representations or agreements.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2. Except as herein modified or amended, the provisions, conditions
and terms of the Lease shall remain unchanged and in full force and effect.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.3. In the case of any inconsistency between the provisions of
the Lease and this Amendment, the provisions of this Amendment shall govern and control.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.4. Submission of this Amendment by Landlord is not an offer
to enter into this Amendment but rather is a solicitation for such an offer by Tenant. Landlord shall not be bound by this Amendment
until Landlord has executed and delivered it to Tenant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.5. Capitalized terms used but not defined in this Amendment
shall have the meanings given in the Lease.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.6. Tenant shall indemnify and hold Landlord, its trustees, members,
principals, beneficiaries, partners, officers, directors, employees, mortgagee(s) and agents, and the respective principals and members
of any such agents harmless from all claims of any brokers (other than Savills Studley, Inc., a New York corporation) claiming to have
represented Tenant in connection with this Amendment. Landlord shall indemnify and hold Tenant, its trustees, members, principals, beneficiaries,
partners, officers, directors, employees, and agents, and the respective principals and members of any such agents harmless from all
claims of any brokers claiming to have represented Landlord in connection with this Amendment. Tenant acknowledges that any assistance
rendered by any agent or employee of any affiliate of Landlord in connection with this Amendment has been made as an accommodation to
Tenant solely in furtherance of consummating the transaction on behalf of Landlord, and not as agent for Tenant.

**[SIGNATURES ARE ON FOLLOWING PAGE]**

**IN WITNESS WHEREOF,** Landlord and Tenant have duly executed this Amendment as of the day and year first above written.

---

| | |
|:---|:---|
| **LANDLORD:** | **LANDLORD:** |
| **BRE/OC GRIFFIN, L.L.C., a Delaware limited liability company** | **BRE/OC GRIFFIN, L.L.C., a Delaware limited liability company** |
| By: | /s/ Spencer Rose |
| Name: | Spencer Rose |
| Title: | Managing Director |
| **TENANT:** | **TENANT:** |
| **C&S BANKING GROUP LLC, a California limited liability company** | **C&S BANKING GROUP LLC, a California limited liability company** |
| By: | /s/ Victor Guerrero |
| Name: | Victor Guerrero |
| Title: | Manager |

---

## Ex1A-6

**Exhibit 6.2**

**INFINITY BANK**

**2018 STOCK INCENTIVE PLAN**

**<u>**TABLE OF CONTENTS**</u>**

---

| | | |
|:---|:---|:---|
|  |  | **<u>Page</u>** |
| Section 1. | Purpose | 1 |

---

Section 2. Definitions 1

Section 3. Administration 3

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Power and Authority of the Board 3

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Delegation 4

Section 4. Shares Available for Awards 4

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Shares Available 4

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Accounting for Awards 4

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Adjustments 4

Section 5. Eligibility 5

Section 6. Awards 5

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Options 5

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Restricted Stock and Restricted Stock Units 5

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Performance Awards 6

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Stock Awards 6

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) Other Stock-Based Awards 6

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) General 6

Section 7. Amendment and Termination 7

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Amendments to the Plan 7

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Amendments to Awards 8

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Correction of Defects, Omissions and Inconsistencies 8

Section 8. Income Tax Withholding 8

Section 9. General Provisions 8

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) No Rights to Awards 8

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Award Agreements 8

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Plan Provisions Control 9

ii

**<u>**TABLE OF CONTENTS**</u>**

**<u>Page</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) No Rights of Stockholders 9

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) No Limit on Other Compensation Plans or Arrangements 9

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) No Right to Employment or Directorship 9

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) Governing Law 9

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) Severability 9

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) No Trust or Fund Created 9

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j) Other Benefits 9

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(k) No Fractional Shares 9

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(l) Headings 9

Section 10. Term of the Plan/Expiration Date 10

iii

**INFINITY BANK**

**2018 STOCK INCENTIVE PLAN**

**Section 1.** **Purpose**

The purpose of the Plan is to promote the interests of Infinity Bank ("Bank") and its stockholders by aiding the Bank in attracting, rewarding and retaining employees, officers, consultants, Organizers and non-employee Directors capable of assuring the future success of the Bank, to offer such persons incentives to put forth maximum efforts for the success of the Bank's business and to compensate such persons through various stock-based arrangements and other compensation and provide them with opportunities for stock ownership in the Bank, thereby aligning the interests of such persons with the Bank's stockholders. The administration of the Plan and any Award (as defined below) thereunder shall comply with FDIC Rules and Regulations, 12 CFR Part 364, Appendix A, Standards for Safety and Soundness, as well as the Interagency Guidance on Sound Incentive Compensation Policies which require that incentive compensation arrangements are not excessive and do not encourage imprudent risk-taking behaviors. Such arrangements will be consistent with the safety and soundness of the Bank and related risk-management, control and governance processes. In addition, notwithstanding other terms of the Plan, administration of the Plan and any Award thereunder shall comply with FDIC Statement of Policy on Applications for FDIC Insurance, including the prohibition on cash payment in lieu of any Stock Award (as defined below) under the Plan for the applicable *de novo* period of operation of the Bank.

**Section 2.** **Definitions**

As used in the Plan, the following terms shall have the meanings set forth below:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) "Affiliate" shall mean (i) any entity that, directly or indirectly through one or more intermediaries, is controlled by the Bank and (ii) any entity in which the Bank has a significant equity interest, in each case as determined by the Board.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) "Award" shall mean any Option, Restricted Stock, Restricted Stock Unit, Performance Award, Dividend Equivalent, Stock Award or Other Stock-Based Award granted under the Plan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) "Award Agreement" shall mean any written agreement, contract or other instrument or document evidencing an Award granted under the Plan. An Award Agreement may be in an electronic medium and need not be signed by a representative of the Bank or the Participant. Each Award Agreement shall be subject to the applicable terms and conditions of the Plan and any other terms and conditions as (not inconsistent with the Plan) determined by the Board.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) "Board" shall mean the Board of Directors of the Bank (subject to any delegation of powers and duties of the Board to a committee pursuant to Section 3(b).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) "Change in Control" shall have the meaning ascribed to such term in an Award Agreement, or any other applicable employment or change in control agreement between the Participant and the Bank.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) "Code" shall mean the Internal Revenue Code of 1986, as amended from time to time, and any regulations promulgated thereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) "Bank" shall mean Infinity Bank, a California banking corporation, or any successor corporation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) "Director" shall mean a member of the Board.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) "Dividend Equivalent" shall mean any right granted under Section 6(f)(iii) of the Plan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j) "Eligible Person" shall mean any employee, officer, consultant, Organizer or non-employee Director providing benefits to the Bank or any Affiliate whom the Board determines to be an Eligible Person.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(k) "Expiration Date" shall have the meaning set forth under Section 10 of the Plan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(l) "Fair Market Value" shall mean, with respect to any property (including, without limitation, any Shares or other securities), the fair market value of such property determined by such methods or procedures as shall be established from time to time by the Board consistent with applicable regulatory requirements. If the Shares are or at any time become securities listed or approved for listing on a national securities exchange or approved for designation as a national market system security on an interdealer quotation system by the Financial Industry Regulatory Association (FINRA), then the determination of Fair Market Value for such Shares shall be based upon the per share closing price for the Shares on the applicable stock exchange for the applicable date. The Board's determination of Fair Market Value shall be conclusive and binding on all persons.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(m) "Family Members" of a Participant mean any child, stepchild, grandchild, parent, stepparent, grandparent, spouse, former spouse, sibling, niece, nephew, mother-in-law, father-in-law, son-in-law, daughter-in-law, brother-in-law, or sister-in-law (including adoptive relationships) of the Participant, any person sharing the household (other than a tenant or employee) of the Participant, a trust in which these persons (or the Participant) have more than 50% of the beneficial interest, a foundation in which these persons (or the Participant) control the management of assets, and any other entity in which these persons (or the Participant) own more than 50% of the voting interests.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(n) "Incentive Stock Option" shall mean an option granted under Section 6(a) of the Plan that is intended to meet the requirements of Section 422 of the Code or any successor provision.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(o) "Non-Qualified Stock Option" shall mean an option granted under Section 6(a) of the Plan that is not intended to be an Incentive Stock Option.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(p) "Option" shall mean an Incentive Stock Option or a Non-Qualified Stock Option.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(q) "Organizer" shall mean a person who contributed funds for the payment of pre-opening expenses of the Bank.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(r) "Organizer Option" shall mean a Non-Qualified Stock Option granted to an Organizer that is specifically described as such in the relevant Stock Option Award Agreement, which shall be granted in recognition of the contribution to the payment of pre-opening expenses for the organization of the Bank.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(s) "Other Stock-Based Award" shall mean any right granted under Section 6(e) of the Plan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(t) "Participant" shall mean an Eligible Person designated to be granted an Award under the Plan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(u) "Performance Award" shall mean any right granted under Section 6(c) of the Plan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) "Performance Goal" shall mean one or more of the following performance goals, either individually, alternatively or in any combination, applied on a corporate, subsidiary, division, business unit or line of business basis: sales, revenue, costs, expenses (including expense efficiency ratios and other expense measures), earnings (including one or more of net profit after tax, gross profit, operating profit, earnings before interest and taxes, earnings before interest, taxes, depreciation and amortization and net earnings), earnings per share, earnings per share from continuing operations, operating income, pre-tax income, operating income margin, net income, margins (including one or more of gross, operating and net income margins), returns (including one or more of return on actual or *pro forma* assets, net assets, equity, investment, capital and net capital employed), stockholder return (including total stockholder return relative to an index or peer group), stock price, growth of loans and deposits, number of customers or households, economic value added, cash generation, cash flow, unit volume, working capital, market share, cost reductions and strategic plan development and implementation. Such goals may reflect absolute entity or business unit performance or a relative comparison to the performance of a peer group of entities or other external measure of the selected performance criteria. The Board may appropriately adjust any evaluation of performance under such goals to exclude the effect of certain events, including any of the following events: asset write-downs; litigation or claim judgments or settlements; changes in tax law, accounting principles or other such laws or provisions affecting reported results; severance, contract termination and other costs related to exiting certain business activities; and gains or losses from the disposition of businesses or assets or from the early extinguishment of debt.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(w) "Person" shall mean any individual or entity, including a corporation, partnership, limited liability company, association, joint venture or trust.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(x) "Plan" shall mean this 2018 Stock Incentive Plan, as amended from time to time.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(y) "Qualifying Termination" shall have the meaning ascribed to it in any applicable Award Agreement, and, if not defined in any applicable Award Agreement, shall mean termination of employment under circumstances that, in the judgment of the Board, warrant acceleration of the exercisability of Options or the lapse of restrictions relating to Restricted Stock, Restricted Stock Units or other Awards under the Plan. Without limiting the generality of the foregoing, a Qualifying Termination may apply to large scale terminations of employment relating to the disposition or divestiture of business or legal entities or similar circumstances.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(z) "Restricted Stock" shall mean any Share granted under Section 6(b) of the Plan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(aa) "Restricted Stock Unit" shall mean any unit granted under Section 6(b) of the Plan evidencing the right to receive a Share at some future date.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(bb) "Section 409A" shall mean Section 409A of the Code, or any successor provision, and applicable Treasury Regulations and other applicable guidance thereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(cc) "Share" or "Shares" shall mean a share or shares of common or preferred stock of the Bank or such other securities or property as may become subject to Awards pursuant to an adjustment made under Section 4(c) of the Plan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(dd) "Stock Award" shall mean any Share granted under Section 6(d) of the Plan.

**Section 3.** **Administration**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Power and Authority of the Board</u>. The Plan shall be administered by the Board. Subject to the express provisions of the Plan and to applicable law, the Board shall have full power and authority to: (i) designate Participants; (ii) determine the type or types of Awards to be granted to each Participant under the Plan; (iii) determine the number of Shares to be covered by (or the method by which payments or other rights are to be calculated in connection with) each Award; (iv) determine the terms and conditions of any Award or Award Agreement; (v) amend the terms and conditions of any Award or Award Agreement, *provided, however*, that, except as otherwise permitted in connection with an event as provided under Section 4(c) hereof, the Board shall not reprice, adjust or amend the exercise price of Options previously awarded to any Participant, whether through amendment, cancellation and replacement grant, or any other means; (vi) accelerate the exercisability of any Award or waive any restrictions relating to any Award, *provided, however*, that, except as otherwise provided herein, any such acceleration of exercisability or lapse of restrictions shall be limited to accelerations relating to a Change in Control, a Qualifying Termination, death or disability; (vii) determine whether, to what extent and under what circumstances Awards may be exercised in cash, Shares, other securities, other Awards or other property, or canceled, forfeited or suspended; (viii) determine whether, to what extent and under what circumstances cash, Shares, other securities, other Awards, other property and other amounts payable with respect to an Award under the Plan shall be deferred either automatically or at the election of the holder of the Award or the Board; (ix) interpret and administer the Plan and any instrument or agreement, including any Award Agreement, relating to the Plan; (x) establish, amend, suspend or waive such rules and regulations and appoint such agents as it shall deem appropriate for the proper administration of the Plan; (xi) commit to repurchase Awards from a Participant in consideration of a payment in cash or other consideration to such Participant and in an amount and subject to terms and conditions to be determined by the Board and, (xii) make any other determination and take any other action that the Board deems necessary or desirable for the administration of the Plan. Unless otherwise expressly provided in the Plan, all designations, determinations, interpretations and other decisions under or with respect to the Plan or any Award or Award Agreement shall be within the sole discretion of the Board, may be made at any time and shall be final, conclusive and binding upon any Participant, any holder or beneficiary of any Award or Award Agreement, and any employee of the Bank or any Affiliate. In addition, and without in any way limiting the generality of the foregoing:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) <u>Dodd-Frank Clawback</u>. The Board shall have full authority to implement any policies and procedures necessary to comply with Section 10D of the Exchange Act and any rules promulgated thereunder. Notwithstanding whether the Bank or any Affiliate is subject to Section 10D of the Exchange Act, the Board may provide in Award Agreements that, in event of a financial restatement that reduces amount of previously awarded incentive compensation that would not have been earned had results been properly reported, outstanding Awards will be cancelled and Bank may clawback (*i.e.*, recapture) realized Option gains and realized value for vested Restricted Stock or Restricted Stock Units or earned Awards within 12 months preceding financial restatement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) <u>Restrictive Covenants</u>. The Board may impose restrictions on any Award with respect to non-competition, confidentiality and other restrictive covenants as it deems necessary or appropriate in its sole discretion.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Delegation</u>. The Board may delegate its powers and duties under the Plan to a committee of Directors, subject to such terms, conditions and limitations as the Board may establish in its sole discretion.

**Section 4.** **Shares Available for Awards**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Shares Available</u>. Subject to adjustment as provided in Section 4(c) of the Plan, the aggregate number of Shares that may be issued under all Awards (including, without limitation, Options) under the Plan shall initially be 990,000 Shares, which is equal to 30% of the number of outstanding and issued Shares as of the date of the opening of the Bank, and may be adjusted by the Board from time to time to an amount up to 30% of the then issued and outstanding Shares. The aggregate number of Shares that may be issued for incentive stock options under the Plan shall initially be 891,000 Shares, which is equal to 90% of the number of Shares initially subject to the Plan, and may be adjusted by the Board from time to time to an amount up to 90% of the then number of Shares subject to the Plan. Shares to be issued under the Plan will be authorized but unissued Shares or Shares that have been reacquired by the Bank and designated as treasury shares. If any Shares covered by an Award or to which an Award relates are not purchased or are forfeited (including shares of Restricted Stock, whether or not dividends have been paid on such shares), or if an Award otherwise terminates or is cancelled without delivery of any Shares, then the number of Shares counted pursuant to Section 4(b) of the Plan against the aggregate number of Shares available under the Plan with respect to such Award, to the extent of any such forfeiture, termination or cancellation, shall again be available for granting Awards under the Plan. Shares tendered by Participants as full or partial payment to the Bank upon exercise of an Award, and Shares withheld by or otherwise remitted to the Bank to satisfy a Participant's tax withholding obligations with respect to an Award, shall not become available for issuance under the Plan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Accounting for Awards</u>. For purposes of this Section 4, if an Award entitles the holder thereof to receive or purchase Shares, the number of Shares covered by such Award or to which such Award relates shall be counted on the date of grant of such Award against the aggregate number of Shares available for granting Awards under the Plan. Awards that do not entitle the holder thereof to receive or purchase Shares, and Awards that are denominated at the time of grant as payable only in cash and that are settled in cash, shall not be counted against the aggregate number of Shares available for Awards under the Plan. If performance awards granted under the Bank's executive incentive plans are payable in Shares, such Shares may be issued under this Plan and shall be counted against the aggregate number of Shares available for granting Awards under the Plan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Adjustments</u>. Subject to any action required under applicable laws by the holders of capital stock of the Bank, (i) the numbers and class of Shares or other stock or securities: (x) authorized under Section 4(a) , and (y) covered by each outstanding Award, (ii) the price per Share covered by each such outstanding Option, (iii) any repurchase price per Share applicable to Shares issued pursuant to any Award, and (iv) the authorization limits under Section 4(a), shall be proportionately adjusted by the Board in the event of a stock split, reverse stock split, stock dividend, combination, consolidation, recapitalization or reclassification of the Shares, subdivision of the Shares, a rights offering, a reorganization, merger, spin-off, split-up, change in corporate structure or other similar occurrence. Any adjustment by the Board pursuant to this Section 4(c) shall be made in the Board's sole and absolute discretion and shall be final, binding and conclusive. Except as expressly provided herein, no issuance by the Bank of shares of stock of any class, or securities convertible into shares of stock of any class, shall affect, and no adjustment by reason thereof shall be made with respect to, the number or price of Shares subject to an Award. If, by reason of a transaction described in this Section 4(c) or an adjustment pursuant to this Section 4(c), a Participant's Award Agreement or related agreement covers additional or different shares of stock or securities, then such additional or different shares, and the Award Agreement or related agreement shall be subject to all of the terms, conditions and restrictions which were applicable to the Award prior to such adjustment.

**Section 5.** **Eligibility**

Any Eligible Person shall be eligible to be designated a Participant. In determining which Eligible Persons shall receive an Award and the terms of any Award, the Board may take into account the nature of the services rendered by the respective Eligible Persons, their present and potential contributions to the success of the Bank or such other factors as the Board, in its discretion, shall deem relevant. Notwithstanding the foregoing, an Incentive Stock Option may only be granted to full-time or part-time employees (which term as used herein includes, without limitation, officers and Directors who are also employees), and an Incentive Stock Option shall not be granted to an employee of an Affiliate unless such Affiliate is also a "subsidiary corporation" of the Bank within the meaning of Section 424(f) of the Code or any successor provision. Also, in accordance with regulatory guidelines, an Organizer shall only be eligible to receive one Organizer Option, a Non-Qualified Stock Option, for each share of common stock invested in the Bank.

**Section 6.** **Awards**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Options</u>. The Board is hereby authorized to grant Options to Eligible Persons with the following terms and conditions and with such additional terms and conditions not inconsistent with the provisions of the Plan as the Board shall determine:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) <u>Exercise Price</u>. The purchase price per Share purchasable under an Option shall be determined by the Board and shall not be less than 100% of the Fair Market Value of a Share on the date of grant of such Option.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) <u>Option Term</u>. The term of each Option shall be fixed by the Board but shall not be longer than 10 years from the date of grant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) <u>Time and Method of Exercise</u>. The Board shall determine the time or times at which an Option may be exercised in whole or in part and the method or methods by which, and the form or forms (including, without limitation, cash, Shares, other securities, other Awards or other property, or any combination thereof, having a Fair Market Value on the exercise date equal to the applicable exercise price) in which, payment of the exercise price with respect thereto may be made or deemed to have been made.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Restricted Stock and Restricted Stock Units</u>. The Board is hereby authorized to grant Restricted Stock and Restricted Stock Units to Eligible Persons with the following terms and conditions and with such additional terms and conditions not inconsistent with the provisions of the Plan as the Board shall determine:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) <u>Restrictions</u>. Shares of Restricted Stock and Restricted Stock Units shall be subject to such restrictions as the Board may impose (including, without limitation, any limitation on the right to vote a Share of Restricted Stock or the right to receive any dividend or other right or property with respect thereto), which restrictions may lapse separately or in combination at such time or times, in such installments or otherwise as the Board may deem appropriate.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) <u>Issuance and Delivery of Shares</u>. Any Restricted Stock granted under the Plan shall be issued at the time such Awards are granted and may be evidenced in such manner as the Board may deem appropriate, including book-entry registration or issuance of a stock certificate or certificates, which certificate or certificates shall be held by the Bank. Such certificate or certificates shall be registered in the name of the Participant and shall bear an appropriate legend referring to the restrictions applicable to such Restricted Stock. Shares representing Restricted Stock that is no longer subject to restrictions shall be delivered to the Participant promptly after the applicable restrictions lapse or are waived. In the case of Restricted Stock Units, no Shares shall be issued at the time such Awards are granted. Upon the lapse or waiver of restrictions and the restricted period relating to Restricted Stock Units evidencing the right to receive Shares, such Shares shall be issued and delivered to the holder of the Restricted Stock Units, or, with respect to Restricted Stock Units that are payable in cash, such cash shall be delivered to holder of the Restricted Stock Units.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Performance Awards</u>. The Board is hereby authorized to grant Performance Awards to Eligible Persons subject to the terms of the Plan. A Performance Award granted under the Plan (i) may be denominated or payable in Shares (including, without limitation, Restricted Stock and Restricted Stock Units), other securities, other Awards or other property and (ii) shall confer on the holder thereof the right to receive Shares, in whole or in part, upon the achievement of such performance goals during such performance periods as the Board shall establish. Subject to the terms of the Plan, the performance goals to be achieved during any performance period, the length of any performance period, the amount of any Performance Award granted, the amount of any stock transfer to be made pursuant to any Performance Award and any other terms and conditions of any Performance Award shall be determined by the Board.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) <u>Stock Awards</u>. The Board is hereby authorized to grant to Eligible Persons Shares without restrictions thereon, as deemed by the Board to be consistent with the purpose of the Plan. Subject to the terms of the Plan and any applicable Award Agreement, such Stock Awards may have such terms and conditions as the Board shall determine.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) <u>Other Stock-Based Awards</u>. The Board is hereby authorized to grant to Eligible Persons such other Awards that are denominated or payable in, valued in whole or in part by reference to, or otherwise based on or related to, Shares (including, without limitation, securities convertible into Shares), as are deemed by the Board to be consistent with the purpose of the Plan. The Board shall determine the terms and conditions of any Other Stock Based Awards, subject to the terms of the Plan and the Award Agreement. Any consideration paid by the Participant with respect to any Other Stock Based Awards may be paid by such method or methods and in such form or forms (including, without limitation, cash, Shares, other securities, other Awards or other property, or any combination thereof), as the Board shall determine.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) <u>General</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) <u>Consideration for Awards</u>. Awards may be granted for no cash consideration or for any cash or other consideration as determined by the Board or required by applicable law.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) <u>Awards May Be Granted Separately or Together</u>. Awards may, in the discretion of the Board, be granted either alone or in addition to, in tandem with or in substitution for any other Award or any award granted under any other plan of the Bank or any Affiliate. Awards granted in addition to or in tandem with other Awards or in addition to or in tandem with awards granted under any other plan of the Bank or any Affiliate may be granted either at the same time as or at a different time from the grant of such other Awards or awards.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) <u>Forms of Payment under Awards</u>. Subject to the terms of the Plan and of any applicable Award Agreement, payments or transfers to be made by the Bank or an Affiliate upon the grant, exercise or payment of an Award may be made in such form or forms as the Board shall determine (including, without limitation, cash, Shares, other securities, other Awards or other property or any combination thereof), and may be made in a single payment or transfer, in installments, in each case in accordance with rules and procedures established by the Board. Such rules and procedures may include, without limitation, provisions for the payment or crediting of reasonable interest on installment or deferred payments or the grant or crediting of Dividend Equivalents with respect to installment or deferred payments.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) <u>Term of Awards</u>. The term of each Award shall be for such period as may be determined by the Board at the time of grant, but in no event shall any Award have a term of more than 10 years.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) <u>Limits on Transfer of Awards</u>. Incentive Stock Options are not transferable, voluntarily or involuntarily, other than by will or by the laws of descent and distribution or pursuant to a qualified domestic relations order as defined by the Code. During a Participant's lifetime, Incentive Stock Options may be exercised only by the Participant (or a legal representative if the Participant becomes incapacitated). All Awards granted pursuant to the Plan other than Incentive Stock Options are transferable only by will or by the laws of descent and distribution or pursuant to a qualified domestic relations order as defined by the Code; provided, however, with the approval of the Board, a Participant may transfer a Non-Qualified Stock Option for no consideration to or for the benefit of one or more Family Members of the Participant subject to such limits as the Board may establish, and the Family Member shall remain subject to all the terms and conditions applicable to the Award prior to such transfer. The transfer of an Award pursuant to this section shall include a transfer of the rights of a Participant under this Plan to consent to certain amendments to the Plan or an Award Agreement and, in the discretion of the Board, shall also include transfer of ancillary rights associated with the Award. No Award (other than a Stock Award) or right under any such Award may be pledged, alienated, attached or otherwise encumbered, and any purported pledge, alienation, attachment or encumbrance thereof shall be void and unenforceable against the Bank or any Affiliate.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi) <u>Restrictions</u>. All Shares or other securities delivered under the Plan pursuant to any Award or the exercise thereof shall be subject to such restrictions as the Board may deem advisable under the Plan, applicable federal or state securities laws and regulatory requirements, and the Board may cause appropriate entries to be made or legends to be placed on the certificates for such Shares or other securities to reflect such restrictions. Additionally, a Participant may be required to exercise or forfeit (or both) any rights with regard to the Participant's Awards granted under the Plan pursuant to an order, directive, enforcement action or any other action from Bank's primary federal or state regulator (together "regulator action"), including, without limitation, a regulator action resulting from Bank's capital falling below the minimum requirements determined by Bank's primary federal or state regulator. If the Shares or other securities are traded on a securities exchange, the Bank shall not be required to deliver any Shares or other securities covered by an Award unless and until such Shares or other securities have been admitted for trading on such securities exchange.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vii) <u>Section 409A Provisions</u>. Notwithstanding anything in the Plan or any Award Agreement to the contrary, to the extent that any amount or benefit that constitutes "deferred compensation" to a Participant under Section 409A of the Code and applicable guidance thereunder is otherwise payable or distributable to a Participant under the Plan or any Award Agreement solely by reason of the occurrence of a Change in Control or due to the Participant's disability or "separation from service" (as such term is defined under Section 409A), such amount or benefit will not be payable or distributable to the Participant by reason of such circumstance unless the Board determines in good faith that (i) the circumstances giving rise to such Change in Control, disability or separation from service meet the definition of a change in ownership or control, disability, or separation from service, as the case may be, in Section 409A(a)(2)(A) of the Code and applicable proposed or final regulations, or (ii) the payment or distribution of such amount or benefit would be exempt from the application of Section 409A by reason of the short-term deferral exemption or otherwise.

**Section 7.** **Amendment and Termination; Corrections**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Amendments to the Plan</u>. The Board may amend, alter, suspend, discontinue or terminate the Plan at any time; *provided, however*, that, notwithstanding any other provision of the Plan or any Award Agreement, prior approval of the stockholders of the Bank shall be required for any amendment to the Plan that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) requires stockholder approval under then applicable law;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) increases the number of shares authorized under the Plan as specified in Section 4(a) of the Plan (except that the Board acting alone may increase the number of shares authorized under the Plan to an amount up to 30% of the then number of outstanding Shares of the Bank);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) permits repricing of Options, which is prohibited by Section 3(a)(v) of the Plan; or,

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) permits the award of Options at a price less than 100% of the Fair Market Value of a Share on the date of grant of such Option, contrary to the provisions of Sections 6(a)(i) of the Plan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Amendments to Awards</u>. Subject to the provisions of the Plan, the Board may waive any conditions of or rights of the Bank under any outstanding Award, prospectively or retroactively. Except as otherwise provided in the Plan, the Board may amend, alter, suspend, discontinue or terminate any outstanding Award, prospectively or retroactively, but no such action may adversely affect the rights of the holder of such Award without the consent of the Participant or holder or beneficiary thereof. The Bank intends that Awards under the Plan shall satisfy the requirements of Section 409A to avoid any adverse tax results thereunder, and the Board shall administer and interpret the Plan and all Award Agreements in a manner consistent with that intent. If any provision of the Plan or an Award Agreement would result in adverse tax consequences under Section 409A, the Board may amend that provision (or take any other action reasonably necessary) to avoid any adverse tax results and no action taken to comply with Section 409A shall be deemed to impair or otherwise adversely affect the rights of any holder of an Award or beneficiary thereof. Nevertheless, the tax treatment of the benefits provided under the Plan or any Award is not warranted or guaranteed. Neither the Bank, any Affiliate nor their respective directors, officers, employees or advisers (other than in his or her capacity as a Participant) shall be held liable for any taxes, interest, penalties or other monetary amounts owed by any Participant or other taxpayer as a result of the Plan or any Award.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Correction of Defects, Omissions and Inconsistencies</u>. The Board may correct any defect, supply any omission or reconcile any inconsistency in the Plan or in any Award or Award Agreement in the manner and to the extent it shall deem desirable to implement or maintain the effectiveness of the Plan.

**Section 8.** **Income Tax Withholding**

In order to comply with all applicable federal, state, local or foreign income tax laws or regulations, the Bank may take such action as it deems appropriate to ensure that all applicable federal, state, local or foreign payroll, withholding, income or other taxes, which are the sole and absolute responsibility of a Participant, are withheld or collected from such Participant. In order to assist a Participant in paying all or a portion of the applicable taxes to be withheld or collected upon exercise or receipt of (or the lapse of restrictions relating to) an Award, the Board, in its discretion and subject to such additional terms and conditions as it may adopt, may permit the Participant to satisfy such tax obligation by (a) electing to have the Bank withhold a portion of the Award otherwise to be delivered upon exercise or receipt of (or the lapse of restrictions relating to) such Award with a Fair Market Value equal to the amount of such taxes, or (b) delivering to the Bank Shares other than Shares issuable upon exercise or receipt of (or the lapse of restrictions relating to) such Award with a Fair Market Value equal to the amount of such taxes. The election, if any, must be made on or before the date that the amount of tax to be withheld is determined.

**Section 9.** **General Provisions**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>No Rights to Awards</u>. No Eligible Person, Participant or other Person shall have any claim to be granted any Award under the Plan, and there is no obligation for uniformity of treatment of Eligible Persons, Participants or holders or beneficiaries of Awards under the Plan. The terms and conditions of Awards need not be the same with respect to any Participant or with respect to different Participants.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Award Agreements</u>. No Participant shall have rights under an Award granted to such Participant unless and until an Award Agreement shall have been duly executed on behalf of the Bank, and, if requested by the Bank, signed by the Participant, or until such Award Agreement is delivered and accepted through any electronic medium in accordance with procedures established by the Bank.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Plan Provisions Control</u>. In the event that any provision of an Award Agreement conflicts with or is inconsistent in any respect with the terms of the Plan as set forth herein or subsequently amended, the terms of the Plan shall control.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) <u>No Rights of Stockholders</u>. Except with respect to Restricted Stock, Stock Awards, and certain types of stock-based Performance Awards, neither a Participant nor the Participant's legal representative shall be, or have any of the rights and privileges of, a stockholder of the Bank with respect to any Shares issuable upon the exercise or payment of any Award, in whole or in part, unless and until the Shares have been issued.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) <u>No Limit on Other Compensation Plans or Arrangements</u>. Nothing contained in the Plan shall prevent the Bank or any Affiliate from adopting or continuing in effect other or additional compensation plans or arrangements, and such plans or arrangements may be either generally applicable or applicable only in specific cases.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) <u>No Right to Employment or Directorship</u>. The grant of an Award shall not be construed as giving a Participant the right to be retained as an employee of the Bank or any Affiliate, or a Director to be retained as a Director, nor will it affect in any way the right of the Bank or an Affiliate to terminate a Participant's employment at any time, with or without cause, or remove a Director in accordance with applicable law. In addition, the Bank or an Affiliate may at any time dismiss a Participant from employment or remove a Director who is a Participant free from any liability or any claim under the Plan or any Award, unless otherwise expressly provided in the Plan or in any Award Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) <u>Governing Law</u>. The internal law, and not the law of conflicts, of the State of California, shall govern all questions concerning the validity, construction and effect of the Plan or any Award, and any rules and regulations relating to the Plan or any Award. Venue for any claims or disputes arising under the Agreement shall be the County of Orange, California.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) <u>Severability</u>. If any provision of the Plan or any Award is or becomes or is deemed to be invalid, illegal or unenforceable in any jurisdiction or would disqualify the Plan or any Award under any law deemed applicable by the Board, such provision shall be construed or deemed amended to conform to applicable laws, or if it cannot be so construed or deemed amended without, in the determination of the Board, materially altering the purpose or intent of the Plan or the Award, such provision shall be stricken as to such jurisdiction or Award, and the remainder of the Plan or any such Award shall remain in full force and effect.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) <u>No Trust or Fund Created</u>. Neither the Plan nor any Award shall create or be construed to create a trust or separate fund of any kind or a fiduciary relationship between the Bank or any Affiliate and a Participant or any other Person. To the extent that any Person acquires a right to receive payments from the Bank or any Affiliate pursuant to an Award, such right shall be no greater than the right of any unsecured general creditor of the Bank or any Affiliate.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j) <u>Other Benefits</u>. No compensation or benefit awarded to or realized by any Participant under the Plan shall be included for the purpose of computing such Participant's compensation or benefits under any pension, retirement, savings, profit sharing, group insurance, disability, welfare or other benefit plan of the Bank, unless required by law or otherwise provided by such other plan.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(k) <u>No Fractional Shares</u>. No fractional Shares shall be issued or delivered pursuant to the Plan or any Award, and the Board shall determine whether cash shall be paid in lieu of any fractional Share or whether such fractional Share or any rights thereto shall be canceled, terminated or otherwise eliminated.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(l) <u>Headings</u>. Headings are given to the sections and subsections of the Plan solely as a convenience to facilitate reference. Such headings shall not be deemed in any way material or relevant to the construction or interpretation of the Plan or any provision thereof.

**Section 10.** **Term of the Plan/ Expiration Date**

The Plan shall remain available for the grant of Awards until the date which is ten (10) years after the date the Plan was approved by the Board of Directors, or such earlier date as the Board of Directors may determine, subject to Section 7(a) of the Plan (the "Expiration Date"). The Plan shall be subject to approval by the stockholders of the Bank at the first meeting of stockholders of the Bank and, if required by law, subject to the approval of the California Department of Business Oversight. However, unless otherwise expressly provided in the Plan or in an applicable Award Agreement, any Award theretofore granted may extend beyond the Expiration Date, and the authority of the Board provided for hereunder with respect to the Plan and any Awards, and the authority of the Board to amend the Plan, shall extend beyond the Expiration Date.

<u>End of Plan</u>.

## Ex1A-6

**Exhibit 6.3**

**<u>EMPLOYMENT AGREEMENT</u>**

**(KARKUTLA P. BALKRISHNA)**

This Employment Agreement ("Agreement") is entered into by and between INFINITY BANK, a California banking corporation (the "Bank"), and KARKUTLA P. BALKRISHNA (the "Employee'') effective as of February 1, 2018, which is the date the Bank commenced business as a California state-chartered bank (the "Effective Date").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**1.** **<u>ENGAGEMENT</u>**. The Bank hereby engages Employee for a term of five (5) years, commencing on the Effective Date and ending on the fifth anniversary thereafter (the "Term"), to render services as President and Chief Executive Officer of the Bank pursuant to the terms and conditions hereof, and Employee hereby accepts such engagement. Employee shall work full-time for the Bank during normal business hours (excluding paid vacations) and at such other additional times as may reasonably be required by the Board of Directors of the Bank (the "Board''). The Term shall be automatically renewed for every one (1) year period (the "Extended Term") occurring thereafter, unless written notice is given and received not less than three (3) months prior to the end of the Term or any Extended Term of the intention of either party not to renew the same. The term for which Employee is employed hereunder (which includes the initial Term and the Extended Term) is hereinafter referred to as the "Term."

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**2.** **<u>NATURE OF SERVICES</u>**. Employee shall render such services as may reasonably be required by the Board and are normally associated with the office of President and Chief Executive Officer of the Bank and shall report to the Board. Employee's duties shall be primarily the management of the Bank as described in the job description attached to this Agreement as Exhibit A. Bank agrees that during the Term it shall not materially diminish Employee's title, authority, status, duties or responsibilities; materially diminish Employee's annual salary; or require Employee to locate his office to a location more than ten miles beyond the present location of the Bank's principal executive offices. The Employee agrees that to the best of Employee's ability and experience Employee will at all times loyally and conscientiously perform all of the duties and obligations required of Employee either expressly or implicitly by the terms of this Agreement and in compliance with all applicable laws, regulations, the Bank's chartering documents, policies, procedures, and the lawful direction of the Board of Directors. Employee shall at all times during the Term comply with the Bank's then-current policy regarding conflicts of interest.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**3.** **<u>DIRECTOR OF THE BANK</u>**. Throughout the Term, the Bank shall endeavor to have Employee nominated and elected to serve on the Board and retained as a director of the Bank. Employee shall serve as a director on the same basis and subject to the same terms and conditions as are generally applicable to members of the Board, except that Employee shall not be paid any additional compensation of any kind for serving as a director of the Bank, except as otherwise expressly agreed. Employee agrees that he shall be deemed as having resigned as a director of the Bank effective upon termination of his employment with the Bank unless otherwise agreed to by the Bank.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**4.** **<u>EXCLUSIVITY</u>**. During the Term, Employee shall at all times faithfully, industriously and to the best of his ability, experience and talent perform all of the duties that may be assigned to him hereunder and shall devote his full time and efforts to the performance of such duties and to the promotion of the interests and business of the Bank; <u>provided, however</u>, notwithstanding the foregoing, the Employee may devote reasonable time to activities other than those required under this Agreement, including activities involving professional, charitable, community, educational, religious and similar types of organizations, speaking engagements, membership on the boards of directors of other organizations and similar types of activities to the extent that such activities do not inhibit or prohibit the performance of services under this Agreement; <u>provided further</u>, that the Employee will not serve on the board of any business or engage in any other business activity without the prior consent of the Board

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.** **<u>COMPENSATION</u>**. As consideration for all services to be rendered by Employee pursuant hereto, the Bank will provide Employee the compensation set forth in this Section 5.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(a)** **<u>Base Compensation</u>**. The Bank will pay or will cause to be paid to Employee, subject to all applicable laws and requirements respecting withholding of federal, state, and/or local taxes, a fixed annual salary in the amount of $260,000, subject to annual upward adjustment as may be determined at the sole discretion of the Board. Such salary shall be payable in accordance with the normal payroll policies of the Bank.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(b)** **<u>Employee Benefits</u>**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(i)** **<u>Reimbursements</u>**. The Bank agrees to provide, at its sole cost and expense, such office facilities and secretarial services as may be required by Employee in order to carry out his duties under this Agreement, at a level and quality normally associated with the position of Chief Executive Officer of the Bank. The Bank shall reimburse Employee for all ordinary and necessary business expenses reasonably incurred by Employee in the performance of Employee's duties and obligations under this Agreement, including, but not limited to, reimbursement for cellular telephone equipment and service, electronic organizer equipment and service, airfare and accommodations for travel, in each case in accordance with the Bank's customary policies and subject to the reasonable review and approval of the Board, or its designee.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(ii)** **<u>Annual Vacation</u>**. Employee shall be entitled to twenty (20) days' vacation time each year of the employment term without loss of compensation, prorated for any portion of a year according to the Bank's policies and procedures. The time for such vacation shall be selected by Employee, subject to coordination with the availability of other members of the Bank's management team. If Employee does not take all vacation to which he is entitled in a given year he may accrue and carry over vacation days into future years, provided that Employee may not accrue at any time more than the then applicable limit under the Bank's policies and procedures.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(iii)** **<u>General Benefits</u>**. During the term of this Agreement, the Bank shall provide to Employee such other employee benefits in accordance with the Bank's personnel policies as are applicable to senior executives generally such as, for example, group health insurance, 401(k) retirement plan, life, disability and other insurance benefits.

Page 2 of 11

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(iv)** **<u>Bank-Owned Automobile</u>**. During the Term, Bank shall provide to Employee, for Employee's sole use, a Bank-owned automobile in the form of a recent model, full size, four-door Lexus, BMW or Mercedes-Benz which is mutually acceptable to Employee and Bank. Bank shall pay all operating expenses of any nature whatsoever with regard to such automobile. Employee shall furnish to Bank adequate records and other documentary evidence required by federal and state statutes and regulations issued by appropriate taxing authorities to substantiate the extent to which such payments are deductible business expenses of the Bank and not deductible to the Employee. Bank shall also procure and maintain in force appropriate insurance coverage on such automobile. At the end of the Term, Employee shall have the option to purchase said automobile from Bank at fair market value, as determined by the Board of Directors in accordance with the Kelley Blue Book or similar independent price guide, with appropriate adjustments based on the equipment and condition of the automobile, provided that Employee has not been terminated for "Cause" as defined in this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(v)** **<u>Gross-Up Payments</u>**. Employee shall be entitled to an additional amount ("Gross-Up Payment") for any fringe benefit provided to the Employee under this Agreement and other agreements entered into by the Bank and the Employee that is includible in the Employee's gross income ("Taxable Fringe Benefit"). The Gross-Up Payment, is a payment in an amount equal to (A) the amount of all federal and state taxes, including, without limitation, any income taxes and all other related payroll taxes, and any interest, penalties and excise taxes ("Taxes") imposed upon the Employee for the value of the Taxable Fringe Benefit and (B) any Taxes imposed upon the Gross-Up Payment. The Gross-Up Payment shall be made by Bank to the Employee in the year that Taxable Fringe Benefit is includible in the Employee's gross income. Notwithstanding the foregoing, without the prior written consent of the Federal Deposit Insurance Corporation ("FDIC"), there shall be no Gross-Up Payment of any taxable fringe benefit, severance or other form of golden parachute payment if the Bank has been deemed a troubled institution subject to Part 359 of the Rules and Regulations of the FDIC.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(c)** **<u>Incentive Compensation</u>**. Employee shall be entitled to receive incentive compensation with respect to each calendar year during the Term in accordance with the Bank's policies and subject to the Bank's overall financial results (the "bonus"). The determination in each year of whether any such bonus is to be paid and the actual amount thereof will be made by, and in the sole and absolute discretion of, the Board. All bonus amounts shall be paid at the same time and in the same manner as bonuses paid to other senior management of the Bank, but in no event later than 90 days after the close of the calendar year.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(d)** **<u>Stock Options/Restricted Stock</u>**. Bank and Employee acknowledge that Employee will receive the grant of certain stock options and restricted stock units pursuant to <u>Exhibits B and C</u> attached hereto and incorporated herein by this reference.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**6.**  **<u>REPRESENTATIONS AND WARRANTIES</u>** .

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(a)** **<u>Representations of Employee</u>**. Employee represents and warrants that Employee has all right, power, authority and capacity, and is free, to enter into this Agreement; that by doing so Employee will not violate or interfere with the rights of any other person or entity; and that Employee is not subject to any contract, understanding or obligation which will or might prevent, interfere with or impair the performance of this Agreement by Employee.

Page 3 of 11

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(b)** **<u>Representations of the Bank</u>**. The Bank represents and warrants that the Bank has all right, power and authority, without the consent of any other person, to execute and deliver and perform its obligations under this Agreement. All corporate and other actions required to be taken by the Bank to authorize the execution, delivery and performance of this Agreement and the consummation of all transactions contemplated hereby have been duly and properly taken. This Agreement is a lawful, valid and legally binding obligation of the Bank, enforceable in accordance with its respective terms, subject to bankruptcy, insolvency and other similar equitable remedies available to creditors.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**7.**  **<u>CERTAIN RIGHTS OF THE BANK</u>** .

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(a)** **<u>Announcement</u>**. The Bank shall have the sole right (but not the obligation) to make a public announcement of the Bank's employment of Employee, provided that the Bank shall make no announcement concerning the financial or economic terms of this Agreement without Employee's prior written consent, except as may be required by applicable law or regulation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(b)** **<u>Use of Name Likeness, and Biography</u>**. The Bank shall have the right (but not the obligation) to use, publish and broadcast, and to authorize others to do so, the name, approved likeness and approved biographical material of Employee to advertise, publicize and promote the business of the Bank and its affiliates, subsidiaries or parent. An "approved likeness" and "approved biographical material" shall be, respectively, any photograph or other depiction of Employee, or any biographical information or life story concerning the professional career of Employee, which has been submitted to and approved by Employee prior to its first use, publication or broadcast.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(c)** **<u>Right to Insure</u>**. The Bank shall have the right to secure in its own name, or otherwise, and at its own expense, life, health, accident or other insurance covering Employee, and Employee shall have no right, title or interest in and to such insurance. Employee shall assist the Bank in procuring such insurance by submitting to reasonable examinations and by signing such applications and other instruments as may be reasonably required by the insurance carriers to which application is made for any such insurance.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**8.** **<u>INDEMNIFICATION BY THE BANK</u>**. The Bank shall, to the fullest extent permitted by law, indemnify, defend and hold harmless Employee from and against any and all loss, damage, expense (including court costs and reasonable attorneys' fees), suit, action, claim, liability, or obligation (collectively, "Liability") to which Employee may become subject related to or caused by the Bank or any of its affiliates, or arising from the performance or nonperformance of duties as an employee, officer or director of the Bank or any of its affiliates, unless such Liability is in any way attributable to the negligence, gross misconduct, repeated or blatant insubordination, theft or other criminal act of Employee, as determined by a final adjudication by a court or tribunal of competent jurisdiction. The Bank shall continue to maintain directors' and officers' liability insurance in commercially reasonable amounts (but in no event less than as in effect on the Effective Date) and the Employee shall be covered under such insurance to the same extent as other senior management employees and directors of the Bank. The Bank agrees that it shall not amend its bylaws so as to limit the Bank's ability to indemnify Employee.

Page 4 of 11

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**9.** **<u>TERMINATION</u>**. This Agreement and Employee's employment may be terminated prior to the expiration of the Term (a "Termination Event'') as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(a)** **<u>Mutual Agreement or Resignation</u>.** This Agreement and Employee's employment may be terminated at any time by mutual written agreement of the parties or upon Employee's resignation. Upon termination by mutual agreement or resignation, the parties shall determine the amount of compensation and benefits, if any, to be paid to Employee. If the parties are unable to so agree within 30 days after the decision to terminate or resign is first communicated to the other party, then Employee shall be entitled to receive (i) any base salary accrued through the date of such termination or resignation pursuant to Section 5(a), (ii) the cash value of any unused vacation benefits under Section 5(b)(ii); (iii) reimbursement for any incurred but unreimbursed business expenses with appropriate evidence supporting such expenses; (iv) any deferred compensation which Employee may be owed; (v) the right to exercise options or receive restricted stock units to the extent and subject to the terms and conditions provided in Exhibits B and C attached hereto; and (vi) the right to exercise options or receive restricted stock units or restricted stock grants which are granted after the date of this Agreement as provided in the agreements granting such options or restricted stock units.

Notwithstanding the foregoing, if Employee resigns based upon a breach of this Agreement by the Bank which the Bank has failed to cure within 30 days after receipt of written notice from Employee of such breach, then Employee shall be entitled to receive the compensation and benefits described in subparagraph (c) below as if the termination was without Cause.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(b)** **<u>Cause</u>**. The Bank may terminate this Agreement upon written notice to Employee for "Cause." If Employee's employment is terminated for Cause, Employee shall be entitled to receive (i) any base salary accrued through the date of such termination pursuant to Section 5(a); (ii) the cash value of any unused vacation benefits under Section 5(b)(ii) and reimbursement for any incurred but unreimbursed business expenses with appropriate evidence supporting such expenses. Upon a termination for Cause, Employee shall not be entitled to any other benefits, and shall not have the right to exercise any options, whether or not vested at the time of such termination, and the right to any unvested restricted stock units is immediately and irrevocably forfeited.

"Cause" shall mean (i) the conviction of Employee for a felony, (ii) the commission by Employee of any act or omission involving dishonesty, disloyalty, breach of fiduciary duty or fraud with respect to the Bank and/or any of its affiliates, subsidiary or parent, (iii) gross negligence or incompetence in the performance or non-performance of duties in Employee's capacity as an employee of the Bank; (iv) a pattern of willful misconduct or repeated or blatant insubordination in the performance of Employee's duties as an employee of the Bank; or (v) Employee's material breach of or default under this Agreement.

Page 5 of 11

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(c)** **<u>Without Cause</u>**. The Bank may terminate this Agreement at any time without Cause, upon written notice to Employee. Upon such termination, Employee shall be entitled to receive: (i) any base salary accrued through the date of such termination or resignation pursuant to Section 5(a); (ii) any incurred but unreimbursed business expenses, payable within 10 days after the effective date of such termination or whenever the Bank receives appropriate evidence supporting such expenses, whichever is later; (iii) any incentive bonus that would be due and payable for such year if the date of determination of such bonus was deemed to be for the conclusion of the fiscal year within which falls the date of termination of Employee's employment, and provided the amount of such incentive bonus shall be prorated for the period of such year actually worked, (iv) any deferred compensation which Employee may be owed; (v) the cash value of any unused vacation pursuant to Section 5(b)(ii); (vi) a lump sum cash amount equal to his base compensation pursuant to Section 5(a) for a period of twelve (12) months, along with the cash value of vacation benefits under 5(b)(ii) for twelve (12) months; (vii) the right to exercise options or receive restricted stock units to the extent and subject to the terms and conditions provided in Exhibits B and C attached hereto; and (viii) the right to exercise options or receive restricted stock units or restricted stock grants which are granted after the date of this Agreement as provided in the agreements granting such options or restricted stock units.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(d)** **<u>Disability</u>**. The Bank may terminate this Agreement upon written notice to Employee if Employee shall be rendered incapable by reason of a "Disability" from complying with the terms, provisions and conditions hereof on his part to be performed during the Term. Upon termination of this Agreement for Disability, Employee shall be entitled to receive the compensation and benefits described in subparagraph (c) above as if the termination was without Cause.

The term "Disability" shall mean the appointment of a conservator of the estate of Employee or the physical or mental incapacity of Employee such that he is incapable, after reasonable accommodation for such Disability, of reporting to work for a period in excess of 90 consecutive calendar days or for shorter periods aggregating 120 days or more in any 12-month period or is unable to perform the essential functions of his job. Notwithstanding the foregoing, if this Agreement is subject to Section 409A of the Internal Revenue Code (the "Code), "Disability" shall mean that Employee is disabled under Section 409A(a)(2)(C)(i) or (ii) of the Code.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(e)** **<u>Death</u>**. This Agreement shall terminate in the event of Employee's death.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(f)** **<u>Termination for Good Reason by Employee</u>**. During the Term of this Agreement, Employee may terminate his employment for "Good Reason," as that term is defined below. In the event of a termination for Good Reason by Employee, such termination will be treated as a termination of Employee by Bank without Cause, in which case Employee will have all remedies to which he may be entitled at law, in equity, or under this Agreement. The term "Good Reason" shall mean:

The breach of this Agreement by the Bank, including but not limited to, a material diminution in Employee's title, authority, status, job duties or responsibilities, a material diminution in Employee's annual salary, a relocation of Employee's employment office to a location which is more than ten (10) miles beyond the present location of the Bank's principal executive offices, and any attempt by Bank to terminate this Agreement without Cause.

Page 6 of 11

In order to resign his employment from the Bank for "Good Reason" under this Section 9(f), Employee must first provide written notice to the Board of Directors of the Bank setting forth with reasonable detail the nature of the Good Reason within 30 days from the occurrence of a Good Reason event, and Employee's resignation for Good Reason shall only be effective as a resignation for Good Reason if the Bank has not cured or remedied the Good Reason event within 30 days after its receipt of Employee's written notice (the "Cure Period").

Upon termination of this Agreement for Good Reason, Employee shall be entitled to receive the compensation and benefits described in subparagraph (c) above as if the termination was without Cause.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**10.** **<u>RETURN OF BANK PROPERTY</u>**. Within 5 days after the termination of this Agreement, Employee shall return to the Bank all equipment (including, without limitation, computers, software, credit cards, cellular or other telephones, pagers and organizers), products, work papers, books, records, forms, data processes, papers and writings relating to the business of the Bank including without limitation the Bank's proprietary or licensed computer programs, customer lists and customer data, and/or copies or duplicates thereof in Employee's possession or under Employee's control. Employee shall not retain any copies or duplicates of such property and all licenses granted to him by the Bank to use such computer programs, data or software shall be revoked upon termination of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**11.** **<u>CHANGE IN CONTROL</u>.** In the event of a Change in Control, as defined below in this Section 11, with or without the termination of Employee's employment by the Bank or a successor to the Bank prior to, upon or after the Change in Control, the Bank or its successor shall pay Employee the following: (i) a lump sum equal to twelve (12) months of Employee's then existing annual base salary; (ii) any base salary accrued through the effective date of the Change in Control pursuant to Section 5(a); (iii) any incurred but unreimbursed business expenses, payable within 10 days after the effective date of the Change in Control or whenever the Bank receives appropriate evidence supporting such expenses, whichever is later; (iv) any incentive bonus that would be due and payable for such year if the date of determination of such bonus was deemed to be for the conclusion of the fiscal year within which falls the effective date of the Change in Control, and provided the amount of such incentive bonus shall be prorated for the period of such year actually worked; (v) any deferred compensation which Employee may be owed, (vi) the cash value of any unused vacation pursuant to Section 5(b)(ii); (vii) the cash value of vacation benefits under 5(b)(ii) for twelve (12) months; (viii) the right to exercise options or receive restricted stock units to the extent and subject to the terms and conditions provided in Exhibits B and C attached hereto; and (ix) the right to exercise options or receive restricted stock units or restricted stock grants which are granted after the date of this Agreement as provided in the agreements granting such options or restricted stock units.

Such payment shall be made as soon as practical following the Change in Control, but in no event longer than 30 days after the effective date of the Change in Control. Any payment made under this Section 11 shall be in lieu of any payment due to Employee under Section 9 hereof.

Page 7 of 11

For purposes of this Agreement "Change in Control" means a transaction or event where the Bank's shareholders do not hold more than 50% of the shares of the surviving corporation, or in the event of a consolidation where the Bank's shareholders do not hold more than 50% of the shares of the consolidated bank, or in the event of a transfer of all or substantially all of the assets of the Bank to an entity which is not controlled by the Bank's shareholders, or in the event of any other corporate reorganization where there is an acquisition of ownership by one person or entity or persons acting in concert [who are not existing shareholders of the Bank] of at least 25% of the outstanding shares of the Bank, except as may result from a transfer of shares to another corporation in exchange for at least 80% control of that corporation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**12.**  **<u>GENERAL</u>** .

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(a)** **<u>Assignment; Successors; Affiliates</u>**. The Bank may not assign this Agreement (or the interest of the Bank herein) except to any affiliate, subsidiary or parent of the Bank or to any entity or its affiliates which is a party to a merger, reorganization, or consolidation with the Bank or to an entity or entities acquiring substantially all of the assets of the Bank (providing any such assignee assumes the Bank's obligation under the Agreement). Upon such assignment, acquisition, merger, consolidation, or reorganization, the term "Bank" as used herein shall be deemed to refer to such assignee or such successor entity. Employee shall not have the right to assign Employee's interest in this Agreement, any rights under this Agreement or any duties imposed under this Agreement, nor shall Employee (or Employee's spouse, heirs, beneficiaries, administrators or executors) have the right to pledge, hypothecate or otherwise encumber Employee's right to receive compensation hereunder without the consent of the Bank. The right of assignment by the Bank shall not prejudice Employee's right to terminate this Agreement pursuant to Section 9 hereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(b)** **<u>Headings</u>**. The subject headings of the sections and subsections of this Agreement are included for purposes of convenience only and shall not affect the construction or interpretation of any of its provisions.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(c)** **<u>Incorporation by Reference of Relevant Regulatory Law</u>**. This Agreement incorporates by reference 12 U.S.C. §1828(k) and any regulations promulgated thereunder with regard to legal restrictions on the payment of golden parachute and indemnification payments. In the event any payments to Employee pursuant to this Agreement are prohibited or limited by the provisions of such statute and/or regulation, the Bank will use its commercially reasonable efforts to obtain the consent of the appropriate regulatory authorities for the payment by the Bank to Employee of the maximum amount that is permitted (up to the amount payable under the terms of this Agreement).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(d)** **<u>Certain Limitations</u>**. In the event that the total amounts payable pursuant to this Agreement, together with all other payments to which Employee is entitled (collectively "Payments") will be subject to the excise tax (the "Excise Tax") imposed under Section 4999 of the Internal Revenue Code of 1986, as amended, then Bank shall pay to Employee an additional amount (the ''Excess Parachute Gross-Up Payment") such that the net amount retained by the Employee, after deduction of any Excise Tax on the Payments and any Taxes upon the Excess Parachute Gross-Up Payment, shall be equal to the Payments to Employee that would have been received as if said Excise Tax had not been imposed. The Excess Parachute Gross-Up Payment shall be made by Bank to the Employee immediately upon the payment to the Employee of the Payments. Any determination and calculation required under this paragraph shall be made in writing in good faith by the accounting or consulting firm mutually agreed upon by the Bank and Employee.

Page 8 of 11

For purposes of determining the amount of the Excess Parachute Gross-Up Payment, the Employee shall be deemed to pay federal income tax at the highest marginal rate of federal income taxation in the calendar year in which the Excess Parachute Gross-Up Payment is to be made and state and local income taxes at the highest marginal rate of taxation in the state and locality of Employee's residence in the calendar year in which the Excess Parachute Gross-Up Payment is to be made, net of the maximum reduction in federal income taxes which could be obtained from deduction of such state and local taxes.

Notwithstanding the foregoing, without the express, prior written consent of the FDIC, there shall be no Excess Parachute Gross-Up Payment of any severance or other form of golden parachute payment if the Bank has been deemed a troubled institution subject to Part 359 of the Rules and Regulations of the FDIC.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(e)** **<u>Severability</u>**. It is agreed that if any term, covenant, provision, paragraph or condition of this Agreement shall be illegal, such illegality shall not invalidate the whole Agreement, but it shall be construed as if not containing the illegal part, and the rights and obligations of the parties shall be construed and enforced accordingly.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(f)** **<u>Entire Agreement</u>**. The parties hereto agree that this Agreement, and the related stock option and restricted stock agreement(s), supersede all existing agreements between the Bank and Employee, whether oral, written, expressed or implied, and contain the entire understanding and agreement between the parties. This Agreement shall not be amended, modified, or supplemented in any respect except by a subsequent written agreement entered into by both parties hereto.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(g)** **<u>Amendment and Waiver</u>**. This Agreement may be amended, modified or supplemented only by a writing executed by each of the parties. Either party may in writing waive any provision of this Agreement to the extent such provision is for the benefit of the waiving party. No waiver by either party of a breach of any provision of this Agreement shall be construed as a waiver of any subsequent or different breach, and no forbearance by a party to seek a remedy for noncompliance or breach by the other party shall be construed as a waiver of any right or remedy with respect to such noncompliance or breach.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(h)** **<u>Review of Terms</u>**. Without binding either of the parties in any respect, the parties intend to review the terms of this Agreement on a periodic basis and discuss such potential modifications thereto as they may mutually agree upon.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(i)** **<u>Choice of Law</u>**. This Agreement and the performance hereunder shall be governed by and construed in accordance with the laws of the State of California, without regard to the conflict of law provisions of any state.

Page 9 of 11

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(j)** **<u>Notices</u>**. Any notices to be given hereunder by any party to any other party may be effected by personal delivery in writing or by mail, registered or certified, postage prepaid with return receipt requested. Mailed notices shall be addressed to the parties at the addresses appearing below, but each party may change his address by written notice in accordance with this Section. Notices delivered personally shall be deemed communicated as of actual receipt; mailed notices shall be deemed communicated 3 days after mailing. In addition, notices and communications may be sent by telephone facsimile transmission or electronic mail, provided manually signed confirming copies are also sent in the manner set forth in the second sentence of this Section, in which event delivery shall be deemed upon receipt of the facsimile transmission or electronic mail.

---

| | |
|:---|:---|
| If to the Bank: | INFINITY BANK |
|  | 6 Hutton Centre Drive, Suite 100 |
|  | Santa Ana, California 92707 |
|  | Attention: Corporate Secretary |
|  | Fax: (714) 619-7456 |
|  | Email: elaine@goinfinitybank.com |
| If to Employee: | K.P. Balkrishna |
|  | 6 Saros |
|  | Irvine, CA 92603 |
|  | Email: bala0624@aol.com |

---

or to such other addresses as may be designated in writing by either of the parties.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(k)** **<u>Deferral of Payment</u>.** In the event that Employee is entitled to a lump sum payment under this Agreement, Employee may elect to receive this lump sum payment on the 1<sup>st</sup> of January immediately following the date of termination.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(l)** **<u>Counterparts</u>**. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original document, but all of which taken together shall constitute one and the same document.

**The next page is the Signature Page.**

Page 10 of 11

IN WITNESS WHEREOF, the Bank and Employee have executed this Agreement as of the Effective Date.

---

| | |
|:---|:---|
| **INFINITY BANK:** | **INFINITY BANK:** |
| By: |  |
|  | Raymond J. Gagnon |
|  | Chairman of the Board |
| **EMPLOYEE:** | **EMPLOYEE:** |
| Karkutla P. Balkrishna | Karkutla P. Balkrishna |

---

Page 11 of 11

## Ex1A-6

**Exhibit 6.4**

**<u>EMPLOYMENT AGREEMENT</u>**

This Employment Agreement ("Agreement") is entered into by and between INFINITY BANK, a California banking corporation (the "Bank"), and VICTOR E. GUERRERO II (the "Employee'') effective as February 1, 2018, which is the date the Bank commenced business as a California state chartered bank (the "Effective Date").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**1.** **<u>ENGAGEMENT</u>**. The Bank hereby engages Employee for a term of five (5) years, commencing on the Effective Date and ending on the fifth anniversary thereafter (the "Term"), to render services as Executive Vice President, Chief Financial Officer and Chief Operating Officer of the Bank pursuant to the terms and conditions hereof, and Employee hereby accepts such engagement. Employee shall work full-time for the Bank during normal business hours (excluding paid vacations) and at such other additional times as may reasonably be required by the Board of Directors of the Bank (the "Board''). The Term shall be automatically renewed for every one (1) year period (the "Extended Term") occurring thereafter, unless written notice is given and received not less than three (3) months prior to the end of the Term or any Extended Term of the intention of either party not to renew the same. The term for which Employee is employed hereunder (which includes the initial Term and the Extended Term) is hereinafter referred to as the "Term."

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**2.** **<u>NATURE OF SERVICES</u>**. Employee shall render such services as may reasonably be required by the Board and are normally associated with the offices of Chief Financial Officer and Chief Operating Officer of the Bank and shall report to the Chief Executive Officer. Employee's duties shall be primarily the duties as described in the job description attached to this Agreement as Exhibit A. Bank agrees that during the Term it shall not materially diminish Employee's title, authority, status, duties or responsibilities; materially diminish Employee's annual salary; or require Employee to locate his office to a location more than fifty miles beyond both the present location of the Bank's principal executive offices and Employee's current principal place of residence. The Employee agrees that to the best of Employee's ability and experience Employee will at all times loyally and conscientiously perform all of the duties and obligations required of Employee either expressly or implicitly by the terms of this Agreement and in compliance with all applicable laws, regulations, the Bank's chartering documents, policies, procedures, and the lawful direction of the Board of Directors. Employee shall at all times during the Term comply with the Bank's then-current policy regarding conflicts of interest.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**3.** **<u>EXCLUSIVITY</u>**. During the Term, Employee shall at all times faithfully, industriously and to the best of his ability, experience and talent perform all of the duties that may be assigned to him hereunder and shall devote his full time and efforts to the performance of such duties and to the promotion of the interests and business of the Bank; <u>provided, however</u>, notwithstanding the foregoing, the Employee may devote reasonable time to activities other than those required under this Agreement, including activities involving professional, charitable, community, educational, religious and similar types of organizations, speaking engagements, membership on the boards of directors of other organizations and similar types of activities to the extent that such activities do not inhibit or prohibit the performance of services under this Agreement; <u>provided further</u>, that the Employee will not serve on the board of any business or engage in any other business activity without the prior consent of the Board.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**4.** **<u>COMPENSATION</u>**. As consideration for all services to be rendered by Employee pursuant hereto, the Bank will provide Employee the compensation set forth in this Section 4.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(a)** **<u>Base Compensation</u>**. The Bank will pay or will cause to be paid to Employee, subject to all applicable laws and requirements respecting withholding of federal, state, and/or local taxes, a fixed annual salary in the amount of $225,000, subject to annual upward adjustment as may be determined at the sole discretion of the Board. Such salary shall be payable in accordance with the normal payroll policies of the Bank.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(b)** **<u>Employee Benefits</u>**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(i)** **<u>Reimbursements</u>**. The Bank agrees to provide, at its sole cost and expense, such office facilities and secretarial services as may be required by Employee in order to carry out his duties under this Agreement, at a level and quality normally associated with the positions of Chief Financial Officer and Chief Operating Officer of the Bank. The Bank shall reimburse Employee for all ordinary and necessary business expenses reasonably incurred by Employee in the performance of Employee's duties and obligations under this Agreement, including, but not limited to, reimbursement for cellular telephone equipment and service, electronic organizer equipment and service, airfare and accommodations for travel, in each case in accordance with the Bank's customary policies and subject to the reasonable review and approval of the Board, or its designee.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(ii)** **<u>Annual Vacation</u>**. Employee shall be entitled to twenty (20) days' vacation time each year of the employment term without loss of compensation, prorated for any portion of a year according to the Bank's policies and procedures. The time for such vacation shall be selected by Employee, subject to coordination with the availability of other members of the Bank's management team. If Employee does not take all vacation to which he is entitled in a given year he may accrue and carry over vacation days into future years, provided that Employee may not accrue at any time more than the then applicable limit under the Bank's policies and procedures.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(iii)** **<u>General Benefits</u>**. During the term of this Agreement, the Bank shall provide to Employee such other employee benefits in accordance with the Bank's personnel policies as are applicable to senior executives generally such as, for example, group health insurance, 401(k) retirement plan, life, disability and other insurance benefits.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(iv)** **<u>Automobile Allowance</u>**. The Bank shall provide to Employee an automobile allowance in the amount of $750 per month during the Term.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(c)** **<u>Incentive Compensation</u>**. Employee shall be entitled to receive incentive compensation with respect to each calendar year during the Term in accordance with the Bank's policies and subject to the Bank's overall financial results (the "Bonus''). The determination in each year of whether any such incentive compensation is to be paid and the actual amount thereof will be made by, and in the sole and absolute discretion of, the Board. All bonus amounts shall be paid at the same time and in the same manner as bonuses paid to other senior management of the Bank, but in no event later than 90 days after the close of the calendar year. The Bank hereby represents and warrants to the Employee that it has taken, or shall take, all corporate action necessary to ensure that the Bank's Incentive Compensation Plan is consistent with Employee's compensation under this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(d)** **<u>Stock Options/Restricted Stock</u>**. Bank and Employee acknowledge that Employee will receive the grant of certain stock options and restricted stock units of the Bank's stock subject to the Award Agreements attached to this Agreement as Exhibit B and C ("Award Agreements").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.** **<u>REPRESENTATIONS AND WARRANTIES</u>**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(a)** **<u>Representations of Employee</u>**. Employee represents and warrants that Employee has all right, power, authority and capacity, and is free, to enter into this Agreement; that by doing so Employee will not violate or interfere with the rights of any other person or entity; and that Employee is not subject to any contract, understanding or obligation which will or might prevent, interfere with or impair the performance of this Agreement by Employee.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(b)** **<u>Representations of the Bank</u>**. The Bank represents and warrants that the Bank has all right, power and authority, without the consent of any other person, to execute and deliver and perform its obligations under this Agreement. All corporate and other actions required to be taken by the Bank to authorize the execution, delivery and performance of this Agreement and the consummation of all transactions contemplated hereby have been duly and properly taken. This Agreement is a lawful, valid and legally binding obligation of the Bank, enforceable in accordance with its respective terms, subject to bankruptcy, insolvency and other similar equitable remedies available to creditors.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**6.** **<u>CERTAIN RIGHTS OF THE BANK</u>**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(a)** **<u>Announcement</u>**. The Bank shall have the sole right (but not the obligation) to make a public announcement of the Bank's employment of Employee, provided that the Bank shall make no announcement concerning the financial or economic terms of this Agreement without Employee's prior written consent, except as may be required by applicable law or regulation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(b)** **<u>Use of Name Likeness, and Biography</u>**. The Bank shall have the right (but not the obligation) to use, publish and broadcast, and to authorize others to do so, the name, approved likeness and approved biographical material of Employee to advertise, publicize and promote the business of the Bank and its affiliates. An "approved likeness" and "approved biographical material" shall be, respectively, any photograph or other depiction of Employee, or any biographical information or life story concerning the professional career of Employee, which has been submitted to and approved by Employee prior to its first use, publication or broadcast.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(c)** **<u>Right to Insure</u>**. The Bank shall have the right to secure in its own name, or otherwise, and at its own expense, life, health, accident or other insurance covering Employee, and Employee shall have no right, title or interest in and to such insurance. Employee shall assist the Bank in procuring such insurance by submitting to reasonable examinations and by signing such applications and other instruments as may be reasonably required by the insurance carriers to which application is made for any such insurance.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**7.** **<u>INDEMNIFICATION BY THE BANK</u>**. The Bank shall, to the fullest extent permitted by law, indemnify, defend and hold harmless Employee from and against any and all loss, damage, expense (including court costs and reasonable attorneys' fees), suit, action, claim, liability, or obligation (collectively, "Liability") to which Employee may become subject related to or caused by the Bank or any of its affiliates, or arising from the performance or nonperformance of duties as an employee, officer or director of the Bank or any of its affiliates, unless such Liability is in any way attributable to the negligence, gross misconduct, repeated or blatant insubordination, theft or other criminal act of Employee, as determined by a final adjudication by a court or tribunal of competent jurisdiction. The Bank shall continue to maintain directors' and officers' liability insurance in commercially reasonable amounts (but in no event less than as in effect on the Effective Date) and the Employee shall be covered under such insurance to the same extent as other senior management employees and directors of the Bank. The Bank agrees that it shall not amend its bylaws so as to limit the Bank's ability to indemnify Employee.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**8.** **<u>TERMINATION</u>**. This Agreement may be terminated prior to the expiration of the Term (a "Termination Event'') as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(a)** **<u>Mutual Agreement</u>**. This Agreement may be terminated at any time by mutual written agreement of the parties.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(b)** **<u>Cause</u>**. The Bank may terminate this Agreement upon written notice to Employee for "Cause," which shall mean (i) the conviction of Employee for a felony, (ii) the commission by Employee of any act or omission involving dishonesty, disloyalty, breach of fiduciary duty or fraud with respect to the Bank and/or any of its affiliates, (iii) gross negligence or incompetence in the performance or non-performance of duties in his capacity as Chief Financial Officer and Chief Operating Officer of the Bank; (iv) a pattern of willful misconduct or repeated or blatant insubordination in the performance of his duties; or (v) Employee's material breach of or default under this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(c)** **<u>Disability</u>**. The Bank may terminate this Agreement upon written notice to Employee if Employee shall be rendered incapable by reason of a "disability" from complying with the terms, provisions and conditions hereof on his part to be performed during the Term. The term "disability" shall mean the appointment of a conservator of the estate of Employee or the physical or mental incapacity of Employee such that he is incapable, after reasonable accommodation for such disability, of reporting to work for a period in excess of 90 consecutive calendar days or for shorter periods aggregating 120 days or more in any 12-month period or is unable to perform the essential functions of his job.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(d)** **<u>Death</u>**. This Agreement shall terminate in the event of Employee's death.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(e)** **<u>Resignation</u>**. This Agreement shall terminate upon Employee's voluntary resignation from the Bank.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(f)** **<u>Bank's Election</u>**. The Bank may terminate this Agreement at any time upon written notice to Employee; provided, however, any such termination without Cause shall entitle Employee to compensation under Section 10 hereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(g)** **<u>Termination for Good Reason by Employee</u>**. During the Term of this Agreement, Employee may terminate his employment for "Good Reason," as that term is defined below. In the event of a termination for Good Reason by Employee, such termination will be treated as a termination of Employee by Bank without Cause, in which case Employee will have all remedies to which he may be entitled at law, in equity, or under this Agreement. The term "Good Reason" shall mean:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) <u>Breach</u>. The breach of this Agreement by the Bank, including but not limited to, a material diminution in job duties or responsibilities, Employee's title, authority or status, a relocation of Employee's office and Employee's annual salary inconsistent with this Agreement, and any attempt by Bank to terminate this Agreement without Cause.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) <u>Change of Control</u>. Within three (3) months following a transaction or event resulting in the group of persons (together with their respective affiliates and trusts) who own a 25% or more controlling interest in the Bank on the Effective Date, ceasing to own a 25% or more controlling interest in the Bank, Employee may terminate his employment and it will be deemed a Termination for Good Reason if the Bank or its successor entity has not fully adopted and ratified this Agreement and assumed all duties and obligations thereunder.

In order to resign his employment from the Bank for "Good Reason" under Section 8(g)(1) above, Employee must first provide written notice to the Board of Directors of the Bank setting forth with reasonable detail the nature of the Good Reason within 30 days from the occurrence of a Good Reason event, and Employee's resignation for Good Reason shall only be effective as a resignation for Good Reason if the Bank has not cured or remedied the Good Reason event within 30 days after its receipt of Employee's written notice (the "Cure Period"). This requirement shall not apply to a termination by Employee for Good Reason due to a change of control, as set forth above.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**9.** **<u>RETURN OF BANK PROPERTY</u>**. Within 5 days after the termination of this Agreement, Employee shall return to the Bank all equipment (including, without limitation, computers, software, credit cards, cellular or other telephones, pagers and organizers), products, work papers, books, records, forms, data processes, papers and writings relating to the business of the Bank including without limitation the Bank's proprietary or licensed computer programs, customer lists and customer data, and/or copies or duplicates thereof in Employee's possession or under Employee's control. Employee shall not retain any copies or duplicates of such property and all licenses granted to him by the Bank to use such computer programs, data or software shall be revoked upon termination of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**10.** **<u>EFFECT OF TERMINATION</u>**. If Employee resigns from the Bank or if Employee's employment with the Bank is terminated pursuant to any provision of Section 8 (other than subsection (f) and (g) thereof or as provided below), then Employee shall be entitled solely to any base salary accrued through the date of such termination or resignation pursuant to Section 4(a), along with the cash value of any unused vacation benefits under Section 4(b)(ii) and any options or restricted stock units granted pursuant to Section 4(d) that have vested as of such date. If Employee's employment with the Bank is terminated pursuant to Section 8(f) or Section 8(g), or if Employee resigns based upon a breach of this Agreement on the part of the Bank which the Bank has failed to cure within 30 days after receipt of written notice from Employee of such breach, then Employee shall be entitled to receive (1) such accrued base compensation, if any, as is due pursuant to Section 4(a) and the cash value of any unused vacation pursuant to Section 4(b)(ii); (2) a lump sum cash amount equal to his base compensation pursuant to Section 4(a) for a period of twelve (12) months, along with the cash value of vacation benefits under 4(b)(ii) for twelve (12) months; and (3) the 90-day right to exercise any options or restricted stock units granted pursuant to Section 4(d) that have vested as of the date of termination of Employee's employment.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**11.** **<u>GENERAL</u>**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(a)** **<u>Assignment; Successors; Affiliates</u>**. The Bank may not assign this Agreement (or the interest of the Bank herein) except to any affiliate of the Bank or to any entity or its affiliates which is a party to a merger, reorganization, or consolidation with the Bank or to an entity or entities acquiring substantially all of the assets of the Bank (providing any such assignee assumes the Bank's obligation under the Agreement). Upon such assignment, acquisition, merger, consolidation, or reorganization, the term "Bank" as used herein shall be deemed to refer to such assignee or such successor entity. Employee shall not have the right to assign Employee's interest in this Agreement, any rights under this Agreement or any duties imposed under this Agreement, nor shall Employee (or Employee's spouse, heirs, beneficiaries, administrators or executors) have the right to pledge, hypothecate or otherwise encumber Employee's right to receive compensation hereunder without the consent of the Bank. The right of assignment by the Bank shall not prejudice Employee's right to terminate this Agreement pursuant to Section 8 hereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(b)** **<u>Headings</u>**. The subject headings of the sections and subsections of this Agreement are included for purposes of convenience only, and shall not affect the construction or interpretation of any of its provisions.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(c)** **<u>Incorporation by Reference of Relevant Regulatory Law</u>**. This Agreement incorporates by reference 12 U.S.C. §1828(k) and any regulations promulgated thereunder with regard to legal restrictions on the payment of golden parachute and indemnification payments. In the event any payments to Employee pursuant to this Agreement are prohibited or limited by the provisions of such statute and/or regulation, the Bank will use its commercially reasonable efforts to obtain the consent of the appropriate regulatory authorities for the payment by the Bank to Employee of the maximum amount that is permitted (up to the amount payable under the terms of this Agreement).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(d)** **<u>Severability</u>**. It is agreed that if any term, covenant, provision, paragraph or condition of this Agreement shall be illegal, such illegality shall not invalidate the whole Agreement, but it shall be construed as if not containing the illegal part, and the rights and obligations of the parties shall be construed and enforced accordingly.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(e)** **<u>Entire Agreement</u>**. The parties hereto agree that this Agreement, and the related stock option and restricted stock agreement(s), supersede all existing agreements between the Bank and Employee, whether oral, written, expressed or implied, and contain the entire understanding and agreement between the parties. This Agreement shall not be amended, modified, or supplemented in any respect except by a subsequent written agreement entered into by both parties hereto.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(f)** **<u>Amendment and Waiver</u>**. This Agreement may be amended, modified or supplemented only by a writing executed by each of the parties. Either party may in writing waive any provision of this Agreement to the extent such provision is for the benefit of the waiving party. No waiver by either party of a breach of any provision of this Agreement shall be construed as a waiver of any subsequent or different breach, and no forbearance by a party to seek a remedy for noncompliance or breach by the other party shall be construed as a waiver of any right or remedy with respect to such noncompliance or breach.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(g)** **<u>Review of Terms</u>**. Without binding either of the parties in any respect, the parties intend to review the terms of this Agreement on a periodic basis and discuss such potential modifications thereto as they may mutually agree upon.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(h)** **<u>Choice of Law</u>**. This Agreement and the performance hereunder shall be governed by and construed in accordance with the laws of the State of California, without regard to the conflict of laws provisions of any state.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(i)** **<u>Notices</u>**. Any notices to be given hereunder by any party to any other party may be effected by personal delivery in writing or by mail, registered or certified, postage prepaid with return receipt requested. Mailed notices shall be addressed to the parties at the addresses appearing below, but each party may change his address by written notice in accordance with this Section. Notices delivered personally shall be deemed communicated as of actual receipt; mailed notices shall be deemed communicated 3 days after mailing. In addition, notices and communications may be sent by telephone facsimile transmission or electronic mail, provided manually signed confirming copies are also sent in the manner set forth in the second sentence of this Section, in which event delivery shall be deemed upon receipt of the facsimile transmission or electronic mail.

---

| | |
|:---|:---|
| If to the Bank: | INFINITY BANK |
|  | 6 Hutton Centre, Suite 100 |
|  | Santa Ana, California 92707 |
|  | Attention: Corporate Secretary |
|  | Fax: <u>(714) 619-7456</u> |
|  | Email: <u>elaine@goinfinitybank.com</u> |
| If to Employee: | Victor E. Guerrero II |
|  | 2723 Woodacre Street |
|  | Brea, CA 92821 |
|  | Fax:_____________________ |
|  | Email: victor1212@yahoo.com |

---

or to such other addresses as may be designated in writing by either of the parties.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(j)** **<u>Counterparts</u>**. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original document, but all of which taken together shall constitute one and the same document.

IN WITNESS WHEREOF, the Bank and Employee have executed this Agreement as of the Effective Date.

---

| |
|:---|
| **INFINITY BANK:** |
| By: |
| Name:<u>Raymond J. Gagnon</u> |
| Title: <u>Chairman of the Board</u> |
| **EMPLOYEE:** |
| Victor E. Guerrero II |

---

## Ex1A-6

**Exhibit 6.5**

**TAX SHARING AGREEMENT**

**By and Between**

**Infinity Bancorp**

**and**

**Infinity Bank**

Infinity Bancorp, a California corporation ("Bancorp"), and Infinity Bank, a California banking corporation ("Bank") which is owned 100% by Bancorp, hereby enter into this Tax Sharing Agreement (this "Agreement") effective as of October 21, 2022, pursuant to which tax liabilities or refunds will be allocated properly between Bancorp and Bank. Bancorp and Bank are collectively referred to herein as "the parties" or "the members" and individually as "a party" or "a member".

NOW, THEREFORE, for valuable consideration, the receipt and sufficiency of which is hereby acknowledged by the parties, and in consideration of the promises and of the mutual covenants and agreements hereinafter set forth, the parties agree as follows:

**ARTICLE I**

**DEFINITIONS**

Unless otherwise indicated, the following terms shall, for the purposes of this Agreement, be defined as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.1 <u>Affiliated Group</u> shall
have the meaning set forth in paragraph 2.1(b) of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.2 <u>Tax Code</u> shall mean the Internal Revenue Code of 1986, as amended.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.3 <u>Independent Public Accountant</u> shall mean the firm of registered independent public accounting firm as may from time to time be retained by Bancorp.

**ARTICLE II**

**TAX SHARING**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.1 <u>Federal Income Tax</u> 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) It is the desire and intent of the parties to this Agreement to establish a method for allocating the consolidated tax liability of each member among the Affiliated Group (hereinafter defined), for reimbursing each member for payment of such tax liability, for compensating members of the Affiliated Group (as defined in paragraph 2.1(b)) for use of their losses, tax credits or tax deferred treatment, and to provide for the allocation and payment of any refunds arising from a carry back of losses, tax credits or tax deferred treatment from subsequent taxable years.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) For purposes of this Article II, the term "Affiliated Group" shall have the meaning assigned to it in Tax Code Section 1504(a) and shall include all members of the group included in the filing of Bancorp's consolidated tax return for federal income tax purposes. Bancorp and Bank are the initial members of the Affiliated Group. In the event additional corporations become members of the Affiliated Group, the parties to this Agreement shall use their best efforts to include such corporations as parties to this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) A U.S. consolidated income tax return will be filed by Bancorp for each taxable year for which this Agreement is in effect and for which members of the Affiliated Group are required or permitted to file a consolidated tax return. The members of the Affiliated Group shall execute and file such consents, elections and other documents that may be required or appropriate for the proper filing of such returns.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) For each taxable period, members of the Affiliated Group shall compute their separate tax liability as if they had filed a separate tax return. The separate return tax liability of the members of the Affiliated Group shall be computed in a manner consistent with the provisions of Treasury Regulation Section 1.1552-1 (a)(2)(H), provided that the carryover of any tax attribute from a prior taxable year, which is not available in determining the consolidated tax liability of the Affiliated Group for such taxable period, shall be disregarded. Moreover, the parties agree to reimburse any member which has tax losses or credits in an amount equal to 100% of the tax benefits realized by the other members of the Affiliated Group as a result of the utilization by them of such member's tax losses, credits or deferred tax treatment. It is the intent of the members of the Affiliated Group that the tax liability will be allocated in accordance with the "percentage method" of Section 1.1502-33(d)(3) of the Treasury Regulations and that the percentage referred to in Section 1.1502-33(d)(3)(i) shall be 100%. Bancorp is authorized to elect the "percentage method" in accordance with the procedures specified in Section 1.1502-33(d)(5) of the Treasury Regulations. The reconciliation and settlement of annual tax liabilities will occur promptly (within 30 calendar days) after the corporate income tax returns have been filed.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) Payment of the consolidated tax liability for a taxable period shall include the payment of estimated tax installments due for such taxable period and members of the Affiliated Group shall promptly pay to Bancorp their estimated tax payments as computed in paragraph 2.1(d) upon receiving notice of such payments from Bancorp, but in no event later than the close of business on the date that is immediately prior to the due date for each estimated tax payment. Upon receipt of the estimated tax payment by the members of the Affiliated Group, Bancorp will make the tax payment pursuant to the Treasury Regulations. Overpayments of estimated tax by members of the Affiliated Group as determined by Bancorp shall be refunded promptly to the appropriate members of the Affiliated Group.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) If part or all of an unused loss, tax credit or deferred tax treatment is allocated to a member of the Affiliated Group pursuant to Treasury Regulation Section 1.1502-79, and is carried back or forward to a year in which the Affiliated Group member filed a separate return or a consolidated return with another affiliated group, any refund or reduction in tax liability arising from the carry back or carry forward shall be retained by the subject Affiliated Group member. Notwithstanding the above, Bancorp shall determine whether an election shall be made not to carry back part or all of a consolidated net operating loss for any taxable year in accordance with Section 172(b)(3) of the Tax Code.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) In calculating any carry-back or carryover of net operating losses, adjustments shall be made to such prior or subsequent year's separate company tax liability as determined under Section 172(b)(2) of the Tax Code. For purposes of this calculation, the election under Section 172(b)(3) shall be made on a separate company basis.

Page 2 of 7

The parties agree that it is their express intent that this Agreement shall at all times be construed in a manner consistent with any law or regulation applicable to any member as now or hereafter in effect. Anything to the contrary herein notwithstanding, (1) Bancorp shall not pay to any member an amount greater than the tax which member of the Affiliated Group would have been required to pay had it filed a separate tax return, taking maximum advantage of available reductions in taxable income; (2) any payments made pursuant to paragraphs 2.1(e), (f) and (g) of this Agreement shall be made only with reference to the time taxes are actually paid or refunds or credits are actually received, it being understood that Bancorp shall at no time make advance payments with respect to the foregoing to any member, and (3) any funds (i) received by Bancorp from any member for the payment by Bancorp of taxes or (ii) received by Bancorp from any taxing authority by reason of any refund, credit or overpayment and properly allocable to another member, shall at all times be held by Bancorp in a segregated account solely as agent for such member and shall at no time be commingled with any other funds held by Bancorp.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2 <u>Certain State Taxes</u>. For each taxable period, members of the Affiliated Group shall compute their separate state tax liability. The separate return state tax liability of the members of the Affiliated Group shall be computed in a manner consistent with the relevant state law provisions. After the computation of their state tax liability, members of the Affiliated Group shall promptly pay to Bancorp their estimated tax payments, but in no event later than the due date for each estimated tax payment. Upon receipt of the estimated tax payment by the members of the Affiliated Group, Bancorp will make the tax payment pursuant to the relevant state taxing authorities. Overpayments of estimated tax by members of the Affiliated Group, as determined by Bancorp, shall be refunded promptly to the appropriate members of the Affiliated Group. If the state tax return is reviewed by a state taxing authority and adjustments are made which will either increase or decrease the tax previously reported and paid, the Affiliated Group members affected by such adjustments shall pay all costs or receive all benefits from such adjustment.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.3 <u>Other Taxes</u>. The other Affiliated Group members may from time to time become subject to additional taxes by federal, state or local authorities. In such event the members of the Affiliated Group shall consult with each other to determine a mutually acceptable form of allocation or apportionment of such taxes.

Page 3 of 7

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.4 <u>Procedural Matters</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Bancorp shall prepare and file consolidated returns, and any other returns, documents or statements required to be filed with the Internal Revenue Service or any other relevant taxing authority with respect to the determination of the tax liability of Bancorp and the Affiliated Group members for all taxable periods commencing with the tax period applicable as of the date of the execution of this Agreement. Bancorp shall have the right, in its sole discretion: (to determine (A) the manner in which such returns shall be prepared and filed, including, without limitation, the manner in which any item of income, gain, loss, deduction or credit shall be reported; provided, however, that Bancorp shall consider in good faith any treatment proposed by the Affiliated Group members, (B) whether any extensions of the statute of limitations may be granted and (C) the elections that will be made pursuant to the Tax Code (or applicable state tax laws) on behalf of any member of the consolidated group (it being agreed, however, that Bancorp shall not unreasonably withhold its consent to any elections that members of the Affiliated Group desire to make); (ii) to contest, compromise or settle any adjustment or deficiency proposed, asserted or assessed as a result of any audit of any such returns; (iii) to file, prosecute, compromise or settle any claim for refund; and (iv) to determine whether any refunds to which the consolidated group may be entitled shall be paid by way of refund or credited against the tax liability of the consolidated group.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Bancorp, to the extent such information is available, shall promptly notify the members of the Affiliated Group of any tax liability or refund issue, and shall advise and consult in good faith with such members with respect to contest, compromise or settlement thereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) In the event of any disagreement as to the method of, or principles followed in, the computation, or as to the amount of income, deduction, gain, loss or credit, the parties shall submit the dispute to the Independent Public Accountant and the determination of such firm shall be conclusive and binding.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.5 <u>Cooperation</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) At all times during which this Agreement is in force, the parties shall make available to each other during normal business hours and in a manner which will not interfere with the other party's business, its tax, accounting and legal staff to the extent reasonably required in connection with the preparation of tax returns and other tax matters.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) In the event of the termination of this Agreement, the parties will use their best efforts to make available to the others, upon written request, its officers and employees in connection with any tax proceedings.

Page 4 of 7

**ARTICLE III**

**AGENCY RELATIONSHIP**

**BETWEEN BANCORP AND BANK**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.1 <u>Bancorp is Agent for Bank</u>

Bancorp is an agent for Bank and any other subsidiaries of Bancorp and/or Bank (collectively referred to as the "Affiliates") with respect to all matters related to consolidated tax returns and refund claims, and nothing in this Agreement shall be construed to alter or modify this agency relationship. If Bancorp receives a tax refund from a taxing authority, these funds are obtained as agent for the Affiliates. Any tax refund attributable to income earned, taxes paid, and losses incurred by the Affiliates is the property of and owned by the Affiliates, and shall be held in trust by Bancorp for the benefit of the Affiliates. Bancorp shall forward promptly the amounts held in trust to the Affiliates. Nothing in this Agreement is intended to be or should be construed to provide Bancorp with an ownership interest in a tax refund that is attributable to income earned, taxes paid, and losses incurred by the Affiliates. Bancorp hereby agrees that this Tax Sharing Agreement does not give it an ownership interest in a tax refund generated by the tax attributes of the Affiliates.

The language of this paragraph 3.1 is intended to acknowledge that an agency relationship exists for purposes of the Interagency Policy Statement on Income Tax Allocation in a Holding Company Structure issued as of November 23, 1998 (the "Policy Statement"), the Addendum to the Policy Statement dated May 15, 2014 (the "Addendum"), and Sections 23A and 23B of the Federal Reserve Act, and to comply with the requirements of the Policy Statement, the Addendum and Sections 23A and 23B of the Federal Reserve Act.

**ARTICLE IV**

**MISCELLANEOUS**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.1 <u>Entire Agreement</u>. This Agreement contains the entire understanding of the parties hereto with respect to the subject matter contained herein. No alteration, amendment or modification of any of the terms of this Agreement shall be valid unless made by an instrument signed by an authorized officer of the parties hereto.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.2 <u>Governing Law.</u> This Agreement has been made in and shall be construed and enforced in accordance with the laws of the State of California, as such laws may from time to time be amended or revised.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.3 <u>Headings.</u> The headings contained in this Agreement are inserted for convenience only and shall not constitute a part hereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.4 <u>Notices.</u> Any notice, demand, claim or other communication under this Agreement shall be in writing and shall be deemed to have been given upon the delivery or mailing thereof, as the case may be, if delivered personally or sent by certified mail, return receipt requested, postage prepaid, to the parties at the following addresses (or at such other address as a party may specify by notice to the others):

Page 5 of 7

---

| | |
|:---|:---|
| If to Bancorp, to: | Infinity Bancorp |
|  | 6 Hutton Centre Drive, Suite 100 |
|  | Santa Ana, CA 92707 |
|  | <u>Attn</u>: President/Chief Operating Officer |
| If to Bank, to | Infinity Bank |
|  | 6 Hutton Centre Drive, Suite 100 |
|  | Santa Ana, CA 92707 |
|  | <u>Attn</u>: Executive Vice President/ |
|  | Chief Financial Officer |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.5 <u>No Assignment or Subcontracting</u>. This Agreement is not assignable in whole or in part by the parties without the other parties' prior written consent. Any attempted assignment without such consent will be null and void.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.6 <u>Successors.</u> Subject to the restrictions on assignment set forth above, this Agreement shall be binding upon and shall inure to the benefit of the parties and their respective successors and assigns.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.7 <u>Authority.</u> The parties represent and warrant that they have the full right, power and authority to enter into and perform this Agreement in accordance with its terms and that the execution and delivery of this Agreement have been duly authorized by proper corporate action.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.8 <u>Severability</u>. If any provision of this Agreement is determined to be illegal, unenforceable or void, this Agreement shall be construed as if not containing that provision, and the rest of the Agreement shall remain in full force and effect. If any provision of this Agreement or any other agreement incorporating this Agreement is determined to violate Federal Reserve Act Section 23A or 23B, the Tax Code, Federal Laws or Regulations, and/or California State Laws, the parties agree to amend the provision, <u>nunc pro tunc,</u> in a manner which brings it into compliance with the law, regulation or Tax Code.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.9 <u>No Third Party Beneficiaries</u>. Nothing in this Agreement shall be construed to confer any right or benefit on any person who is not a party to this Agreement.

**[The next page is the signature page.]**

Page 6 of 7

IN WITNESS WHEREOF, each affiliate has caused its name to be subscribed and executed by their respective authorized officer on the dates indicated, effective as of the date first set forth above.

---

| | | | |
|:---|:---|:---|:---|
| Bancorp: | Bancorp: | Bank: | Bank: |
| Infinity Bancorp | Infinity Bancorp | Infinity Bank | Infinity Bank |
| By: | /s/ Victor E. Guerrero | By: | /s/ Allison Duncan |
|  | Victor E. Guerrero |  | Allison Duncan |
|  | President/Chief Operating Officer |  | Executive Vice President/Chief Financial Officer |

---

Page 7 of 7

## Ex1A-6

**Exhibit 6.6**

**<u>SUBORDINATED NOTE</u>**

**INFINITY BANK**

**4.25% FIXED TO FLOATING RATE SUBORDINATED NOTE**

**DUE NOVEMBER 1, 2031**

THE INDEBTEDNESS EVIDENCED BY THIS SUBORDINATED NOTE IS NOT A DEPOSIT AND IS NOT INSURED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY OTHER GOVERNMENT AGENCY OR FUND.

THE INDEBTEDNESS EVIDENCED BY THIS SUBORDINATED NOTE IS SUBORDINATED AND JUNIOR IN RIGHT OF PAYMENT TO SENIOR INDEBTEDNESS (AS DEFINED IN <u>SECTION 3</u> (SUBORDINATION) OF THIS SUBORDINATED NOTE) OF INFINITY BANK, A CALIFORNIA CORPORATION (THE "<u>COMPANY</u>"), INCLUDING OBLIGATIONS OF THE COMPANY TO ITS GENERAL AND SECURED CREDITORS AND IS UNSECURED. IT IS INELIGIBLE AS COLLATERAL FOR ANY EXTENSION OF CREDIT BY THE COMPANY OR ANY OF ITS SUBSIDIARIES.

IN THE EVENT OF LIQUIDATION, ALL HOLDERS OF SENIOR INDEBTEDNESS OF THE COMPANY SHALL BE ENTITLED TO BE PAID IN FULL WITH SUCH INTEREST AS MAY BE PROVIDED BY LAW BEFORE ANY PAYMENT SHALL BE MADE ON ACCOUNT OF PRINCIPAL OF OR INTEREST ON THIS SUBORDINATED NOTE. AFTER PAYMENT IN FULL OF ALL SUMS OWING TO SUCH HOLDERS OF SENIOR INDEBTEDNESS, THE HOLDER OF THIS SUBORDINATED NOTE, TOGETHER WITH THE HOLDERS OF ANY OBLIGATIONS OF THE COMPANY RANKING ON A PARITY WITH THE SUBORDINATED NOTES, SHALL BE ENTITLED TO BE PAID FROM THE REMAINING ASSETS OF THE COMPANY THE UNPAID PRINCIPAL AMOUNT OF THIS SUBORDINATED NOTE PLUS ACCRUED AND UNPAID INTEREST THEREON BEFORE ANY PAYMENT OR OTHER DISTRIBUTION, WHETHER IN CASH, PROPERTY OR OTHERWISE, SHALL BE MADE (i) with respect to any obligation that by its terms expressly is junior in the right of payment to the Subordinated Notes, (ii) WITH RESPECT TO any indebtedness between the Company and any of its subsidiaries or affiliates or (iII) on account OF ANY SHARES OF CAPITAL STOCK OF THE COMPANY.

THIS SUBORDINATED NOTE WILL BE ISSUED AND MAY BE TRANSFERRED ONLY IN MINIMUM DENOMINATIONS OF $100,000 AND MULTIPLES OF $1,000 IN EXCESS THEREOF. ANY ATTEMPTED TRANSFER OF THIS SUBORDINATED NOTE IN A DENOMINATION OF LESS THAN $100,000 SHALL BE DEEMED TO BE VOID AND OF NO LEGAL EFFECT WHATSOEVER. ANY SUCH PURPORTED TRANSFEREE SHALL BE DEEMED NOT TO BE THE HOLDER OF THIS SUBORDINATED NOTE FOR ANY PURPOSE, INCLUDING, BUT NOT LIMITED TO, THE RECEIPT OF PAYMENTS ON THIS SUBORDINATED NOTE, AND SUCH PURPORTED TRANSFEREE SHALL BE DEEMED TO HAVE NO INTEREST WHATSOEVER IN THIS SUBORDINATED NOTE.

THIS SUBORDINATED NOTE MAY BE SOLD ONLY IN COMPLIANCE WITH APPLICABLE FEDERAL AND STATE SECURITIES LAWS. THIS SUBORDINATED NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY APPLICABLE STATE SECURITIES LAWS, OR ANY OTHER APPLICABLE SECURITIES LAWS. NEITHER THIS SUBORDINATED NOTE NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT.

**CERTAIN ERISA CONSIDERATIONS:**

THE HOLDER OF THIS SUBORDINATED NOTE, OR ANY INTEREST HEREIN, BY ITS ACCEPTANCE HEREOF OR THEREOF AGREES, REPRESENTS AND WARRANTS THAT IT IS NOT AN EMPLOYEE BENEFIT PLAN, INDIVIDUAL RETIREMENT ACCOUNT OR OTHER PLAN OR ARRANGEMENT SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE") (EACH, A "PLAN"), OR AN ENTITY WHOSE UNDERLYING ASSETS INCLUDE "PLAN ASSETS" BY REASON OF ANY PLAN'S INVESTMENT IN THE ENTITY, AND NO PERSON INVESTING "PLAN ASSETS" OF ANY PLAN MAY ACQUIRE OR HOLD THIS SUBORDINATED NOTE OR ANY INTEREST HEREIN, UNLESS SUCH PURCHASER OR HOLDER IS ELIGIBLE FOR THE EXEMPTIVE RELIEF AVAILABLE UNDER U.S. DEPARTMENT OF LABOR PROHIBITED TRANSACTION CLASS EXEMPTION 96-23, 95-60, 91-38, 90-1 OR 84-14 OR ANOTHER APPLICABLE EXEMPTION OR ITS PURCHASE AND HOLDING OF THIS SUBORDINATED NOTE, OR ANY INTEREST HEREIN, ARE NOT PROHIBITED BY SECTION 406 OF ERISA OR SECTION 4975 OF THE CODE WITH RESPECT TO SUCH PURCHASE AND HOLDING. ANY PURCHASER OR HOLDER OF THIS SUBORDINATED NOTE OR ANY INTEREST HEREIN WILL BE DEEMED TO HAVE REPRESENTED BY ITS PURCHASE AND HOLDING THEREOF THAT EITHER: (I) IT IS NOT AN EMPLOYEE BENEFIT PLAN OR OTHER PLAN TO WHICH TITLE I OF ERISA OR SECTION 4975 OF THE CODE IS APPLICABLE, A TRUSTEE OR OTHER PERSON ACTING ON BEHALF OF ANY SUCH EMPLOYEE BENEFIT PLAN OR OTHER PLAN, OR ANY OTHER PERSON OR ENTITY USING THE "PLAN ASSETS" OF ANY SUCH PLAN OR OTHER PLAN TO FINANCE SUCH PURCHASE OR (II) SUCH PURCHASE OR HOLDING WILL NOT RESULT IN A PROHIBITED TRANSACTION UNDER SECTION 406 OF ERISA OR SECTION 4975 OF THE CODE FOR WHICH FULL EXEMPTIVE RELIEF IS NOT AVAILABLE UNDER APPLICABLE STATUTORY OR ADMINISTRATIVE EXEMPTION.

**ANY FIDUCIARY OF ANY PLAN WHO IS CONSIDERING THE ACQUISITION OF THIS SUBORDINATED NOTE OR ANY INTEREST HEREIN SHOULD CONSULT WITH HIS OR HER LEGAL COUNSEL PRIOR TO ACQUIRING THIS SUBORDINATED NOTE OR ANY INTEREST HEREIN.**

**INFINITY BANK**

**4.25% FIXED TO FLOATING RATE SUBORDINATED NOTE**

**DATED OCTOBER 22, 2021 AND DUE NOVEMBER 1, 2031**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**1.** **<u>Subordinated Notes</u>**. This subordinated note is one of an issue of notes of Infinity Bank, a California corporation (the "<u>Company</u>"), designated as the "4.25% Fixed to Floating Rate Subordinated Notes due November 1, 2031" (the "<u>Subordinated Notes</u>") issued pursuant to that Subordinated Note Purchase Agreement, dated as of the date upon which this Subordinated Note was originally issued (the "<u>Issue Date</u>"), between the Company and the one or more purchasers of the Subordinated Notes identified in the signature pages thereto (the "<u>Purchase Agreement</u>").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**2.** **<u>Payment</u>**. The Company, for value received, promises to pay to **CALIFORNIA BANK OF COMMERCE**, or its registered assigns, the principal sum of **TWO MILLION FIVE HUNDRED THOUSAND DOLLARS (U.S.) ($2,500,000),** plus accrued but unpaid interest on **November 1, 2031** (the "<u>Maturity Date</u>") and to pay interest thereon (i) from and including the original issue date of the Subordinated Notes to but excluding **November 1, 2026** or the earlier redemption date contemplated by <u>Section 4</u> (Redemption) of this Subordinated Note (the "<u>Fixed Rate Period</u>"), at the rate of **4.25%** per annum, computed on the basis of a 360-day year consisting of twelve 30-day months and payable semi-annually in arrears on **May 1** and **November 1** of each year (each payment date, a "<u>Fixed Interest Payment Date</u>"), beginning **May 1, 2022**, and (ii) from and including **November 1, 2026**, to but excluding the Maturity Date or earlier redemption date contemplated by <u>Section 4</u> (Redemption) of this Subordinated Note (the "<u>Floating Rate Period</u>"), at the rate per annum, reset quarterly, equal to the Floating Interest Rate (as defined below) determined on the Floating Interest Determination Date (as defined below) of the applicable interest period plus **336** basis points, computed on the basis of a 360-day year and the actual number of days elapsed and payable quarterly in arrears (each quarterly period, a "<u>Floating Interest Period</u>") on **February 1, May 1, August 1 and November 1** of each year (each payment date, a "<u>Floating Interest Payment Date</u>"). Dollar amounts resulting from this calculation shall be rounded to the nearest cent, with one-half cent being rounded up. The term "<u>Floating Interest Determination Date</u>" means the date upon which the Floating Interest Rate is determined by the Calculation Agent (as defined below) pursuant to the Three-Month Term SOFR Conventions (as defined below).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) An "<u>Interest Payment Date</u>" is either a Fixed Interest Payment Date or a Floating Interest Payment Date, as applicable.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The "<u>Floating Interest Rate</u>" means:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) initially Three-Month Term SOFR (as defined below).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Notwithstanding the foregoing <u>clause (i)</u> of this <u>Section 2(b)</u>:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) If the Calculation Agent, reasonably determines in good faith prior to the relevant Floating Interest Determination Date that a Benchmark Transition Event and its related Benchmark Replacement Date (each of such terms as defined below) have occurred with respect to Three-Month Term SOFR, then the Company shall promptly provide notice of such determination to the Noteholders and <u>Section 2(c)</u> (Effect of Benchmark Transition Event) will thereafter apply to all determinations, calculations and quotations made or obtained for the purposes of calculating the Floating Interest Rate payable on the Subordinated Notes during a relevant Floating Interest Period.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) However, if the Calculation Agent reasonably determines in good faith that a Benchmark Transition Event and its related Benchmark Replacement Date have occurred with respect to Three-Month Term SOFR, but for any reason the Benchmark Replacement has not been determined as of the relevant Floating Interest Determination Date, the Floating Interest Rate for the applicable Floating Interest Period will be equal to the Floating Interest Rate on the last Floating Interest Determination Date for the Subordinated Notes, as determined by the Calculation Agent.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) If the then-current Benchmark is Three-Month Term SOFR and any of the foregoing provisions concerning the calculation of the interest rate and the payment of interest during the Floating Rate Period are inconsistent with any of the Three-Month Term SOFR Conventions determined by the Company, then the relevant Three-Month Term SOFR Conventions will apply.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Effect of Benchmark Transition Event</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) If the Calculation Agent reasonably determines in good faith that a Benchmark Transition Event and its related Benchmark Replacement Date have occurred prior to the Reference Time (as defined below) in respect of any determination of the Benchmark (as defined below) on any date, the Benchmark Replacement will replace the then-current Benchmark for all purposes relating to the Subordinated Notes during the relevant Floating Interest Period in respect of such determination on such date and all determinations on all subsequent dates.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) In connection with the implementation of a Benchmark Replacement, the Company will have the right to make Benchmark Replacement Conforming Changes from time to time, and such changes shall become effective without consent from the relevant Noteholders (as defined below) or any other party.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) Any determination, decision or election that may be made by the Company or by the Calculation Agent pursuant to the benchmark transition provisions set forth herein, including any determination with respect to a tenor, rate or adjustment or of the occurrence or non-occurrence of an event, circumstance or date, and any decision to take or refrain from taking any action or any selection:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) will be conclusive and binding absent manifest error;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) if made by the Company, will be made in the Company's sole discretion;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) if made by the Calculation Agent, will be made after consultation with the Company, and the Calculation Agent will not make any such determination, decision or election to which the Company reasonably objects; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(4) notwithstanding anything to the contrary in this Subordinated Note or the Purchase Agreement, shall become effective without consent from the relevant Noteholders (as defined below) or any other party.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) For the avoidance of doubt, after a Benchmark Transition Event and its related Benchmark Replacement Date have occurred, interest payable on this Subordinated Note for the Floating Rate Period will be an annual rate equal to the sum of the applicable Benchmark Replacement and the spread specified on the face hereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) As used in this Subordinated Note, the following terms have the meanings as set forth below:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) "<u>Benchmark</u>" means, initially, Three-Month Term SOFR; provided that if a Benchmark Transition Event and its related Benchmark Replacement Date have occurred with respect to Three-Month Term SOFR or the then-current Benchmark, then "<u>Benchmark</u>" means the applicable Benchmark Replacement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) "<u>Benchmark Replacement</u>" means the Interpolated Benchmark with respect to the then-current Benchmark; provided that if (a) the Calculation Agent cannot determine the Interpolated Benchmark as of the Benchmark Replacement Date or (b) the then-current Benchmark is Three-Month Term SOFR and a Benchmark Transition Event and its related Benchmark Replacement Date have occurred with respect to Three-Month Term SOFR (in which event no Interpolated Benchmark with respect to Three-Month Term SOFR shall be determined), then "<u>Benchmark Replacement</u>" means the first alternative set forth in the order below that can be determined by the Calculation Agent, as of the Benchmark Replacement Date:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a. The sum of (i) Compounded SOFR and (ii) the Benchmark Replacement Adjustment;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b. the sum of: (i) the alternate rate of interest that has been selected or recommended by the Relevant Governmental Body as the replacement for the then-current Benchmark for the applicable Corresponding Tenor and (ii) the Benchmark Replacement Adjustment;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c. the sum of: (i) the ISDA Fallback Rate and (ii) the Benchmark Replacement Adjustment;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d. the sum of: (i) the alternate rate of interest that has been selected by the Company as the replacement for the then-current Benchmark for the applicable Corresponding Tenor giving due consideration to any industry-accepted rate of interest as a replacement for the then-current Benchmark for U.S. dollar denominated floating rate notes at such time and (ii) the Benchmark Replacement Adjustment.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) "<u>Benchmark Replacement Adjustment</u>" means the first alternative set forth in the order below that can be determined by the Calculation Agent, as of the Benchmark Replacement Date:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a. the spread adjustment, or method for calculating or determining such spread adjustment, (which may be a positive or negative value or zero) that has been selected or recommended by the Relevant Governmental Body for the applicable Unadjusted Benchmark Replacement;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b. if the applicable Unadjusted Benchmark Replacement is equivalent to the ISDA Fallback Rate, then the ISDA Fallback Adjustment;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c. the spread adjustment (which may be a positive or negative value or zero) that has been selected by the Company giving due consideration to any industry-accepted spread adjustment, or method for calculating or determining such spread adjustment, for the replacement of the then-current Benchmark with the applicable Unadjusted Benchmark Replacement for U.S. dollar denominated floating rate notes at such time.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(4) "<u>Benchmark Replacement Conforming Changes</u>" means, with respect to any Benchmark Replacement, any technical, administrative or operational changes (including changes to the definition of "<u>Floating Interest Period</u>," timing and frequency of determining rates with respect to each Floating Interest Period and making payments of interest, rounding of amounts or tenors and other administrative matters) that the Company reasonably decides in good faith may be appropriate to reflect the adoption of such Benchmark Replacement in a manner substantially consistent with market practice (or, if the Company reasonably decides in good faith that adoption of any portion of such market practice is not administratively feasible or if the Company reasonably determines in good faith that no market practice for use of the Benchmark Replacement exists, in such other manner as the Company determines in good faith is reasonably necessary).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(5) "<u>Benchmark Replacement Date</u>" means the earliest to occur of the following events with respect to the then-current Benchmark:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a. in the case of clause (a) of the definition of "<u>Benchmark Transition Event</u>," the relevant Reference Time in respect of any determination;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b. in the case of <u>clause (b)</u> or <u>(c)</u> of the definition of "<u>Benchmark Transition Event</u>," the later of (i) the date of the public statement or publication of information referenced therein and (ii) the date on which the administrator of the Benchmark permanently or indefinitely ceases to provide the Benchmark; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c. in the case of <u>clause (d)</u> of the definition of "<u>Benchmark Transition Event</u>," the date of such public statement or publication of information referenced therein.

For the avoidance of doubt, if the event giving rise to the Benchmark Replacement Date occurs on the same day as, but earlier than, the Reference Time in respect of any determination, the Benchmark Replacement Date will be deemed to have occurred prior to the Reference Time for purposes of such determination.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(6) "<u>Benchmark Transition Event</u>" means the occurrence of one or more of the following events with respect to the then-current Benchmark:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a. if the Benchmark is Three-Month Term SOFR, (i) the Relevant Governmental Body has not selected or recommended a forward-looking term rate for a tenor of three months based on SOFR, (ii) the development of a forward-looking term rate for a tenor of three months based on SOFR that has been recommended or selected by the Relevant Governmental Body is not complete or (iii) the Company reasonably determines in good faith that the use of a forward-looking rate for a tenor of three months based on SOFR is not administratively feasible;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b. a public statement or publication of information by or on behalf of the administrator of the Benchmark announcing that such administrator has ceased or will cease to provide the Benchmark, permanently or indefinitely, provided that, at the time of such statement or publication, there is no successor administrator that will continue to provide the Benchmark;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c. a public statement or publication of information by the regulatory supervisor for the administrator of the Benchmark, the central bank for the currency of the Benchmark, an insolvency official with jurisdiction over the administrator for the Benchmark, a resolution authority with jurisdiction over the administrator for the Benchmark or a court or an entity with similar insolvency or resolution authority over the administrator for the Benchmark, which states that the administrator of the Benchmark has ceased or will cease to provide the Benchmark permanently or indefinitely, provided that, at the time of such statement or publication, there is no successor administrator that will continue to provide the Benchmark; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d. a public statement or publication of information by the regulatory supervisor for the administrator of the Benchmark announcing that the Benchmark is no longer representative.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(7) "<u>Calculation Agent</u>" means such bank or other entity (which may be the Company or an affiliate of the Company) as may be appointed by the Company to act as Calculation Agent for the Subordinated Notes during the Floating Rate Period.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(8) "<u>Compounded SOFR</u>" means the compounded average of SOFRs for the applicable Corresponding Tenor, with the rate, or methodology for this rate, and conventions for this rate being established by the Company or its designee in accordance with:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a. the rate, or methodology for this rate, and conventions for this rate selected or recommended by the Relevant Governmental Body for determining compounded SOFR; *provided* that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b. if, and to the extent that, the Company or its designee reasonably determines in good faith that Compounded SOFR cannot be determined in accordance with <u>clause (a)</u> above, then the rate, or methodology for this rate, and conventions for this rate that have been selected by the Company or its designee giving due consideration to any industry-accepted market practice for U.S. dollar denominated floating rate notes at such time.

For the avoidance of doubt, the calculation of Compounded SOFR will exclude the Benchmark Replacement Adjustment.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(9) "<u>Corresponding Tenor</u>" with respect to a Benchmark Replacement means a tenor (including overnight) having approximately the same length (disregarding Business Day adjustment) as the applicable tenor for the then-current Benchmark.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(10) "<u>FRBNY</u>" means the Federal Reserve Bank of New York.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(11) "<u>FRBNY's Website</u>" means the website of the FRBNY at http://www.newyorkfed.org, or any successor source.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(12) "<u>Interpolated Benchmark</u>" with respect to the Benchmark means the rate determined for the Corresponding Tenor by interpolating on a linear basis between: (1) the Benchmark for the longest period (for which the Benchmark is available) that is shorter than the Corresponding Tenor and (2) the Benchmark for the shortest period (for which the Benchmark is available) that is longer than the Corresponding Tenor.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(13) "<u>ISDA</u>" means the International Swaps and Derivatives Association, Inc. or any successor thereto.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(14) "<u>ISDA Definitions</u>" means the 2006 ISDA Definitions published by the ISDA or any successor thereto, as amended or supplemented from time to time, or any successor definitional booklet for interest rate derivatives published from time to time.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(15) "<u>ISDA Fallback Adjustment</u>" means the spread adjustment (which may be a positive or negative value or zero) that would apply for derivatives transactions referencing the ISDA Definitions to be determined upon the occurrence of an index cessation event with respect to the Benchmark for the applicable tenor.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(16) "<u>ISDA Fallback Rate</u>" means the rate that would apply for derivatives transactions referencing the ISDA Definitions to be effective upon the occurrence of an index cessation date with respect to the Benchmark for the applicable tenor excluding the applicable ISDA Fallback Adjustment.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(17) "<u>Reference Time</u>" with respect to any determination of a Benchmark means (1) if the Benchmark is Three-Month Term SOFR, the time determined by the Calculation Agent after giving effect to the Three-Month Term SOFR Conventions, and (2) if the Benchmark is not Three-Month Term SOFR, the time determined by the Calculation Agent after giving effect to the Benchmark Replacement Conforming Changes.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(18) "<u>Relevant Governmental Body</u>" means the Board of Governors of the Federal Reserve System (the "<u>Federal Reserve</u>") and/or the FRBNY, or a committee officially endorsed or convened by the Federal Reserve and/or the FRBNY or any successor thereto.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(19) "<u>SOFR</u>" means the daily Secured Overnight Financing Rate provided by the FRBNY, as the administrator of the benchmark (or a successor administrator), on the FRBNY's Website.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(20) "<u>Term SOFR</u>" means the forward-looking term rate for the Corresponding Tenor based on SOFR that has been selected or recommended by the Relevant Governmental Body.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(21) "<u>Term SOFR Administrator</u>" means any entity designated by the Relevant Governmental Body as the administrator of Term SOFR (or a successor administrator).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(22) "<u>Three-Month Term SOFR</u>" means the rate for Term SOFR for a tenor of three months that is published by the Term SOFR Administrator at the Reference Time for any Floating Interest Period, as determined by the Calculation Agent after giving effect to the Three-Month Term SOFR Conventions; *<u>provided</u>*, *<u>however</u>*, that in the event Three-Month Term SOFR calculated as described in the foregoing clause is less than zero, Three-Month Term SOFR shall be deemed to be zero.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(23) "<u>Three-Month Term SOFR Conventions</u>" means any determination, decision or election with respect to any technical, administrative or operational matter (including with respect to the manner and timing of the publication of Three-Month Term SOFR, or changes to the definition of "Floating Interest Period", timing and frequency of determining Three-Month Term SOFR with respect to each Floating Interest Period and making payments of interest, rounding of amounts or tenors, and other administrative matters) that the Company reasonably decides in good faith may be appropriate to reflect the use of Three-Month Term SOFR as the Benchmark in a manner substantially consistent with market practice (or, if the Company reasonably decides in good faith that adoption of any portion of such market practice is not administratively feasible or if the Company reasonably determines in good faith that no market practice for the use of Three-Month Term SOFR exists, in such other manner as the Company determines in good faith is reasonably necessary).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(24) "<u>Unadjusted Benchmark Replacement</u>" means the Benchmark Replacement excluding the Benchmark Replacement Adjustment.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) In the event that any Fixed Interest Payment Date during the Fixed Rate Period falls on a day that is not a Business Day (as defined below), the interest payment due on that date shall be postponed to the next day that is a Business Day and no additional interest shall accrue as a result of that postponement. In the event that any Floating Interest Payment Date during the Floating Rate Period falls on a day that is not a Business Day (as defined below), the interest payment due on that date shall be postponed to the next day that is a Business Day and interest shall accrue to but excluding the date interest is paid. However, if the postponement would cause the day to fall in the next calendar month during the Floating Interest Period, the Floating Interest Payment Date shall instead be brought forward to the immediately preceding Business Day. The term "Business Day" means any day other than a Saturday or Sunday or any other day on which banking institutions in the State of California are generally authorized or required by law or executive order to be closed.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**3.** **<u>Subordination</u>**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The indebtedness of the Company evidenced by this Subordinated Note, including the principal and interest on this Subordinated Note, shall be subordinate and junior in right of payment to the prior payment in full of all existing claims of creditors of the Company whether now outstanding or subsequently created, assumed, guaranteed or incurred (collectively, "<u>Senior Indebtedness</u>"), which shall consist of principal of (and premium, if any) and interest, if any, on: (i) all indebtedness and obligations of, or guaranteed or assumed by, the Company for money borrowed, whether or not evidenced by bonds, debentures, securities, notes or other similar instruments, including all obligations to the Company's general and secured creditors; (ii) any deferred obligations of the Company for the payment of the purchase price of property or assets acquired other than in the ordinary course of business; (iii) all obligations, contingent or otherwise, of the Company in respect of any letters of credit, bankers' acceptances, security purchase facilities and similar direct credit substitutes; (iv) any capital lease obligations of the Company; (v) all obligations of the Company in respect of interest rate swap, cap or other agreements, interest rate future or option contracts, currency swap agreements, currency future or option contracts, commodity contracts and other similar arrangements or derivative products; (vi) all obligations that are similar to those in clauses (i) through (v) of other Persons for the payment of which the Company is responsible or liable as obligor, guarantor or otherwise arising from an off-balance sheet guarantee; (vii) all obligations of the types referred to in clauses (i) through (vi) of other Persons secured by a lien on any property or asset of the Company; and (viii) in the case of (i) through (vii) above, all amendments, renewals, extensions, modifications and refundings of such indebtedness and obligations; *except* "Senior Indebtedness" does not include (A) the Subordinated Notes, (B) any obligation that by its terms expressly is junior to, or ranks equally in right of payment with, the Subordinated Notes, or (C) any indebtedness between the Company and any of its subsidiaries or Affiliates. This Subordinated Note is not secured by any assets of the Company or any of its subsidiaries or Affiliates. The term "<u>Affiliate(s)</u>" means, with respect to any Person, such Person's immediate family members, partners, members or parent and subsidiary corporations, and any other Person directly or indirectly controlling, controlled by, or under common control with said Person and their respective Affiliates. The term "<u>Person</u>" as used in this Subordinated Note means an individual, a corporation (whether or not for profit), a partnership, a limited liability company, a joint venture, an association, a trust, an unincorporated organization, a government or any department or agency thereof or any other entity or organization. The term "<u>control</u>" (including the terms "controlling," "controlled by," and "under common control with") means the possession, direct or indirect, of the power to direct or cause the direction of the management and policies of a person, whether through the ownership of voting securities, by contract, or otherwise.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) In the event of any liquidation of the Company, holders of Senior Indebtedness of the Company shall be entitled to be paid in full with such interest as may be provided by law before any payment shall be made on account of principal of or interest on this Subordinated Note. Additionally, in the event of any insolvency, dissolution, assignment for the benefit of creditors or any liquidation or winding up of or relating to the Company, whether voluntary or involuntary, holders of Senior Indebtedness shall be entitled to be paid in full before any payment shall be made on account of the principal of or interest on the Subordinated Notes, including this Subordinated Note. In the event of any such proceeding, after payment in full of all sums owing with respect to the Senior Indebtedness, the registered holders of the Subordinated Notes from time to time (each a "<u>Noteholder</u>" and, collectively, the "<u>Noteholders</u>"), together with the holders of any obligations of the Company ranking on parity with the Subordinated Notes, shall be entitled to be paid from the remaining assets of the Company the unpaid principal thereof, and the unpaid interest thereon before any payment or other distribution, whether in cash, property or otherwise, shall be made (i) with respect to any obligation that by its terms expressly is junior to in the right of payment to the Subordinated Notes, (ii) with respect to any indebtedness between the Company and any of its subsidiaries or Affiliates or (iii) on account of any capital stock.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) If there shall have occurred and be continuing (i) a default in any payment with respect to any Senior Indebtedness or (ii) an event of default with respect to any Senior Indebtedness as a result of which the maturity thereof is accelerated, unless and until such payment default or event of default shall have been cured or waived or shall have ceased to exist, no payments shall be made by the Company with respect to the Subordinated Notes. The provisions of this paragraph shall not apply to any payment with respect to which the immediately preceding paragraph of this <u>Section 3</u> (Subordination) would be applicable.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Nothing herein shall act to prohibit, limit or impede the Company from issuing additional debt of the Company having the same rank as the Subordinated Notes or which may be junior or senior in rank to the Subordinated Notes. Each Noteholder, by its acceptance hereof, further acknowledges and agrees that the foregoing subordination provisions are, and are intended to be, an inducement and a consideration for each holder of any Senior Indebtedness, whether such Senior Indebtedness was created or acquired before or after the issuance of the Subordinated Notes, to acquire and continue to hold, or to continue to hold, such Senior Indebtedness, and such holder of Senior Indebtedness shall be deemed conclusively to have relied on such subordination provisions in acquiring and continuing to hold or in continuing to hold such Senior Indebtedness.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**4.**  **<u>Redemption</u>** .

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Redemption Prior to Fifth Anniversary</u>. This Subordinated Note shall not be redeemable by the Company in whole or in part prior to **November 1, 2026**, except in the event of a: (i) Tier 2 Capital Event (as defined below); (ii) Tax Event (as defined below); or (iii) Investment Company Event (as defined below). Upon the occurrence of a Tier 2 Capital Event, a Tax Event or an Investment Company Event, the Company may redeem this Subordinated Note, subject to <u>Section 4(f)</u> (Regulatory Approvals) hereof, in whole or in part at any time, upon giving not less than 10 Business Days' notice to the holder of this Subordinated Note at an amount equal to 100% of the outstanding principal amount being redeemed plus accrued but unpaid interest, to but excluding the redemption date. "<u>Tier 2 Capital Event</u>" means the receipt by the Company of an opinion of counsel to the Company to the effect that there is, or within 120 days after receipt of such opinion there will be, a material risk that this Subordinated Note does not qualify as "Tier 2" Capital (as defined by the Federal Deposit Insurance Corporation) (or its then equivalent) as a result of a change in law or regulation, or interpretation or application thereof, by any judicial, legislative or regulatory authority that becomes effective after the date of issuance of this Subordinated Note. "<u>Tax Event</u>" means the receipt by the Company of an opinion of counsel to the Company that as a result of any amendment to, or change (including any final and adopted (or enacted) prospective change) in, the laws (or any regulations thereunder) of the United States or any political subdivision or taxing authority thereof or therein, or as a result of any official administrative pronouncement or judicial decision interpreting or applying such laws or regulations, there exists a material risk that interest payable by the Company on the Subordinated Notes is not, or within 120 days after the receipt of such opinion will not be, deductible by the Company, in whole or in part, for United States federal income tax purposes. "<u>Investment Company Event</u>" means the receipt by the Company of an opinion of counsel to the Company to the effect that there is a material risk that the Company is or, within one hundred twenty (120) days after the receipt of such opinion will be, required to register as an investment company pursuant to the Investment Company Act of 1940, as amended.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Redemption on or after Fifth Anniversary</u>. On or after **November 1, 2026**, subject to the provisions of <u>Section 4(f)</u> (Regulatory Approvals) hereof, this Subordinated Note shall be redeemable at the option of and by the Company, in whole or in part from time to time upon any Interest Payment Date, at an amount equal to 100% of the outstanding principal amount being redeemed plus accrued but unpaid interest, to but excluding the redemption date, but in all cases in a principal amount with integral multiples of $1,000. In addition, the Company may redeem all or a portion of the Subordinated Notes, at any time upon the occurrence of a Tier 2 Capital Event, Tax Event or an Investment Company Event. The redemption referenced in this <u>Section 4(b)</u> (Redemption on or after Fifth Anniversary) shall be subject to the receipt of any required regulatory approval.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Partial Redemption</u>. If less than the then-outstanding principal amount of this Subordinated Note is redeemed, (i) a new Subordinated Note shall be issued representing the unredeemed portion without charge to the holder thereof and (ii) such redemption shall be effected on a pro rata basis as to the Noteholders. For purposes of clarity, upon a partial redemption, a like percentage of the principal amount of every Subordinated Note held by every Noteholder shall be redeemed.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) <u>No Redemption at Option of Noteholder</u>. This Subordinated Note is not subject to redemption at the option of the holder of this Subordinated Note.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) <u>Effectiveness of Redemption</u>. If notice of redemption has been duly given and notwithstanding that this Subordinated Note has been called for redemption but has not yet been surrendered for cancellation, on and after the date fixed for redemption interest shall cease to accrue on the portion of this Subordinated Note called for redemption, this Subordinated Note shall no longer be deemed outstanding with respect to the portion called for redemption and all rights with respect to the portion of this Subordinated Note called for redemption shall forthwith on such date fixed for redemption cease and terminate unless the Company shall default in the payment of the redemption price, except only the right of the holder hereof to receive the amount payable on such redemption, without interest. For purposes of clarity, any redemption made pursuant to the terms of this Subordinated Note shall be made on a pro rata basis, and, to the extent applicable and for purposes of a redemption processed through The Depository Trust Company (DTC), on a "Pro Rata Pass-Through Distribution of Principal" basis, among all of the Subordinated Notes outstanding at the time thereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) <u>Regulatory Approvals</u>. Any such redemption shall be subject to receipt of any and all required federal and state regulatory approvals or non-objections, including, but not limited to, the consent of the Federal Deposit Insurance Corporation. In the case of any redemption of this Subordinated Note pursuant to paragraphs (b) or (c) of this <u>Section 4</u>, the Company will give the holder hereof notice of redemption, which notice shall indicate the aggregate principal amount of Subordinated Notes to be redeemed, not less than thirty (30) nor more than forty-five (45) calendar days prior to the redemption date.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) <u>Purchase and Resale of the Subordinated Notes</u>. Subject to any required federal and state regulatory approvals and the provisions of this Subordinated Note, the Company shall have the right to purchase any of the Subordinated Notes at any time in the open market, private transactions or otherwise. If the Company purchases any Subordinated Notes, it may, in its discretion, hold, resell or cancel any of the purchased Subordinated Notes.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) <u>Payment Restriction</u>. No payment shall at any time be made on account of the principal thereof, unless following such payment the aggregate of the shareholders' equity and capital notes or debentures thereafter outstanding shall be the equal of such aggregate at the date of the original issue of such capital notes or debentures, or as may be otherwise authorized by the California Department of Financial Protection and Innovation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.** **<u>Events of Default; Acceleration</u>**.

Each of the following events shall constitute an "<u>Event of Default</u>":

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) the entry of a decree or order for relief in respect of the Company by a court having jurisdiction in the premises in an involuntary case or proceeding under any applicable bankruptcy, insolvency, or reorganization law, now or hereafter in effect of the United States or any political subdivision thereof, and such decree or order will have continued unstayed and in effect for a period of sixty (60) consecutive calendar days;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) the commencement by the Company of a voluntary case under any applicable bankruptcy, insolvency or reorganization law, now or hereafter in effect of the United States or any political subdivision thereof, or the consent by the Company to the entry of a decree or order for relief in an involuntary case or proceeding under any such law;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) the Company (i) becomes insolvent or is unable to pay its debts as they mature, (ii) makes an assignment for the benefit of creditors, or (iii) admits in writing its inability to pay its debts as they mature;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) the failure of the Company to pay any installment of interest on any of the Subordinated Notes as and when the same will become due and payable, and the continuation of such failure for a period of fifteen (15) calendar days;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) the failure of the Company to pay all or any part of the principal of any of the Subordinated Notes as and when the same will become due and payable;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) the liquidation of the Company (for the avoidance of doubt, "liquidation" does not include any merger, consolidation, sale of equity or assets or reorganization (exclusive of a reorganization in bankruptcy) of the Company or any of its subsidiaries);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) the failure of the Company to perform any other covenant or agreement on the part of the Company contained in the Subordinated Note(s), and the continuation of such failure for a period of thirty (30) days after the date on which notice specifying such failure will have been given in the manner set forth in <u>Section 21</u> (Notices), to the Company by a Noteholder; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) the default by the Company under any bond, debenture, note or other evidence of indebtedness for money borrowed by the Company having an aggregate principal amount outstanding of at least $10,000,000, whether such indebtedness now exists or is created or incurred in the future, which default (i) constitutes a failure to pay any portion of the principal of such indebtedness when due and payable after the expiration of any applicable grace period or (ii) results in such indebtedness becoming due or being declared due and payable prior to the date on which it otherwise would have become due and payable without, in the case of clause (i), such indebtedness having been discharged or, in the case of clause (ii), without such indebtedness having been discharged or such acceleration having been rescinded or annulled.

Unless the principal amount of this Subordinated Note already shall have become due and payable, if an Event of Default set forth in <u>subsections (a)</u> or <u>(b)</u> of this <u>Section 5</u> shall have occurred and be continuing, then the principal amount of this Subordinated Note, and accrued and unpaid interest, if any, on the Subordinated Note will become and be immediately due and payable without any declaration or other act on the part of the Noteholder, and the Company waives demand, presentment for payment, notice of nonpayment, notice of protest, and all other notices. Notwithstanding the foregoing, because the Company treats the Subordinated Notes as Tier 2 Capital, upon the occurrence of an Event of Default other than an Event of Default described in <u>subsections (a)</u> or <u>(b)</u> of this <u>Section 5</u>, no Noteholder may accelerate the Maturity Date of the Subordinated Notes and make the principal of, and any accrued and unpaid interest on, the Subordinated Notes, immediately due and payable. The Company, within forty-five (45) calendar days after the receipt of written notice from any Noteholder of the occurrence of an Event of Default with respect to this Subordinated Note, shall mail to all Noteholders, at their addresses shown on the Security Register (as defined in <u>Section 13</u> (Registration of Transfer, Security Register) below), such written notice of Event of Default, unless such Event of Default shall have been cured or waived before the giving of such notice as certified by the Company in writing.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**6.** **<u>Failure to Make Payments</u>**. In the event of an Event of Default under <u>Section 5(c), Section 5(d),</u> or <u>Section 5(e)</u> above, the Company will, upon demand of the Noteholder, pay to the Noteholder the amount then due and payable on this Subordinated Note for principal and interest (without acceleration of the Subordinated Note in any manner), with interest on the overdue principal and interest at the per annum rate borne by this Subordinated Note, to the extent permitted by applicable law. If the Company fails to pay such amount upon such demand, the Noteholder may, among other things, institute a judicial proceeding for the collection of the sums so due and unpaid and such amount as shall be sufficient to cover the reasonable costs and expenses of collection, including the reasonable compensation, expenses, disbursements and advances of such Noteholder, its agents and counsel, may prosecute such proceeding to judgment or final decree and may enforce the same against the Company and collect the amounts adjudged or decreed to be payable in the manner provided by law out of the property of the Company.

Upon the occurrence of a failure by the Company to make any required payment of principal or interest on this Subordinated Note or an Event of Default, until such failure or Event of Default is cured by the Company or waived by the Noteholders in accordance with <u>Section 17</u> (Waiver and Consent) hereof, except as may be required by any federal or state bank regulatory agency, the Company shall not: (a) declare or pay any dividends or distributions on, or redeem, purchase, acquire, or make a liquidation payment with respect to, any of the Company's capital stock; (b) make any payment of principal or interest or premium, if any, on or repay, repurchase or redeem any indebtedness of the Company that ranks equal with or junior to the Subordinated Notes; or (c) make any payments under any guarantee that ranks equal with or junior to the Subordinated Notes, other than: (i) any dividends or distributions in shares of, or options, warrants or rights to subscribe for or purchase shares of, any class of the Company's common stock; (ii) any declaration of a non-cash dividend in connection with the implementation of a shareholders' rights plan, or the issuance of stock under any such plan in the future, or the redemption or repurchase of any such rights pursuant thereto; (iii) as a result of a reclassification of the Company's capital stock or the exchange or conversion of one class or series of the Company's capital stock for another class or series of the Company's capital stock; (iv) the purchase of fractional interests in shares of the Company's capital stock pursuant to the conversion or exchange provisions of such capital stock or the security being converted or exchanged; or (v) purchases of any class of the Company's common stock related to the issuance of common stock or rights under any benefit plans for the Company's directors, officers or employees or any of the Company's dividend reinvestment plans (including, without limitation, any repurchases or acquisitions in connection with the forfeiture of any stock award, cashless or net exercise of any option, or acceptance of common stock in lieu of an award recipient's tax obligations under any equity award) (the foregoing clauses (i) through (v) are collectively referred to as the "<u>Permitted Dividends</u>"). The limitations imposed by the provisions of this <u>Section 6</u> shall apply whether or not the Noteholder has notified the Company of an Event of Default.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**7.** **<u>Affirmative Covenants of the Company; Compliance Certificate</u>**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Notice of Certain Events</u>. To the extent permitted by applicable statute, rule or regulation, the Company shall provide written notice to the Noteholder, at its addresses shown on the Security Register (as defined in <u>Section 13</u> (Registration of Transfer, Security Register) below), of the occurrence of any of the following events as soon as practicable, but in no event later than thirty (30) Business Days following the Company becoming aware of the occurrence of such event:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) The total risk-based capital ratio, Tier 1 risk-based capital ratio, common equity Tier 1 risk-based capital ratio or leverage ratio of the Company, becomes less than eight percent (8.0%), six percent (6.0%), four and one-half percent (4.50%) or four percent (4.0%), respectively, as of the end of any calendar quarter (provided, that, to the extent the Company has opted into the community bank leverage ratio framework, no notice need be given until the Company ceases to be a qualifying community banking organization, as defined under 12 CFR § 3.12);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) The Company, or any of the Company's subsidiaries, or any officer of the Company (in such capacity), becomes subject to any formal, written regulatory enforcement action (as defined by the applicable state or federal bank regulatory authority); or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) There is a change in beneficial ownership of 25% or more of the outstanding securities of the Company entitled to vote for the election of directors.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Payment of Principal and Interest</u>. The Company covenants and agrees for the benefit of the Noteholder that it will duly and punctually pay the principal of, and interest on, this Subordinated Note, in accordance with the terms hereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Maintenance of Office</u>. The Company will maintain an office or agency in the State of California where Subordinated Notes may be surrendered for registration of transfer or for exchange and where notices and demands to or upon the Company in respect of the Subordinated Notes may be served.

The Company may also from time to time designate one or more other offices or agencies where the Subordinated Notes may be presented or surrendered for any or all such purposes and may from time to time rescind such designations; provided that no such designation or rescission will in any manner relieve the Company of its obligation to maintain an office or agency in the State of California. The Company will give prompt written notice to the Noteholders of any such designation or rescission and of any change in the location of any such other office or agency.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) <u>Corporate Existence</u>. The Company will do or cause to be done all things necessary to preserve and keep in full force and effect: (i) the corporate existence of the Company; and (ii) the rights (constituent governing documents and statutory), licenses and franchises of the Company; *provided, however*, that the Company will not be required to preserve its existence or any such right, license or franchise of the Company if the Board of Directors of the Company determines that the preservation thereof is no longer desirable in the conduct of the business of the Company and its subsidiaries taken as a whole and that the loss thereof will not be disadvantageous in any material respect to the Noteholders.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) <u>Maintenance of Properties</u>. The Company will, and will cause each subsidiary of the Company to, cause all its properties used or useful in the conduct of its business to be maintained and kept in good condition, repair and working order, ordinary wear and tear excepted, and supplied with all necessary equipment and will cause to be made all necessary repairs, renewals, replacements, betterments and improvements thereof, all as in the judgment of the Company may be necessary so that the business carried on in connection therewith may be properly and advantageously conducted at all times; *provided, however*, that nothing in this <u>Section 7(e)</u> will prevent the Company or any subsidiary from discontinuing the operation and maintenance of any of their respective properties if such discontinuance is, in the reasonable judgment of the Board of Directors of the Company or of any subsidiary, as the case may be, desirable in the conduct of its business.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) <u>Waiver of Certain Covenants</u>. The Company may omit in any particular instance to comply with any term, provision or condition set forth in <u>Section 7(c)</u> (Maintenance of Office), <u>Section 7(d)</u> (Corporate Existence), or <u>Section 7(e)</u> (Maintenance of Properties) above, with respect to this Subordinated Note if before the time for such compliance the Noteholders of at least a majority in aggregate principal amount of the outstanding Subordinated Notes, by act of such Noteholders, either will waive such compliance in such instance or generally will have waived compliance with such term, provision or condition, but no such waiver will extend to or affect such term, provision or condition except to the extent so expressly waived, and, until such waiver will become effective, the obligations of the Company in respect of any such term, provision or condition will remain in full force and effect.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) <u>Tier 2 Capital</u>. Whether or not the Company is subject to the consolidated capital requirements of the Federal Deposit Insurance Corporation, if all or any portion of the Subordinated Notes ceases to qualify for inclusion as Tier 2 Capital, other than due to the limitation imposed on the capital treatment of subordinated debt during the five (5) years immediately preceding the Maturity Date of the Subordinated Notes, the Company will immediately notify the Noteholders and thereafter, subject to the Company's right to redeem the Subordinated Notes under such circumstances pursuant to the terms of the Subordinated Notes, the Company and the Noteholders will work together in good faith to execute and deliver all agreements as reasonably necessary in order to restructure the applicable portions of the obligations evidenced by the Subordinated Notes to qualify as Tier 2 Capital; *provided*, *however*, that nothing contained in this <u>Section 7(g)</u> (Tier 2 Capital) shall limit the Company's right to redeem the Subordinated Notes upon the occurrence of a Tier 2 Capital Event pursuant to <u>Section 4(a)</u> (Redemption Prior to Fifth Anniversary) or <u>Section 4(b)</u> (Redemption on or after Fifth Anniversary).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) <u>Compliance with Laws</u>. The Company and each subsidiary of the Company shall comply with the requirements of all laws, regulations, orders and decrees applicable to it or its properties, except for such noncompliance that would not reasonably be expected to have a Material Adverse Effect (as such term is defined in the Purchase Agreement).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) <u>Taxes and Assessments</u>. The Company shall punctually pay and discharge all material taxes, assessments, and other governmental charges or levies imposed upon it or upon its income or upon any of its properties; provided, that no such taxes, assessments or other governmental charges need be paid if they are being contested in good faith by the Company.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j) <u>Company Statement as to Compliance</u>. The Company will deliver to the Noteholders, within one hundred twenty (120) calendar days after the end of each fiscal year, an Officer's Certificate covering the preceding calendar year, stating whether or not, to the best of his or her knowledge, the Company is in default in the performance and observance of any of the terms, provisions and conditions of this Subordinated Note (without regard to notice requirements or periods of grace) and if the Company will be in default, specifying all such defaults and the nature and status thereof of which he or she may have knowledge.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**8.** **<u>Negative Covenants of the Company</u>.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Limitation on Dividends.</u> The Company shall not declare or pay any dividend or make any distribution on capital stock or other equity securities of any kind of the Company if the Company is not "well capitalized" for regulatory purposes immediately prior to the declaration of such dividend or distribution, except for Permitted Dividends.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Merger or Sale of Assets.</u> The Company shall not merge into another entity or convey, transfer or lease substantially all of its properties and assets to any Person, unless:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) the continuing entity into which the Company is merged or the Person which acquires by conveyance or transfer or which leases substantially all of the properties and assets of the Company shall be a corporation, association or other legal entity organized and existing under the laws of the United States of America, any State thereof or the District of Columbia and expressly assumes the due and punctual payment of the principal of and any premium and interest on the Subordinated Notes according to their terms, and the due and punctual performance of all covenants and conditions hereof on the part of the Company to be performed or observed; *provided, however,* that no express assumption shall be required by any successor by merger to the Company to the extent such legal successor assumes the Company's obligations hereunder by operation of law; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) immediately after giving effect to such transaction, no Event of Default (as defined above), and no event which, after notice or lapse of time or both, would become an Event of Default, shall have occurred and be continuing.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Continuance of Business.</u> Except as otherwise permitted under Section 8(b), the Company shall not take any action, omit to take any action or enter into any other transaction that would have the effect of: (i) the liquidation or dissolution of the Company or (ii) the Company ceasing to be an "insured depository institution" under Section 3(c)(2) of the Federal Deposit Insurance Act, as amended.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**9.** **<u>Denominations</u>**. The Subordinated Notes are issuable only in registered form without interest coupons in minimum denominations of $100,000 and integral multiples of $1,000 in excess thereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**10.** **<u>Charges and Transfer Taxes</u>**. No service charge will be made for any registration of transfer or exchange of this Subordinated Note, or any redemption or repayment of this Subordinated Note, or any conversion or exchange of this Subordinated Note for other types of securities or property, but the Company may require payment of a sum sufficient to pay all taxes, assessments or other governmental charges that may be imposed in connection with the transfer or exchange of this Subordinated Note from the Noteholder requesting such transfer or exchange.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**11.** **<u>Payment Procedures</u>**. Payment of the principal and interest payable on the Maturity Date will be made by check, by wire transfer or by Automated Clearing House (ACH) transfer in immediately available funds to a bank account in the United States designated by the registered Noteholder if such Noteholder shall have previously provided wire or ACH instructions to the Company, upon presentation and surrender of this Subordinated Note at the Payment Office (as defined in <u>Section 21</u> (Notices) below) or at such other place or places as the Company shall designate by notice to the registered Noteholders as the Payment Office, provided that this Subordinated Note is presented to the Company in time for the Company to make such payments in such funds in accordance with its normal procedures. Payments of interest (other than interest payable on the Maturity Date) shall be made on each Interest Payment Date by wire transfer in immediately available funds or check mailed to the registered Noteholder, as such Person's address appears on the Security Register (as defined in <u>Section 13</u> below). Interest payable on any Interest Payment Date shall be payable to the Noteholder in whose name this Subordinated Note is registered at the close of business on the fifteenth (15<sup>th</sup>) calendar day prior to the applicable Interest Payment Date, without regard to whether such date is a Business Day, except that interest not paid on the Interest Payment Date, if any, will be paid to the holder in whose name this Subordinated Note is registered at the close of business on a special record date fixed by the Company (a "<u>Special Record Date</u>"), notice of which shall be given to the Noteholder not less than ten (10) calendar days prior to such Special Record Date. To the extent permitted by applicable law, interest shall accrue, at the rate at which interest accrues on the principal of this Subordinated Note, on any amount of principal or interest on this Subordinated Note not paid when due. All payments on this Subordinated Note shall be applied first against costs and expenses of the Noteholder, if any, for which the Company is liable under this Subordinated Note; then against interest due hereunder; and then against principal due hereunder. The Noteholder acknowledges and agrees that the payment of all or any portion of the outstanding principal amount of this Subordinated Note and all interest hereon shall be *pari passu* in right of payment and in all other respects to the other Subordinated Notes. In the event that the Noteholder receives payments in excess of the Noteholder's pro rata share of the Company's payments to the holders of all of the Subordinated Notes, then the Noteholder shall hold in trust all such excess payments for the benefit of the other Noteholders and shall pay such amounts held in trust to such other holders upon demand by such holders.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**12.** **<u>Form of Payment</u>**. Payments of principal and interest on this Subordinated Note shall be made in such coin or currency of the United States of America as at the time of payment shall be legal tender for the payment of public and private debts.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**13.** **<u>Registration of Transfer, Security Register</u>**. Except as otherwise provided herein, or in the Purchase Agreement between Noteholder and the Company, and subject to limitations on transfer under applicable state and federal securities laws, this Subordinated Note is transferable in whole or in part, and may be exchanged for a like aggregate principal amount of Subordinated Notes of other authorized denominations, by the Noteholder in person, or by its attorney duly authorized in writing, at the Payment Office or the offices of the Registrar. The Company or its agent (the "<u>Registrar</u>") shall maintain a register providing for the registration of the Subordinated Notes and any exchange or transfer thereof (the "<u>Security Register</u>"). Upon surrender or presentation of this Subordinated Note for exchange or registration of transfer, the Company or the Registrar shall execute and deliver in exchange therefor a Subordinated Note or Subordinated Notes of like aggregate principal amount, each in a minimum denomination of $100,000 or any amount in excess thereof which is an integral multiple of $1,000 (and, in the absence of an opinion of counsel satisfactory to the Company to the contrary, bearing the restrictive legend(s) set forth hereinabove) and that is or are registered in such name or names requested by the Noteholder. Any Subordinated Note presented or surrendered for registration of transfer or for exchange shall be duly endorsed and accompanied by a written instrument of transfer in such form as is attached hereto and incorporated herein, duly executed by the Noteholder or its attorney duly authorized in writing, with such tax identification number (including, without limitation, an appropriate and properly executed Internal Revenue Service Form W-9 or appropriate type of Form W-8) or other information for each Person in whose name a Subordinated Note is to be issued, and accompanied by evidence of compliance with any restrictive legend(s) appearing on such Subordinated Note or Subordinated Notes as the Company may reasonably request to comply with applicable law. No exchange or registration of transfer of this Subordinated Note shall be made on or after (i) the fifteenth (15<sup>th</sup>) day immediately preceding the Maturity Date or (ii) the due delivery of notice of redemption.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**14.** **<u>Successors and Assigns</u>**. This Subordinated Note shall be binding upon the Company and inure to the benefit of the Noteholder and its respective successors and permitted assigns. The Noteholder may assign all, or any part of, or any interest in, the Noteholder's rights and benefits hereunder only to the extent and in the manner permitted by the terms of this Subordinated Note, the Purchase Agreement, and under applicable securities laws and regulations. To the extent of any such assignment, such assignee shall have the same rights and benefits against the Company and shall agree to be bound by and to comply with the terms and conditions of the Purchase Agreement as it would have had if it were the Noteholder hereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**15.** **<u>Priority</u>**. The Subordinated Notes rank *pari passu* among themselves and *pari passu*, in the event of any insolvency proceeding, dissolution, assignment for the benefit of creditors, reorganization, restructuring of debt, marshaling of assets and liabilities or similar proceeding or any liquidation or winding up of the Company, with all other present or future unsecured subordinated debt obligations of the Company, except any unsecured subordinated debt that, pursuant to its express terms, is senior or subordinate in right of payment to the Subordinated Notes.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**16.** **<u>Ownership</u>**. Prior to due presentment of this Subordinated Note for registration of transfer, the Company may treat the holder in whose name this Subordinated Note is registered in the Security Register as the absolute owner of this Subordinated Note for receiving payments of principal and interest on this Subordinated Note and for all other purposes whatsoever, whether or not this Subordinated Note be overdue, and the Company shall not be affected by any notice to the contrary.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**17.** **<u>Waiver and Consent</u>**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) This Subordinated Note may be amended or waived pursuant to, and in accordance with, the provisions set forth herein and as set forth in Section 7.3 of the Purchase Agreement. Any such consent or waiver given by the Noteholder shall be conclusive and binding upon such Noteholder and upon all subsequent holders of this Subordinated Note and of any Subordinated Note issued upon the registration of transfer hereof or in exchange therefor or in lieu hereof, whether or not notation of such consent or waiver is made upon this Subordinated Note. No delay or omission of the Noteholder to exercise any right or remedy accruing upon any Event of Default shall impair such right or remedy or constitute a waiver of any such Event of Default or an acquiescence therein. Any insured depository institution that shall be a Noteholder or that otherwise shall have any beneficial ownership interest in this Subordinated Note shall, by its acceptance of such Subordinated Note (or beneficial interest therein), be deemed to have waived any right of offset with respect to the indebtedness evidenced thereby.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) No waiver or amendment of any term, provision, condition, covenant or agreement in the Subordinated Notes shall be effective except with the consent of the Noteholders holding more than fifty percent (50%) in aggregate principal amount (excluding any Subordinated Notes held by the Company or any of its Affiliates) of the Subordinated Notes at the time outstanding; *provided*, *however*, that without the consent of each Noteholder of an affected Subordinated Note, no such amendment or waiver may: (i) reduce the principal amount of the Subordinated Note; (ii) reduce the rate of or change the time for payment of interest on any Subordinated Note; (iii) extend the maturity of any Subordinated Note; (iv) change the currency in which payment of the obligations of the Company under the Subordinated Notes are to be made; (v) lower the percentage of aggregate principal amount of outstanding Subordinated Notes required to approve any amendment of the Subordinated Notes; (vi) make any changes to Section 4(c) (Partial Redemption), Section 5 (Events of Default; Acceleration), Section 6 (Failure to Make Payments), Section 15 (Priority), or Section 17 (Waiver and Consent) of the Subordinated Notes that adversely affects the rights of any Noteholder; or (vii) disproportionately and adversely affect the rights of any of the holders of the then outstanding Subordinated Notes. Notwithstanding the foregoing, the Company may amend or supplement the Subordinated Notes without the consent of the Noteholders to cure any ambiguity, defect or inconsistency or to provide for uncertificated Subordinated Notes in addition to or in place of certificated Subordinated Notes, or to make any change that does not adversely affect the rights of any Noteholder of any of the Subordinated Notes. No failure to exercise or delay in exercising, by any Noteholder of the Subordinated Notes, of any right, power or privilege hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any right, power or privilege preclude any other or further exercise thereof, or the exercise of any other right or remedy provided by law. The rights and remedies provided in this Subordinated Note are cumulative and not exclusive of any right or remedy provided by law or equity. No notice or demand on the Company in any case shall, in itself, entitle the Company to any other or further notice or demand in similar or other circumstances or constitute a waiver of the rights of the Noteholders to any other or further action in any circumstances without notice or demand. No consent or waiver, express or implied, by the Noteholders to or of any breach or default by the Company in the performance of its obligations hereunder shall be deemed or construed to be a consent or waiver to or of any other breach or default in the performance of the same or any other obligations of the Company hereunder. Failure on the part of the Noteholders to complain of any acts or failure to act or to declare an Event of Default, irrespective of how long such failure continues, shall not constitute a waiver by the Noteholders of their rights hereunder or impair any rights, powers or remedies on account of any breach or default by the Company.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**18.** **<u>Absolute and Unconditional Obligation of the Company</u>**. No provisions of this Subordinated Note shall alter or impair the obligation of the Company, which is absolute and unconditional, to pay the principal and interest on this Subordinated Note at the times, places and rate, and in the coin or currency, herein prescribed. No delay or omission of the Noteholder to exercise any right or remedy accruing upon any Event of Default shall impair such right or remedy or constitute a waiver of any such Event of Default or an acquiescence therein.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**19.** **<u>No Sinking Fund; Convertibility</u>**. This Subordinated Note is not entitled to the benefit of any sinking fund. This Subordinated Note is not convertible into or exchangeable for any of the equity securities, other securities or assets of the Company or any subsidiary of the Company.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**20.** **<u>No Recourse Against Others</u>**. No recourse under or upon any obligation, covenant or agreement contained in this Subordinated Note, or for any claim based thereon or otherwise in respect thereof, will be had against any past, present or future shareholder, employee, officer, or director, as such, of the Company or of any predecessor or successor, either directly or through the Company or any predecessor or successor, under any rule of law, statute or constitutional provision or by the enforcement of any assessment or by any legal or equitable proceeding or otherwise, all such liability being expressly waived and released by the acceptance of this Subordinated Note by the Noteholder and as part of the consideration for the issuance of this Subordinated Note.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**21.** **<u>Notices</u>**. All notices to the Company under this Subordinated Note shall be in writing and addressed to the Company at 6 Hutton Centre Drive, Suite 100, Santa Ana, CA 92707, Attention: Chief Financial Officer, or to such other address as the Company may notify to the Noteholder (the "<u>Payment Office</u>"). All notices to the Noteholders shall be in writing and sent by first-class mail to each Noteholder at his or its address as set forth in the Security Register.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**22.** **<u>Further Issues</u>**. The Company may, without the consent of the Noteholders, create and issue additional notes having the same terms and conditions of the Subordinated Notes (except for the Issue Date and issue price) so that such further notes shall be consolidated and form a single series with the Subordinated Notes.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**23.** **<u>Governing Law; Interpretation</u>**. THIS SUBORDINATED NOTE WILL BE DEEMED TO BE A CONTRACT MADE UNDER THE LAWS OF THE STATE OF NEW YORK AND WILL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICT OF LAW PRINCIPLES THEREOF. IT IS INTENDED THAT THIS SUBORDINATED NOTE SHALL MEET THE CRITERIA FOR QUALIFICATION OF THE OUTSTANDING PRINCIPAL AS TIER 2 CAPITAL UNDER THE REGULATORY GUIDELINES OF THE FEDERAL DEPOSIT INSURANCE CORPORATION, AND THE TERMS HEREOF SHALL BE INTERPRETED IN A MANNER TO SATISFY SUCH INTENT.

*[Signature Page Follows]*

IN WITNESS WHEREOF, the undersigned has caused this Subordinated Note to be duly executed and attested.

---

| | |
|:---|:---|
| INFINITY BANK | INFINITY BANK |
| By: |  |
| Name: | Victor Guerrero |
| Title: | President, Chief Operating Officer and Chief Financial Officer |

---

---

| |
|:---|
| ATTEST: |
| Name: Elaine Crouch |
| Title: EVP and Corporate Secretary |

---

*[Company Signature Page to California Bank of Commerce Subordinated Note]*

**ASSIGNMENT FORM**

[Capitalized terms used herein but not defined have the meanings assigned in the Subordinated Note]

To assign this Subordinated Note of Infinity Bank, fill in the form below: (I) or (we) assign and transfer this Subordinated Note to:

------

(Print or type assignee's name, address and zip code)

------

(Insert assignee's social security or tax I.D. No.)

and irrevocably appoint___________________________agent to transfer this Subordinated Note on the books of the Company. The agent may substitute another to act for him.

Date:   Your signature:   <br> (Sign exactly as your name appears on the face of this Subordinated Note)

FOR EXECUTION BY AN ENTITY: <br> <br> Entity name:  

By:   <br> Name:   <br> Title:  

Tax Identification No:  

Signature Guarantee:  

*(Signatures must be guaranteed by an eligible guarantor institution (banks, stockbrokers, savings and loan associations and credit unions with membership in an approved signature guarantee medallion program), pursuant to Rule 17Ad-15 promulgated under the Securities Exchange Act of 1934, as amended (the "Exchange Act")).*

The undersigned certifies that he/she/it [is / is not] (*circle one*) an Affiliate of the Company and that, to its knowledge, the proposed transferee [is / is not] (*circle one*) an Affiliate of the Company.

In connection with any transfer or exchange of this Subordinated Note occurring prior to the date that is one year after the later of the date of original issuance of this Subordinated Note and the last date, if any, on which this Subordinated Note was owned by the Company or any Affiliate of the Company, the undersigned confirms that this Subordinated Note is being:

CHECK ONE BOX BELOW:

(1) acquired for the undersigned's own account, without transfer;

(2) transferred to the Company;

(3) transferred in accordance and in compliance with Rule 144A under the Securities Act of 1933, as amended (the "Securities Act");

(4) transferred under an effective registration statement under the Securities Act;

(5) transferred in accordance with and in compliance with Regulation S under the Securities Act;

(6) transferred to an institutional "accredited investor" (as defined in Rule 501(a)(1), (2), (3) or (7) under the Securities Act);

(7) transferred to an "accredited investor" (as defined in Rule 501(a)(4) under the Securities Act), not referred to in item (6) that has been provided with the information designated under Section 4(d) of the Securities Act; or

(8) transferred in accordance with another available exemption from the registration requirements of the Securities Act.

Unless one of the boxes is checked, the Company will refuse to register this Subordinated Note in the name of any person other than the registered holder thereof; provided, however, that if box (5), (6), (7) or (8) is checked, the Company may require, prior to registering any such transfer of this Subordinated Note, in its sole discretion, such legal opinions, certifications and other information as the Company may reasonably request to confirm that such transfer is being made pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act such as the exemption provided by Rule 144 under such Act.

Signature:   <br> (Sign exactly as your name appears on the face of this Subordinated Note)

FOR EXECUTION BY AN ENTITY: <br> <br> Entity name:  

By:   <br> Name:   <br> Title:  

Tax Identification No.:  

Signature Guarantee:  

*(Signatures must be guaranteed by an eligible guarantor institution (banks, stockbrokers, savings and loan associations and credit unions with membership in an approved signature guarantee medallion program), pursuant to Exchange Act Rule 17Ad-l5).*

TO BE COMPLETED BY PURCHASER IF BOX (1) OR (3) ABOVE IS CHECKED.

The undersigned represents and warrants that it is purchasing this Subordinated Note for its own account or an account with respect to which it exercises sole investment discretion and that it and any such account is a "qualified institutional buyer" within the meaning of Rule 144A under the Securities Act and is aware that the sale to it is being made in reliance on Rule 144A and acknowledges that it has received such information regarding the Company as the undersigned has requested pursuant to Rule 144A or has determined not to request such information and that it is aware that the transferor is relying upon the undersigned's foregoing representations in order to claim the exemption from registration provided by Rule 144A.

Date:   Signature:   <br> <br> Print name:  

FOR EXECUTION BY AN ENTITY: <br> <br> Entity name:  

By:   <br> Name:   <br> Title:  

Tax Identification No.:  

**<u>SUBORDINATED NOTE</u>**

**INFINITY BANK**

**4.25% FIXED TO FLOATING RATE SUBORDINATED NOTE**

**DUE NOVEMBER 1, 2031**

THE INDEBTEDNESS EVIDENCED BY THIS SUBORDINATED NOTE IS NOT A DEPOSIT AND IS NOT INSURED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY OTHER GOVERNMENT AGENCY OR FUND.

THE INDEBTEDNESS EVIDENCED BY THIS SUBORDINATED NOTE IS SUBORDINATED AND JUNIOR IN RIGHT OF PAYMENT TO SENIOR INDEBTEDNESS (AS DEFINED IN <u>SECTION 3</u> (SUBORDINATION) OF THIS SUBORDINATED NOTE) OF INFINITY BANK, A CALIFORNIA CORPORATION (THE "<u>COMPANY</u>"), INCLUDING OBLIGATIONS OF THE COMPANY TO ITS GENERAL AND SECURED CREDITORS AND IS UNSECURED. IT IS INELIGIBLE AS COLLATERAL FOR ANY EXTENSION OF CREDIT BY THE COMPANY OR ANY OF ITS SUBSIDIARIES.

IN THE EVENT OF LIQUIDATION, ALL HOLDERS OF SENIOR INDEBTEDNESS OF THE COMPANY SHALL BE ENTITLED TO BE PAID IN FULL WITH SUCH INTEREST AS MAY BE PROVIDED BY LAW BEFORE ANY PAYMENT SHALL BE MADE ON ACCOUNT OF PRINCIPAL OF OR INTEREST ON THIS SUBORDINATED NOTE. AFTER PAYMENT IN FULL OF ALL SUMS OWING TO SUCH HOLDERS OF SENIOR INDEBTEDNESS, THE HOLDER OF THIS SUBORDINATED NOTE, TOGETHER WITH THE HOLDERS OF ANY OBLIGATIONS OF THE COMPANY RANKING ON A PARITY WITH THE SUBORDINATED NOTES, SHALL BE ENTITLED TO BE PAID FROM THE REMAINING ASSETS OF THE COMPANY THE UNPAID PRINCIPAL AMOUNT OF THIS SUBORDINATED NOTE PLUS ACCRUED AND UNPAID INTEREST THEREON BEFORE ANY PAYMENT OR OTHER DISTRIBUTION, WHETHER IN CASH, PROPERTY OR OTHERWISE, SHALL BE MADE (i) with respect to any obligation that by its terms expressly is junior in the right of payment to the Subordinated Notes, (ii) WITH RESPECT TO any indebtedness between the Company and any of its subsidiaries or affiliates or (iII) on account OF ANY SHARES OF CAPITAL STOCK OF THE COMPANY.

THIS SUBORDINATED NOTE WILL BE ISSUED AND MAY BE TRANSFERRED ONLY IN MINIMUM DENOMINATIONS OF $100,000 AND MULTIPLES OF $1,000 IN EXCESS THEREOF. ANY ATTEMPTED TRANSFER OF THIS SUBORDINATED NOTE IN A DENOMINATION OF LESS THAN $100,000 SHALL BE DEEMED TO BE VOID AND OF NO LEGAL EFFECT WHATSOEVER. ANY SUCH PURPORTED TRANSFEREE SHALL BE DEEMED NOT TO BE THE HOLDER OF THIS SUBORDINATED NOTE FOR ANY PURPOSE, INCLUDING, BUT NOT LIMITED TO, THE RECEIPT OF PAYMENTS ON THIS SUBORDINATED NOTE, AND SUCH PURPORTED TRANSFEREE SHALL BE DEEMED TO HAVE NO INTEREST WHATSOEVER IN THIS SUBORDINATED NOTE.

THIS SUBORDINATED NOTE MAY BE SOLD ONLY IN COMPLIANCE WITH APPLICABLE FEDERAL AND STATE SECURITIES LAWS. THIS SUBORDINATED NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY APPLICABLE STATE SECURITIES LAWS, OR ANY OTHER APPLICABLE SECURITIES LAWS. NEITHER THIS SUBORDINATED NOTE NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT.

**CERTAIN ERISA CONSIDERATIONS:**

THE HOLDER OF THIS SUBORDINATED NOTE, OR ANY INTEREST HEREIN, BY ITS ACCEPTANCE HEREOF OR THEREOF AGREES, REPRESENTS AND WARRANTS THAT IT IS NOT AN EMPLOYEE BENEFIT PLAN, INDIVIDUAL RETIREMENT ACCOUNT OR OTHER PLAN OR ARRANGEMENT SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE") (EACH, A "PLAN"), OR AN ENTITY WHOSE UNDERLYING ASSETS INCLUDE "PLAN ASSETS" BY REASON OF ANY PLAN'S INVESTMENT IN THE ENTITY, AND NO PERSON INVESTING "PLAN ASSETS" OF ANY PLAN MAY ACQUIRE OR HOLD THIS SUBORDINATED NOTE OR ANY INTEREST HEREIN, UNLESS SUCH PURCHASER OR HOLDER IS ELIGIBLE FOR THE EXEMPTIVE RELIEF AVAILABLE UNDER U.S. DEPARTMENT OF LABOR PROHIBITED TRANSACTION CLASS EXEMPTION 96-23, 95-60, 91-38, 90-1 OR 84-14 OR ANOTHER APPLICABLE EXEMPTION OR ITS PURCHASE AND HOLDING OF THIS SUBORDINATED NOTE, OR ANY INTEREST HEREIN, ARE NOT PROHIBITED BY SECTION 406 OF ERISA OR SECTION 4975 OF THE CODE WITH RESPECT TO SUCH PURCHASE AND HOLDING. ANY PURCHASER OR HOLDER OF THIS SUBORDINATED NOTE OR ANY INTEREST HEREIN WILL BE DEEMED TO HAVE REPRESENTED BY ITS PURCHASE AND HOLDING THEREOF THAT EITHER: (I) IT IS NOT AN EMPLOYEE BENEFIT PLAN OR OTHER PLAN TO WHICH TITLE I OF ERISA OR SECTION 4975 OF THE CODE IS APPLICABLE, A TRUSTEE OR OTHER PERSON ACTING ON BEHALF OF ANY SUCH EMPLOYEE BENEFIT PLAN OR OTHER PLAN, OR ANY OTHER PERSON OR ENTITY USING THE "PLAN ASSETS" OF ANY SUCH PLAN OR OTHER PLAN TO FINANCE SUCH PURCHASE OR (II) SUCH PURCHASE OR HOLDING WILL NOT RESULT IN A PROHIBITED TRANSACTION UNDER SECTION 406 OF ERISA OR SECTION 4975 OF THE CODE FOR WHICH FULL EXEMPTIVE RELIEF IS NOT AVAILABLE UNDER APPLICABLE STATUTORY OR ADMINISTRATIVE EXEMPTION.

**ANY FIDUCIARY OF ANY PLAN WHO IS CONSIDERING THE ACQUISITION OF THIS SUBORDINATED NOTE OR ANY INTEREST HEREIN SHOULD CONSULT WITH HIS OR HER LEGAL COUNSEL PRIOR TO ACQUIRING THIS SUBORDINATED NOTE OR ANY INTEREST HEREIN.**

**INFINITY BANK**

**4.25% FIXED TO FLOATING RATE SUBORDINATED NOTE**

**DATED OCTOBER 22, 2021 AND DUE NOVEMBER 1, 2031**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**1.** **<u>Subordinated Notes</u>**. This subordinated note is one of an issue of notes of Infinity Bank, a California corporation (the "<u>Company</u>"), designated as the "4.25% Fixed to Floating Rate Subordinated Notes due November 1, 2031" (the "<u>Subordinated Notes</u>") issued pursuant to that Subordinated Note Purchase Agreement, dated as of the date upon which this Subordinated Note was originally issued (the "<u>Issue Date</u>"), between the Company and the one or more purchasers of the Subordinated Notes identified in the signature pages thereto (the "<u>Purchase Agreement</u>").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**2.** **<u>Payment</u>**. The Company, for value received, promises to pay to **1<sup>st</sup> Capital Bank,** or its registered assigns, the principal sum of **ONE MILLION DOLLARS (U.S.) ($1,000,000),** plus accrued but unpaid interest on **November 1, 2031** (the "<u>Maturity Date</u>") and to pay interest thereon (i) from and including the original issue date of the Subordinated Notes to but excluding **November 1, 2026** or the earlier redemption date contemplated by <u>Section 4</u> (Redemption) of this Subordinated Note (the "<u>Fixed Rate Period</u>"), at the rate of **4.25%** per annum, computed on the basis of a 360-day year consisting of twelve 30-day months and payable semi-annually in arrears on **May 1** and **November 1** of each year (each payment date, a "<u>Fixed Interest Payment Date</u>"), beginning **May 1, 2022**, and (ii) from and including **November 1, 2026**, to but excluding the Maturity Date or earlier redemption date contemplated by <u>Section 4</u> (Redemption) of this Subordinated Note (the "<u>Floating Rate Period</u>"), at the rate per annum, reset quarterly, equal to the Floating Interest Rate (as defined below) determined on the Floating Interest Determination Date (as defined below) of the applicable interest period plus **336** basis points, computed on the basis of a 360-day year and the actual number of days elapsed and payable quarterly in arrears (each quarterly period, a "<u>Floating Interest Period</u>") on **February 1, May 1, August 1 and November 1** of each year (each payment date, a "<u>Floating Interest Payment Date</u>"). Dollar amounts resulting from this calculation shall be rounded to the nearest cent, with one-half cent being rounded up. The term "<u>Floating Interest Determination Date</u>" means the date upon which the Floating Interest Rate is determined by the Calculation Agent (as defined below) pursuant to the Three-Month Term SOFR Conventions (as defined below).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) An "<u>Interest Payment Date</u>" is either a Fixed Interest Payment Date or a Floating Interest Payment Date, as applicable.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The "<u>Floating Interest Rate</u>" means:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) initially Three-Month Term SOFR (as defined below).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Notwithstanding the foregoing <u>clause (i)</u> of this <u>Section 2(b)</u>:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) If the Calculation Agent, reasonably determines in good faith prior to the relevant Floating Interest Determination Date that a Benchmark Transition Event and its related Benchmark Replacement Date (each of such terms as defined below) have occurred with respect to Three-Month Term SOFR, then the Company shall promptly provide notice of such determination to the Noteholders and <u>Section 2(c)</u> (Effect of Benchmark Transition Event) will thereafter apply to all determinations, calculations and quotations made or obtained for the purposes of calculating the Floating Interest Rate payable on the Subordinated Notes during a relevant Floating Interest Period.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) However, if the Calculation Agent reasonably determines in good faith that a Benchmark Transition Event and its related Benchmark Replacement Date have occurred with respect to Three-Month Term SOFR, but for any reason the Benchmark Replacement has not been determined as of the relevant Floating Interest Determination Date, the Floating Interest Rate for the applicable Floating Interest Period will be equal to the Floating Interest Rate on the last Floating Interest Determination Date for the Subordinated Notes, as determined by the Calculation Agent.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) If the then-current Benchmark is Three-Month Term SOFR and any of the foregoing provisions concerning the calculation of the interest rate and the payment of interest during the Floating Rate Period are inconsistent with any of the Three-Month Term SOFR Conventions determined by the Company, then the relevant Three-Month Term SOFR Conventions will apply.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Effect of Benchmark Transition Event</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) If the Calculation Agent reasonably determines in good faith that a Benchmark Transition Event and its related Benchmark Replacement Date have occurred prior to the Reference Time (as defined below) in respect of any determination of the Benchmark (as defined below) on any date, the Benchmark Replacement will replace the then-current Benchmark for all purposes relating to the Subordinated Notes during the relevant Floating Interest Period in respect of such determination on such date and all determinations on all subsequent dates.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) In connection with the implementation of a Benchmark Replacement, the Company will have the right to make Benchmark Replacement Conforming Changes from time to time, and such changes shall become effective without consent from the relevant Noteholders (as defined below) or any other party.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) Any determination, decision or election that may be made by the Company or by the Calculation Agent pursuant to the benchmark transition provisions set forth herein, including any determination with respect to a tenor, rate or adjustment or of the occurrence or non-occurrence of an event, circumstance or date, and any decision to take or refrain from taking any action or any selection:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) will be conclusive and binding absent manifest error;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) if made by the Company, will be made in the Company's sole discretion;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) if made by the Calculation Agent, will be made after consultation with the Company, and the Calculation Agent will not make any such determination, decision or election to which the Company reasonably objects; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(4) notwithstanding anything to the contrary in this Subordinated Note or the Purchase Agreement, shall become effective without consent from the relevant Noteholders (as defined below) or any other party.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) For the avoidance of doubt, after a Benchmark Transition Event and its related Benchmark Replacement Date have occurred, interest payable on this Subordinated Note for the Floating Rate Period will be an annual rate equal to the sum of the applicable Benchmark Replacement and the spread specified on the face hereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) As used in this Subordinated Note, the following terms have the meanings as set forth below:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1) "<u>Benchmark</u>" means, initially, Three-Month Term SOFR; provided that if a Benchmark Transition Event and its related Benchmark Replacement Date have occurred with respect to Three-Month Term SOFR or the then-current Benchmark, then "<u>Benchmark</u>" means the applicable Benchmark Replacement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2) "<u>Benchmark Replacement</u>" means the Interpolated Benchmark with respect to the then-current Benchmark; provided that if (a) the Calculation Agent cannot determine the Interpolated Benchmark as of the Benchmark Replacement Date or (b) the then-current Benchmark is Three-Month Term SOFR and a Benchmark Transition Event and its related Benchmark Replacement Date have occurred with respect to Three-Month Term SOFR (in which event no Interpolated Benchmark with respect to Three-Month Term SOFR shall be determined), then "<u>Benchmark Replacement</u>" means the first alternative set forth in the order below that can be determined by the Calculation Agent, as of the Benchmark Replacement Date:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a. The sum of (i) Compounded SOFR and (ii) the Benchmark Replacement Adjustment;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b. the sum of: (i) the alternate rate of interest that has been selected or recommended by the Relevant Governmental Body as the replacement for the then-current Benchmark for the applicable Corresponding Tenor and (ii) the Benchmark Replacement Adjustment;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c. the sum of: (i) the ISDA Fallback Rate and (ii) the Benchmark Replacement Adjustment;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d. the sum of: (i) the alternate rate of interest that has been selected by the Company as the replacement for the then-current Benchmark for the applicable Corresponding Tenor giving due consideration to any industry-accepted rate of interest as a replacement for the then-current Benchmark for U.S. dollar denominated floating rate notes at such time and (ii) the Benchmark Replacement Adjustment.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3) "<u>Benchmark Replacement Adjustment</u>" means the first alternative set forth in the order below that can be determined by the Calculation Agent, as of the Benchmark Replacement Date:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a. the spread adjustment, or method for calculating or determining such spread adjustment, (which may be a positive or negative value or zero) that has been selected or recommended by the Relevant Governmental Body for the applicable Unadjusted Benchmark Replacement;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b. if the applicable Unadjusted Benchmark Replacement is equivalent to the ISDA Fallback Rate, then the ISDA Fallback Adjustment;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c. the spread adjustment (which may be a positive or negative value or zero) that has been selected by the Company giving due consideration to any industry-accepted spread adjustment, or method for calculating or determining such spread adjustment, for the replacement of the then-current Benchmark with the applicable Unadjusted Benchmark Replacement for U.S. dollar denominated floating rate notes at such time.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(4) "<u>Benchmark Replacement Conforming Changes</u>" means, with respect to any Benchmark Replacement, any technical, administrative or operational changes (including changes to the definition of "<u>Floating Interest Period</u>," timing and frequency of determining rates with respect to each Floating Interest Period and making payments of interest, rounding of amounts or tenors and other administrative matters) that the Company reasonably decides in good faith may be appropriate to reflect the adoption of such Benchmark Replacement in a manner substantially consistent with market practice (or, if the Company reasonably decides in good faith that adoption of any portion of such market practice is not administratively feasible or if the Company reasonably determines in good faith that no market practice for use of the Benchmark Replacement exists, in such other manner as the Company determines in good faith is reasonably necessary).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(5) "<u>Benchmark Replacement Date</u>" means the earliest to occur of the following events with respect to the then-current Benchmark:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a. in the case of clause (a) of the definition of "<u>Benchmark Transition Event</u>," the relevant Reference Time in respect of any determination;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b. in the case of <u>clause (b)</u> or <u>(c)</u> of the definition of "<u>Benchmark Transition Event</u>," the later of (i) the date of the public statement or publication of information referenced therein and (ii) the date on which the administrator of the Benchmark permanently or indefinitely ceases to provide the Benchmark; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c. in the case of <u>clause (d)</u> of the definition of "<u>Benchmark Transition Event</u>," the date of such public statement or publication of information referenced therein.

For the avoidance of doubt, if the event giving rise to the Benchmark Replacement Date occurs on the same day as, but earlier than, the Reference Time in respect of any determination, the Benchmark Replacement Date will be deemed to have occurred prior to the Reference Time for purposes of such determination.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(6) "<u>Benchmark Transition Event</u>" means the occurrence of one or more of the following events with respect to the then-current Benchmark:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a. if the Benchmark is Three-Month Term SOFR, (i) the Relevant Governmental Body has not selected or recommended a forward-looking term rate for a tenor of three months based on SOFR, (ii) the development of a forward-looking term rate for a tenor of three months based on SOFR that has been recommended or selected by the Relevant Governmental Body is not complete or (iii) the Company reasonably determines in good faith that the use of a forward-looking rate for a tenor of three months based on SOFR is not administratively feasible;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b. a public statement or publication of information by or on behalf of the administrator of the Benchmark announcing that such administrator has ceased or will cease to provide the Benchmark, permanently or indefinitely, provided that, at the time of such statement or publication, there is no successor administrator that will continue to provide the Benchmark;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c. a public statement or publication of information by the regulatory supervisor for the administrator of the Benchmark, the central bank for the currency of the Benchmark, an insolvency official with jurisdiction over the administrator for the Benchmark, a resolution authority with jurisdiction over the administrator for the Benchmark or a court or an entity with similar insolvency or resolution authority over the administrator for the Benchmark, which states that the administrator of the Benchmark has ceased or will cease to provide the Benchmark permanently or indefinitely, provided that, at the time of such statement or publication, there is no successor administrator that will continue to provide the Benchmark; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d. a public statement or publication of information by the regulatory supervisor for the administrator of the Benchmark announcing that the Benchmark is no longer representative.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(7) "<u>Calculation Agent</u>" means such bank or other entity (which may be the Company or an affiliate of the Company) as may be appointed by the Company to act as Calculation Agent for the Subordinated Notes during the Floating Rate Period.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(8) "<u>Compounded SOFR</u>" means the compounded average of SOFRs for the applicable Corresponding Tenor, with the rate, or methodology for this rate, and conventions for this rate being established by the Company or its designee in accordance with:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a. the rate, or methodology for this rate, and conventions for this rate selected or recommended by the Relevant Governmental Body for determining compounded SOFR; *provided* that:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b. if, and to the extent that, the Company or its designee reasonably determines in good faith that Compounded SOFR cannot be determined in accordance with <u>clause (a)</u> above, then the rate, or methodology for this rate, and conventions for this rate that have been selected by the Company or its designee giving due consideration to any industry-accepted market practice for U.S. dollar denominated floating rate notes at such time.

For the avoidance of doubt, the calculation of Compounded SOFR will exclude the Benchmark Replacement Adjustment.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(9) "<u>Corresponding Tenor</u>" with respect to a Benchmark Replacement means a tenor (including overnight) having approximately the same length (disregarding Business Day adjustment) as the applicable tenor for the then-current Benchmark.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(10) "<u>FRBNY</u>" means the Federal Reserve Bank of New York.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(11) "<u>FRBNY's Website</u>" means the website of the FRBNY at http://www.newyorkfed.org, or any successor source.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(12) "<u>Interpolated Benchmark</u>" with respect to the Benchmark means the rate determined for the Corresponding Tenor by interpolating on a linear basis between: (1) the Benchmark for the longest period (for which the Benchmark is available) that is shorter than the Corresponding Tenor and (2) the Benchmark for the shortest period (for which the Benchmark is available) that is longer than the Corresponding Tenor.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(13) "<u>ISDA</u>" means the International Swaps and Derivatives Association, Inc. or any successor thereto.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(14) "<u>ISDA Definitions</u>" means the 2006 ISDA Definitions published by the ISDA or any successor thereto, as amended or supplemented from time to time, or any successor definitional booklet for interest rate derivatives published from time to time.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(15) "<u>ISDA Fallback Adjustment</u>" means the spread adjustment (which may be a positive or negative value or zero) that would apply for derivatives transactions referencing the ISDA Definitions to be determined upon the occurrence of an index cessation event with respect to the Benchmark for the applicable tenor.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(16) "<u>ISDA Fallback Rate</u>" means the rate that would apply for derivatives transactions referencing the ISDA Definitions to be effective upon the occurrence of an index cessation date with respect to the Benchmark for the applicable tenor excluding the applicable ISDA Fallback Adjustment.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(17) "<u>Reference Time</u>" with respect to any determination of a Benchmark means (1) if the Benchmark is Three-Month Term SOFR, the time determined by the Calculation Agent after giving effect to the Three-Month Term SOFR Conventions, and (2) if the Benchmark is not Three-Month Term SOFR, the time determined by the Calculation Agent after giving effect to the Benchmark Replacement Conforming Changes.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(18) "<u>Relevant Governmental Body</u>" means the Board of Governors of the Federal Reserve System (the "<u>Federal Reserve</u>") and/or the FRBNY, or a committee officially endorsed or convened by the Federal Reserve and/or the FRBNY or any successor thereto.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(19) "<u>SOFR</u>" means the daily Secured Overnight Financing Rate provided by the FRBNY, as the administrator of the benchmark (or a successor administrator), on the FRBNY's Website.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(20) "<u>Term SOFR</u>" means the forward-looking term rate for the Corresponding Tenor based on SOFR that has been selected or recommended by the Relevant Governmental Body.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(21) "<u>Term SOFR Administrator</u>" means any entity designated by the Relevant Governmental Body as the administrator of Term SOFR (or a successor administrator).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(22) "<u>Three-Month Term SOFR</u>" means the rate for Term SOFR for a tenor of three months that is published by the Term SOFR Administrator at the Reference Time for any Floating Interest Period, as determined by the Calculation Agent after giving effect to the Three-Month Term SOFR Conventions; *<u>provided</u>*, *<u>however</u>*, that in the event Three-Month Term SOFR calculated as described in the foregoing clause is less than zero, Three-Month Term SOFR shall be deemed to be zero.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(23) "<u>Three-Month Term SOFR Conventions</u>" means any determination, decision or election with respect to any technical, administrative or operational matter (including with respect to the manner and timing of the publication of Three-Month Term SOFR, or changes to the definition of "Floating Interest Period", timing and frequency of determining Three-Month Term SOFR with respect to each Floating Interest Period and making payments of interest, rounding of amounts or tenors, and other administrative matters) that the Company reasonably decides in good faith may be appropriate to reflect the use of Three-Month Term SOFR as the Benchmark in a manner substantially consistent with market practice (or, if the Company reasonably decides in good faith that adoption of any portion of such market practice is not administratively feasible or if the Company reasonably determines in good faith that no market practice for the use of Three-Month Term SOFR exists, in such other manner as the Company determines in good faith is reasonably necessary).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(24) "<u>Unadjusted Benchmark Replacement</u>" means the Benchmark Replacement excluding the Benchmark Replacement Adjustment.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) In the event that any Fixed Interest Payment Date during the Fixed Rate Period falls on a day that is not a Business Day (as defined below), the interest payment due on that date shall be postponed to the next day that is a Business Day and no additional interest shall accrue as a result of that postponement. In the event that any Floating Interest Payment Date during the Floating Rate Period falls on a day that is not a Business Day (as defined below), the interest payment due on that date shall be postponed to the next day that is a Business Day and interest shall accrue to but excluding the date interest is paid. However, if the postponement would cause the day to fall in the next calendar month during the Floating Interest Period, the Floating Interest Payment Date shall instead be brought forward to the immediately preceding Business Day. The term "Business Day" means any day other than a Saturday or Sunday or any other day on which banking institutions in the State of California are generally authorized or required by law or executive order to be closed.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**3.** **<u>Subordination</u>**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The indebtedness of the Company evidenced by this Subordinated Note, including the principal and interest on this Subordinated Note, shall be subordinate and junior in right of payment to the prior payment in full of all existing claims of creditors of the Company whether now outstanding or subsequently created, assumed, guaranteed or incurred (collectively, "<u>Senior Indebtedness</u>"), which shall consist of principal of (and premium, if any) and interest, if any, on: (i) all indebtedness and obligations of, or guaranteed or assumed by, the Company for money borrowed, whether or not evidenced by bonds, debentures, securities, notes or other similar instruments, including all obligations to the Company's general and secured creditors; (ii) any deferred obligations of the Company for the payment of the purchase price of property or assets acquired other than in the ordinary course of business; (iii) all obligations, contingent or otherwise, of the Company in respect of any letters of credit, bankers' acceptances, security purchase facilities and similar direct credit substitutes; (iv) any capital lease obligations of the Company; (v) all obligations of the Company in respect of interest rate swap, cap or other agreements, interest rate future or option contracts, currency swap agreements, currency future or option contracts, commodity contracts and other similar arrangements or derivative products; (vi) all obligations that are similar to those in clauses (i) through (v) of other Persons for the payment of which the Company is responsible or liable as obligor, guarantor or otherwise arising from an off-balance sheet guarantee; (vii) all obligations of the types referred to in clauses (i) through (vi) of other Persons secured by a lien on any property or asset of the Company; and (viii) in the case of (i) through (vii) above, all amendments, renewals, extensions, modifications and refundings of such indebtedness and obligations; *except* "Senior Indebtedness" does not include (A) the Subordinated Notes, (B) any obligation that by its terms expressly is junior to, or ranks equally in right of payment with, the Subordinated Notes, or (C) any indebtedness between the Company and any of its subsidiaries or Affiliates. This Subordinated Note is not secured by any assets of the Company or any of its subsidiaries or Affiliates. The term "<u>Affiliate(s)</u>" means, with respect to any Person, such Person's immediate family members, partners, members or parent and subsidiary corporations, and any other Person directly or indirectly controlling, controlled by, or under common control with said Person and their respective Affiliates. The term "<u>Person</u>" as used in this Subordinated Note means an individual, a corporation (whether or not for profit), a partnership, a limited liability company, a joint venture, an association, a trust, an unincorporated organization, a government or any department or agency thereof or any other entity or organization. The term "<u>control</u>" (including the terms "controlling," "controlled by," and "under common control with") means the possession, direct or indirect, of the power to direct or cause the direction of the management and policies of a person, whether through the ownership of voting securities, by contract, or otherwise.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) In the event of any liquidation of the Company, holders of Senior Indebtedness of the Company shall be entitled to be paid in full with such interest as may be provided by law before any payment shall be made on account of principal of or interest on this Subordinated Note. Additionally, in the event of any insolvency, dissolution, assignment for the benefit of creditors or any liquidation or winding up of or relating to the Company, whether voluntary or involuntary, holders of Senior Indebtedness shall be entitled to be paid in full before any payment shall be made on account of the principal of or interest on the Subordinated Notes, including this Subordinated Note. In the event of any such proceeding, after payment in full of all sums owing with respect to the Senior Indebtedness, the registered holders of the Subordinated Notes from time to time (each a "<u>Noteholder</u>" and, collectively, the "<u>Noteholders</u>"), together with the holders of any obligations of the Company ranking on parity with the Subordinated Notes, shall be entitled to be paid from the remaining assets of the Company the unpaid principal thereof, and the unpaid interest thereon before any payment or other distribution, whether in cash, property or otherwise, shall be made (i) with respect to any obligation that by its terms expressly is junior to in the right of payment to the Subordinated Notes, (ii) with respect to any indebtedness between the Company and any of its subsidiaries or Affiliates or (iii) on account of any capital stock.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) If there shall have occurred and be continuing (i) a default in any payment with respect to any Senior Indebtedness or (ii) an event of default with respect to any Senior Indebtedness as a result of which the maturity thereof is accelerated, unless and until such payment default or event of default shall have been cured or waived or shall have ceased to exist, no payments shall be made by the Company with respect to the Subordinated Notes. The provisions of this paragraph shall not apply to any payment with respect to which the immediately preceding paragraph of this <u>Section 3</u> (Subordination) would be applicable.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Nothing herein shall act to prohibit, limit or impede the Company from issuing additional debt of the Company having the same rank as the Subordinated Notes or which may be junior or senior in rank to the Subordinated Notes. Each Noteholder, by its acceptance hereof, further acknowledges and agrees that the foregoing subordination provisions are, and are intended to be, an inducement and a consideration for each holder of any Senior Indebtedness, whether such Senior Indebtedness was created or acquired before or after the issuance of the Subordinated Notes, to acquire and continue to hold, or to continue to hold, such Senior Indebtedness, and such holder of Senior Indebtedness shall be deemed conclusively to have relied on such subordination provisions in acquiring and continuing to hold or in continuing to hold such Senior Indebtedness.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**4.**  **<u>Redemption</u>** .

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Redemption Prior to Fifth Anniversary</u>. This Subordinated Note shall not be redeemable by the Company in whole or in part prior to **November 1, 2026**, except in the event of a: (i) Tier 2 Capital Event (as defined below); (ii) Tax Event (as defined below); or (iii) Investment Company Event (as defined below). Upon the occurrence of a Tier 2 Capital Event, a Tax Event or an Investment Company Event, the Company may redeem this Subordinated Note, subject to <u>Section 4(f)</u> (Regulatory Approvals) hereof, in whole or in part at any time, upon giving not less than 10 Business Days' notice to the holder of this Subordinated Note at an amount equal to 100% of the outstanding principal amount being redeemed plus accrued but unpaid interest, to but excluding the redemption date. "<u>Tier 2 Capital Event</u>" means the receipt by the Company of an opinion of counsel to the Company to the effect that there is, or within 120 days after receipt of such opinion there will be, a material risk that this Subordinated Note does not qualify as "Tier 2" Capital (as defined by the Federal Deposit Insurance Corporation) (or its then equivalent) as a result of a change in law or regulation, or interpretation or application thereof, by any judicial, legislative or regulatory authority that becomes effective after the date of issuance of this Subordinated Note. "<u>Tax Event</u>" means the receipt by the Company of an opinion of counsel to the Company that as a result of any amendment to, or change (including any final and adopted (or enacted) prospective change) in, the laws (or any regulations thereunder) of the United States or any political subdivision or taxing authority thereof or therein, or as a result of any official administrative pronouncement or judicial decision interpreting or applying such laws or regulations, there exists a material risk that interest payable by the Company on the Subordinated Notes is not, or within 120 days after the receipt of such opinion will not be, deductible by the Company, in whole or in part, for United States federal income tax purposes. "<u>Investment Company Event</u>" means the receipt by the Company of an opinion of counsel to the Company to the effect that there is a material risk that the Company is or, within one hundred twenty (120) days after the receipt of such opinion will be, required to register as an investment company pursuant to the Investment Company Act of 1940, as amended.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Redemption on or after Fifth Anniversary</u>. On or after **November 1, 2026**, subject to the provisions of <u>Section 4(f)</u> (Regulatory Approvals) hereof, this Subordinated Note shall be redeemable at the option of and by the Company, in whole or in part from time to time upon any Interest Payment Date, at an amount equal to 100% of the outstanding principal amount being redeemed plus accrued but unpaid interest, to but excluding the redemption date, but in all cases in a principal amount with integral multiples of $1,000. In addition, the Company may redeem all or a portion of the Subordinated Notes, at any time upon the occurrence of a Tier 2 Capital Event, Tax Event or an Investment Company Event. The redemption referenced in this <u>Section 4(b)</u> (Redemption on or after Fifth Anniversary) shall be subject to the receipt of any required regulatory approval.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Partial Redemption</u>. If less than the then-outstanding principal amount of this Subordinated Note is redeemed, (i) a new Subordinated Note shall be issued representing the unredeemed portion without charge to the holder thereof and (ii) such redemption shall be effected on a pro rata basis as to the Noteholders. For purposes of clarity, upon a partial redemption, a like percentage of the principal amount of every Subordinated Note held by every Noteholder shall be redeemed.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) <u>No Redemption at Option of Noteholder</u>. This Subordinated Note is not subject to redemption at the option of the holder of this Subordinated Note.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) <u>Effectiveness of Redemption</u>. If notice of redemption has been duly given and notwithstanding that this Subordinated Note has been called for redemption but has not yet been surrendered for cancellation, on and after the date fixed for redemption interest shall cease to accrue on the portion of this Subordinated Note called for redemption, this Subordinated Note shall no longer be deemed outstanding with respect to the portion called for redemption and all rights with respect to the portion of this Subordinated Note called for redemption shall forthwith on such date fixed for redemption cease and terminate unless the Company shall default in the payment of the redemption price, except only the right of the holder hereof to receive the amount payable on such redemption, without interest. For purposes of clarity, any redemption made pursuant to the terms of this Subordinated Note shall be made on a pro rata basis, and, to the extent applicable and for purposes of a redemption processed through The Depository Trust Company (DTC), on a "Pro Rata Pass-Through Distribution of Principal" basis, among all of the Subordinated Notes outstanding at the time thereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) <u>Regulatory Approvals</u>. Any such redemption shall be subject to receipt of any and all required federal and state regulatory approvals or non-objections, including, but not limited to, the consent of the Federal Deposit Insurance Corporation. In the case of any redemption of this Subordinated Note pursuant to paragraphs (b) or (c) of this <u>Section 4</u>, the Company will give the holder hereof notice of redemption, which notice shall indicate the aggregate principal amount of Subordinated Notes to be redeemed, not less than thirty (30) nor more than forty-five (45) calendar days prior to the redemption date.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) <u>Purchase and Resale of the Subordinated Notes</u>. Subject to any required federal and state regulatory approvals and the provisions of this Subordinated Note, the Company shall have the right to purchase any of the Subordinated Notes at any time in the open market, private transactions or otherwise. If the Company purchases any Subordinated Notes, it may, in its discretion, hold, resell or cancel any of the purchased Subordinated Notes.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) <u>Payment Restriction</u>. No payment shall at any time be made on account of the principal thereof, unless following such payment the aggregate of the shareholders' equity and capital notes or debentures thereafter outstanding shall be the equal of such aggregate at the date of the original issue of such capital notes or debentures, or as may be otherwise authorized by the California Department of Financial Protection and Innovation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**5.** **<u>Events of Default; Acceleration</u>**.

Each of the following events shall constitute an "<u>Event of Default</u>":

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) the entry of a decree or order for relief in respect of the Company by a court having jurisdiction in the premises in an involuntary case or proceeding under any applicable bankruptcy, insolvency, or reorganization law, now or hereafter in effect of the United States or any political subdivision thereof, and such decree or order will have continued unstayed and in effect for a period of sixty (60) consecutive calendar days;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) the commencement by the Company of a voluntary case under any applicable bankruptcy, insolvency or reorganization law, now or hereafter in effect of the United States or any political subdivision thereof, or the consent by the Company to the entry of a decree or order for relief in an involuntary case or proceeding under any such law;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) the Company (i) becomes insolvent or is unable to pay its debts as they mature, (ii) makes an assignment for the benefit of creditors, or (iii) admits in writing its inability to pay its debts as they mature;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) the failure of the Company to pay any installment of interest on any of the Subordinated Notes as and when the same will become due and payable, and the continuation of such failure for a period of fifteen (15) calendar days;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) the failure of the Company to pay all or any part of the principal of any of the Subordinated Notes as and when the same will become due and payable;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) the liquidation of the Company (for the avoidance of doubt, "liquidation" does not include any merger, consolidation, sale of equity or assets or reorganization (exclusive of a reorganization in bankruptcy) of the Company or any of its subsidiaries);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) the failure of the Company to perform any other covenant or agreement on the part of the Company contained in the Subordinated Note(s), and the continuation of such failure for a period of thirty (30) days after the date on which notice specifying such failure will have been given in the manner set forth in <u>Section 21</u> (Notices), to the Company by a Noteholder; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) the default by the Company under any bond, debenture, note or other evidence of indebtedness for money borrowed by the Company having an aggregate principal amount outstanding of at least $10,000,000, whether such indebtedness now exists or is created or incurred in the future, which default (i) constitutes a failure to pay any portion of the principal of such indebtedness when due and payable after the expiration of any applicable grace period or (ii) results in such indebtedness becoming due or being declared due and payable prior to the date on which it otherwise would have become due and payable without, in the case of clause (i), such indebtedness having been discharged or, in the case of clause (ii), without such indebtedness having been discharged or such acceleration having been rescinded or annulled.

Unless the principal amount of this Subordinated Note already shall have become due and payable, if an Event of Default set forth in <u>subsections (a)</u> or <u>(b)</u> of this <u>Section 5</u> shall have occurred and be continuing, then the principal amount of this Subordinated Note, and accrued and unpaid interest, if any, on the Subordinated Note will become and be immediately due and payable without any declaration or other act on the part of the Noteholder, and the Company waives demand, presentment for payment, notice of nonpayment, notice of protest, and all other notices. Notwithstanding the foregoing, because the Company treats the Subordinated Notes as Tier 2 Capital, upon the occurrence of an Event of Default other than an Event of Default described in <u>subsections (a)</u> or <u>(b)</u> of this <u>Section 5</u>, no Noteholder may accelerate the Maturity Date of the Subordinated Notes and make the principal of, and any accrued and unpaid interest on, the Subordinated Notes, immediately due and payable. The Company, within forty-five (45) calendar days after the receipt of written notice from any Noteholder of the occurrence of an Event of Default with respect to this Subordinated Note, shall mail to all Noteholders, at their addresses shown on the Security Register (as defined in <u>Section 13</u> (Registration of Transfer, Security Register) below), such written notice of Event of Default, unless such Event of Default shall have been cured or waived before the giving of such notice as certified by the Company in writing.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**6.** **<u>Failure to Make Payments</u>**. In the event of an Event of Default under <u>Section 5(c), Section 5(d),</u> or <u>Section 5(e)</u> above, the Company will, upon demand of the Noteholder, pay to the Noteholder the amount then due and payable on this Subordinated Note for principal and interest (without acceleration of the Subordinated Note in any manner), with interest on the overdue principal and interest at the per annum rate borne by this Subordinated Note, to the extent permitted by applicable law. If the Company fails to pay such amount upon such demand, the Noteholder may, among other things, institute a judicial proceeding for the collection of the sums so due and unpaid and such amount as shall be sufficient to cover the reasonable costs and expenses of collection, including the reasonable compensation, expenses, disbursements and advances of such Noteholder, its agents and counsel, may prosecute such proceeding to judgment or final decree and may enforce the same against the Company and collect the amounts adjudged or decreed to be payable in the manner provided by law out of the property of the Company.

Upon the occurrence of a failure by the Company to make any required payment of principal or interest on this Subordinated Note or an Event of Default, until such failure or Event of Default is cured by the Company or waived by the Noteholders in accordance with <u>Section 17</u> (Waiver and Consent) hereof, except as may be required by any federal or state bank regulatory agency, the Company shall not: (a) declare or pay any dividends or distributions on, or redeem, purchase, acquire, or make a liquidation payment with respect to, any of the Company's capital stock; (b) make any payment of principal or interest or premium, if any, on or repay, repurchase or redeem any indebtedness of the Company that ranks equal with or junior to the Subordinated Notes; or (c) make any payments under any guarantee that ranks equal with or junior to the Subordinated Notes, other than: (i) any dividends or distributions in shares of, or options, warrants or rights to subscribe for or purchase shares of, any class of the Company's common stock; (ii) any declaration of a non-cash dividend in connection with the implementation of a shareholders' rights plan, or the issuance of stock under any such plan in the future, or the redemption or repurchase of any such rights pursuant thereto; (iii) as a result of a reclassification of the Company's capital stock or the exchange or conversion of one class or series of the Company's capital stock for another class or series of the Company's capital stock; (iv) the purchase of fractional interests in shares of the Company's capital stock pursuant to the conversion or exchange provisions of such capital stock or the security being converted or exchanged; or (v) purchases of any class of the Company's common stock related to the issuance of common stock or rights under any benefit plans for the Company's directors, officers or employees or any of the Company's dividend reinvestment plans (including, without limitation, any repurchases or acquisitions in connection with the forfeiture of any stock award, cashless or net exercise of any option, or acceptance of common stock in lieu of an award recipient's tax obligations under any equity award) (the foregoing clauses (i) through (v) are collectively referred to as the "<u>Permitted Dividends</u>"). The limitations imposed by the provisions of this <u>Section 6</u> shall apply whether or not the Noteholder has notified the Company of an Event of Default.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**7.** **<u>Affirmative Covenants of the Company; Compliance Certificate</u>**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Notice of Certain Events</u>. To the extent permitted by applicable statute, rule or regulation, the Company shall provide written notice to the Noteholder, at its addresses shown on the Security Register (as defined in <u>Section 13</u> (Registration of Transfer, Security Register) below), of the occurrence of any of the following events as soon as practicable, but in no event later than thirty (30) Business Days following the Company becoming aware of the occurrence of such event:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) The total risk-based capital ratio, Tier 1 risk-based capital ratio, common equity Tier 1 risk-based capital ratio or leverage ratio of the Company, becomes less than eight percent (8.0%), six percent (6.0%), four and one-half percent (4.50%) or four percent (4.0%), respectively, as of the end of any calendar quarter (provided, that, to the extent the Company has opted into the community bank leverage ratio framework, no notice need be given until the Company ceases to be a qualifying community banking organization, as defined under 12 CFR § 3.12);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) The Company, or any of the Company's subsidiaries, or any officer of the Company (in such capacity), becomes subject to any formal, written regulatory enforcement action (as defined by the applicable state or federal bank regulatory authority); or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) There is a change in beneficial ownership of 25% or more of the outstanding securities of the Company entitled to vote for the election of directors.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Payment of Principal and Interest</u>. The Company covenants and agrees for the benefit of the Noteholder that it will duly and punctually pay the principal of, and interest on, this Subordinated Note, in accordance with the terms hereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Maintenance of Office</u>. The Company will maintain an office or agency in the State of California where Subordinated Notes may be surrendered for registration of transfer or for exchange and where notices and demands to or upon the Company in respect of the Subordinated Notes may be served.

The Company may also from time to time designate one or more other offices or agencies where the Subordinated Notes may be presented or surrendered for any or all such purposes and may from time to time rescind such designations; provided that no such designation or rescission will in any manner relieve the Company of its obligation to maintain an office or agency in the State of California. The Company will give prompt written notice to the Noteholders of any such designation or rescission and of any change in the location of any such other office or agency.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) <u>Corporate Existence</u>. The Company will do or cause to be done all things necessary to preserve and keep in full force and effect: (i) the corporate existence of the Company; and (ii) the rights (constituent governing documents and statutory), licenses and franchises of the Company; *provided, however*, that the Company will not be required to preserve its existence or any such right, license or franchise of the Company if the Board of Directors of the Company determines that the preservation thereof is no longer desirable in the conduct of the business of the Company and its subsidiaries taken as a whole and that the loss thereof will not be disadvantageous in any material respect to the Noteholders.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) <u>Maintenance of Properties</u>. The Company will, and will cause each subsidiary of the Company to, cause all its properties used or useful in the conduct of its business to be maintained and kept in good condition, repair and working order, ordinary wear and tear excepted, and supplied with all necessary equipment and will cause to be made all necessary repairs, renewals, replacements, betterments and improvements thereof, all as in the judgment of the Company may be necessary so that the business carried on in connection therewith may be properly and advantageously conducted at all times; *provided, however*, that nothing in this <u>Section 7(e)</u> will prevent the Company or any subsidiary from discontinuing the operation and maintenance of any of their respective properties if such discontinuance is, in the reasonable judgment of the Board of Directors of the Company or of any subsidiary, as the case may be, desirable in the conduct of its business.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) <u>Waiver of Certain Covenants</u>. The Company may omit in any particular instance to comply with any term, provision or condition set forth in <u>Section 7(c)</u> (Maintenance of Office), <u>Section 7(d)</u> (Corporate Existence), or <u>Section 7(e)</u> (Maintenance of Properties) above, with respect to this Subordinated Note if before the time for such compliance the Noteholders of at least a majority in aggregate principal amount of the outstanding Subordinated Notes, by act of such Noteholders, either will waive such compliance in such instance or generally will have waived compliance with such term, provision or condition, but no such waiver will extend to or affect such term, provision or condition except to the extent so expressly waived, and, until such waiver will become effective, the obligations of the Company in respect of any such term, provision or condition will remain in full force and effect.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) <u>Tier 2 Capital</u>. Whether or not the Company is subject to the consolidated capital requirements of the Federal Deposit Insurance Corporation, if all or any portion of the Subordinated Notes ceases to qualify for inclusion as Tier 2 Capital, other than due to the limitation imposed on the capital treatment of subordinated debt during the five (5) years immediately preceding the Maturity Date of the Subordinated Notes, the Company will immediately notify the Noteholders and thereafter, subject to the Company's right to redeem the Subordinated Notes under such circumstances pursuant to the terms of the Subordinated Notes, the Company and the Noteholders will work together in good faith to execute and deliver all agreements as reasonably necessary in order to restructure the applicable portions of the obligations evidenced by the Subordinated Notes to qualify as Tier 2 Capital; *provided*, *however*, that nothing contained in this <u>Section 7(g)</u> (Tier 2 Capital) shall limit the Company's right to redeem the Subordinated Notes upon the occurrence of a Tier 2 Capital Event pursuant to <u>Section 4(a)</u> (Redemption Prior to Fifth Anniversary) or <u>Section 4(b)</u> (Redemption on or after Fifth Anniversary).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) <u>Compliance with Laws</u>. The Company and each subsidiary of the Company shall comply with the requirements of all laws, regulations, orders and decrees applicable to it or its properties, except for such noncompliance that would not reasonably be expected to have a Material Adverse Effect (as such term is defined in the Purchase Agreement).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) <u>Taxes and Assessments</u>. The Company shall punctually pay and discharge all material taxes, assessments, and other governmental charges or levies imposed upon it or upon its income or upon any of its properties; provided, that no such taxes, assessments or other governmental charges need be paid if they are being contested in good faith by the Company.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j) <u>Company Statement as to Compliance</u>. The Company will deliver to the Noteholders, within one hundred twenty (120) calendar days after the end of each fiscal year, an Officer's Certificate covering the preceding calendar year, stating whether or not, to the best of his or her knowledge, the Company is in default in the performance and observance of any of the terms, provisions and conditions of this Subordinated Note (without regard to notice requirements or periods of grace) and if the Company will be in default, specifying all such defaults and the nature and status thereof of which he or she may have knowledge.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**8.** **<u>Negative Covenants of the Company</u>.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Limitation on Dividends.</u> The Company shall not declare or pay any dividend or make any distribution on capital stock or other equity securities of any kind of the Company if the Company is not "well capitalized" for regulatory purposes immediately prior to the declaration of such dividend or distribution, except for Permitted Dividends.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Merger or Sale of Assets.</u> The Company shall not merge into another entity or convey, transfer or lease substantially all of its properties and assets to any Person, unless:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) the continuing entity into which the Company is merged or the Person which acquires by conveyance or transfer or which leases substantially all of the properties and assets of the Company shall be a corporation, association or other legal entity organized and existing under the laws of the United States of America, any State thereof or the District of Columbia and expressly assumes the due and punctual payment of the principal of and any premium and interest on the Subordinated Notes according to their terms, and the due and punctual performance of all covenants and conditions hereof on the part of the Company to be performed or observed; *provided, however,* that no express assumption shall be required by any successor by merger to the Company to the extent such legal successor assumes the Company's obligations hereunder by operation of law; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) immediately after giving effect to such transaction, no Event of Default (as defined above), and no event which, after notice or lapse of time or both, would become an Event of Default, shall have occurred and be continuing.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Continuance of Business.</u> Except as otherwise permitted under Section 8(b), the Company shall not take any action, omit to take any action or enter into any other transaction that would have the effect of: (i) the liquidation or dissolution of the Company or (ii) the Company ceasing to be an "insured depository institution" under Section 3(c)(2) of the Federal Deposit Insurance Act, as amended.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**9.** **<u>Denominations</u>**. The Subordinated Notes are issuable only in registered form without interest coupons in minimum denominations of $100,000 and integral multiples of $1,000 in excess thereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**10.** **<u>Charges and Transfer Taxes</u>**. No service charge will be made for any registration of transfer or exchange of this Subordinated Note, or any redemption or repayment of this Subordinated Note, or any conversion or exchange of this Subordinated Note for other types of securities or property, but the Company may require payment of a sum sufficient to pay all taxes, assessments or other governmental charges that may be imposed in connection with the transfer or exchange of this Subordinated Note from the Noteholder requesting such transfer or exchange.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**11.** **<u>Payment Procedures</u>**. Payment of the principal and interest payable on the Maturity Date will be made by check, by wire transfer or by Automated Clearing House (ACH) transfer in immediately available funds to a bank account in the United States designated by the registered Noteholder if such Noteholder shall have previously provided wire or ACH instructions to the Company, upon presentation and surrender of this Subordinated Note at the Payment Office (as defined in <u>Section 21</u> (Notices) below) or at such other place or places as the Company shall designate by notice to the registered Noteholders as the Payment Office, provided that this Subordinated Note is presented to the Company in time for the Company to make such payments in such funds in accordance with its normal procedures. Payments of interest (other than interest payable on the Maturity Date) shall be made on each Interest Payment Date by wire transfer in immediately available funds or check mailed to the registered Noteholder, as such Person's address appears on the Security Register (as defined in <u>Section 13</u> below). Interest payable on any Interest Payment Date shall be payable to the Noteholder in whose name this Subordinated Note is registered at the close of business on the fifteenth (15<sup>th</sup>) calendar day prior to the applicable Interest Payment Date, without regard to whether such date is a Business Day, except that interest not paid on the Interest Payment Date, if any, will be paid to the holder in whose name this Subordinated Note is registered at the close of business on a special record date fixed by the Company (a "<u>Special Record Date</u>"), notice of which shall be given to the Noteholder not less than ten (10) calendar days prior to such Special Record Date. To the extent permitted by applicable law, interest shall accrue, at the rate at which interest accrues on the principal of this Subordinated Note, on any amount of principal or interest on this Subordinated Note not paid when due. All payments on this Subordinated Note shall be applied first against costs and expenses of the Noteholder, if any, for which the Company is liable under this Subordinated Note; then against interest due hereunder; and then against principal due hereunder. The Noteholder acknowledges and agrees that the payment of all or any portion of the outstanding principal amount of this Subordinated Note and all interest hereon shall be *pari passu* in right of payment and in all other respects to the other Subordinated Notes. In the event that the Noteholder receives payments in excess of the Noteholder's pro rata share of the Company's payments to the holders of all of the Subordinated Notes, then the Noteholder shall hold in trust all such excess payments for the benefit of the other Noteholders and shall pay such amounts held in trust to such other holders upon demand by such holders.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**12.** **<u>Form of Payment</u>**. Payments of principal and interest on this Subordinated Note shall be made in such coin or currency of the United States of America as at the time of payment shall be legal tender for the payment of public and private debts.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**13.** **<u>Registration of Transfer, Security Register</u>**. Except as otherwise provided herein, or in the Purchase Agreement between Noteholder and the Company, and subject to limitations on transfer under applicable state and federal securities laws, this Subordinated Note is transferable in whole or in part, and may be exchanged for a like aggregate principal amount of Subordinated Notes of other authorized denominations, by the Noteholder in person, or by its attorney duly authorized in writing, at the Payment Office or the offices of the Registrar. The Company or its agent (the "<u>Registrar</u>") shall maintain a register providing for the registration of the Subordinated Notes and any exchange or transfer thereof (the "<u>Security Register</u>"). Upon surrender or presentation of this Subordinated Note for exchange or registration of transfer, the Company or the Registrar shall execute and deliver in exchange therefor a Subordinated Note or Subordinated Notes of like aggregate principal amount, each in a minimum denomination of $100,000 or any amount in excess thereof which is an integral multiple of $1,000 (and, in the absence of an opinion of counsel satisfactory to the Company to the contrary, bearing the restrictive legend(s) set forth hereinabove) and that is or are registered in such name or names requested by the Noteholder. Any Subordinated Note presented or surrendered for registration of transfer or for exchange shall be duly endorsed and accompanied by a written instrument of transfer in such form as is attached hereto and incorporated herein, duly executed by the Noteholder or its attorney duly authorized in writing, with such tax identification number (including, without limitation, an appropriate and properly executed Internal Revenue Service Form W-9 or appropriate type of Form W-8) or other information for each Person in whose name a Subordinated Note is to be issued, and accompanied by evidence of compliance with any restrictive legend(s) appearing on such Subordinated Note or Subordinated Notes as the Company may reasonably request to comply with applicable law. No exchange or registration of transfer of this Subordinated Note shall be made on or after (i) the fifteenth (15<sup>th</sup>) day immediately preceding the Maturity Date or (ii) the due delivery of notice of redemption.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**14.** **<u>Successors and Assigns</u>**. This Subordinated Note shall be binding upon the Company and inure to the benefit of the Noteholder and its respective successors and permitted assigns. The Noteholder may assign all, or any part of, or any interest in, the Noteholder's rights and benefits hereunder only to the extent and in the manner permitted by the terms of this Subordinated Note, the Purchase Agreement, and under applicable securities laws and regulations. To the extent of any such assignment, such assignee shall have the same rights and benefits against the Company and shall agree to be bound by and to comply with the terms and conditions of the Purchase Agreement as it would have had if it were the Noteholder hereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**15.** **<u>Priority</u>**. The Subordinated Notes rank *pari passu* among themselves and *pari passu*, in the event of any insolvency proceeding, dissolution, assignment for the benefit of creditors, reorganization, restructuring of debt, marshaling of assets and liabilities or similar proceeding or any liquidation or winding up of the Company, with all other present or future unsecured subordinated debt obligations of the Company, except any unsecured subordinated debt that, pursuant to its express terms, is senior or subordinate in right of payment to the Subordinated Notes.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**16.** **<u>Ownership</u>**. Prior to due presentment of this Subordinated Note for registration of transfer, the Company may treat the holder in whose name this Subordinated Note is registered in the Security Register as the absolute owner of this Subordinated Note for receiving payments of principal and interest on this Subordinated Note and for all other purposes whatsoever, whether or not this Subordinated Note be overdue, and the Company shall not be affected by any notice to the contrary.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**17.** **<u>Waiver and Consent</u>**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) This Subordinated Note may be amended or waived pursuant to, and in accordance with, the provisions set forth herein and as set forth in Section 7.3 of the Purchase Agreement. Any such consent or waiver given by the Noteholder shall be conclusive and binding upon such Noteholder and upon all subsequent holders of this Subordinated Note and of any Subordinated Note issued upon the registration of transfer hereof or in exchange therefor or in lieu hereof, whether or not notation of such consent or waiver is made upon this Subordinated Note. No delay or omission of the Noteholder to exercise any right or remedy accruing upon any Event of Default shall impair such right or remedy or constitute a waiver of any such Event of Default or an acquiescence therein. Any insured depository institution that shall be a Noteholder or that otherwise shall have any beneficial ownership interest in this Subordinated Note shall, by its acceptance of such Subordinated Note (or beneficial interest therein), be deemed to have waived any right of offset with respect to the indebtedness evidenced thereby.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) No waiver or amendment of any term, provision, condition, covenant or agreement in the Subordinated Notes shall be effective except with the consent of the Noteholders holding more than fifty percent (50%) in aggregate principal amount (excluding any Subordinated Notes held by the Company or any of its Affiliates) of the Subordinated Notes at the time outstanding; *provided*, *however*, that without the consent of each Noteholder of an affected Subordinated Note, no such amendment or waiver may: (i) reduce the principal amount of the Subordinated Note; (ii) reduce the rate of or change the time for payment of interest on any Subordinated Note; (iii) extend the maturity of any Subordinated Note; (iv) change the currency in which payment of the obligations of the Company under the Subordinated Notes are to be made; (v) lower the percentage of aggregate principal amount of outstanding Subordinated Notes required to approve any amendment of the Subordinated Notes; (vi) make any changes to Section 4(c) (Partial Redemption), Section 5 (Events of Default; Acceleration), Section 6 (Failure to Make Payments), Section 15 (Priority), or Section 17 (Waiver and Consent) of the Subordinated Notes that adversely affects the rights of any Noteholder; or (vii) disproportionately and adversely affect the rights of any of the holders of the then outstanding Subordinated Notes. Notwithstanding the foregoing, the Company may amend or supplement the Subordinated Notes without the consent of the Noteholders to cure any ambiguity, defect or inconsistency or to provide for uncertificated Subordinated Notes in addition to or in place of certificated Subordinated Notes, or to make any change that does not adversely affect the rights of any Noteholder of any of the Subordinated Notes. No failure to exercise or delay in exercising, by any Noteholder of the Subordinated Notes, of any right, power or privilege hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any right, power or privilege preclude any other or further exercise thereof, or the exercise of any other right or remedy provided by law. The rights and remedies provided in this Subordinated Note are cumulative and not exclusive of any right or remedy provided by law or equity. No notice or demand on the Company in any case shall, in itself, entitle the Company to any other or further notice or demand in similar or other circumstances or constitute a waiver of the rights of the Noteholders to any other or further action in any circumstances without notice or demand. No consent or waiver, express or implied, by the Noteholders to or of any breach or default by the Company in the performance of its obligations hereunder shall be deemed or construed to be a consent or waiver to or of any other breach or default in the performance of the same or any other obligations of the Company hereunder. Failure on the part of the Noteholders to complain of any acts or failure to act or to declare an Event of Default, irrespective of how long such failure continues, shall not constitute a waiver by the Noteholders of their rights hereunder or impair any rights, powers or remedies on account of any breach or default by the Company.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**18.** **<u>Absolute and Unconditional Obligation of the Company</u>**. No provisions of this Subordinated Note shall alter or impair the obligation of the Company, which is absolute and unconditional, to pay the principal and interest on this Subordinated Note at the times, places and rate, and in the coin or currency, herein prescribed. No delay or omission of the Noteholder to exercise any right or remedy accruing upon any Event of Default shall impair such right or remedy or constitute a waiver of any such Event of Default or an acquiescence therein.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**19.** **<u>No Sinking Fund; Convertibility</u>**. This Subordinated Note is not entitled to the benefit of any sinking fund. This Subordinated Note is not convertible into or exchangeable for any of the equity securities, other securities or assets of the Company or any subsidiary of the Company.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**20.** **<u>No Recourse Against Others</u>**. No recourse under or upon any obligation, covenant or agreement contained in this Subordinated Note, or for any claim based thereon or otherwise in respect thereof, will be had against any past, present or future shareholder, employee, officer, or director, as such, of the Company or of any predecessor or successor, either directly or through the Company or any predecessor or successor, under any rule of law, statute or constitutional provision or by the enforcement of any assessment or by any legal or equitable proceeding or otherwise, all such liability being expressly waived and released by the acceptance of this Subordinated Note by the Noteholder and as part of the consideration for the issuance of this Subordinated Note.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**21.** **<u>Notices</u>**. All notices to the Company under this Subordinated Note shall be in writing and addressed to the Company at 6 Hutton Centre Drive, Suite 100, Santa Ana, CA 92707, Attention: Chief Financial Officer, or to such other address as the Company may notify to the Noteholder (the "<u>Payment Office</u>"). All notices to the Noteholders shall be in writing and sent by first-class mail to each Noteholder at his or its address as set forth in the Security Register.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**22.** **<u>Further Issues</u>**. The Company may, without the consent of the Noteholders, create and issue additional notes having the same terms and conditions of the Subordinated Notes (except for the Issue Date and issue price) so that such further notes shall be consolidated and form a single series with the Subordinated Notes.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**23.** **<u>Governing Law; Interpretation</u>**. THIS SUBORDINATED NOTE WILL BE DEEMED TO BE A CONTRACT MADE UNDER THE LAWS OF THE STATE OF NEW YORK AND WILL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICT OF LAW PRINCIPLES THEREOF. IT IS INTENDED THAT THIS SUBORDINATED NOTE SHALL MEET THE CRITERIA FOR QUALIFICATION OF THE OUTSTANDING PRINCIPAL AS TIER 2 CAPITAL UNDER THE REGULATORY GUIDELINES OF THE FEDERAL DEPOSIT INSURANCE CORPORATION, AND THE TERMS HEREOF SHALL BE INTERPRETED IN A MANNER TO SATISFY SUCH INTENT.

*[Signature Page Follows]*

IN WITNESS WHEREOF, the undersigned has caused this Subordinated Note to be duly executed and attested.

---

| | |
|:---|:---|
| INFINITY BANK | INFINITY BANK |
| By: |  |
| Name: | Victor Guerrero |
| Title: | President, Chief Operating Officer and Chief Financial Officer |

---

---

| |
|:---|
| ATTEST: |
| Name: Elaine Crouch |
| Title: EVP and Corporate Secretary |

---

*[Signature Page to Subordinated Note]*

**ASSIGNMENT FORM**

[Capitalized terms used herein but not defined have the meanings assigned in the Subordinated Note]

To assign this Subordinated Note of Infinity Bank, fill in the form below: (I) or (we) assign and transfer this Subordinated Note to:

------

(Print or type assignee's name, address and zip code)

------

(Insert assignee's social security or tax I.D. No.)

and irrevocably appoint___________________________agent to transfer this Subordinated Note on the books of the Company. The agent may substitute another to act for him.

Date:   Your signature:   <br> (Sign exactly as your name appears on the face of this Subordinated Note)

FOR EXECUTION BY AN ENTITY: <br> <br> Entity name:  

By:   <br> Name:   <br> Title:  

Tax Identification No:  

Signature Guarantee:  

*(Signatures must be guaranteed by an eligible guarantor institution (banks, stockbrokers, savings and loan associations and credit unions with membership in an approved signature guarantee medallion program), pursuant to Rule 17Ad-15 promulgated under the Securities Exchange Act of 1934, as amended (the "Exchange Act")).*

The undersigned certifies that he/she/it [is / is not] (*circle one*) an Affiliate of the Company and that, to its knowledge, the proposed transferee [is / is not] (*circle one*) an Affiliate of the Company.

In connection with any transfer or exchange of this Subordinated Note occurring prior to the date that is one year after the later of the date of original issuance of this Subordinated Note and the last date, if any, on which this Subordinated Note was owned by the Company or any Affiliate of the Company, the undersigned confirms that this Subordinated Note is being:

CHECK ONE BOX BELOW:

(1) acquired for the undersigned's own account, without transfer;

(2) transferred to the Company;

(3) transferred in accordance and in compliance with Rule 144A under the Securities Act of 1933, as amended (the "Securities Act");

(4) transferred under an effective registration statement under the Securities Act;

(5) transferred in accordance with and in compliance with Regulation S under the Securities Act;

(6) transferred to an institutional "accredited investor" (as defined in Rule 501(a)(1), (2), (3) or (7) under the Securities Act);

(7) transferred to an "accredited investor" (as defined in Rule 501(a)(4) under the Securities Act), not referred to in item (6) that has been provided with the information designated under Section 4(d) of the Securities Act; or

(8) transferred in accordance with another available exemption from the registration requirements of the Securities Act.

Unless one of the boxes is checked, the Company will refuse to register this Subordinated Note in the name of any person other than the registered holder thereof; provided, however, that if box (5), (6), (7) or (8) is checked, the Company may require, prior to registering any such transfer of this Subordinated Note, in its sole discretion, such legal opinions, certifications and other information as the Company may reasonably request to confirm that such transfer is being made pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act such as the exemption provided by Rule 144 under such Act.

Signature:   <br> (Sign exactly as your name appears on the face of this Subordinated Note)

FOR EXECUTION BY AN ENTITY: <br> <br> Entity name:  

By:   <br> Name:   <br> Title:  

Tax Identification No.:  

Signature Guarantee:  

*(Signatures must be guaranteed by an eligible guarantor institution (banks, stockbrokers, savings and loan associations and credit unions with membership in an approved signature guarantee medallion program), pursuant to Exchange Act Rule 17Ad-l5).*

TO BE COMPLETED BY PURCHASER IF BOX (1) OR (3) ABOVE IS CHECKED.

The undersigned represents and warrants that it is purchasing this Subordinated Note for its own account or an account with respect to which it exercises sole investment discretion and that it and any such account is a "qualified institutional buyer" within the meaning of Rule 144A under the Securities Act and is aware that the sale to it is being made in reliance on Rule 144A and acknowledges that it has received such information regarding the Company as the undersigned has requested pursuant to Rule 144A or has determined not to request such information and that it is aware that the transferor is relying upon the undersigned's foregoing representations in order to claim the exemption from registration provided by Rule 144A.

Date:   Signature:   <br> <br> Print name:  

FOR EXECUTION BY AN ENTITY: <br> <br> Entity name:  

By:   <br> Name:   <br> Title:  

Tax Identification No.:  

---

| | |
|:---|:---|
| &nbsp;&nbsp;![GRAPHIC](tm237204d1_ex6-6img001.jpg) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;SUBORDINATED NOTE INFINITY BANK 4.25% FIXED TO FLOATING RA TE SUBORDINATED NOTE DUE NOVEMBER 1, 2031 THE INDEBTEDNESS EVIDENCED BY THIS SUBORDINATED NOTE IS NOT A DEPOSIT AND IS NOT INSURED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY OTHER GOVERNMENT AGENCY OR FUND. THE INDEBTEDNESS EVIDENCED BY THIS SUBORDINATED NOTE IS SUBORDINATED AND JUNIOR IN RIGHT OF PAYMENT TO SENIOR INDEBTEDNESS (AS DEFINED IN SECTION 3 (SUBORDINATION) OF THIS SUBORDINATED NOTE) OF INFINITY BANK, A CALIFORNIA CORPORATION (THE "COMPANY"), INCLUDING OBLIGATIONS OF THE COMPANY TO ITS GENERAL AND SECURED CREDITORS AND IS UNSECURED. IT IS INELIGIBLE AS COLLATERAL FOR ANY EXTENSION OF CREDIT BY THE COMPANY OR ANY OF ITS SUBSIDIARIES. IN THE EVENT OF LIQUIDATION, ALL HOLDERS OF SENIOR INDEBTEDNESS OF THE COMPANY SHALL BE ENTITLED TO BE PAID IN FULL WITH SUCH INTEREST AS MAY BE PROVIDED BY LAW BEFORE ANY PAYMENT SHALL BE MADE ON ACCOUNT OF PRINCIPAL OF OR INTEREST ON THIS SUBORDINATED NOTE. AFTER PAYMENT IN FULL OF ALL SUMS OWING TO SUCH HOLDERS OF SENIOR INDEBTEDNESS, THE HOLDER OF THIS SUBORDINATED NOTE, TOGETHER WITH THE HOLDERS OF ANY OBLIGATIONS OF THE COMPANY RANKING ON A PARITY WITH THE SUBORDINATED NOTES, SHALL BE ENTITLED TO BE PAID FROM THE REMAINING ASSETS OF THE COMPANY THE UNPAID PRINCIPAL AMOUNT OF THIS SUBORDINATED NOTE PLUS ACCRUED AND UNPAID INTEREST THEREON BEFORE ANY PAYMENT OR OTHER DISTRIBUTION, WHETHER IN CASH, PROPERTY OR OTHERWISE, SHALL BE MADE (I) WITH RESPECT TO ANY OBLIGATION THAT BY ITS TERMS EXPRESSLY IS JUNIOR IN THE RIGHT OF PAYMENT TO THE SUBORDINATED NOTES, (II) WITH RESPECT TO ANY INDEBTEDNESS BETWEEN THE COMPANY AND ANY OF ITS SUBSIDIARIES OR AFFILIATES OR (III) ON ACCOUNT OF ANY SHARES OF CAPITAL STOCK OF THE COMPANY. THIS SUBORDINATED NOTE WILL BE ISSUED AND MAY BE TRANSFERRED ONLY IN MINIMUM DENOMINATIONS OF $100,000 AND MULTIPLES OF $1,000 IN EXCESS THEREOF. ANY ATTEMPTED TRANSFER OF THIS SUBORDINATED NOTE IN A DENOMINATION OF LESS THAN $ I 00,000 SHALL BE DEEMED TO BE VOID AND OF NO LEGAL EFFECT WHATSOEVER. ANY SUCH PURPORTED TRANSFEREE SHALL BE DEEMED NOT TO BE THE HOLDER OF THIS SUBORDINATED NOTE FOR ANY PURPOSE, INCLUDING, BUT NOT LIMITED TO, THE RECEIPT OF PAYMENTS ON THIS SUBORDINATED NOTE, AND SUCH PURPORTED TRANSFEREE SHALL BE DEEMED TO HA VE NO INTEREST WHATSOEVER IN THIS SUBORDINATED NOTE.  |

---

---

| | |
|:---|:---|
| &nbsp;&nbsp;![GRAPHIC](tm237204d1_ex6-6img002.jpg) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;THIS SUBORDINATED NOTE MAY BE SOLD ONLY IN COMPLIANCE WITH APPLICABLE FEDERAL AND ST ATE SECURITIES LAWS. THIS SUBORDINATED NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY APPLICABLE ST ATE SECURITIES LAWS, OR ANY OTHER APPLICABLE SECURITIES LAWS. NEITHER THIS SUBORDINATED NOTE NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. CERTAIN ERISA CONSIDERATIONS: THE HOLDER OF THIS SUBORDINATED NOTE, OR ANY INTEREST HEREIN, BY ITS ACCEPTANCE HEREOF OR THEREOF AGREES, REPRESENTS AND WARRANTS THAT IT IS NOT AN EMPLOYEE BENEFIT PLAN, INDIVIDUAL RETIREMENT ACCOUNT OR OTHER PLAN OR ARRANGEMENT SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), OR SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE") (EACH, A "PLAN"), OR AN ENTITY WHOSE UNDERLYING ASSETS INCLUDE "PLAN ASSETS" BY REASON OF ANY PLAN'S INVESTMENT IN THE ENTITY, AND NO PERSON INVESTING "PLAN ASSETS" OF ANY PLAN MAY ACQUIRE OR HOLD THIS SUBORDINATED NOTE OR ANY INTEREST HEREIN, UNLESS SUCH PURCHASER OR HOLDER IS ELIGIBLE FOR THE EXEMPTIVE RELIEF AVAILABLE UNDER U.S. DEPARTMENT OF LABOR PROHIBITED TRANSACTION CLASS EXEMPTION 96-23, 95- 60, 91-38, 90-1 OR 84-14 OR ANOTHER APPLICABLE EXEMPTION OR ITS PURCHASE AND HOLDING OF THIS SUBORDINATED NOTE, OR ANY INTEREST HEREIN, ARE NOT PROHIBITED BY SECTION 406 OF ERISA OR SECTION 4975 OF THE CODE WITH RESPECT TO SUCH PURCHASE AND HOLDING. ANY PURCHASER OR HOLDER OF THIS SUBORDINATED NOTE OR ANY INTEREST HEREIN WILL BE DEEMED TO HA VE REPRESENTED BY ITS PURCHASE AND HOLDING THEREOF THAT EITHER: (I) IT IS NOT AN EMPLOYEE BENEFIT PLAN OR OTHER PLAN TO WHICH TITLE I OF ERISA OR SECTION 4975 OF THE CODE IS APPLICABLE, A TRUSTEE OR OTHER PERSON ACTING ON BEHALF OF ANY SUCH EMPLOYEE BENEFIT PLAN OR OTHER PLAN, OR ANY OTHER PERSON OR ENTITY USING THE "PLAN ASSETS" OF ANY SUCH PLAN OR OTHER PLAN TO FINANCE SUCH PURCHASE OR (II) SUCH PURCHASE OR HOLDING WILL NOT RESULT IN A PROHIBITED TRANSACTION UNDER SECTION 406 OF ERISA OR SECTION 4975 OF THE CODE FOR WHICH FULL EXEMPTIVE RELIEF IS NOT AVAILABLE UNDER APPLICABLE STATUTORY OR ADMINISTRATIVE EXEMPTION. ANY FIDUCIARY OF ANY PLAN WHO IS CONSIDERING THE ACQUISITION OF THIS SUBORDINATED NOTE OR ANY INTEREST HEREIN SHOULD CONSULT WITH HIS OR HER LEGAL COUNSEL PRIOR TO ACQUIRING THIS SUBORDINATED NOTE OR ANY INTEREST HEREIN. 2  |

---

---

| | |
|:---|:---|
| &nbsp;&nbsp;![GRAPHIC](tm237204d1_ex6-6img003.jpg) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;INFINITY BANK 4.25% FIXED TO FLOATING RA TE SUBORDINATED NOTE DATED OCTOBER 22, 2021 AND DUE NOVEMBER 1, 2031 1. Subordinated Notes. This subordinated note is one of an issue of notes of Infinity Bank, a California corporation (the "Company"), designated as the "4.25% Fixed to Floating Rate Subordinated Notes due November 1, 2031" (the "Subordinated Notes") issued pursuant to that Subordinated Note Purchase Agreement, dated as of the date upon which this Subordinated Note was originally issued (the "Issue Date"), between the Company and the one or more purchasers of the Subordinated Notes identified in the signature pages thereto (the "Purchase Agreement"). 2. Payment. The Company, for value received, promises to pay to CalPrivate Bank, or its registered assigns, the principal sum of FIVE HUNDRED THOUSAND DOLLARS (U.S.) ($500000), plus accrued but unpaid interest on November 1, 2031 (the "Maturity Date") and to pay interest thereon (i) from and including the original issue date of the Subordinated Notes to but excluding November 1, 2026 or the earlier redemption date contemplated by Section 4 (Redemption) of this Subordinated Note (the "Fixed Rate Period"), at the rate of 4.25% per annum, computed on the basis of a 360-day year consisting of twelve 30-day months and payable semi-annually in arrears on May 1 and November 1 of each year (each payment date, a "Fixed Interest Payment Date"), beginning May 1, 2022, and (ii) from and including November 1, 2026, to but excluding the Maturity Date or earlier redemption date contemplated by Section 4 (Redemption) of this Subordinated Note (the "Floating Rate Period"), at the rate per annum, reset quarterly, equal to the Floating Interest Rate (as defined below) determined on the Floating Interest Determination Date (as defined below) of the applicable interest period plus 336 basis points, computed on the basis of a 360-day year and the actual number of days elapsed and payable quarterly in arrears (each quarterly period, a "Floating Interest Period") on February 1, May 1, August 1 and November 1 of each year (each payment date, a "Floating Interest Payment Date"). Dollar amounts resulting from this calculation shall be rounded to the nearest cent, with one-half cent being rounded up. The term "Floating Interest Determination Date" means the date upon which the Floating Interest Rate is determined by the Calculation Agent (as defined below) pursuant to the Three-Month Term SOFR Conventions (as defined below). (a) An "Interest Payment Date" is either a Fixed Interest Payment Date or a Floating Interest Payment Date, as applicable. (b) The "Floating Interest Rate" means: (i) initially Three-Month Term SOFR (as defined below). (ii) Notwithstanding the foregoing clause (i) of this Section 2(b): (1) If the Calculation Agent, reasonably determines in good faith prior to the relevant Floating Interest Determination Date that a Benchmark Transition Event and its related Benchmark Replacement Date (each of such terms as defined below) have occurred with respect to Three-Month Term SOFR, then the Company shall promptly provide notice of such determination to the Noteholders and Section 2(c) (Effect of Benchmark Transition Event) will 3  |

---

---

| | |
|:---|:---|
| &nbsp;&nbsp;![GRAPHIC](tm237204d1_ex6-6img004.jpg) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;thereafter apply to all determinations, calculations and quotations made or obtained for the purposes of calculating the Floating Interest Rate payable on the Subordinated Notes during a relevant Floating Interest Period. (2) However, if the Calculation Agent reasonably determines in good faith that a Benchmark Transition Event and its related Benchmark Replacement Date have occurred with respect to Three-Month Term SOFR, but for any reason the Benchmark Replacement has not been determined as of the relevant Floating Interest Determination Date, the Floating Interest Rate for the applicable Floating Interest Period will be equal to the Floating Interest Rate on the last Floating Interest Determination Date for the Subordinated Notes, as determined by the Calculation Agent. (iii) If the then-current Benchmark is Three-Month Term SOFR and any of the foregoing provisions concerning the calculation of the interest rate and the payment of interest during the Floating Rate Period are inconsistent with any of the Three-Month Term SOFR Conventions determined by the Company, then the relevant Three-Month Term SOFR Conventions will apply. (c) Effect of Benchmark Transition Event. (i) If the Calculation Agent reasonably determines in good faith that a Benchmark Transition Event and its related Benchmark Replacement Date have occurred prior to the Reference Time (as defined below) in respect of any determination of the Benchmark (as defined below) on any date, the Benchmark Replacement will replace the then-current Benchmark for all purposes relating to the Subordinated Notes during the relevant Floating Interest Period in respect of such determination on such date and all determinations on all subsequent dates. (ii) In connection with the implementation of a Benchmark Replacement, the Company will have the right to make Benchmark Replacement Conforming Changes from time to time, and such changes shall become effective without consent from the relevant Noteholders (as defined below) or any other party. (iii) Any determination, decision or election that may be made by the Company or by the Calculation Agent pursuant to the benchmark transition provisions set forth herein, including any determination with respect to a tenor, rate or adjustment or of the occurrence or non-occurrence of an event, circumstance or date, and any decision to take or refrain from taking any action or any selection: sole discretion; (1) will be conclusive and binding absent manifest error; (2) if made by the Company, will be made in the Company's (3) if made by the Calculation Agent, will be made after consultation with the Company, and the Calculation Agent will not make any such determination, decision or election to which the Company reasonably objects; and 4  |

---

---

| | |
|:---|:---|
| &nbsp;&nbsp;![GRAPHIC](tm237204d1_ex6-6img005.jpg) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(4) notwithstanding anything to the contrary in this Subordinated Note or the Purchase Agreement, shall become effective without consent from the relevant Noteholders (as defined below) or any other party. (iv) For the avoidance of doubt, after a Benchmark Transition Event and its related Benchmark Replacement Date have occurred, interest payable on this Subordinated Note for the Floating Rate Period will be an annual rate equal to the sum of the applicable Benchmark Replacement and the spread specified on the face hereof. (v) As used in this Subordinated Note, the following terms have the meanings as set forth below: (1) "Benchmark" means, initially, Three-Month Term SOFR; provided that if a Benchmark Transition Event and its related Benchmark Replacement Date have occurred with respect to Three-Month Term SOFR or the then-current Benchmark, then "Benchmark" means the applicable Benchmark Replacement. (2) "Benchmark Replacement" means the Interpolated Benchmark with respect to the then-current Benchmark; provided that if (a) the Calculation Agent cannot determine the Interpolated Benchmark as of the Benchmark Replacement Date or (b) the then-current Benchmark is Three-Month Term SOFR and a Benchmark Transition Event and its related Benchmark Replacement Date have occurred with respect to Three-Month Term SOFR (in which event no Interpolated Benchmark with respect to Three-Month Term SOFR shall be determined), then "Benchmark Replacement" means the first alternative set forth in the order below that can be determined by the Calculation Agent, as of the Benchmark Replacement Date: a. The sum of (i) Compounded SOFR and (ii) the Benchmark Replacement Adjustment; b. the sum of: (i) the alternate rate of interest that has been selected or recommended by the Relevant Governmental Body as the replacement for the then-current Benchmark for the applicable Corresponding Tenor and (ii) the Benchmark Replacement Adjustment; C. the sum of: (i) the ISDA Fallback Rate and (ii) the Benchmark Replacement Adjustment; d. the sum of: (i) the alternate rate of interest that has been selected by the Company as the replacement for the then-current Benchmark for the applicable Corresponding Tenor giving due consideration to any industry-accepted rate of interest as a replacement for the then-current Benchmark for U.S. dollar denominated floating rate notes at such time and (ii) the Benchmark Replacement Adjustment. (3) "Benchmark Replacement Adiustment" means the first alternative set forth in the order below that can be determined by the Calculation Agent, as of the Benchmark Replacement Date: 5  |

---

---

| | |
|:---|:---|
| &nbsp;&nbsp;![GRAPHIC](tm237204d1_ex6-6img006.jpg) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a. the spread adjustment, or method for calculating or determining such spread adjustment, (which may be a positive or negative value or zero) that has been selected or recommended by the Relevant Governmental Body for the applicable Unadjusted Benchmark Replacement; b. if the applicable Unadjusted Benchmark Replacement is equivalent to the ISDA Fallback Rate, then the ISDA Fallback Adjustment; c. the spread adjustment (which may be a positive or negative value or zero) that has been selected by the Company giving due consideration to any industry-accepted spread adjustment, or method for calculating or determining such spread adjustment, for the replacement of the then-current Benchmark with the applicable Unadjusted Benchmark Replacement for U.S. dollar denominated floating rate notes at such time. (4) "Benchmark Replacement Conforming Changes" means, with respect to any Benchmark Replacement, any technical, administrative or operational changes (including changes to the definition of "Floating Interest Period," timing and frequency of determining rates with respect to each Floating Interest Period and making payments of interest, rounding of amounts or tenors and other administrative matters) that the Company reasonably decides in good faith may be appropriate to reflect the adoption of such Benchmark Replacement in a manner substantially consistent with market practice (or, if the Company reasonably decides in good faith that adoption of any portion of such market practice is not administratively feasible or if the Company reasonably determines in good faith that no market practice for use of the Benchmark Replacement exists, in such other manner as the Company determines in good faith is reasonably necessary). (5) "Benchmark Replacement Date" means the earliest to occur of the following events with respect to the then-current Benchmark: a. in the case of clause (a) of the definition of "Benchmark Transition Event," the relevant Reference Time in respect of any determination; b. in the case of clause (b) or (£1 of the definition of "Benchmark Transition Event," the later of (i) the date of the public statement or publication of information referenced therein and (ii) the date on which the administrator of the Benchmark permanently or indefinitely ceases to provide the Benchmark; or c. in the case of clause (d) of the definition of "Benchmark Transition Event," the date of such public statement or publication of information referenced therein. For the avoidance of doubt, if the event giving rise to the Benchmark Replacement Date occurs on the same day as, but earlier than, the Reference Time in respect of any determination, the Benchmark Replacement Date will be deemed to have occurred prior to the Reference Time for purposes of such determination. (6) "Benchmark Transition Event" means the occurrence of one or more of the following events with respect to the then-current Benchmark: 6  |

---

---

| | |
|:---|:---|
| &nbsp;&nbsp;![GRAPHIC](tm237204d1_ex6-6img007.jpg) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a. if the Benchmark is Three-Month Term SOFR, (i) the Relevant Governmental Body has not selected or recommended a forward-looking term rate for a tenor of three months based on SOFR, (ii) the development of a forward-looking term rate for a tenor of three months based on SOFR that has been recommended or selected by the Relevant Governmental Body is not complete or (iii) the Company reasonably determines in good faith that the use of a forward-looking rate for a tenor of three months based on SO FR is not administratively feasible; b. a public statement or publication of information by or on behalf of the administrator of the Benchmark announcing that such administrator has ceased or will cease to provide the Benchmark, permanently or indefinitely, provided that, at the time of such statement or publication, there is no successor administrator that will continue to provide the Benchmark; c. a public statement or publication of information by the regulatory supervisor for the administrator of the Benchmark, the central bank for the currency of the Benchmark, an insolvency official with jurisdiction over the administrator for the Benchmark, a resolution authority with jurisdiction over the administrator for the Benchmark or a court or an entity with similar insolvency or resolution authority over the administrator for the Benchmark, which states that the administrator of the Benchmark has ceased or will cease to provide the Benchmark permanently or indefinitely, provided that, at the time of such statement or publication, there is no successor administrator that will continue to provide the Benchmark; or d. a public statement or publication of information by the regulatory supervisor for the administrator of the Benchmark announcing that the Benchmark is no longer representative. (7) "Calculation Agent" means such bank or other entity (which may be the Company or an affiliate of the Company) as may be appointed by the Company to act as Calculation Agent for the Subordinated Notes during the Floating Rate Period. (8) "Compounded SOFR" means the compounded average of SOFRs for the applicable Corresponding Tenor, with the rate, or methodology for this rate, and conventions for this rate being established by the Company or its designee in accordance with: a. the rate, or methodology for this rate, and conventions for this rate selected or recommended by the Relevant Governmental Body for determining compounded SOFR; provided that: b. if, and to the extent that, the Company or its designee reasonably determines in good faith that Compounded SOFR cannot be determined in accordance with clause (a) above, then the rate, or methodology for this rate, and conventions for this rate that have been selected by the Company or its designee giving due consideration to any industry-accepted market practice for U.S. dollar denominated floating rate notes at such time. For the avoidance of doubt, the calculation of Compounded SOFR will exclude the Benchmark Replacement Adjustment. 7  |

---

---

| | |
|:---|:---|
| &nbsp;&nbsp;![GRAPHIC](tm237204d1_ex6-6img008.jpg) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(9) "Corresponding Tenor" with respect to a Benchmark Replacement means a tenor (including overnight) having approximately the same length (disregarding Business Day adjustment) as the applicable tenor for the then-current Benchmark. (10) "FRBNY" means the Federal Reserve Bank of New York. (11) "FRBNY's Website" means the website of the FRBNY at http://www.newyorkfed.org, or any successor source. (12) "Intemolated Benchmark" with respect to the Benchmark means the rate determined for the Corresponding Tenor by interpolating on a linear basis between: (1) the Benchmark for the longest period (for which the Benchmark is available) that is shorter than the Corresponding Tenor and (2) the Benchmark for the shortest period (for which the Benchmark is available) that is longer than the Corresponding Tenor. (13) "ISDA'' means the International Swaps and Derivatives Association, Inc. or any successor thereto. (14) "ISDA Definitions" means the 2006 ISDA Definitions published by the ISDA or any successor thereto, as amended or supplemented from time to time, or any successor definitional booklet for interest rate derivatives published from time to time. (15) "ISDA Fallback Adjustment" means the spread adjustment (which may be a positive or negative value or zero) that would apply for derivatives transactions referencing the ISDA Definitions to be determined upon the occurrence of an index cessation event with respect to the Benchmark for the applicable tenor. (16) "ISDA Fall back Rate" means the rate that would apply for derivatives transactions referencing the ISDA Definitions to be effective upon the occurrence of an index cessation date with respect to the Benchmark for the applicable tenor excluding the applicable ISDA Fallback Adjustment. (17) "Reference Time" with respect to any determination of a Benchmark means (1) if the Benchmark is Three-Month Term SOFR, the time determined by the Calculation Agent after giving effect to the Three-Month Term SOFR Conventions, and (2) if the Benchmark is not Three-Month Term SOFR, the time determined by the Calculation Agent after giving effect to the Benchmark Replacement Conforming Changes. (18) "Relevant Governmental Body" means the Board of Governors of the Federal Reserve System (the "Federal Reserve") and/or the FRBNY, or a committee officially endorsed or convened by the Federal Reserve and/or the FRBNY or any successor thereto. (19) "SOFR" means the daily Secured Overnight Financing Rate provided by the FRBNY, as the administrator of the benchmark (or a successor administrator), on the FRBNY's Website. 8  |

---

---

| | |
|:---|:---|
| &nbsp;&nbsp;![GRAPHIC](tm237204d1_ex6-6img009.jpg) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(20) "Term SOFR" means the forward-looking term rate for the Corresponding Tenor based on SOFR that has been selected or recommended by the Relevant Governmental Body. (21) "Term SOFR Administrator" means any entity designated by the Relevant Governmental Body as the administrator of Term SOFR (or a successor administrator). (22) "Three-Month Term SOFR" means the rate for Term SOFR for a tenor of three months that is published by the Term SOFR Administrator at the Reference Time for any Floating Interest Period, as determined by the Calculation Agent after giving effect to the Three-Month Term SOFR Conventions: provided, however, that in the event Three-Month Term SOFR calculated as described in the foregoing clause is less than zero, Three-Month Term SOFR shall be deemed to be zero. (23) "Three-Month Term SOFR Conventions" means any determination, decision or election with respect to any technical, administrative or operational matter (including with respect to the manner and timing of the publication of Three-Month Term SOFR, or changes to the definition of "Floating Interest Period", timing and frequency of determining Three-Month Term SOFR with respect to each Floating Interest Period and making payments of interest, rounding of amounts or tenors, and other administrative matters) that the Company reasonably decides in good faith may be appropriate to reflect the use of Three-Month Term SOFR as the Benchmark in a manner substantially consistent with market practice (or, if the Company reasonably decides in good faith that adoption of any portion of such market practice is not administratively feasible or if the Company reasonably determines in good faith that no market practice for the use of Three-Month Term SOFR exists, in such other manner as the Company determines in good faith is reasonably necessary). (24) "Unadjusted Benchmark Replacement" means the Benchmark Replacement excluding the Benchmark Replacement Adjustment. (d) In the event that any Fixed Interest Payment Date during the Fixed Rate Period falls on a day that is not a Business Day (as defined below), the interest payment due on that date shall be postponed to the next day that is a Business Day and no additional interest shall accrue as a result of that postponement. In the event that any Floating Interest Payment Date during the Floating Rate Period falls on a day that is not a Business Day (as defined below), the interest payment due on that date shall be postponed to the next day that is a Business Day and interest shall accrue to but excluding the date interest is paid. However, if the postponement would cause the day to fall in the next calendar month during the Floating Interest Period, the Floating Interest Payment Date shall instead be brought forward to the immediately preceding Business Day. The term "Business Day" means any day other than a Saturday or Sunday or any other day on which banking institutions in the State of California are generally authorized or required by law or executive order to be closed. 9  |

---

---

| | |
|:---|:---|
| &nbsp;&nbsp;![GRAPHIC](tm237204d1_ex6-6img010.jpg) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. Subordination. (a) The indebtedness of the Company evidenced by this Subordinated Note, including the principal and interest on this Subordinated Note, shall be subordinate and junior in right of payment to the prior payment in full of all existing claims of creditors of the Company whether now outstanding or subsequently created, assumed, guaranteed or incurred (collectively, "Senior Indebtedness"), which shall consist of principal of (and premium, if any) and interest, if any, on: (i) all indebtedness and obligations of, or guaranteed or assumed by, the Company for money borrowed, whether or not evidenced by bonds, debentures, securities, notes or other similar instruments, including all obligations to the Company's general and secured creditors; (ii) any deferred obligations of the Company for the payment of the purchase price of property or assets acquired other than in the ordinary course of business; (iii) all obligations, contingent or otherwise, of the Company in respect of any letters of credit, bankers' acceptances, security purchase facilities and similar direct credit substitutes; (iv) any capital lease obligations of the Company; (v) all obligations of the Company in respect of interest rate swap, cap or other agreements, interest rate future or option contracts, currency swap agreements, currency future or option contracts, commodity contracts and other similar arrangements or derivative products; (vi) all obligations that are similar to those in clauses (i) through (v) of other Persons for the payment of which the Company is responsible or liable as obligor, guarantor or otherwise arising from an off-balance sheet guarantee; (vii) all obligations of the types referred to in clauses (i) through (vi) of other Persons secured by a lien on any property or asset of the Company; and (viii) in the case of (i) through (vii) above, all amendments, renewals, extensions, modifications and refundings of such indebtedness and obligations; except "Senior Indebtedness" does not include (A) the Subordinated Notes, (B) any obligation that by its terms expressly is junior to, or ranks equally in right of payment with, the Subordinated Notes, or (C) any indebtedness between the Company and any of its subsidiaries or Affiliates. This Subordinated Note is not secured by any assets of the Company or any of its subsidiaries or Affiliates. The term "Affiliate(s)" means, with respect to any Person, such Person's immediate family members, partners, members or parent and subsidiary corporations, and any other Person directly or indirectly controlling, controlled by, or under common control with said Person and their respective Affiliates. The term "Person" as used in this Subordinated Note means an individual, a corporation (whether or not for profit), a partnership, a limited liability company, a joint venture, an association, a trust, an unincorporated organization, a government or any department or agency thereof or any other entity or organization. The term "control" (including the terms "controlling," "controlled by," and "under common control with") means the possession, direct or indirect, of the power to direct or cause the direction of the management and policies of a person, whether through the ownership of voting securities, by contract, or otherwise. (b) In the event of any liquidation of the Company, holders of Senior Indebtedness of the Company shall be entitled to be paid in full with such interest as may be provided by law before any payment shall be made on account of principal of or interest on this Subordinated Note. Additionally, in the event of any insolvency, dissolution, assignment for the benefit of creditors or any liquidation or winding up of or relating to the Company, whether voluntary or involuntary, holders of Senior Indebtedness shall be entitled to be paid in full before any payment shall be made on account of the principal of or interest on the Subordinated Notes, including this Subordinated Note. In the event of any such proceeding, after payment in full of all sums owing with respect to the Senior Indebtedness, the registered holders of the Subordinated  |

---

---

| | |
|:---|:---|
| &nbsp;&nbsp;![GRAPHIC](tm237204d1_ex6-6img011.jpg) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Notes from time to time (each a "Noteholder" and, collectively, the "Noteholders"), together with the holders of any obligations of the Company ranking on parity with the Subordinated Notes, shall be entitled to be paid from the remaining assets of the Company the unpaid principal thereof, and the unpaid interest thereon before any payment or other distribution, whether in cash, property or otherwise, shall be made (i) with respect to any obligation that by its terms expressly is junior to in the right of payment to the Subordinated Notes, (ii) with respect to any indebtedness between the Company and any of its subsidiaries or Affiliates or (iii) on account of any capital stock. (c) If there shall have occurred and be continuing (i) a default in any payment with respect to any Senior Indebtedness or (ii) an event of default with respect to any Senior Indebtedness as a result of which the maturity thereof is accelerated, unless and until such payment default or event of default shall have been cured or waived or shall have ceased to exist, no payments shall be made by the Company with respect to the Subordinated Notes. The provisions of this paragraph shall not apply to any payment with respect to which the immediately preceding paragraph of this Section 3 (Subordination) would be applicable. (d) Nothing herein shall act to prohibit, limit or impede the Company from issuing additional debt of the Company having the same rank as the Subordinated Notes or which may be junior or senior in rank to the Subordinated Notes. Each Noteholder, by its acceptance hereof, further acknowledges and agrees that the foregoing subordination provisions are, and are intended to be, an inducement and a consideration for each holder of any Senior Indebtedness, whether such Senior Indebtedness was created or acquired before or after the issuance of the Subordinated Notes, to acquire and continue to hold, or to continue to hold, such Senior Indebtedness, and such holder of Senior Indebtedness shall be deemed conclusively to have relied on such subordination provisions in acquiring and continuing to hold or in continuing to hold such Senior Indebtedness. 4. Redemption. (a) Redemption Prior to Fifth Anniversary. This Subordinated Note shall not be redeemable by the Company in whole or in part prior to November 1, 2026, except in the event of a: (i) Tier 2 Capital Event (as defined below); (ii) Tax Event (as defined below); or (iii) Investment Company Event (as defined below). Upon the occurrence of a Tier 2 Capital Event, a Tax Event or an Investment Company Event, the Company may redeem this Subordinated Note, subject to Section 4(Q (Regulatory Approvals) hereof, in whole or in part at any time, upon giving not less than 10 Business Days' notice to the holder of this Subordinated Note at an amount equal to 100% of the outstanding principal amount being redeemed plus accrued but unpaid interest, to but excluding the redemption date. "Tier 2 Capital Event" means the receipt by the Company of an opinion of counsel to the Company to the effect that there is, or within 120 days after receipt of such opinion there will be, a material risk that this Subordinated Note does not qualify as "Tier 2" Capital (as defined by the Federal Deposit Insurance Corporation) (or its then equivalent) as a result of a change in law or regulation, or interpretation or application thereof, by any judicial, legislative or regulatory authority that becomes effective after the date of issuance of this Subordinated Note. "Tax Event" means the receipt by the Company of an opinion of counsel to the Company that as a result of any amendment to, or change (including any final and adopted (or enacted) prospective change) in, the laws (or any regulations thereunder) of the United States or any political subdivision or taxing authority thereof or therein, or as a result of any official 11  |

---

---

| | |
|:---|:---|
| &nbsp;&nbsp;![GRAPHIC](tm237204d1_ex6-6img012.jpg) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;administrative pronouncement or judicial decision interpreting or applying such laws or regulations, there exists a material risk that interest payable by the Company on the Subordinated Notes is not, or within 120 days after the receipt of such opinion will not be, deductible by the Company, in whole or in part, for United States federal income tax purposes. "Investment Company Event" means the receipt by the Company of an opinion of counsel to the Company to the effect that there is a material risk that the Company is or, within one hundred twenty (120) days after the receipt of such opinion will be, required to register as an investment company pursuant to the Investment Company Act of 1940, as amended. (b) Redemption on or after Fifth Anniversary. On or after November 1, 2026, subject to the provisions of Section 4(f) (Regulatory Approvals) hereof, this Subordinated Note shall be redeemable at the option of and by the Company, in whole or in part from time to time upon any Interest Payment Date, at an amount equal to 100% of the outstanding principal amount being redeemed plus accrued but unpaid interest, to but excluding the redemption date, but in all cases in a principal amount with integral multiples of $1,000. In addition, the Company may redeem all or a portion of the Subordinated Notes, at any time upon the occurrence of a Tier 2 Capital Event, Tax Event or an Investment Company Event. The redemption referenced in this Section 4(b) (Redemption on or after Fifth Anniversary) shall be subject to the receipt of any required regulatory approval. (c) Partial Redemption. If less than the then-outstanding principal amount of this Subordinated Note is redeemed, (i) a new Subordinated Note shall be issued representing the unredeemed portion without charge to the holder thereof and (ii) such redemption shall be effected on a pro rata basis as to the Noteholders. For purposes of clarity, upon a partial redemption, a like percentage of the principal amount of every Subordinated Note held by every Noteholder shall be redeemed. (d) No Redemption at Option of Noteholder. This Subordinated Note is not subject to redemption at the option of the holder of this Subordinated Note. (e) Effectiveness of Redemption. If notice of redemption has been duly given and notwithstanding that this Subordinated Note has been called for redemption but has not yet been surrendered for cancellation, on and after the date fixed for redemption interest shall cease to accrue on the portion of this Subordinated Note called for redemption, this Subordinated Note shall no longer be deemed outstanding with respect to the portion called for redemption and all rights with respect to the portion of this Subordinated Note called for redemption shall forthwith on such date fixed for redemption cease and terminate unless the Company shall default in the payment of the redemption price, except only the right of the holder hereof to receive the amount payable on such redemption, without interest. For purposes of clarity, any redemption made pursuant to the terms of this Subordinated Note shall be made on a pro rata basis, and, to the extent applicable and for purposes of a redemption processed through The Depository Trust Company (OTC), on a "Pro Rata Pass-Through Distribution of Principal" basis, among all of the Subordinated Notes outstanding at the time thereof. (f) Regulatory Approvals. Any such redemption shall be subject to receipt of any and all required federal and state regulatory approvals or non-objections, including, but not limited to, the consent of the Federal Deposit Insurance Corporation. In the case of any redemption 12  |

---

---

| | |
|:---|:---|
| &nbsp;&nbsp;![GRAPHIC](tm237204d1_ex6-6img013.jpg) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;of this Subordinated Note pursuant to paragraphs (b) or (c) of this Section 4, the Company will give the holder hereof notice of redemption, which notice shall indicate the aggregate principal amount of Subordinated Notes to be redeemed, not less than thirty (30) nor more than forty-five (45) calendar days prior to the redemption date. (g) Purchase and Resale of the Subordinated Notes. Subject to any required federal and state regulatory approvals and the provisions of this Subordinated Note, the Company shall have the right to purchase any of the Subordinated Notes at any time in the open market, private transactions or otherwise. If the Company purchases any Subordinated Notes, it may, in its discretion, hold, resell or cancel any of the purchased Subordinated Notes. (h) Payment Restriction. No payment shall at any time be made on account of the principal thereof, unless following such payment the aggregate of the shareholders' equity and capital notes or debentures thereafter outstanding shall be the equal of such aggregate at the date of the original issue of such capital notes or debentures, or as may be otherwise authorized by the California Department of Financial Protection and Innovation. 5. Events of Default; Acceleration. Each of the following events shall constitute an "Event of Default": (a) the entry of a decree or order for reliefin respect of the Company by a court having jurisdiction in the premises in an involuntary case or proceeding under any applicable bankruptcy, insolvency, or reorganization law, now or hereafter in effect of the United States or any political subdivision thereof, and such decree or order will have continued unstayed and in effect for a period of sixty (60) consecutive calendar days; (b) the commencement by the Company of a voluntary case under any applicable bankruptcy, insolvency or reorganization law, now or hereafter in effect of the United States or any political subdivision thereof, or the consent by the Company to the entry of a decree or order for relief in an involuntary case or proceeding under any such law; (c) the Company (i) becomes insolvent or is unable to pay its debts as they mature, (ii) makes an assignment for the benefit of creditors, or (iii) admits in writing its inability to pay its debts as they mature; (d) the failure of the Company to pay any installment of interest on any of the Subordinated Notes as and when the same will become due and payable, and the continuation of such failure for a period of fifteen (15) calendar days; (e) the failure of the Company to pay all or any part of the principal of any of the Subordinated Notes as and when the same will become due and payable; (f) the liquidation of the Company (for the avoidance of doubt, "liquidation" does not include any merger, consolidation, sale of equity or assets or reorganization (exclusive of a reorganization in bankruptcy) of the Company or any ofits subsidiaries); 13  |

---

---

| | |
|:---|:---|
| &nbsp;&nbsp;![GRAPHIC](tm237204d1_ex6-6img014.jpg) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) the failure of the Company to perform any other covenant or agreement on the part of the Company contained in the Subordinated Note(s), and the continuation of such failure for a period of thirty (30) days after the date on which notice specifying such failure will have been given in the manner set forth in Section 21 (Notices), to the Company by a Noteholder; or (h) the default by the Company under any bond, debenture, note or other evidence of indebtedness for money borrowed by the Company having an aggregate principal amount outstanding of at least $10,000,000, whether such indebtedness now exists or is created or incurred in the future, which default (i) constitutes a failure to pay any portion of the principal of such indebtedness when due and payable after the expiration of any applicable grace period or (ii) results in such indebtedness becoming due or being declared due and payable prior to the date on which it otherwise would have become due and payable without, in the case of clause (i), such indebtedness having been discharged or, in the case of clause (ii), without such indebtedness having been discharged or such acceleration having been rescinded or annulled. Unless the principal amount of this Subordinated Note already shall have become due and payable, if an Event of Default set forth in subsections (a) or (hl of this Section 5 shall have occurred and be continuing, then the principal amount of this Subordinated Note, and accrued and unpaid interest, if any, on the Subordinated Note will become and be immediately due and payable without any declaration or other act on the part of the Noteholder, and the Company waives demand, presentment for payment, notice of nonpayment, notice of protest, and all other notices. Notwithstanding the foregoing, because the Company treats the Subordinated Notes as Tier 2 Capital, upon the occurrence of an Event of Default other than an Event of Default described in subsections (a) or (hl of this Section 5, no Noteholder may accelerate the Maturity Date of the Subordinated Notes and make the principal of, and any accrued and unpaid interest on, the Subordinated Notes, immediately due and payable. The Company, within forty-five (45) calendar days after the receipt of written notice from any Noteholder of the occurrence of an Event of Default with respect to this Subordinated Note, shall mail to all Noteholders, at their addresses shown on the Security Register (as defined in Section 13 (Registration of Transfer, Security Register) below), such written notice of Event of Default, unless such Event of Default shall have been cured or waived before the giving of such notice as certified by the Company in writing. 6. Failure to Make Payments. In the event of an Event of Default under Section S(c). Section 5(d). or Section 5(e) above, the Company will, upon demand of the Noteholder, pay to the Noteholder the amount then due and payable on this Subordinated Note for principal and interest (without acceleration of the Subordinated Note in any manner), with interest on the overdue principal and interest at the per annum rate borne by this Subordinated Note, to the extent permitted by applicable law. If the Company fails to pay such amount upon such demand, the Noteholder may, among other things, institute a judicial proceeding for the collection of the sums so due and unpaid and such amount as shall be sufficient to cover the reasonable costs and expenses of collection, including the reasonable compensation, expenses, disbursements and advances of such Noteholder, its agents and counsel, may prosecute such proceeding to judgment or final decree and may enforce the same against the Company and collect the amounts adjudged or decreed to be payable in the manner provided by law out of the property of the Company. Upon the occurrence of a failure by the Company to make any required payment of principal or interest on this Subordinated Note or an Event of Default, until such failure or Event 14  |

---

---

| | |
|:---|:---|
| &nbsp;&nbsp;![GRAPHIC](tm237204d1_ex6-6img015.jpg) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;of Default is cured by the Company or waived by the Noteholders in accordance with Section 17 (Waiver and Consent) hereof, except as may be required by any federal or state bank regulatory agency, the Company shall not: (a) declare or pay any dividends or distributions on, or redeem, purchase, acquire, or make a liquidation payment with respect to, any of the Company's capital stock; (b) make any payment of principal or interest or premium, if any, on or repay, repurchase or redeem any indebtedness of the Company that ranks equal with or junior to the Subordinated Notes; or (c) make any payments under any guarantee that ranks equal with or junior to the Subordinated Notes, other than: (i) any dividends or distributions in shares of, or options, warrants or rights to subscribe for or purchase shares of, any class of the Company's common stock; (ii) any declaration of a non-cash dividend in connection with the implementation of a shareholders' rights plan, or the issuance of stock under any such plan in the future, or the redemption or repurchase of any such rights pursuant thereto; (iii) as a result of a reclassification of the Company's capital stock or the exchange or conversion of one class or series of the Company's capital stock for another class or series of the Company's capital stock; (iv) the purchase of fractional interests in shares of the Company's capital stock pursuant to the conversion or exchange provisions of such capital stock or the security being converted or exchanged; or (v) purchases of any class of the Company's common stock related to the issuance of common stock or rights under any benefit plans for the Company's directors, officers or employees or any of the Company's dividend reinvestment plans (including, without limitation, any repurchases or acquisitions in connection with the forfeiture of any stock award, cashless or net exercise of any option, or acceptance of common stock in lieu of an award recipient's tax obligations under any equity award) (the foregoing clauses (i) through (v) are collectively referred to as the "Permitted Dividends"). The limitations imposed by the provisions of this Section 6 shall apply whether or not the Noteholder has notified the Company of an Event of Default. 7. Affirmative Covenants of the Company; Compliance Certificate. (a) Notice of Certain Events. To the extent permitted by applicable statute, rule or regulation, the Company shall provide written notice to the Noteholder, at its addresses shown on the Security Register (as defined in Section 13 (Registration of Transfer, Security Register) below), of the occurrence of any of the following events as soon as practicable, but in no event later than thirty (30) Business Days following the Company becoming aware of the occurrence of such event: (i) The total risk-based capital ratio, Tier 1 risk-based capital ratio, common equity Tier 1 risk-based capital ratio or leverage ratio of the Company, becomes less than eight percent (8.0%), six percent (6.0%), four and one-half percent (4.50%) or four percent (4.0%), respectively, as of the end of any calendar quarter (provided, that, to the extent the Company has opted into the community bank leverage ratio framework, no notice need be given until the Company ceases to be a qualifying community banking organization, as defined under 12 CFR § 3.12); (ii) The Company, or any of the Company's subsidiaries, or any officer of the Company (in such capacity), becomes subject to any formal, written regulatory enforcement action (as defined by the applicable state or federal bank regulatory authority); or 15  |

---

---

| | |
|:---|:---|
| &nbsp;&nbsp;![GRAPHIC](tm237204d1_ex6-6img016.jpg) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) There is a change in beneficial ownership of 25% or more of the outstanding securities of the Company entitled to vote for the election of directors. (b) Payment of Principal and Interest. The Company covenants and agrees for the benefit of the Noteholder that it will duly and punctually pay the principal of, and interest on, this Subordinated Note, in accordance with the terms hereof. (c) Maintenance of Office. The Company will maintain an office or agency in the State of California where Subordinated Notes may be surrendered for registration of transfer or for exchange and where notices and demands to or upon the Company in respect of the Subordinated Notes may be served. The Company may also from time to time designate one or more other offices or agencies where the Subordinated Notes may be presented or surrendered for any or all such purposes and may from time to time rescind such designations; provided that no such designation or rescission will in any manner relieve the Company of its obligation to maintain an office or agency in the State of California. The Company will give prompt written notice to the Noteholders of any such designation or rescission and of any change in the location of any such other office or agency. (d) Corporate Existence. The Company will do or cause to be done all things necessary to preserve and keep in full force and effect: (i) the corporate existence of the Company; and (ii) the rights (constituent governing documents and statutory), licenses and franchises of the Company; provided, however, that the Company will not be required to preserve its existence or any such right, license or franchise of the Company if the Board of Directors of the Company determines that the preservation thereof is no longer desirable in the conduct of the business of the Company and its subsidiaries taken as a whole and that the loss thereof will not be disadvantageous in any material respect to the Noteholders. (e) Maintenance of Properties. The Company will, and will cause each subsidiary of the Company to, cause all its properties used or useful in the conduct of its business to be maintained and kept in good condition, repair and working order, ordinary wear and tear excepted, and supplied with all necessary equipment and will cause to be made all necessary repairs, renewals, replacements, betterments and improvements thereof, all as in the judgment of the Company may be necessary so that the business carried on in connection therewith may be properly and advantageously conducted at all times;provided, however, that nothing in this Section 7(e) will prevent the Company or any subsidiary from discontinuing the operation and maintenance of any of their respective properties if such discontinuance is, in the reasonable judgment of the Board of Directors of the Company or of any subsidiary, as the case may be, desirable in the conduct of its business. (t) Waiver of Certain Covenants. The Company may omit in any particular instance to comply with any term, provision or condition set forth in Section 7(c) (Maintenance of Office), Section 7(d) (Corporate Existence), or Section 7(e) (Maintenance of Properties) above, with respect to this Subordinated Note if before the time for such compliance the Noteholders of at least a majority in aggregate principal amount of the outstanding Subordinated Notes, by act of such Noteholders, either will waive such compliance in such instance or generally will have waived compliance with such term, provision or condition, but no such waiver will extend to or 16  |

---

---

| | |
|:---|:---|
| &nbsp;&nbsp;![GRAPHIC](tm237204d1_ex6-6img017.jpg) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;affect such term, provision or condition except to the extent so expressly waived, and, until such waiver will become effective, the obligations of the Company in respect of any such term, provision or condition will remain in full force and effect. (g) Tier 2 Capital. Whether or not the Company is subject to the consolidated capital requirements of the Federal Deposit Insurance Corporation, if all or any portion of the Subordinated Notes ceases to qualify for inclusion as Tier 2 Capital, other than due to the limitation imposed on the capital treatment of subordinated debt during the five (5) years immediately preceding the Maturity Date of the Subordinated Notes, the Company will immediately notify the Noteholders and thereafter, subject to the Company's right to redeem the Subordinated Notes under such circumstances pursuant to the terms of the Subordinated Notes, the Company and the Noteholders will work together in good faith to execute and deliver all agreements as reasonably necessary in order to restructure the applicable portions of the obligations evidenced by the Subordinated Notes to qualify as Tier 2 Capital; provided, however, that nothing contained in this Section 7(g} (Tier 2 Capital) shall limit the Company's right to redeem the Subordinated Notes upon the occurrence of a Tier 2 Capital Event pursuant to Section 4(a) (Redemption Prior to Fifth Anniversary) or Section 4(b) (Redemption on or after Fifth Anniversary). (h) Compliance with Laws. The Company and each subsidiary of the Company shall comply with the requirements of all laws, regulations, orders and decrees applicable to it or its properties, except for such noncompliance that would not reasonably be expected to have a Material Adverse Effect (as such term is defined in the Purchase Agreement). (i) Taxes and Assessments. The Company shall punctually pay and discharge all material taxes, assessments, and other governmental charges or levies imposed upon it or upon its income or upon any of its properties; provided, that no such taxes, assessments or other governmental charges need be paid if they are being contested in good faith by the Company. (j) Company Statement as to Compliance. The Company will deliver to the Noteholders, within one hundred twenty (120) calendar days after the end of each fiscal year, an Officer's Certificate covering the preceding calendar year, stating whether or not, to the best of his or her knowledge, the Company is in default in the performance and observance of any of the terms, provisions and conditions of this Subordinated Note (without regard to notice requirements or periods of grace) and if the Company will be in default, specifying all such defaults and the nature and status thereof of which he or she may have knowledge. 8. Negative Covenants of the Company. (a) Limitation on Dividends. The Company shall not declare or pay any dividend or make any distribution on capital stock or other equity securities of any kind of the Company if the Company is not "well capitalized" for regulatory purposes immediately prior to the declaration of such dividend or distribution, except for Permitted Dividends. (b) Merger or Sale of Assets. The Company shall not merge into another entity or convey, transfer or lease substantially all of its properties and assets to any Person, unless: (i) the continuing entity into which the Company is merged or the Person which acquires by conveyance or transfer or which leases substantially all of the properties 17  |

---

---

| | |
|:---|:---|
| &nbsp;&nbsp;![GRAPHIC](tm237204d1_ex6-6img018.jpg) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;and assets of the Company shall be a corporation, association or other legal entity organized and existing under the laws of the United States of America, any State thereof or the District of Columbia and expressly assumes the due and punctual payment of the principal of and any premium and interest on the Subordinated Notes according to their terms, and the due and punctual performance of all covenants and conditions hereof on the part of the Company to be performed or observed; provided, however, that no express assumption shall be required by any successor by merger to the Company to the extent such legal successor assumes the Company's obligations hereunder by operation of law; and (ii) immediately after giving effect to such transaction, no Event of Default (as defined above), and no event which, after notice or lapse of time or both, would become an Event of Default, shall have occurred and be continuing. (c) Continuance of Business. Except as otherwise permitted under Section 8(b), the Company shall not take any action, omit to take any action or enter into any other transaction that would have the effect of: (i) the liquidation or dissolution of the Company or (ii) the Company ceasing to be an "insured depository institution" under Section 3(c)(2) of the Federal Deposit Insurance Act, as amended. 9. Denominations. The Subordinated Notes are issuable only in registered form without interest coupons in minimum denominations of$100,000 and integral multiples of$1,000 in excess thereof. 10. Charges and Transfer Taxes. No service charge will be made for any registration of transfer or exchange of this Subordinated Note, or any redemption or repayment of this Subordinated Note, or any conversion or exchange of this Subordinated Note for other types of securities or property, but the Company may require payment of a sum sufficient to pay all taxes, assessments or other governmental charges that may be imposed in connection with the transfer or exchange of this Subordinated Note from the Noteholder requesting such transfer or exchange. 11. Payment Procedures. Payment of the principal and interest payable on the Maturity Date will be made by check, by wire transfer or by Automated Clearing House (ACH) transfer in immediately available funds to a bank account in the United States designated by the registered Noteholder if such Noteholder shall have previously provided wire or ACH instructions to the Company, upon presentation and surrender of this Subordinated Note at the Payment Office (as defined in Section 21 (Notices) below) or at such other place or places as the Company shall designate by notice to the registered Noteholders as the Payment Office, provided that this Subordinated Note is presented to the Company in time for the Company to make such payments in such funds in accordance with its normal procedures. Payments of interest (other than interest payable on the Maturity Date) shall be made on each Interest Payment Date by wire transfer in immediately available funds or check mailed to the registered Noteholder, as such Person's address appears on the Security Register (as defined in Section 13 below). Interest payable on any Interest Payment Date shall be payable to the Noteholder in whose name this Subordinated Note is registered at the close of business on the fifteenth (l 5 th) calendar day prior to the applicable Interest Payment Date, without regard to whether such date is a Business Day, except that interest not paid on the Interest Payment Date, if any, will be paid to the holder in whose name this Subordinated Note is registered at the close of business on a special record date fixed by the Company (a "Special 18  |

---

---

| | |
|:---|:---|
| &nbsp;&nbsp;![GRAPHIC](tm237204d1_ex6-6img019.jpg) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Record Date"), notice of which shall be given to the Noteholder not less than ten (10) calendar days prior to such Special Record Date. To the extent permitted by applicable law, interest shall accrue, at the rate at which interest accrues on the principal of this Subordinated Note, on any amount of principal or interest on this Subordinated Note not paid when due. All payments on this Subordinated Note shall be applied first against costs and expenses of the Noteholder, if any, for which the Company is liable under this Subordinated Note; then against interest due hereunder; and then against principal due hereunder. The Noteholder acknowledges and agrees that the payment of all or any portion of the outstanding principal amount of this Subordinated Note and all interest hereon shall be pari passu in right of payment and in all other respects to the other Subordinated Notes. In the event that the Noteholder receives payments in excess of the Noteholder's pro rata share of the Company's payments to the holders of all of the Subordinated Notes, then the Noteholder shall hold in trust all such excess payments for the benefit of the other Noteholders and shall pay such amounts held in trust to such other holders upon demand by such holders. 12. Form of Payment. Payments of principal and interest on this Subordinated Note shall be made in such coin or currency of the United States of America as at the time of payment shall be legal tender for the payment of public and private debts. 13. Registration of Transfer, Security Register. Except as otherwise provided herein, or in the Purchase Agreement between Noteholder and the Company, and subject to limitations on transfer under applicable state and federal securities laws, this Subordinated Note is transferable in whole or in part, and may be exchanged for a like aggregate principal amount of Subordinated Notes of other authorized denominations, by the Noteholder in person, or by its attorney duly authorized in writing, at the Payment Office or the offices of the Registrar. The Company or its agent (the "Registrar") shall maintain a register providing for the registration of the Subordinated Notes and any exchange or transfer thereof (the "Security Register"). Upon surrender or presentation of this Subordinated Note for exchange or registration of transfer, the Company or the Registrar shall execute and deliver in exchange therefor a Subordinated Note or Subordinated Notes of like aggregate principal amount, each in a minimum denomination of $ I00,000 or any amount in excess thereof which is an integral multiple of $ I ,000 (and, in the absence of an opinion of counsel satisfactory to the Company to the contrary, bearing the restrictive legend(s) set forth hereinabove) and that is or are registered in such name or names requested by the Noteholder. Any Subordinated Note presented or surrendered for registration of transfer or for exchange shall be duly endorsed and accompanied by a written instrument of transfer in such form as is attached hereto and incorporated herein, duly executed by the Noteholder or its attorney duly authorized in writing, with such tax identification number (including, without limitation, an appropriate and properly executed Internal Revenue Service Form W-9 or appropriate type of Form W-8) or other information for each Person in whose name a Subordinated Note is to be issued, and accompanied by evidence of compliance with any restrictive legend(s) appearing on such Subordinated Note or Subordinated Notes as the Company may reasonably request to comply with applicable law. No exchange or registration of transfer of this Subordinated Note shall be made on or after (i) the fifteenth (15th) day immediately preceding the Maturity Date or (ii) the due delivery of notice of redemption. 14. Successors and Assigns. This Subordinated Note shall be binding upon the Company and inure to the benefit of the Noteholder and its respective successors and permitted 19  |

---

---

| | |
|:---|:---|
| &nbsp;&nbsp;![GRAPHIC](tm237204d1_ex6-6img020.jpg) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;assigns. The Noteholder may assign all, or any part of, or any interest in, the Noteholder's rights and benefits hereunder only to the extent and in the manner permitted by the terms of this Subordinated Note, the Purchase Agreement, and under applicable securities laws and regulations. To the extent of any such assignment, such assignee shall have the same rights and benefits against the Company and shall agree to be bound by and to comply with the terms and conditions of the Purchase Agreement as it would have had if it were the Noteholder hereunder. 15. Priority. The Subordinated Notes rank pari passu among themselves and pari passu, in the event of any insolvency proceeding, dissolution, assignment for the benefit of creditors, reorganization, restructuring of debt, marshaling of assets and liabilities or similar proceeding or any liquidation or winding up of the Company, with all other present or future unsecured subordinated debt obligations of the Company, except any unsecured subordinated debt that, pursuant to its express terms, is senior or subordinate in right of payment to the Subordinated Notes. 16. Ownership. Prior to due presentment of this Subordinated Note for registration of transfer, the Company may treat the holder in whose name this Subordinated Note is registered in the Security Register as the absolute owner of this Subordinated Note for receiving payments of principal and interest on this Subordinated Note and for all other purposes whatsoever, whether or not this Subordinated Note be overdue, and the Company shall not be affected by any notice to the contrary. 17. Waiver and Consent. (a) This Subordinated Note may be amended or waived pursuant to, and in accordance with, the provisions set forth herein and as set forth in Section 7.3 of the Purchase Agreement. Any such consent or waiver given by the Noteholder shall be conclusive and binding upon such Noteholder and upon all subsequent holders of this Subordinated Note and of any Subordinated Note issued upon the registration of transfer hereof or in exchange therefor or in lieu hereof, whether or not notation of such consent or waiver is made upon this Subordinated Note. No delay or omission of the Noteholder to exercise any right or remedy accruing upon any Event of Default shall impair such right or remedy or constitute a waiver of any such Event of Default or an acquiescence therein. Any insured depository institution that shall be a Noteholder or that otherwise shall have any beneficial ownership interest in this Subordinated Note shall, by its acceptance of such Subordinated Note (or beneficial interest therein), be deemed to have waived any right of offset with respect to the indebtedness evidenced thereby. (b) No waiver or amendment of any term, provision, condition, covenant or agreement in the Subordinated Notes shall be effective except with the consent of the Noteholders holding more than fifty percent (50%) in aggregate principal amount (excluding any Subordinated Notes held by the Company or any of its Affiliates) of the Subordinated Notes at the time outstanding; provided, however, that without the consent of each Noteholder of an affected Subordinated Note, no such amendment or waiver may: (i) reduce the principal amount of the Subordinated Note; (ii) reduce the rate of or change the time for payment of interest on any Subordinated Note; (iii) extend the maturity of any Subordinated Note; (iv) change the currency in which payment of the obligations of the Company under the Subordinated Notes are to be made; (v) lower the percentage of aggregate principal amount of outstanding Subordinated Notes 20  |

---

---

| | |
|:---|:---|
| &nbsp;&nbsp;![GRAPHIC](tm237204d1_ex6-6img021.jpg) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;required to approve any amendment of the Subordinated Notes; (vi) make any changes to Section 4(c) (Partial Redemption), Section 5 (Events of Default; Acceleration), Section 6 (Failure to Make Payments), Section 15 (Priority), or Section 17 (Waiver and Consent) of the Subordinated Notes that adversely affects the rights of any Noteholder; or (vii) disproportionately and adversely affect the rights of any of the holders of the then outstanding Subordinated Notes. Notwithstanding the foregoing, the Company may amend or supplement the Subordinated Notes without the consent of the Noteholders to cure any ambiguity, defect or inconsistency or to provide for uncertificated Subordinated Notes in addition to or in place of certificated Subordinated Notes, or to make any change that does not adversely affect the rights of any Noteholder of any of the Subordinated Notes. No failure to exercise or delay in exercising, by any Noteholder of the Subordinated Notes, of any right, power or privilege hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any right, power or privilege preclude any other or further exercise thereof, or the exercise of any other right or remedy provided by law. The rights and remedies provided in this Subordinated Note are cumulative and not exclusive of any right or remedy provided by law or equity. No notice or demand on the Company in any case shall, in itself, entitle the Company to any other or further notice or demand in similar or other circumstances or constitute a waiver of the rights of the Noteholders to any other or further action in any circumstances without notice or demand. No consent or waiver, express or implied, by the Noteholders to or of any breach or default by the Company in the performance of its obligations hereunder shall be deemed or construed to be a consent or waiver to or of any other breach or default in the performance of the same or any other obligations of the Company hereunder. Failure on the part of the Noteholders to complain of any acts or failure to act or to declare an Event of Default, irrespective of how long such failure continues, shall not constitute a waiver by the Noteholders of their rights hereunder or impair any rights, powers or remedies on account of any breach or default by the Company. 18. Absolute and Unconditional Obligation of the Company. No provisions of this Subordinated Note shall alter or impair the obligation of the Company, which is absolute and unconditional, to pay the principal and interest on this Subordinated Note at the times, places and rate, and in the coin or currency, herein prescribed. No delay or omission of the Noteholder to exercise any right or remedy accruing upon any Event of Default shall impair such right or remedy or constitute a waiver of any such Event of Default or an acquiescence therein. 19. No Sinking Fund; Convertibility. This Subordinated Note is not entitled to the benefit of any sinking fund. This Subordinated Note is not convertible into or exchangeable for any of the equity securities, other securities or assets of the Company or any subsidiary of the Company. 20. No Recourse Against Others. No recourse under or upon any obligation, covenant or agreement contained in this Subordinated Note, or for any claim based thereon or otherwise in respect thereof, will be had against any past, present or future shareholder, employee, officer, or director, as such, of the Company or of any predecessor or successor, either directly or through the Company or any predecessor or successor, under any rule oflaw, statute or constitutional provision or by the enforcement of any assessment or by any legal or equitable proceeding or otherwise, all such liability being expressly waived and released by the acceptance of this Subordinated Note by the Noteholder and as part of the consideration for the issuance of this Subordinated Note. 21  |

---

---

| | |
|:---|:---|
| &nbsp;&nbsp;![GRAPHIC](tm237204d1_ex6-6img022.jpg) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;21. Notices. All notices to the Company under this Subordinated Note shall be in writing and addressed to the Company at 6 Hutton Centre Drive, Suite 100, Santa Ana, CA 92707, Attention: Chief Financial Officer, or to such other address as the Company may notify to the Noteholder (the "Payment Office"). All notices to the Noteholders shall be in writing and sent by first-class mail to each Noteholder at his or its address as set forth in the Security Register. 22. Further Issues. The Company may, without the consent of the Noteholders, create and issue additional notes having the same terms and conditions of the Subordinated Notes (except for the Issue Date and issue price) so that such further notes shall be consolidated and form a single series with the Subordinated Notes. 23. Governing Law; Interpretation. THIS SUBORDINATED NOTE WILL BE DEEMED TO BE A CONTRACT MADE UNDER THE LAWS OF THE STATE OF NEW YORK AND WILL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICT OF LAW PRINCIPLES THEREOF. IT IS INTENDED THAT THIS SUBORDINATED NOTE SHALL MEET THE CRITERIA FOR QUALIFICATION OF THE OUTSTANDING PRINCIPAL AS TIER 2 CAPITAL UNDER THE REGULATORY GUIDELINES OF THE FEDERAL DEPOSIT INSURANCE CORPORATION, AND THE TERMS HEREOF SHALL BE INTERPRETED IN A MANNER TO SATISFY SUCH INTENT. [Signature Page Follows] 22  |

---

---

| | |
|:---|:---|
| &nbsp;&nbsp;![GRAPHIC](tm237204d1_ex6-6img023.jpg) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;IN WITNESS WHEREOF, the undersigned has caused this Subordinated Note to be duly executed and attested. ATTEST: N �laine '1� Crouch Title: EVP and Corporate Secretary INFINITY BANK By: Name: Title: President, Chief Operating Officer and Chief Financial Officer [Company Signature Page to Ca/Private Bank Subordinated Note]  |

---

---

| | |
|:---|:---|
| &nbsp;&nbsp;![GRAPHIC](tm237204d1_ex6-6img024.jpg) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;ASSIGNMENT FORM [Capitalized terms used herein but not defined have the meanings assigned in the Subordinated Note] To assign this Subordinated Note of Infinity Bank, fill in the form below: (I) or (we) assign and transfer this Subordinated Note to: (Print or type assignee's name, address and zip code) (Insert assignee's social security or tax 1.0. No.) and irrevocably appoint __________ agent to transfer this Subordinated Note on the books of the Company. The agent may substitute another to act for him. Date: ________ Your signature: _________________ _ (Sign exactly as your name appears on the face of this Subordinated Note) FOR EXECUTION BY AN ENTITY: Entity name:. _____________ _ By:. ________________ _ Name: ·---------------- Title: ----------------- Tax Identification No: --------------- Signature Guarantee: _________________________ _ (Signatures must be guaranteed by an eligible guarantor institution (banks, stockbrokers, savings and loan associations and credit unions with membership in an approved signature guarantee medallion program), pursuant to Rule 17 Ad-15 promulgated under the Securities Exchange Act of 1934, as amended (the "Exchange Act")). The undersigned certifies that he/she/it [is / is not] (circle one) an Affiliate of the Company and that, to its knowledge, the proposed transferee [is / is not] (circle one) an Affiliate of the Company. In connection with any transfer or exchange of this Subordinated Note occurring prior to the date that is one year after the later of the date of original issuance of this Subordinated Note and the last date, if any, on which this Subordinated Note was owned by the Company or any Affiliate of the Company, the undersigned confirms that this Subordinated Note is being: 24  |

---

---

| | |
|:---|:---|
| &nbsp;&nbsp;![GRAPHIC](tm237204d1_ex6-6img025.jpg) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;CHECK ONE BOX BELOW: o (l) acquired for the undersigned's own account, without transfer; o (2) transferred to the Company; o (3) transferred in accordance and in compliance with Rule 144A under the Securities Act of 1933, as amended (the "Securities Act"); o (4) transferred under an effective registration statement under the Securities Act; o (5) transferred in accordance with and in compliance with Regulation S under the Securities Act; o (6) transferred to an institutional "accredited investor" (as defined in Rule 50l(a)(l), (2), (3) or (7) under the Securities Act); o (7) transferred to an '"accredited investor" (as defined in Rule 50l(a)(4) under the Securities Act), not referred to in item (6) that has been provided with the information designated under Section 4(d) of the Securities Act; or o (8) transferred in accordance with another available exemption from the registration requirements of the Securities Act. Unless one of the boxes is checked, the Company will refuse to register this Subordinated Note in the name of any person other than the registered holder thereof; provided, however, that if box (5), (6), (7) or (8) is checked, the Company may require, prior to registering any such transfer of this Subordinated Note, in its sole discretion, such legal opinions, certifications and other information as the Company may reasonably request to confirm that such transfer is being made pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act such as the exemption provided by Rule 144 under such Act. Signature Guarantee: Signature: __________________ _ (Sign exactly as your name appears on the face of this Subordinated Note) FOR EXECUTION BY AN ENTITY: Entity name:. _____________ _ By: ________________ _ Name: ·---------------- Title:. ________________ _ Tax Identification No.: --------------- -------------------------- 25  |

---

---

| | |
|:---|:---|
| &nbsp;&nbsp;![GRAPHIC](tm237204d1_ex6-6img026.jpg) | &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(Signatures must be guaranteed by an eligible guarantor institution (banks, stockbrokers, savings and loan associations and credit unions with membership in an approved signature guarantee medallion program), pursuant to Exchange Act Rule 17 Ad-15). TO BE COMPLETED BY PURCHASER IF BOX (l) OR (3) ABOVE IS CHECKED. The undersigned represents and warrants that it is purchasing this Subordinated Note for its own account or an account with respect to which it exercises sole investment discretion and that it and any such account is a "qualified institutional buyer" within the meaning of Rule 144A under the Securities Act and is aware that the sale to it is being made in reliance on Rule 144A and acknowledges that it has received such information regarding the Company as the undersigned has requested pursuant to Rule 144A or has determined not to request such information and that it is aware that the transferor is relying upon the undersigned's foregoing representations in order to claim the exemption from registration provided by Rule 144A. Date: ------------ Signature: ______________ _ Print name: --------------- FOR EXECUTION BY AN ENTITY: Entity name: ______________ _ By: ________________ _ Name: ----------------- Title: ________________ _ Tax Identification No.: ---------- 26  |

---

## Ex1A-7

**Exhibit 7**

**PLAN OF REORGANIZATION AND MERGER AGREEMENT**

This Plan of Reorganization and Merger Agreement ("**Agreement**") is made and entered into as of July 6, 2022, by and among Infinity Bank (the "**Bank**"), Infinity Merger Co. ("**Subsidiary**"), and Infinity Bancorp ("**Infinity Bancorp**"), collectively referred to herein as the "parties" and individually as a "party".

**Recitals and Undertakings**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A. The Bank is a California banking corporation with its head banking office in Santa Ana, California. Subsidiary is a corporation duly organized and existing under the laws of the State of California with its principal office in Santa Ana, California. Infinity Bancorp is a corporation duly organized and existing under the laws of the State of California with its principal office in Santa Ana, California.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;B. As of the date hereof, the Bank has 20,000,000 shares of no par value Common Stock authorized, of which there are 3,319,297 shares outstanding, and 10,000,000 shares of Preferred Stock authorized, of which there are no shares outstanding.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;C. Immediately prior to the Effective Date (as defined in Section 1.2 herein), Subsidiary will have 20,000,000 shares of no par Common Stock authorized, of which 100 shares of Common Stock will be outstanding at the Effective Date (as defined in <u>Section 1.2</u> herein). All 100 shares of Common Stock of Subsidiary outstanding as of the Effective Date will be owned by Infinity Bancorp. Upon the Merger becoming effective, each of such 100 shares shall be converted into and exchanged by Infinity Bancorp for one share of fully paid and nonassessable Common Stock of the Bank as the Surviving Corporation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;D. Immediately prior to the Effective Date (as defined in Section 1.2 herein, Infinity Bancorp will have 20,000,000 shares of common stock authorized, of which 50 shares of Common Stock will be outstanding at the Effective Date (as defined in <u>Section 1.2</u> herein), and 10,000,000 shares of Preferred Stock authorized, of which no shares will be outstanding at the Effective Date. Upon the Merger becoming effective, each of such 50 shares shall be repurchased by Infinity Bancorp as provided in <u>Section 2.2</u> herein.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;D. The Boards of Directors of Infinity Bancorp, Bank and Subsidiary have, each respectively, approved this Agreement and authorized its execution.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;E. The parties intend by this Agreement to set forth the terms and conditions of a tax-free reorganization under Sections 368(a)(1)(A) and 368(a)(2)(E) of the Internal Revenue Code of 1986, as amended.

NOW, THEREFORE, in consideration of the mutual agreements of the parties contained herein, the parties hereby agree as follows:

---

| | |
|:---|:---|
| **Section 1.** | **<u>General</u>.** |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.1 <u>The Merger</u>. On the Effective Date, Subsidiary shall be merged into Bank (the **"Merger"**) and Bank shall be the surviving corporation (the "**Surviving Corporation**") and a subsidiary of Infinity Bancorp, and its name shall continue to be "**Infinity Bank**."

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.2 <u>Effective Date</u>. This Agreement shall become effective at the close of business on the day on which this Agreement shall have been filed with the Secretary of State of the State of California in accordance with Section 1103 of the California General Corporation Law (the "**Effective Date**").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.3 <u>Articles of Incorporation and Bylaws</u>. On the Effective Date, the Articles of Incorporation of the Bank, as in effect immediately prior to the Effective Date, shall be and remain the Articles of Incorporation of the Surviving Corporation; the Bylaws of the Bank shall be and remain the Bylaws of the Surviving Corporation until altered, amended or repealed; the Certificate of Authority of the Bank issued by the Commissioner of the California Department of Business Oversight (now the Department of Financial Protection and Innovation ("**DFPI**")) shall be and remain the Certificate of Authority of the Surviving Corporation; and the Bank's insurance of deposits coverage by the Federal Deposit Insurance Corporation ("**FDIC**") shall be and remain the deposit insurance of the Surviving Corporation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.4 <u>Directors and Officers of the Surviving Corporation</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Directors</u>. On the Effective Date, the directors of the Bank immediately prior to the Effective Date shall be and remain the directors of the Surviving Corporation. Directors of the Surviving Corporation shall serve until the next annual meeting of shareholders of the Surviving Corporation or until such time as their successors are elected and have qualified.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Officers and Employees</u>. On the Effective Date, the officers and employees of the Bank immediately prior to the Effective Date shall be and remain the officers and employees of the Surviving Corporation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.5 <u>Directors and Officers of Infinity Bancorp</u>

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Directors</u>. On the Effective Date, the directors of Infinity Bancorp shall be the following persons:

---

| | |
|:---|:---|
| Karkutla P. Balkrishna | Victor E. Guerrero II |
| Cary D. Bren | Katherine T. Le |
| Curtis E. Campbell | Richard H. Schlatter |
| Raymond J. Gagnon | Glenn B. Stearns |

---

Directors of the Infinity Bancorp shall serve until the next annual meeting of shareholders of Infinity Bancorp or until such time as their successors are elected and have qualified.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Officers</u>. On the Effective Date, the officers of Infinity Bancorp shall be the following persons:

---

| | |
|:---|:---|
| Chairman and Chief Executive Officer | Karkutla P. Balkrishna |
| President | Victor E. Guerrero II |
| Executive Vice President/Risk Management/<br> Director of HR/Corporate Secretary | Elaine Crouch |
| Executive Vice President/Chief Financial Officer | Allison Duncan |

---

Page 2 of 10

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.6 <u>Effect of the Merger</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) <u>Assets and Rights</u>. Upon the Merger becoming effective, all rights, privileges, franchises and property of Subsidiary, and all debts and liabilities due or to become due to Subsidiary, including things in action and every interest or asset of conceivable value or benefit, shall be deemed fully and finally and without any right of reversion transferred to and vested in the Surviving Corporation without further act or deed, and the Surviving Corporation shall have and hold the same in its own right as fully as the same was possessed and held by Subsidiary.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) <u>Liabilities</u>. Upon the Merger becoming effective, all debts, liabilities, and obligations due or to become due of, and all claims or demands for any cause existing against Subsidiary shall be and become the debts, liabilities, obligations of, and the claims and demands against, the Surviving Corporation in the same manner as if the Surviving Corporation had itself incurred or become liable for them.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) <u>Creditors' Rights and Liens</u>. Upon the Merger becoming effective, all rights of creditors of Subsidiary, and all liens upon the property of Subsidiary, shall be preserved unimpaired, limited in lien to the property affected by the liens immediately prior to the time of the Merger.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) <u>Pending Actions</u>. Upon the Merger becoming effective, any action or proceeding pending by or against Subsidiary shall not be deemed to have abated or been discontinued, but may be prosecuted to judgment, with the right to appeal or review as in other cases, as if the Merger had not taken place or the Surviving Corporation may be substituted for Subsidiary.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.7 <u>Tax Consequences of the Reorganization</u>

This Agreement has been structured to qualify the Reorganization as a tax-free reorganization such that, among other things, no gain or loss will be recognized by the shareholders of the Bank upon exchange of their shares of the Bank's Common Stock for shares of Common Stock of Infinity Bancorp.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.8 <u>Further Assurances</u>. The Bank and Subsidiary each agree that at any time, or from time to time, as and when requested by the Surviving Corporation, or by its successors and assigns, it will execute and deliver, or cause to be executed and delivered in its name by its last acting officers, or by the corresponding officers of the Surviving Corporation, all such conveyances, assignments, transfers, deeds or other instruments, and will take or cause to be taken such further or other action as the Surviving Corporation, its successors or assigns may deem necessary or desirable, in order to evidence the transfer, vesting or devolution of any property right, privilege or franchise or to vest or perfect in or confirm to the Surviving Corporation, its successors and assigns, title to and possession of all the property, rights, privileges, powers, immunities, franchises and interests referred to in this <u>Section 1</u> and otherwise to carry out the intent and purposes hereof.

Page 3 of 10

---

| | |
|:---|:---|
| **Section 2.** | **<u>Capital Stock of the Surviving Corporation</u>.** |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.1 <u>Stock of Subsidiary</u>. Upon the Merger becoming effective, each share of Common Stock of Subsidiary issued and outstanding immediately prior to the Effective Date shall thereupon be converted into and exchanged by Infinity Bancorp for one share of fully paid and nonassessable Common Stock of the Bank as the Surviving Corporation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2 <u>Stock of Infinity Bancorp</u>. Upon the Merger becoming effective, each of the 50 shares of Common Stock of Infinity Bancorp issued and outstanding immediately prior to the time the Merger becomes effective shall be repurchased by Infinity Bancorp for its issue price of $10.00 per share.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.3 <u>Stock of the Bank</u>. Upon the Merger becoming effective, each and every share of Common Stock of the Bank issued and outstanding shall, by virtue of the Merger and without any action on the part of the holders thereof, be exchanged for and converted into one share of fully paid and nonassessable Common Stock of Infinity Bancorp.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.4 <u>Exchange of Stock</u>. Upon the Merger becoming effective:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) the shareholders of record of the Bank shall be entitled to receive and shall be allocated one share of Common Stock of Infinity Bancorp for each share of Common Stock of the Bank;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Infinity Bancorp shall issue the shares of its Common Stock which the shareholders of the Bank shall be entitled to receive. As of the date of this Agreement, all shares of Common Stock held by shareholders of the Bank are held in book-entry form. Infinity Bancorp shall cause all shares resulting from the reorganization to be issued and recorded in book-entry form in the name of each such shareholder and held by Infinity Bancorp's transfer agent. No physical certificates for shares resulting from the reorganization will be issued.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.5 <u>Equity Awards and Equity Award Plans</u>. At the close of business on the Effective Date, Infinity Bancorp will adopt and assume all of the Bank's rights and obligations under each of the Bank's equity and/or stock option plans (the "**Plans**"), and under each outstanding stock option or other award agreement evidencing an option or other award (whether an incentive stock option, a nonqualified stock option, a restricted stock unit or other type of award) previously granted under any of the Plans. The Plans shall be continued by Infinity Bancorp, the obligations of the Plans shall be assumed by Infinity Bancorp and by virtue of such assumption, all rights of an optionee or participant with respect to the Common Stock of the Bank shall become the same right with respect to the Common Stock of Infinity Bancorp, on a one-for-one basis. Each such option or other award, subject to such modifications as may be appropriate or required, and subject to the requirements of the Securities Act of 1933, as amended, and the California Corporate Securities Law of 1968, shall constitute a continuation of the option or other award, substituting Infinity Bancorp for the Bank. The option or other award vesting period and price per share of Infinity Bancorp Common Stock at which such option or other award may be exercised shall be the same vesting period and price as were applicable to the purchase of Bank Common Stock, and all other terms and conditions applicable to the option or other award shall, except as may be otherwise provided herein, be unchanged. Each option or other award granted pursuant to any of the Plans, from and after the close of business on the Effective Date, shall constitute an option or other award granted by Infinity Bancorp and outstanding pursuant to the applicable Plan.

Page 4 of 10

---

| | |
|:---|:---|
| **Section 3.** | **<u>Approvals</u>.** |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.1 <u>Shareholder Approval</u>. This Agreement shall be submitted to the shareholders of Infinity Bancorp, Bank and Subsidiary for ratification and approval in accordance with the applicable provisions of law.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.2 <u>Regulatory Approvals</u>. The parties shall obtain the waivers, consents and approvals of all regulatory authorities as required by law for consummation of the Merger and Plan of Reorganization on the terms herein provided.

---

| | |
|:---|:---|
| **Section 4.** | **<u>Conditions Precedent, Termination and Payment of Expenses</u>.** |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.1 <u>Conditions Precedent to the Merger</u>. Consummation of the Merger is conditioned upon:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) ratification and approval of this Agreement by the shareholders of the Infinity Bancorp, Bank and Subsidiary, as required by law;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) obtaining all other consents and approvals, and satisfaction of all other requirements prescribed by law which are necessary for consummation of the Merger, including, but not limited to, approval of the FDIC, approval of the DFPI, approval of the Board of Governors of the Federal Reserve System under the Bank Holding Company Act of 1956, as amended, and any required action under the Securities Act of 1933, as amended, and state securities laws with respect to the securities of Infinity Bancorp issuable upon consummation of the Merger;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) obtaining all consents or approvals, governmental or otherwise, which are or, in the opinion of counsel for the Bank may be, necessary to permit or enable the Surviving Corporation, upon and after the Merger, to conduct all or any part of the business and activities of the Bank up to the time of the Merger, in the manner in which such activities and business are then conducted; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) performance by each party hereto of all of its obligations hereunder to be performed prior to the Merger becoming effective.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.2 <u>Termination of the Merger</u>. If any condition in <u>Section 4.1</u> has not been fulfilled, or, if in the opinion of a majority of the Board of Directors of any of the parties:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) any action, suit, proceeding or claim has been instituted, made or threatened relating to the proposed Merger which makes consummation of the Merger inadvisable; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) for any other reason consummation of the Merger is inadvisable;

then this Agreement may be terminated at any time before the Merger becomes effective. Upon termination, this Agreement shall be void and of no further effect, and there shall be no liability by reason of this Agreement or the termination thereof on the part of the parties or their respective directors, officers, employees, agents or shareholders, except as provided in <u>Section 4.3</u> hereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.3 <u>Expenses of the Merger</u>. Subject to applicable federal laws and regulations, each party shall bear its own expenses of the Merger, including filing fees, printing costs, mailing costs, accountants' fees and legal fees.

Page 5 of 10

---

| | |
|:---|:---|
| **Section 5.** | **<u>Miscellaneous</u>.** |

---

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.1 <u>Assignment</u>. No party shall have the right to assign its rights or obligations under this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.2 <u>Execution</u>. This Agreement may be executed in counterparts, each of which when so executed shall be deemed an original and such counterparts shall together constitute one and the same instrument.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.3 <u>Governing Law</u>. This Agreement is made and entered into in the State of California, and the laws of said State shall govern the validity and interpretation hereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.4 <u>Entire Agreement</u>. This Agreement contains the entire agreement between the parties hereto with respect to the plan of reorganization and merger and supersedes all prior arrangements or understandings with respect thereto.

**The next page is the signature page.**

Page 6 of 10

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

---

| | |
|:---|:---|
| INFINITY BANK | INFINITY BANK |
| By: | /s/ Victor E. Guerrero |
|  | Victor E. Guerrero |
|  | President and Chief Operating Officer |
| By: | /s/ Elaine Crouch |
|  | Elaine Crouch |
|  | Corporate Secretary |
| INFINITY MERGER CO. | INFINITY MERGER CO. |
| By: | /s/ Victor E. Guerrero |
|  | Victor E. Guerrero |
|  | President |
| By: | /s/ Elaine Crouch |
|  | Elaine Crouch |
|  | Corporate Secretary |
| INFINITY BANCORP | INFINITY BANCORP |
| By: | /s/ Victor E. Guerrero |
|  | Victor E. Guerrero |
|  | President and Chief Operating Officer |
| By: | /s/ Elaine Crouch |
|  | Elaine Crouch |
|  | Corporate Secretary |

---

Page 7 of 10

![](tm237204d1_ex7img001.jpg)

**CORPORATIONS CODE - CORP**

**TITLE 1. CORPORATIONS [100 - 14631]** *(Title 1 enacted by Stats. 1947, Ch. 1038.)*

**DIVISION 1. GENERAL CORPORATION LAW [100 - 2319]** *(Division 1 repealed and added by Stats. 1975, Ch. 682.)*

**CHAPTER 13. Dissenters' Rights [1300 - 1313]** *(Chapter 13 added by Stats. 1975, Ch. 682.)*

**<u>1300.</u>**

&nbsp;&nbsp;&nbsp;&nbsp;(a) If
 the approval of the outstanding shares (Section 152)
 of a corporation is required for a reorganization under subdivisions (a) and (b) or
 subdivision (e) or (f) of Section 1201, each shareholder of the corporation
 entitled to vote on the transaction and each shareholder of a subsidiary corporation in a
 short-form merger may, by complying with this chapter, require the corporation in which the
 shareholder holds shares to purchase for cash at their fair market value the shares owned
 by the shareholder which are dissenting shares as defined in subdivision (b). The fair market
 value shall be determined as of the day of, and immediately prior to, the first announcement
 of the terms of the proposed reorganization or short-form merger, excluding any appreciation
 or depreciation in consequence of the proposed reorganization or short-form merger, as adjusted
 for any stock split, reverse stock split, or share dividend that becomes effective thereafter.

(b) As
 used in this chapter, "dissenting shares" means shares to which all of the following
 apply:

(1)That were not, immediately prior to the reorganization or short-form merger, listed on any national securities exchange certified by the Commissioner of Business Oversight under subdivision (o) of Section 25100, and the notice of meeting of shareholders to act upon the reorganization summarizes this section and Sections 1301, 1302, 1303, and 1304; provided, however, that this provision does not apply to any shares with respect to which there exists any restriction on transfer imposed by the corporation or by any law or regulation; and provided, further, that this provision does not apply to any shares where the holder of those shares is required, by the terms of the reorganization or short-form merger, to accept for the shares anything except: (A) shares of any other corporation, which shares, at the time the reorganization or short-form merger is effective, are listed on any national securities exchange certified by the Commissioner of Business Oversight under subdivision (o) of Section 25100; (B) cash in lieu of fractional shares described in the foregoing subparagraph (A); or (C) any combination of the shares and cash in lieu of fractional shares described in the foregoing subparagraphs (A) and (B).

(2)That were outstanding on the date for the determination of shareholders entitled to vote on the reorganization and (A) were not voted in favor of the reorganization or, (B) if described in paragraph (1), were voted against the reorganization, or were held of record on the effective date of a short-form merger; provided, however, that subparagraph (A) rather than subparagraph (B) of this paragraph applies in any case where the approval required by Section 1201 is sought by written consent rather than at a meeting.

(3)That the dissenting shareholder has demanded that the corporation purchase at their fair market value, in accordance with Section1301.

(4) That
 the dissenting shareholder has submitted for endorsement, in accordance with Section 1302.

(c) As used in this chapter, "dissenting shareholder" means the recordholder of dissenting shares and includes a transferee of record.

*(Amended by Stats. 2019, Ch. 143, Sec. 24. (SB 251) Effective January 1, 2020.)*

**<u>1301.</u>**

(a) If, in the case of a reorganization, any shareholders of a corporation have a right under Section 1300, subject to compliance with paragraphs (3) and (4) of subdivision (b) thereof, to require the corporation to purchase their shares for cash, that corporation shall mail to each of those shareholders a notice of the approval of the reorganization by its outstanding shares (Section 152) within 10 days after the date of that approval, accompanied by a copy of Sections 1300, 1302, 1303, and 1304 and this section, a statement of the price determined by the corporation to represent the fair market value of the dissenting shares, and a brief description of the procedure to be followed if the shareholder desires to exercise the shareholder's right under those sections. The statement of price constitutes an offer by the corporation to purchase at the price stated any dissenting shares as defined in subdivision (b) of Section 1300, unless they lose their status as dissenting shares under Section 1309.

Page 8 of 10

&nbsp;&nbsp;&nbsp;&nbsp;

(b) Any shareholder who has a right to require the corporation to purchase the shareholder's shares for cash under Section 1300, subject to compliance with paragraphs (3) and (4) of subdivision (b) thereof, and who desires the corporation to purchase shares shall make written demand upon the corporation for the purchase of those shares and payment to the shareholder in cash of their fair market value. The demand is not effective for any purpose unless it is received by the corporation or any transfer agent thereof (1) in the case of shares described in subdivision (b) of Section 1300, not later than the date of the shareholders' meeting to vote upon the reorganization, or (2) in any other case, within 30 days after the date on which the notice of the approval by the outstanding shares pursuant to subdivision (a) or the notice pursuant to subdivision (h) of Section 1110 was mailed to the shareholder.

(c)The demand shall state the number and class of the shares held of record by the shareholder which the shareholder demands that the corporation purchase and shall contain a statement of what the shareholder claims to be the fair market value of those shares as determined pursuant to subdivision (a) of Section 1300. The statement of fair market value constitutes an offer by the shareholder to sell the shares at that price.

*(Amended by Stats. 2012, Ch. 473, Sec. 2. (AB 1680) Effective January 1, 2013.)*

**<u>1302.</u>**

Within 30 days after the date on which notice of the approval by the outstanding shares or the notice pursuant to subdivision (h) of Section 1110 was mailed to the shareholder, the shareholder shall submit to the corporation at its principal office or at the office of any transfer agent thereof, (a) if the shares are certificated securities, the shareholder's certificates representing any shares which the shareholder demands that the corporation purchase, to be stamped or endorsed with a statement that the shares are dissenting shares or to be exchanged for certificates of appropriate denomination so stamped or endorsed or (b) if the shares are uncertificated securities, written notice of the number of shares which the shareholder demands that the corporation purchase. Upon subsequent transfers of the dissenting shares on the books of the corporation, the new certificates, initial transaction statement, and other written statements issued therefor shall bear a like statement, together with the name of the original dissenting holder of the shares.

*(Amended by Stats. 2012, Ch. 473, Sec. 3. (AB 1680) Effective January 1, 2013.)*

**<u>1303.</u>**

(a) If the corporation and the shareholder agree that the shares are dissenting shares and agree upon the price of the shares, the dissenting shareholder is entitled to the agreed price with interest thereon at the legal rate on judgments from the date of the agreement. Any agreements fixing the fair market value of any dissenting shares as between the corporation and the holders thereof shall be filed with the secretary of the corporation.

(b) Subject to the provisions of Section1306, payment of the fair market value of dissenting shares shall be made within 30 days after the amount thereof has been agreed or within 30 days after any statutory or contractual conditions to the reorganization are satisfied, whichever is later, and in the case of certificated securities, subject to surrender of the certificates therefor, unless provided otherwise by agreement.

*(Amended by Stats. 1986, Ch. 766, Sec. 24.)*

**<u>1304.</u>**

(a) If the corporation denies that the shares are dissenting shares, or the corporation and the shareholder fail to agree upon the fair market value of the shares, then the shareholder demanding purchase of such shares as dissenting shares or any interested corporation, within six months after the date on which notice of the approval by the outstanding shares (Section 152) or notice pursuant to subdivision (h) of Section 1110 was mailed to the shareholder, but not thereafter, may file a complaint in the superior court of the proper county praying the court to determine whether the shares are dissenting shares or the fair market value of the dissenting shares or both or may intervene in any action pending on such a complaint.

(b) Two or more dissenting shareholders may join as plaintiffs or be joined as defendants in any such action and two or more such actions may be consolidated.

(c) On the trial of the action, the court shall determine the issues. If the status of the shares as dissenting shares is in issue, the court shall first determine that issue. If the fair market value of the dissenting shares is in issue, the court shall determine, or shall appoint one or more impartial appraisers to determine, the fair market value of the shares.

*(Amended by Stats. 2012, Ch. 473, Sec. 4. (AB 1680) Effective January 1, 2013.)*

Page 9 of 10

**This Page Intentionally Left Blank**

Page 10 of 10

### UNITED STATES SECURITIES AND EXCHANGE COMMISSION
**Washington, D.C. 20549**

## FORM 1-A

### REGULATION A OFFERING STATEMENT
### UNDER THE SECURITIES ACT OF 1933

### Item 1. Issuer Information

**Exact name of issuer:** Infinity Bancorp

**Jurisdiction of Incorporation/Organization:** CA

**Year of Incorporation:** 2022

**CIK:** 0001962911

**I.R.S. Employer Identification Number:** 88-3121738

**Primary Standard Industrial Classification Code:** 6022

**Total number of full-time employees:** 29

**Total number of part-time employees:** 2

**Address of Principal Executive Offices:** 6 HUTTON CENTRE DRIVE, SUITE 100, SANTA ANA, CA 92707

**Company Phone:** 657-223-1000

**Person to contact:** Richard Knecht

### Financial Statements

**Balance Sheet Information**

| Metric                                   | Amount        |
|:---|:---|
| Cash and Cash Equivalents                | $113050000.00 |
| Investment Securities                    | $54735000.00  |
| Accounts and Notes Receivable            |  |
| Property, Plant and Equipment (PP&E)     |  |
| Total Assets                             | $322309000.00 |
| Accounts Payable and Accrued Liabilities | $1364000.00   |
| Long-Term Debt                           | $3923000.00   |
| Total Liabilities                        | $296276000.00 |
| Total Stockholders' Equity               | $26033000.00  |
| Total Liabilities and Equity             | $322309000.00 |

**Statement of Comprehensive Income Information**

| Metric                                    | Amount      |
|:---|:---|
| Total Revenues                            |  |
| Costs and Expenses Applicable to Revenues |  |
| Depreciation and Amortization             | $89000.00   |
| Net Income                                | $1627000.00 |
| Earnings Per Share - Basic                | 0.49        |
| Earnings Per Share - Diluted              | 0.49        |

**Auditor Information**

| Metric          | Amount    |
|:---|:---|
| Name of Auditor | Crowe LLP |

### Outstanding Securities

| Class                      |   Outstanding | CUSIP     | Publicly Traded   |
|:---|---:|:---|:---|
| Common Stock               |       3325716 | 00045674V | OTC               |
| Subordinated Capital Notes |             3 | 000000000 | None              |

### Item 2. Issuer Eligibility
- [x] The issuer certifies that all of the statements in this part are true.

### Item 3. Application of Rule 262
- [x] The issuer certifies that it is not disqualified and has not been involved in any disqualifying event.

### Item 4. Summary Information Regarding the Offering

**Tier:** Tier1

**Financial Statement Status:** Audited

**Type of Securities Offered:** Equity (common or preferred stock)

**Is this a delayed or continuous offering?** No

**Was or is the offering to take place within one year after qualification?** No

**Was or is the offering to commence within two days after qualification?** No

**Is this a best efforts offering?** Yes

**Was there any solicitation of interest?** No

**Are there any resale securities by affiliates of the issuer?** No

**Offering Amounts**

| Description                                                     | Amount   |
|:---|:---|
| Number of securities offered                                    | 800000   |
| Number of securities outstanding                                | 3325716  |
| Price per security                                              | $12.50   |
| Issuer's aggregate offering price                               | $0.00    |
| Aggregate offering price of securities held by security holders | $0.00    |
| Aggregate price of securities offered concurrently              | $0.00    |
| Total aggregate offering price                                  | $0.00    |

**Anticipated Fees**

| Service Provider   | Name                  | Fees      |
|:---|:---|:---|
| Auditor            | Crowe LLP             | $15000.00 |
| Legal              | Richard E. Knecht APC | $25000.00 |
| Promoters          |  |  |

**Estimated Net Proceeds to the Issuer:** $9952000.00

### Item 5. Jurisdictions in Which Securities are to be Offered

- All States and Territories

### Item 6. Unregistered Securities Issued or Sold Within One Year

**Name of Such Issuer:** Infinity Bancorp

**Title of Securities Issued:** Common Stock

**Total Amount of Securities Issued:** 3325716

**Amount of such securities sold by principal security holders:** 0

**Aggregate consideration:** $33424000 - based on amount of Infinity Bank's capital stock which was exchanged on October 31, 2022 for shares of Infinity Bancorp's common stock on a one-for-one basis in the bank holding company reorganization

**Basis for aggregate consideration:** —

**Securities Act Exemption:** Section 3(a)(12) of the Securities Act- the exemption for reorganization of a bank as a wholly owned subsidiary of a bank holding company