Document:

Branch Purchase and Assumption Agreement

 EXHIBIT 10.123 
  
 BRANCH PURCHASE AND ASSUMPTION AGREEMENT 
  
 BY AND BETWEEN 
  
 PAN AMERICAN BANK, FSB, AS SELLER 
  
 AND 
  
 GUARANTY BANK, AS BUYER 
  
 dated as of July 1, 2004 
  

  
 BRANCH PURCHASE AND
ASSUMPTION AGREEMENT 
  
 This Branch Purchase and
Assumption Agreement (“Agreement”) is made and entered into as of July 1, 2004 (“Signature Date”), by and between PAN AMERICAN BANK, FSB, a federal savings bank with its home office located at 1801 El Camino Real,
Burlingame, California 94010 (“Seller”), UNITED PANAM FINANCIAL CORP., a California corporation with its home office located at 3990 Westerly Place, Suite 200, Newport Beach, California 92660 (“Seller’s Parent
Company”), and GUARANTY BANK, a federal savings bank with its home office located at 1300 South MoPac Expressway, Austin, Texas 78746 (“Buyer”). 
  
 RECITALS 
  
 A. Buyer desires to acquire certain assets and assume certain liabilities with respect to two (2) of Seller’s northern California branches, and
Seller desires to transfer such assets, liabilities and the operation of the two branches to Buyer. 
  
 B. Seller and Buyer propose to apply to the appropriate regulatory authorities for permission to effect the purchase and sale described herein and for
such other requisite approvals as may be necessary for the consummation of the transactions contemplated hereby. 
  
 C. Seller and Buyer wish to consummate the transactions contemplated hereby in a timely and efficient manner. 
  
 AGREEMENT 
  
 In consideration of the foregoing and the representations, warranties,
covenants and agreements set forth in this Agreement, and subject to the conditions set forth herein, Seller and Buyer agree as follows: 
  
 ARTICLE I 
  
 DEFINITIONS 
  
 1.1 DEFINITIONS. As used in this Agreement, the following terms have the definitions indicated: 
  
 “ACCOUNTING FIRM” has the meaning set forth in Section 4.4(a). 
  
 “ACCOUNT LOANS” means all checking account lines of credit or overdraft checking loan balances related to or
secured by the Assumed Liabilities and all other loans secured by the Assumed Liabilities that are listed on the books and records of the Branches. 
  
 “ACCOUNT LOANS PAYMENT” has the meaning set forth in Section 2.1(c). 
  
 “ACCOUNT LOANS TAX PRORATION” has the meaning set forth in Section 2.4. 
  

 “ACCRUED INTEREST” means interest on Account Loans and Deposits which is accrued but unpaid or
unposted, as the case may be, through and including the Closing Date. 
  
 “ACH ITEMS” means automated clearing house debits and credits, including, but not limited to, social security payments, federal recurring payments and other payments debited and/or credited on a regularly scheduled basis to or
from Deposit Accounts pursuant to arrangements between the owner of the account and a third party directly making the credits or debits. 
  
 “AFFILIATE” means a Person that directly or indirectly, through one or more intermediaries, controls or is controlled by or is under common
control with the Person specified. 
  
 “ASSETS” means
the Branch Leases, Fixed Assets, Cash on Hand and the Related Assets. 
  
 “ASSUMED LIABILITIES” means the aggregate outstanding balance of all Deposit Accounts at the Branches as of Closing, except that Assumed Liabilities shall not include: (i) Deposit Accounts holding funds held in escrow; (ii)
Deposit Accounts that are Dormant Accounts as of the Closing Date or are subject to remittance to the State of California pursuant to the laws of abandoned property or escheat or similar laws during the year ended December 31, 2003; (iii) Deposit
Accounts that are title, tax and lien accounts; (iv) Deposit Accounts excluded pursuant to Section 2.1(g); (v) Deposit Accounts of directors or senior officers of Seller; (vi) Brokered Deposit Accounts; and (vii) Internet Accounts.

  
 “ATM” means automated teller machine. 
  
 “BRANCH EMPLOYEES” means the employees of Seller at the Branches.

  
 “BRANCHES” means the Burlingame Branch and the San
Carlos Branch. 
  
 “BRANCH LEASES” means all rights and
obligations of Seller under the Burlingame Branch lease and the San Carlos Branch lease pursuant to which Seller holds leasehold interests as tenant. 
  
 “BROKERED DEPOSIT ACCOUNTS” means Deposits gathered by a deposit broker and placed with Seller. 
  
 “BURLINGAME BRANCH” means Seller’s branch located at 1801 El
Camino Real, Burlingame, California. 
  
 “BUSINESS DAY”
means any day on which the Federal Reserve Bank of San Francisco is open for the transaction of ordinary business. 
  
 “BUYER’S CLOSING PAYMENT” has the meaning set forth in Section 2.1(b). 
  
 “CASH ON HAND” means all petty cash, vault cash, cash in the ATMs and teller cash located at the Branches.

  

 “CASH ON HAND PAYMENT” has the meaning set forth in Section 2.1(c). 
  
 “CLOSING” and “CLOSING DATE” have the meanings set forth
in Section 4.1. 
  
 “CLOSING PAYMENTS” means
Buyer’s Closing Payment and Seller’s Closing Payment. 
  
 “CLOSING SETTLEMENT STATEMENT” has the meaning set forth in Section 4.3(a). 
  
 “CLOSING SETTLEMENT STATEMENT DELIVERY DATE” has the meaning set forth in Section 4.3(a). 
  
 “CONFIDENTIAL INFORMATION” has the meaning set forth in Section
7.5. 
  
 “CORRECTION PAYMENT” has the meaning set
forth in Section 4.4(b). 
  
 “DEPOSIT” or
“DEPOSIT ACCOUNTS” means any deposit as defined in Section 3(l)(1) of the Federal Deposit Insurance Act, as amended, 12 U.S.C. Section 1813(l)(1), maintained at the Branches, together with Accrued Interest thereon, if any. 
  
 “DORMANT ACCOUNTS” means Deposit Accounts that, as of the Closing
Date, have been inactive for a period of two (2) years or more. 
  
 “ENCUMBRANCES” means all encumbrances, mortgages, options, pledges, security interests, liens, charges, conditional sales agreements, leases or any other restriction, whether imposed by agreement, understanding, law or otherwise.

  
 “ERISA” means the Employee Retirement Income
Security Act of 1974, as amended. 
  
 “EXPENSES” means
all reasonable out-of-pocket expenses (including all fees and expenses of attorneys, accountants, experts and consultants to the Party and its Affiliates) incurred by the Party or on its behalf in connection with the consummation of the transactions
contemplated hereby. 
  
 “FDIC” means the Federal
Deposit Insurance Corporation or any successor thereto. 
  
 “FEDERAL FUNDS RATE” means the closing bid price for federal funds as quoted in the Wall Street Journal on the date in question (it being understood that on days on which the Wall Street Journal is not published,
interest shall accrue at the overnight Federal Funds Rate in effect on the most recent day on which the Wall Street Journal was published). 
  
 “FINAL SETTLEMENT DATE” has the meaning set forth in Section 4.3(b). 
  
 “FIXED ASSETS” means all furniture, equipment, trade fixtures, ATMs and other tangible personal property owned or
leased by Seller and located in or upon the Branches, 

  

 
and all leasehold improvements on the Leased Branches that Seller has made, all as described on Schedule 3.1(b). 
  
 “FIXED ASSETS PAYMENT” has the meaning set forth in Section 2.1(c).

  
 “GAAP” means generally accepted accounting
principles, consistently applied. 
  
 “HAZARDOUS
SUBSTANCES” means chemicals, pollutants, contaminants, wastes and substances that have been defined as toxic or hazardous by any applicable federal, state, county or local law or regulation; provided, however, that for purposes of this
definition, Hazardous Substances shall not include any substance of a nature, quantity or concentration that is customarily used, stored or disposed of as part of or incidental to the operation and maintenance of the Branches in the ordinary course
of business conducted thereon. 
  
 “INTERNET ACCOUNTS”
means Deposits gathered via the internet. 
  
 “IRA”
means a trust or custodianship created for the exclusive benefit of an individual or his beneficiaries in accordance with the provisions of Section 408 of the Internal Revenue Code of 1986, as amended. 
  
 “IRA DEPOSITS” has the meaning set forth in Section 2.1(g).

  
 “IRS” means the Internal Revenue Service.

  
 “LEASED BRANCHES” means the Burlingame Branch and
the San Carlos Branch. 
  
 “LIQUIDATED DAMAGES” has the
meaning set forth in Section 11.4. 
  
 “NET BOOK VALUE”
means the net book value of an asset, as shown on the books and records of Seller, determined in accordance with GAAP. 
  
 “OTS” means the Office of Thrift Supervision or any successor thereto. 
  
 “PARTY” means Seller or Buyer, and “PARTIES” means both Seller and Buyer. 
  
 “PERSON” means any individual, corporation, association,
partnership, limited liability company, trust, joint venture, other entity, unincorporated body, government or governmental department or agency. 
  
 “PREMIUM” means three and one-quarter percent (3.25%). 
  

“PREMIUM PAYMENT” means the product of the Premium multiplied by Buyer’s Closing Payment. 
  
 “PREPAYMENT CREDIT” has the meaning set forth in Section
2.1(e). 
  
 “REALTY” means the tenancy interests of
Seller under the Branch Leases. 
  

 “RECORDS” means all records and original documents located at the Branches or in centralized
servicing areas which pertain to the Branches, Fixed Assets, Assumed Liabilities and Account Loans, including, but not limited to, (i) loan applications; (ii) activity reports for escheat purposes; (iii) an account history for each account related
to the Assumed Liabilities and Account Loans for a period including at least the current year; and (iii) signature cards, customer cards, customer statements, legal files, pending files, all open account agreements, Account Loan agreements, computer
records and documents. 
  
 “RELATED ASSETS” means the
Account Loans and Records. 
  
 “RETURNED ITEMS” has the
meaning set forth in Section 11.6. 
  
 “SAN CARLOS
BRANCH” means Seller’s branch located at 644 Laurel Street, San Carlos, California. 
  
 “SECURITIZATION” has the meaning set forth in Section 10.2(f). 
  
 “SELLER’S CLOSING PAYMENT” has the meaning set forth in Section 4.2(b). 
  
 “SERVICE CONTRACTS” means service and maintenance agreements,
equipment leases and any other agreements, licenses and permits affecting the Branches, all of which are listed on Schedule 6.22 hereto. 
  
 “SIGNATURE DATE” means the date set forth as such in the first paragraph of this Agreement. 
  
 “TAXPAYER INFORMATION” has the meaning set forth in Section
13.18. 
  
 “TIN” means taxpayer identification
number. 
  
 “TRANSFER APPLICATION” has the meaning set
forth in Section 7.1. 
  
 “TRANSFERRED EMPLOYEE”
has the meaning set forth in Section 12.3. 
  
 “WITHHOLDING OBLIGATIONS” has the meaning set forth in Section 13.17. 
  
 ARTICLE II 
  
 TERMS OF PURCHASE
AND ASSUMPTION 
  
 2.1 ASSETS AND LIABILITIES 
  
 (a) PURCHASE AND SALE. On the Closing Date, subject to the
terms and conditions set forth herein, Seller shall sell, convey, assign and transfer to Buyer and Buyer shall (i) purchase and acquire from Seller all of Seller’s right, title and interest in and to the Assets; (ii) assume the Assumed
Liabilities as of the Closing Date in accordance with the terms of such Assumed Liabilities in effect on the Closing Date; (iii) assume Seller’s obligations to its Assumed Liabilities’ customers accruing after the Closing Date in
accordance with the 

  

 
terms of the Assumed Liabilities in effect on the Closing Date; and (iv) be responsible for modifying the terms of such customer relationships effective as
of the Closing Date as necessary to conform to Buyer’s practices. 
  
 (b) PURCHASE PRICE. On the Closing Date, Seller shall reimburse Buyer, in cash, for the assumption by Buyer of the liabilities and obligations relating to the Assumed Liabilities pursuant to Section 2.1(a) in
an amount equal to one hundred percent (100%) of the aggregate amount of the Assumed Liabilities (“Buyer’s Closing Payment”) in the form attached hereto as Exhibit 2.1(b). 
  
 (c) PREMIUM PAYMENT; ASSUMED LIABILITIES; ASSETS. In
consideration of the assumption of the Assumed Liabilities by Buyer, Buyer shall pay Seller the Premium Payment. In consideration for the Account Loans acquired by Buyer hereunder, Buyer shall pay to Seller at Closing the outstanding principal
balance of each Account Loan plus Accrued Interest on each Account Loan as of the Closing Date (“Account Loans Payment”). In consideration of the Fixed Assets and Cash on Hand acquired hereunder, Buyer shall pay to Seller at Closing the
Net Book Value of the Fixed Assets (“Fixed Assets Payment”) as of the Closing Date and the amount of Cash on Hand (“Cash on Hand Payment”) at the Branches as of the close of business on the Closing Date. 
  
 (d) ASSUMPTION OF BRANCH LEASES AND SERVICE CONTRACTS.
Subject to the terms and conditions hereof, specifically including, but not limited to, the provisions of Section 6.22, Buyer shall assume the duties and obligations of Seller under the Branch Leases and under the assigned Service Contracts from and
after the Closing Date. 
  
 (e) PRORATIONS. All
payments under or pursuant to the Branch Leases and Service Contracts, all personal property taxes with respect to the Fixed Assets, and all ordinary operating expenses of the Branches (including amounts payable under maintenance contracts and for
utilities, but excluding insurance) shall be prorated between the Parties on the basis of a 365-day year and actual days elapsed. In addition, the pro rata amount of FDIC insurance premiums attributable to the Assumed Liabilities, and paid in
advance by Seller for the period after the Closing Date, as well as any prepayments made by Seller for periods after the Closing Date under the Branch Leases or Service Contracts, shall be credited to Seller at Closing (“Prepayment
Credit”). 
  
 (f) NO OTHER DEBTS,
OBLIGATIONS OR LIABILITIES ASSUMED. It is understood and agreed that, except as expressly set forth in Sections 2.1(a) and 2.1(d), Buyer shall not assume or be liable for any debts, obligations or liabilities of Seller. 
  
 (g) IRA DEPOSITS. Seller shall: (i) resign as of the Closing
Date as the trustee/custodian of each IRA deposit liability (“IRA Deposits”) of which it is the trustee/custodian; (ii) to the extent permitted by the documentation governing each IRA, appoint Buyer as successor trustee/custodian thereof,
and Buyer agrees to accept each such trusteeship/custodianship and assume all fiduciary obligations with respect thereto as of the Closing; and (iii) deliver to the IRA grantor and/or named fiduciary of each IRA such notice of the foregoing as is
required by the documentation governing such IRA. If, pursuant to the terms 

  

 
of the documentation governing such IRA, the IRA grantor objects in writing to such assignment, or is entitled to name a successor trustee/custodian and
names a successor trustee/custodian other than Buyer, all deposits held under such IRA shall be excluded from the Assumed Liabilities. 
  
 2.2 NO SALE OF SELLER’S NAME AND LOGO. Seller is not selling, assigning, conveying, transferring or delivering, nor shall Buyer acquire any rights or
interest in or to (i) the name of Seller, or any combination or derivation thereof; or (ii) any logos, service marks or trademarks of Seller or any advertising materials or slogans or any similar items used before, on or after the Closing Date by
Seller in connection with its business. 
  
 2.3 EXPENSES. Seller
shall operate for its own account the Assumed Liabilities and Assets being transferred and assumed pursuant to this Agreement through the Closing Date, and Buyer shall operate for its own account such Assumed Liabilities and Assets from and after
such time. All Expenses, costs, obligations and liabilities related to the Assets and the Branches prior to Closing shall be Seller’s responsibility. 
  
 2.4 RESPONSIBILITY FOR TAXES. Seller shall be responsible for paying sales and use taxes arising out of the transfer of the Account Loans and shall pay
its portion, prorated as of the Closing Date, of state and local, real and personal property taxes related to the Account Loans (“Account Loans Tax Proration”). Seller and Buyer shall cooperate in the preparation of any applicable filings
and returns required by California tax law. 
  
 2.5 INFORMATION
REPORTS. With respect to the calendar year in which the Closing Date occurs, for federal income tax reporting purposes, Seller shall report all interest accrued and paid with respect to all Assumed Liabilities through the Closing Date, and Buyer
shall report all interest accrued and paid with respect to all Assumed Liabilities after the Closing Date. 
  
 ARTICLE III 
  
 TRANSFER OF ASSETS 
  
 3.1 PERSONAL PROPERTY. 

 
 (a) Seller is the lawful owner or lessee of the Fixed
Assets. On the Closing Date, Seller shall assign to Buyer all right, title and interest in and to the Fixed Assets located at the Branches free and clear of all Encumbrances and shall cause a bill of sale and assignment of the Fixed Assets in the
form of Exhibit 10.1(e)(1) to be delivered to Buyer on the Closing Date to effect such transfer. 
  
 (b) Attached hereto as Schedule 3.1(b) is a schedule of the Fixed Assets, which identifies each item of personal property with
reasonable particularity, giving the Net Book Value of such item on Seller’s books and describing any Encumbrances thereon. 
  
 3.2 CONDITION AND DESTRUCTION OF PROPERTY. Seller hereby agrees that the Fixed Assets to be delivered on the Closing Date shall be substantially the same
as the Fixed Assets set forth on Schedule 3.1(b), ordinary wear and tear excepted; provided, that 

  

 
in the event of material damage to the Fixed Assets, Seller shall have the option to repair or replace such Fixed Assets at Seller’s sole cost and
expense. Seller shall assign to Buyer any manufacturer or supplier warranty covering such Fixed Assets. Seller shall give Buyer prompt written notice of (a) any material fire or casualty with respect to any of the Fixed Assets or the Branches, and
(b) any actual or threatened condemnation or eminent domain action with respect to all or any part of any of the premises of either Branch. Upon receipt of such notice, Buyer may, in its sole and exclusive discretion, within fourteen (14) days
following receipt of such notice, elect either to: (i) close the transactions contemplated hereby, excluding the Fixed Assets or Branch in question and deducting from the purchase price an amount mutually agreeable to the Parties; provided, that if
no such agreement can be reached, Buyer may elect to terminate this Agreement; or (ii) close the transactions contemplated hereby, including the personal property or real property in question, in which event Seller shall (y) assign, transfer and set
over unto Buyer all of Seller’s right, title and interest in and to any condemnation award, casualty award, insurance policy, insurance payment or any manner of payment in any way related to the condemnation or casualty, and (z) in the event of
a casualty, extend Buyer a credit against the purchase price in the amount of any deductible carried under any policy of insurance. For purposes hereof, a “material fire or casualty” is one which is reasonably estimated by Buyer to cost
more than Fifty Thousand Dollars ($50,000) to repair. 
  
 3.3
ALLOCATION. Seller and Buyer agree that the allocation of the purchase price shall be made in accordance with Exhibit 4.2(b). After Closing, the Parties shall make consistent use of the allocation for all tax purposes and in any and all
filings, declarations and reports with the IRS with respect thereto, including the reports required by Section 1060 of the Internal Revenue Code of 1986, as amended, it being understood and agreed that Buyer shall deliver an IRS Form 8594 to Seller
within forty-five (45) days after Closing if such form is required to be filed with the IRS. In any proceeding related to the determination of any tax, neither Seller nor Buyer shall contend or represent that such allocation is not a correct
allocation. 
  
 ARTICLE IV 
  
 CLOSING 
  
 4.1 CLOSING. The date of the closing of the transactions contemplated by this Agreement (“Closing Date”) shall be
the first (1st) Friday after the expiration of five (5) Business Days after the last of the following to be achieved: (a) written approval by the OTS of the transactions contemplated hereby shall have been received and become effective; (b) any
other approval required from any other governmental authority having jurisdiction over Seller, Buyer or the transactions contemplated hereby shall have been received; and (c) Seller shall have closed the Securitization. The Closing shall be deemed
to occur at 11:59 P.M. Pacific Time on the Closing Date. Notwithstanding the foregoing, the Closing may occur at such later time or date as mutually agreed upon by Seller and Buyer. 
  

 4.2 CLOSING PAYMENTS. Because the Parties acknowledge that certain amounts to be paid may not be finally
determinable until after the Closing Date, the Closing Payments shall be paid as follows: 
  
 (a) Provided that all conditions required for consummating the Closing have been satisfied by 9:00 a.m. Pacific Time on the Closing Date,
Seller shall pay to Buyer, by wire transfer of immediately available funds to an account designated by Buyer, no later than 10:00 a.m. Pacific Time on the Closing Date, Buyer’s Closing Payment. Buyer’s Closing Payment shall be estimated,
based on account balances of the Assumed Liabilities as of the close of business on the third Business Day immediately prior to the Closing Date. 
  
 (b) Immediately upon receipt of Buyer’s Closing Payment, Buyer shall pay to Seller by wire transfer of immediately available funds
the sum of (i) the Premium Payment; (ii) the Account Loans Payment; (iii) the Fixed Assets Payment; (iv) the Cash on Hand Payment; and (v) the Prepayment Credit, minus the Account Loans Tax Proration (collectively, “Seller’s Closing
Payment”) in the form attached hereto as Exhibit 4.2(b). Seller’s Closing Payment shall be estimated, based on the Net Book Value of the Fixed Assets and the Cash on Hand as of the close of business on the third (3rd) Business Day immediately prior to the Closing Date. Any payment pursuant to this Agreement sent after 12:00 p.m. Pacific Time
shall be deemed to have been made on the next Business Day. 
  
 4.3 POST-CLOSING ADJUSTMENTS. 
  
 (a)
Two (2) Business Days following Closing (“Closing Settlement Statement Delivery Date”), Seller shall provide Buyer with a closing settlement statement (“Closing Settlement Statement”), in the form attached hereto as Exhibit
4.3(a), of the Closing Payments initially calculated pursuant to Section 4.2, that accurately reflects the Assumed Liabilities, the Premium Payment, Cash on Hand, the Net Book Value of the Fixed Assets, the principal balance of the
Account Loans plus Accrued Interest, the Prepayment Credit and the Account Loans Tax Proration (and any prorations or credits not reflected in the payment made in the Closing Payments) all as of and including the Closing Date. 
  
 (b) Seller or Buyer, as appropriate, shall, within seven (7)
Business Days following the Closing Date (“Final Settlement Date”), pay to the other Party any amount payable based upon the difference between the Closing Payments made pursuant to Section 4.2 and the amount calculated pursuant to
Section 4.3(a) by wire transfer in immediately available funds to an account designated by the receiving Party. Any payment to be made pursuant to this Section 4.3(b) by either Party to the other shall include interest at the Federal
Funds Rate on the amount of the adjustment for the number of calendar days elapsed from, but excluding, the Closing Date to and including the Final Settlement Date, and shall be sent no later than 10:00 a.m. Pacific Time on the Final Settlement
Date. 
  
 4.4 DISPUTES. Any disputes between the Parties regarding
the accuracy or correctness of the amounts delivered or amounts that should have been delivered by the Parties pursuant to this Article IV shall be resolved as follows: 
  
 (a) NEGOTIATION BY PARTIES. Seller or Buyer, as the case may be, shall have twenty (20) Business Days
following the Final Settlement Date to notify the other Party that it disputes the accuracy or correctness of the amount(s) delivered, or which should have been delivered, pursuant to Section 4.2 or 4.3. Seller and Buyer agree to use good
faith efforts to resolve any disputes, controversies or claims relating to the amounts delivered or which 

  

 
should have been delivered. Each Party shall appoint a designated individual with authority to bind the respective Party. The designated individuals shall
promptly meet in person or by conference telephone to resolve the issues in dispute. If the designated individuals are unable to resolve the dispute within ten (10) Business Days following such meeting, the Parties shall jointly select a national
accounting firm with expertise in the auditing of financial services institutions (“Accounting Firm”) to resolve the dispute. If the Parties cannot agree on an Accounting Firm, each Party’s independent accountant shall, within three
(3) Business Days, jointly select an Accounting Firm to arbitrate the dispute. If the Accounting Firm selected by the Parties’ independent accountants declines the engagement, the selection process by the Parties’ independent accountants
shall be repeated immediately until an Accounting Firm is selected which accepts the engagement. 
  
 (b) RESOLUTION OF DISPUTE. The Accounting Firm shall investigate the disputed matter and as soon as possible render a determination as to
what amounts, if any, are payable by either Party so as to resolve the dispute in accordance with the terms hereof (“Correction Payment”). The Correction Payment shall include interest thereon at the Federal Funds Rate for the period from
the Closing Date to and including the date of its payment if the amount has been underpaid, or, in the case of overpayment, from the date of overpayment to and including the date of payment. The Correction Payment shall be paid within one (1)
Business Day after the Accounting Firm determination is communicated to both Parties. 
  
 (c) PAYMENT FOR RESOLUTION OF DISPUTE. Initially, the services of the Accounting Firm shall be shared equally by Seller and Buyer.
Thereafter, if the Correction Payment, excluding interest, is greater than Ten Thousand Dollars ($10,000), the Party paying such Correction Payment shall be required to reimburse the other Party for the other Party’s share of the Accounting
Firm’s costs within ten (10) Business Days following written receipt by that Party of demand for such reimbursement. If the Correction Payment is $10,000 or less, the Party requesting the services of such Accounting Firm shall be required to
reimburse the other Party for its share of the Accounting Firm’s costs within ten (10) Business Days following written receipt by that Party of demand for such reimbursement. 
  
 4.5 DELIVERIES AT CLOSING. At Closing, Seller shall deliver to Buyer the documents set forth in Section 10.1(e), and
Buyer shall deliver to Seller the documents set forth in Section 10.2(e). 
  
 ARTICLE V 
  
 REPRESENTATIONS AND
WARRANTIES OF BUYER 
  
 Buyer represents and warrants to Seller
the following: 
  
 5.1 ORGANIZATION. Buyer is a federally
chartered savings bank, duly organized, validly existing and in good standing under the laws of the United States of America. 
  
 5.2 AUTHORITY. Buyer has the corporate power and authority to carry on its business as now being conducted and to execute, deliver and perform this
Agreement and has secured all necessary corporate consents and approvals in connection with the execution hereof 

  

 
and the consummation of the transactions contemplated hereby, subject to obtaining requisite regulatory approvals. Upon execution and delivery, this
Agreement and other agreements being delivered herewith shall constitute valid and binding obligations of Buyer enforceable against it in accordance with their respective terms, subject to applicable bankruptcy, insolvency, receivership and similar
laws affecting creditors’ rights generally and laws relating to the rights of creditors of federally insured financial institutions, and to general principles of equity (whether enforcement is sought in a proceeding in equity or at law).

  
 5.3 COMPLIANCE WITH OTHER INSTRUMENTS AND LAW. Buyer holds all
licenses, franchises, permits and authorizations necessary for the lawful conduct of its business and has not violated, and is in compliance with, all applicable statutes, laws, ordinances, rules and regulations of all federal, state and local
governmental bodies, agencies and subdivisions having, asserting or claiming jurisdiction over it, except to the extent any such violation would not have an adverse effect upon its ability to enter into and perform its obligations hereunder.

  
 5.4 NO BREACH. Buyer’s execution, delivery and
performance hereof and the consummation of the transactions contemplated hereby will not (a) violate or cause a breach of or constitute a default under any judgment, injunction, order, decree, agreement or instrument binding upon Buyer, or (b)
violate Buyer’s charter or by-laws or, upon receipt of all required regulatory approvals, any law or regulation applicable to Buyer. 
  
 5.5 LITIGATION. There is no action, suit or proceeding pending against Buyer or, to Buyer’s knowledge, threatened against or affecting Buyer before
any court or arbitrator or any governmental body, agency or official that could adversely affect the ability of Buyer to perform its obligations hereunder. 
  
 5.6 GOVERNMENTAL NOTICES. Buyer has no reason to believe that any federal, state or other governmental agency having jurisdiction to approve or consent to
the transactions contemplated hereby would oppose or not grant or issue such approval or consent, if required. 
  
 5.7 REGULATORY APPROVALS. The information furnished or to be furnished by Buyer pursuant to Section 7.1 for the purpose of filing any regulatory
application and/or notice is or will be true and complete in all material respects as of the date so furnished. 
  
 5.8 CONSENTS. Other than the approval of the OTS, as well as any applicable approval or consent of the FDIC, no consent of, notice to, or approval or
authorization from any governmental authority or agency or any non-governmental third party is required for Buyer’s execution, delivery and performance hereof and the consummation by Buyer of the transactions contemplated hereby. 
  
 5.9 ACCURACY AND CURRENTNESS OF INFORMATION. The representations and
warranties made herein by Buyer or in the lists and schedules hereto do not contain any untrue statement of a material fact or omit any material fact which is necessary under the circumstances in which it was made to prevent the statements contained
herein or in such schedules from being misleading. 
  

 ARTICLE VI 
  
 REPRESENTATIONS AND WARRANTIES OF SELLER 
  
 Seller represents and warrants to Buyer the following: 
  
 6.1 ORGANIZATION. Seller is a federally chartered savings bank, duly organized, validly existing and in good standing under the laws of the United States
of America. 
  
 6.2 AUTHORITY. Seller has the corporate power and
authority to carry on its business as now being conducted and to execute, deliver and perform this Agreement and has secured all necessary corporate consents and approvals in connection with the execution hereof and the consummation of the
transactions contemplated hereby, subject to obtaining requisite regulatory approvals. Upon execution and delivery, this Agreement and other agreements being delivered herewith will constitute valid and binding obligations of Seller enforceable
against it in accordance with their respective terms, subject to applicable bankruptcy, insolvency, receivership and similar laws affecting creditors’ rights generally and the rights of creditors of federally insured financial institutions, and
to general principles of equity (whether enforcement is sought in a proceeding in equity or at law). 
  
 6.3 COMPLIANCE WITH OTHER INSTRUMENTS AND LAW. Seller holds all licenses, franchises, permits and authorizations necessary for the lawful conduct of its
business at the Branches. Seller has complied with all laws, regulations, opinions, orders, ordinances, judgments and decrees of all governmental bodies and any agencies or subdivisions thereof (federal, state, local, foreign or otherwise)
applicable to the Branches or any part of their operation, including, but not limited to, the OTS and the FDIC, except to the extent any such violation would not have an adverse effect upon its ability to enter into and perform its obligations
hereunder. Seller has not received any written notification of any outstanding asserted failure by Seller to comply with any of such laws. The Branches (including improvements) and the current use and operation thereof by Seller are each in material
compliance with and authorized by applicable zoning and other land use regulations, including, but not limited to, building, fire, health, safety, hazardous waste and environmental codes and all private covenants, restrictions and easements as they
apply to Seller’s current use and operations. There are no facts or circumstances existing or, to Seller’s knowledge, threatened, which could have a material adverse effect on the present use of either of the Branches. Seller has not
received notice that any governmental authority considers that either of the Branches violates or has violated any fire, zoning, health, building, hazardous waste or environmental code or other ordinance, law or regulation or order of any government
or any agency, body or subdivision thereof. 
  
 6.4 NO BREACH.
Seller’s execution, delivery and performance hereof and the consummation of the transactions contemplated hereby will not (a) violate or cause a breach of or constitute a default under any judgment, injunction, order, decree, material agreement
or material instrument binding upon Seller, or (b) violate Seller’s charter or by-laws or, upon receipt of all required regulatory approvals, any law or regulation applicable to Seller. 
  

 6.5 LITIGATION. There is no action, suit, investigation or proceeding pending against Seller or, to
Seller’s knowledge, threatened against or affecting Seller, before any court or arbitrator or any governmental body, agency or official that could adversely affect (a) the ability of Seller to perform its obligations hereunder, or (b) the
Assets, Assumed Liabilities, or the operation of the Branches. None of the Assumed Liabilities or Account Loans are subject to any Encumbrances or any legal restraint or other legal process other than customary court orders, levies and garnishments
affecting the depositors, all of which Encumbrances are described on Schedule 6.5. 
  
 6.6 GOVERNMENTAL NOTICES. Seller has no reason to believe that any federal, state or other governmental agency having jurisdiction to approve or consent to the transactions contemplated hereby would oppose or not
grant or issue such approval or consent, if required. 
  
 6.7
REGULATORY APPROVALS. The information furnished or to be furnished by Seller pursuant to Section 7.1 for the purpose of enabling Buyer to complete and file an application with the OTS is or will be true and complete in all material respects
as of the date so furnished. 
  
 6.8 CONSENTS. Other than the
approval of the OTS and any consents required in connection with the Branch Leases or Service Contracts, no consent of, notice to, or approval or authorization from any governmental authority or agency or any non-governmental third party is required
for Seller’s execution, delivery and performance hereof and the consummation by Seller of any transactions contemplated hereby. 
  
 6.9 FDIC INSURANCE. The Deposits are insured by the FDIC up to the current applicable maximum limits, and Seller has received no written notice of any
action pending or threatened by the FDIC with respect to termination of such insurance. 
  
 6.10 DEPOSITS. Seller has, or will have within one (1) Business Day following the Signature Date, delivered to Buyer a true and complete copy of the account forms for all Deposit Accounts offered by Seller at the
Branches. Except as identified to Buyer by Seller in writing pursuant to Schedule 6.10, all of the Deposit Accounts related to the Assumed Liabilities are in compliance with all applicable laws, orders and regulations and were originated in
material compliance with all applicable laws, orders and regulations. 
  
 (a) Schedule 6.10(a) sets forth a true and correct schedule of the Deposits and Assumed Liabilities (such Assumed Liabilities being designated separately on said Schedule) prepared as of the Signature Date (and
which shall be updated on the last day of every month through the Closing Date and as of the Closing Date and Final Settlement Date), listing by category the respective amounts of Deposits and Assumed Liabilities. All Deposits are insured to the
fullest extent permissible by the FDIC, and Seller has received no written notice of any action pending or threatened by the FDIC with respect to termination of such insurance. Seller has and will have as of the Closing Date all rights and full
authority to transfer and assign the Assumed Liabilities without restriction to Buyer. 
  

 (b) As of the Signature Date, subject to the Return Items (as defined in Section
13.6), and immaterial bookkeeping errors, all Accrued Interest on the Deposits has been properly credited thereto and properly reflected on Seller’s books of account, and Seller is not in default in the payment of any thereof. 

 
 (c) As of the Signature Date, subject to Return Items and
immaterial bookkeeping errors, Seller has timely paid and performed all of its obligations and liabilities related to the Deposits as and when the same have become due and payable, and none is in default or exists by virtue of a default by Seller.

  
 (d) As of the Signature Date, subject to
immaterial bookkeeping errors, Seller (i) has administered all the Deposits in accordance with applicable fiduciary duties and good and sound financial practices and procedures; (ii) has properly made all appropriate credits and debits thereto;
(iii) has delivered to its customers, on a regular basis, statements adequately and accurately reflecting the amount, date and nature of each such credit and debit; (iv) in the event a question, complaint or objection by any depositor with respect
to any of the Deposits has occurred, Seller has promptly and properly reviewed and responded and taken corrective action, in accordance with good and sound financial practice; and (v) is not liable, contingently or otherwise, to any depositors
included in the Assumed Liabilities for any shortages or for any efforts, acts or omissions by Seller. 
  
 6.11 TITLE TO ASSETS OTHER THAN REALTY. Seller is the lawful owner of, and has good and marketable title to, the Fixed Assets and the Related Assets free
and clear of all Encumbrances. Delivery to Buyer of the instruments of transfer of ownership contemplated hereby will vest in Buyer good and marketable title to the Assets free and clear of any Encumbrances. Set forth on Schedule 6.11 is a
true and correct schedule of all Account Loans prepared as of the Signature Date (which shall be updated on the last day of every month through the Closing Date and on the Closing Date and Final Settlement Date) listing by category the amount of
each Account Loan, together with the amount of Accrued Interest thereon. All Account Loans extended by Seller and any extensions, renewals or continuations of such Account Loans were made in accordance with customary lending standards of Seller in
the ordinary course of business and are secured by deposit accounts that constitute Deposits hereunder. The Account Loans and any applicable interest are evidenced by appropriate and sufficient documentation based upon customary and ordinary
practices in the industry. 
  
 6.12 LEASES. 
  
 (a) Schedule 6.12 lists each of the leases and
subleases pursuant to which Seller holds a leasehold interest in the Branch Leases. Seller is the current lessee under the Branch Leases. 
  
 (b) Each of the Branch Leases is the legal, valid and binding obligation of Seller. Seller’s leasehold interest is not subject to any
Encumbrances, and there does not exist with respect to Seller’s obligations under any of the Branch Leases, or with respect to the lessor’s obligations under the Branch Leases, any default or any event or condition which, after notice or
lapse of time or both, could constitute such a default. 
  

 6.13 NO COMMITMENTS. There are no representations or commitments made to borrowers in connection with the
Account Loans or to customers in connection with the Assumed Liabilities which are not set forth in writing in the Records. 
  
 6.14 COMMUNITY REINVESTMENT ACT. Seller received a rating of “Satisfactory” in its most recent examination or interim review with respect to the
Community Reinvestment Act. Seller has not been advised of any supervisory concerns regarding its compliance with the Community Reinvestment Act. To Seller’s knowledge, there are no threatened or pending actions, proceedings or allegations by
any Person or regulatory agency which may cause the OTS or the FDIC to deny or fail to issue any regulatory approval required to consummate the transactions contemplated hereby. There are no agreements with any consumer or community groups with
respect to the Related Assets or Assumed Liabilities. 
  
 6.15
TAXES. Seller has filed all required tax returns and reports related to the Assets and any business conducted at the Branches, including returns and reports related to payroll, withholding, sales, use, transfer, excise and property taxes. Seller has
not received any notice indicating that any taxing authority has asserted any claim for the assessment of any tax liability (including additions to tax, penalties and interest), withholding or other governmental charges. 
  
 6.16 TIN CERTIFICATION. Seller has complied in all material respects with all
applicable laws in obtaining the Deposits, including the use of due diligence in obtaining TIN certifications from holders of the Deposits. 
  
 6.17 BRANCH EMPLOYEES. There is no action, suit or proceeding pending against Seller, or to Seller’s knowledge, threatened against or affecting
Seller, before any court, arbitrator or any governmental body, agency or official that has been brought or threatened to be brought by or on behalf of any Branch Employee. Seller is not a party to any collective bargaining agreement with respect to
any of its Branch Employees or any labor organization to which its Branch Employees belong. 
  
 6.18 INSURANCE. The Branches and the Assets are covered by effective insurance in the amounts, types and forms as are customary and appropriate for Seller’s business, operations, properties and assets. Pursuant
to the insurance policies set forth on Schedule 6.18, copies of which have been delivered to Buyer prior to the Signature Date, all amounts due and payable under such insurance policies are fully paid, and all such insurance policies are in
full force and effect. 
  
 6.19 BINDING OBLIGATIONS. Except for
agreements previously delivered to Buyer and agreements necessary or desirable to consummate the transactions contemplated hereby, Seller is not a party to any other agreement relating to either of the Branches nor is there any other agreement by
which either of the Branches is bound. 
  
 6.20 ENVIRONMENTAL.

  
 (a) No Hazardous Substances have been stored,
disposed of or released upon or below the Branches by Seller, or, to Seller’s knowledge, by any other Person, in violation of any environmental law. 
  

 (b) Seller has not received, and, to Seller’s knowledge, no other Person has
received, any written communication from any governmental authority alleging the violation of any environmental law with respect to either of the Branches. 
  
 (c) To Seller’s knowledge, no person or entity has asserted any claim against Seller arising out of, based upon or resulting from (i)
the presence or release into the environment of any Hazardous Substance upon or below either of the Branches in violation of any environmental law, or (ii) the violation or alleged violation of any environmental law with respect to either of the
Branches. 
  
 6.21 RELATED PARTY TRANSACTIONS. No director,
officer or Affiliate of Seller is a party to the Branch Leases or the Service Contracts or maintains any direct ownership or investment interests in the Branches. 
  
 6.22 SERVICE CONTRACTS. Schedule 6.22 lists all of the contracts, licenses, permits, service and maintenance
agreements and other agreements entered into by Seller in connection with the operation of the Branches. Buyer shall not be obligated to assume any of the Service Contracts, and Buyer shall have the right to determine, in its sole discretion, which,
if any, of the Service Contracts Buyer wishes to assume. 
  
 6.23
DOCUMENTS. Seller has delivered to Buyer true, correct and complete copies of the following: 
  
 (a) any and all real and personal property leases, including the Branch Leases, certificates of occupancy, Service Contracts, and all
other agreements relating to the operation of the Branches or the Fixed Assets; 
  
 (b) any plans and specifications for the improvements constructed on the Branches and as-built plans and surveys; 
  
 (c) all notices received by Seller during the past three (3)
years regarding the Branches with respect to violation of any statutes, rules or regulations of government agencies or violation of any easements, covenants, conditions or restrictions affecting the Realty; and 
  
 (d) copies of any environmental site assessment reports or
surveys on the Realty or owned Branches. 
  
 6.24 ACCURACY AND
CURRENTNESS OF INFORMATION. The representations and warranties made by Seller herein or in the lists and schedules hereto do not contain any untrue statement of a material fact or omit to state any material fact that is necessary under the
circumstances under which it was made to prevent the statements contained herein or in such schedules from being misleading. 
  

 ARTICLE VII 
  
 COVENANTS OF BUYER 
  
 7.1 OBTAINING REGULATORY APPROVALS. Buyer shall be responsible for the preparation and filing with the OTS of the applications and notices for approval of
the transactions contemplated hereby except for any application under Section 563.22 of the OTS Regulations (“Transfer Application”) which may be required of Seller. Buyer shall use its best efforts to file all such applications and
notices simultaneously with the execution hereof or as soon thereafter as reasonably feasible. Buyer shall pay any required filing fees for any application required to be filed by Buyer under applicable law. Buyer shall provide Seller with a copy of
any such application and any related correspondence with such regulatory authorities contemporaneously with the filing or receipt of same. Buyer shall use its best efforts to perform and fulfill all conditions and obligations on its part to be
performed or fulfilled hereunder and to effect Closing at the earliest possible date. Buyer shall cooperate with Seller in providing information for the Transfer Application. 
  
 7.2 PAYMENT OF CHECKS. From and after the Closing Date, Buyer agrees to pay, subject to Seller’s compliance with
Section 8.8 hereof, to the extent of sufficient available funds on deposit, all properly drawn checks, drafts and negotiable orders of withdrawal timely presented to Buyer by mail, over its counters or through clearings if such items are
drawn on the Assumed Liabilities, whether drawn on the check or draft forms provided by Seller, for at least one hundred eighty (180) days following the Closing Date, or on those provided to Buyer. In addition, Buyer shall, in all other respects,
discharge all the duties, liabilities and obligations related to the Assumed Liabilities which occur following Closing. 
  
 7.3 CONSENTS AND NOTICES. Buyer shall (a) obtain prior to the Closing Date all consents, approvals and authorizations required to be obtained by Buyer for
the consummation of the transactions contemplated hereby; and (b) publish all notices required by all governmental authorities and agencies for Buyer’s execution, delivery and performance hereof and Buyer’s consummation of the transactions
contemplated hereby. 
  
 7.4 FURTHER ASSURANCES. On and after the
Closing Date, Buyer shall give such further assistance to Seller and, upon Seller’s request, shall execute, acknowledge and deliver all such instruments and take such further action as may be reasonably necessary and appropriate to effectively
relieve and discharge Seller from any obligations remaining under the Assets, Account Loans and Assumed Liabilities transferred to Buyer and to confirm Buyer’s assumption of the Assumed Liabilities. 
  
 7.5 CONFIDENTIALITY. Unless disclosure to a bank regulatory authority is
necessary in connection with any regulatory approval or unless compelled to disclose by judicial or administrative process or, in the written opinion of Buyer’s counsel, by other requirements of law or the applicable requirements of any
regulatory agency or relevant stock exchange, Buyer shall hold, and shall cause its directors, officers, employees, agents, consultants and advisors to hold, in strict confidence, all records, books, contracts, instruments, computer data, and other
data and information concerning Seller (collectively, “Confidential Information”) furnished to Buyer by Seller or its representatives pursuant to this Agreement (except to the extent that such 

  

 
information can be shown to have been (a) previously known by Buyer on a non-confidential basis, (b) in the public domain through no fault of Buyer, or (c)
later acquired lawfully by Buyer from other sources without a breach of any obligation to maintain such information in confidence) and shall not release or disclose such Confidential Information to any other Person, except Buyer’s auditors,
attorneys, financial advisors, bankers and other consultants and advisors and, to the extent permitted above, to bank regulatory authorities. In the event of termination of the transactions contemplated hereby prior to Closing, Buyer shall return to
Seller all such records, books, contracts, instruments, computer data, and other data or information and all copies thereof in its possession or in the possession of third parties subject to its direction, and shall certify in writing as to the
foregoing. 
  
 7.6 SATISFACTION OF CONDITIONS. Buyer shall use its
best efforts and cooperate with others to expeditiously bring about the satisfaction of conditions specified in Section 10.2 and advise Seller promptly in writing of any matter which would make the representations and warranties set forth in
Article V not true and correct in all material respects at Closing. 
  
 ARTICLE VIII 
  
 COVENANTS OF SELLER 
  
 8.1 ASSISTANCE IN OBTAINING REGULATORY APPROVALS. Seller shall be responsible
for the preparation and filing of any Transfer Application it may be required to file to consummate the transactions contemplated hereby. Seller shall cooperate with Buyer in providing information for Buyer’s applications to the OTS, including
promptly providing Buyer, or the appropriate regulatory authorities, with all information in Seller’s possession required to be submitted by Buyer in connection with such approvals. 
  
 8.2 CONSENTS AND NOTICES. Seller shall (a) secure all consents, approvals and authorizations required to be obtained by
Seller for the consummation of the transactions contemplated hereby, including, but not limited to, all necessary consents, approvals and authorizations to transfer the Realty and Service Contracts to Buyer; (b) comply with all applicable laws,
regulations and rulings in connection with this Agreement and the transactions contemplated hereby; and (c) publish all notices required by all governmental authorities and agencies for Seller’s execution, delivery and performance hereof and
Seller’s consummation of the transactions contemplated hereby. 
  
 8.3 ACCESS TO RECORDS AND INFORMATION; PERSONNEL; CUSTOMERS. 
  
 (a) Between the Signature Date and the Closing Date, Seller shall grant Buyer and its authorized agents and representatives access to the Records during normal business hours. Buyer shall give Seller reasonable notice
for such access, and the date and time of such access shall then be mutually agreed upon by the Parties. Seller shall cause its personnel to provide reasonable assistance to Buyer in Buyer’s investigation of matters relating to the Assets,
Assumed Liabilities and Branches; provided, however, that Buyer’s investigation shall be conducted in a manner which does not unreasonably interfere with Seller’s normal operations, 

  

 
customers and employee relations. Seller shall consent, upon reasonable notice, to discussions between the officers and authorized representatives of Buyer
with parties with which Seller has business relationships so long as such investigation is limited to the Branches. 
  
 (b) Buyer, with Seller’s prior written consent, which consent may not be unreasonably withheld, may, at its own expense, upon
regulatory approval of the transactions contemplated hereby, communicate with, and deliver information, brochures, bulletins, press releases and other communications to, depositors whose Assumed Liabilities or Account Loans are being transferred
concerning such transactions and concerning the business and operations of Buyer. 
  
 8.4 CONDUCT OF BUSINESS PRIOR TO CLOSING. From the Signature Date to the Closing Date, Seller shall not engage in any transaction affecting the Branches or the Assets except in the ordinary course of business; shall
operate and manage the business of the Branches, preserve the present operations of the Branches and preserve Buyer’s present relationships with persons employed at the Branches having business dealings with the Branches, in the ordinary course
consistent with past practices and in accordance with GAAP; shall maintain the Records in the usual, regular and ordinary manner; and shall duly maintain compliance with all laws, regulatory requirements and agreements to which the Branches are
subject or by which Seller is bound. Without limiting the generality of the foregoing, prior to the Closing Date, Seller shall not, without the prior written consent of Buyer: 
  
 (a) fail to maintain the Assets and the Branches in their present state of repair, order and condition,
reasonable wear and tear excepted; 
  
 (b) fail
to maintain the Records in accordance with GAAP; 
  
 (c) fail to comply in all material respects with all applicable laws and regulations related to or affecting the operation of the Branches; 
  
 (d) authorize or enter into any material contract or amend, modify or supplement any material contract related to or affecting the
operation of the Branches; 
  
 (e) perform any
act which could, or omit to perform any act, the omission of which could, cause a breach of any contract, commitment or obligation relating to or affecting the operation of the Branches; 
  
 (f) make any changes in its accounting systems, policies, principles or practices related to or affecting
the operation of the Branches; 
  
 (g) enter into
or renew any data processing service contract related to or affecting the operation of the Branches; 
  
 (h) make any change in any lease related to the Leased Branches; 
  
 (i) cause the Branches to engage or participate in any material transaction or incur or sustain any material
obligation except in the ordinary course of business; 
  

 (j) cause the Branches to transfer, in the ordinary course of business, to Seller’s
other operations or branches any Account Loans, Fixed Assets, Branch Employees, Deposits or Records, except upon the unsolicited request of a customer or, in the case of a Branch Employee transfer, upon an unsolicited request of a Branch Employee;

  
 (k) make any loan or commitment for any loan
for the account of the Branches which will constitute an Asset to be acquired by Buyer, except for loans and commitments which Seller legally is able to make and which are made in the ordinary course of business; 
  
 (l) undertake any actions which are inconsistent with a
program to use all reasonable efforts to maintain good relations with Branch Employees and customers of the Branches; 
  
 (m) encumber, transfer, assign, otherwise dispose of, or enter into any contract, agreement or understanding to encumber, transfer, assign
or otherwise dispose of, any of the Assets except in the ordinary course of business; 
  
 (n) invest in any Fixed Assets or improvements in excess of Ten Thousand Dollars ($10,000) at either of the Branches, except for
commitments made on or before the Signature Date and previously disclosed to Buyer in writing for replacements of furniture, fixtures and equipment and for normal maintenance and refurbishing purchased or made in the ordinary course of business;

  
 (o) increase or agree to increase the salary,
remuneration or compensation of Branch Employees other than in accordance with Seller’s customary policies and past practices and/or any bank-wide changes, or pay or agree to pay any uncommitted bonus to any Branch Employees other than regular
bonuses granted based on historical practice; provided, however, that Seller may, at its option (and without in any way assuming an obligation to do so) (i) make payments to or for Branch Employees in lieu of or as partial compensation for
savings incentives or other employee benefits, and (ii) pay incentive compensation to Branch Employees for purposes of retaining their services or maintaining Deposit levels through the Closing Date. 
  
 (p) amend or modify any of its promotional, Deposit Account
or Account Loan practices with respect to the Branches, other than amendments or modifications in the ordinary course of business or otherwise consistent with the provisions hereof; or 
  
 (q) fail to maintain deposit rates, service charges or service fees at the Branches substantially in accord
with past standards and practices. 
  
 8.5 NO ENCUMBRANCES.
Between the Signature Date and the Closing Date, Seller shall not create or suffer to exist any new Encumbrance on any of the Assets or otherwise enter into any material transaction or make any material commitment related to any of the Assets
without the prior written consent of Buyer, which consent shall not be unreasonably withheld. 
  

 8.6 BOOKS AND RECORDS. Seller shall retain all books and records related to the Branches that, due to the
nature and format thereof, cannot be segregated from records relating to offices other than the Branches, but in connection with Closing, Buyer shall receive possession of, and right, title and interest to and in, all such books and records that can
be segregated from books and records related to offices other than the Branches and are ordinarily maintained at or may be transferred to the Branches. In each case the Records directly related to the Branches, Fixed Assets, Account Loans and
Assumed Liabilities prior to the Closing Date that are retained by one Party shall be open for inspection by the other Party and its authorized agents, representatives and regulators upon reasonable request during regular business hours after the
Closing Date, and the Party with the right of inspection may, at its own expense, make such copies of and excerpts from such Records as it may deem desirable. All Records related to the Branches, Fixed Assets, Account Loans and Assumed Liabilities
prior to the Closing Date shall be maintained for a period of time which is at least the longer of (a) the period required by law, or (b) the normal retention period under Seller’s records management program unless the Parties shall, applicable
law permitting, agree upon a shorter period. In the event one Party’s audit or inspection of Records in the other Party’s possession results in the second Party’s employees or agents having to devote any substantial amount of time or
such Party having to allocate facilities or equipment or incur any substantial costs, then the second Party shall be entitled to reasonable reimbursement for all such costs incurred. 
  
 8.7 INSURANCE POLICIES. Seller shall maintain in effect through and until the Closing Date all current insurance policies
related to the Branches or comparable policies of insurance as reasonably agreed to by Seller and Buyer. 
  
 8.8 FURTHER ASSURANCES. On and after the Closing Date, Seller shall give such further assistance to Buyer and shall execute, acknowledge and deliver all
such instruments and take such further action as may be necessary and appropriate to effectively vest in Buyer full, legal and equitable title to the Assets and shall use its best efforts to assist Buyer in the orderly transfer of the Assets and
Assumed Liabilities; provided, however, that Seller need not incur any material costs or expenses in connection with the undertakings contained in this Section 8.8 unless such costs or expenses are paid by Buyer. In particular, and
without limiting the generality of the foregoing: 
  
 (a) For a period of one hundred eighty (180) calendar days following the Closing Date, Seller shall remit to Buyer, promptly after Seller’s receipt after the Closing Date at any of its other offices, all payments related to Account
Loans or amounts intended for deposit to the accounts which are part of the Assumed Liabilities or otherwise related to the Assumed Liabilities or Related Assets, and after said 180-calendar-day period Seller may return such items marked “Refer
to Maker” with instructions on making payment to Buyer. 
  
 (b) With respect to checks or drafts drawn against accounts which are Assumed Liabilities or Account Loans, Seller shall, for a period of one hundred eighty (180) calendar days following the Closing Date, cooperate
with Buyer and take all reasonable steps requested by Buyer to ensure that, on and after the Closing Date, each such item which is coded for presentment to Seller or to any bank for the account of Seller is delivered to Buyer in a timely manner and
in accordance with applicable law and clearing house rules or agreements. After said 180-calendar-day period Seller may return such items marked “Refer to Maker.” 
  

 (c) Seller and Buyer agree to ensure an orderly transfer of all data tapes and processing
information and to facilitate a systematic conversion of all applicable data regarding ATM cards, Assumed Liabilities and Related Assets. Seller agrees to do the following, all at Seller’s cost: (i) within three (3) Business Days following the
Signature Date, provide the information necessary to complete such conversion processing, the initial data processing pre-conversion file layout on paper, and product definitions; (ii) within three (3) Business Days following the Signature Date,
provide all data necessary to enable Buyer to calculate APY and APYE for the Assumed Liabilities and otherwise comply with Regulation DD, including rate history, back items, no books and interest calculation; (iii) no later than thirty (30) calendar
days prior to the Closing Date, provide the final data processing pre-conversion file packages; (iv) on a day-to-day basis subsequent to the preparation of the final pre-conversion tapes, provide information on any data processing system changes or
additions; (v) as part of the data processing conversion, pay all accrued interest on interest-bearing Deposit Accounts (excluding certificates of deposit), send statements on all Deposit Accounts as required by Regulation DD, and book all savings
account no-book items; and (vi) by 10:00 a.m. Pacific Time one (1) calendar day following the Closing Date, provide two sets of final data processing conversion file packages. Immediately prior to or on the date of conversion of the data processing
information at the Branches, Seller shall (x) deconvert accounts and block any further activity with respect thereto, (y) cycle all accounts, and (z) prepare and send out account statements dated as of the conversion date to all account holders and
provide microfiche, if available, to Buyer. 
  
 (d) Seller shall remove any supply of money orders, association checks, traveler’s checks and Seller’s negotiable items located at the Branches on the Closing Date. 
  
 (e) CLOSE OF BUSINESS ON CLOSING DATE. On the Closing Date, Seller shall close the Branches for business not
later than 3:00 p.m. Pacific Time, whereupon Buyer’s representatives shall have access to the Branches, under the supervision of Seller’s representatives, to verify Seller’s provision to Buyer of the documents, files and records
relating to the Branches, including the Records. Thereafter, Buyer shall continue to have access to such information and materials as set forth in Sections 8.3 and 8.6. 
  
 8.9 CONFIDENTIALITY. Unless disclosure to a bank regulatory authority is necessary in connection with any regulatory
approval or unless compelled to disclose by judicial or administrative process or, in the written opinion of Seller’s counsel, by other requirements of law or the applicable requirements of any regulatory agency or relevant stock exchange,
Seller shall hold, and shall cause its directors, officers, employees, agents, consultants and advisors to hold, in strict confidence, all Confidential Information concerning Buyer furnished to Seller by Buyer or its representatives pursuant to this
Agreement (except to the extent that such information can be shown to have been (a) previously known by Seller on a non-confidential basis, (b) in the public domain through no fault of Seller, or (c) later lawfully acquired by Seller from other
sources without a breach of any obligation to maintain such information in confidence) and shall not release or disclose such Confidential Information to any other Person, except Seller’s auditors, attorneys, financial advisors, bankers and
other consultants and advisors and, to the extent permitted above, to bank regulatory authorities. In the event of termination of the transactions contemplated hereby prior to Closing, Seller shall return to Buyer all such 

  

 
records, books, contracts, instruments, computer data, and other data or information and all copies thereof in its possession or in the possession of third
parties subject to its direction, and shall certify in writing as to the foregoing. 
  
 8.10 WEEKLY REPORTS. Between the Signature Date and Closing, Seller shall provide Buyer with a weekly rate sheet reflecting Seller’s pricing levels for all products, and no products shall be offered at rates in
excess of those set forth on such weekly rate sheets. Notwithstanding the foregoing, Buyer acknowledges and agrees that Seller in its ordinary course of business regularly pays to its best customers negotiated higher rates and may continue to do so
in accordance with its past and customary practices through the Closing Date; provided, however, that between the Signature Date and the Closing Date, Seller (a) shall not offer or extend such higher rates to other than its “best
customers” and (b) shall not increase its rate on any product for any such best customer by more than twenty-five (25) basis points in the aggregate above Seller’s posted rates. 
  
 8.11 MAINTENANCE OF ACCOUNTS. Seller shall use its reasonable best efforts to retain at the Branches the Deposits that are
domiciled at the Branches as of the Signature Date. 
  
 8.12
SUPPLEMENTAL INFORMATION; DISCLOSURE SUPPLEMENTS. From time to time prior to Closing, Seller shall promptly disclose in writing to Buyer any matter hereafter arising which, if existing, occurring or known at the Signature Date would have been
required to be disclosed or which would render inaccurate any of the representations, warranties or statements set forth herein; provided, however, that except as provided in Sections 6.10 and 6.11, Seller shall be obligated to update
schedules or lists provided hereunder no more frequently than the last day of every month following the Signature Date and one Business Day prior to Closing to reflect any matter which, if existing, occurring or known at the Signature Date, would
have been required to be set forth or described in such schedule or list or which is necessary to correct any information in such schedule or list that has been rendered inaccurate thereby. 
  
 8.13 SATISFACTION OF CONDITIONS. Seller shall use its best efforts and
cooperate with others to expeditiously bring about the satisfaction of conditions specified in Section 10.1 and advise Buyer promptly in writing of any matter which would make the representations and warranties set forth in Article V not true
and correct in all material respects at Closing. 
  
 ARTICLE IX

  
 NON-COMPETITION 
  
 9.1 SOLICITATION. Prior to Closing, Seller shall not knowingly solicit any
Deposit customers of the Branches, either directly or indirectly, to reduce or transfer Deposits, close Deposit Accounts or open deposit accounts at other branches of Seller. For a period of three (3) years following the Closing Date, Seller shall
not, directly or indirectly, knowingly solicit deposits by the use of direct mail, telemarketing programs or other similar marketing methods specifically directed at former customers whose Deposits were transferred to Buyer hereunder.
Notwithstanding the preceding sentence, this Section 9.1 shall not limit the right of 

  

 
Seller to solicit customers through a general marketing program (including Internet marketing) not targeted to former Deposit customers of the Branches whose
Deposits were transferred to Buyer hereunder or to solicit customers who are also customers of other operations or branches of Seller. This Section 9.1 shall not prohibit Seller from acquiring accounts of former Deposit customers of the
Branches when such acquisition is part of a purchase from, or a merger with, another financial institution. 
  
 9.2 NON-COMPETITION. On the Closing Date, Seller shall cease all retail banking activity at the Branches, including, but not limited to, deposit gathering
and ATM operations. Seller shall not, for a period of three (3) years following the Closing Date, directly or indirectly, without the prior written consent of Buyer, own, operate or purchase an office of a savings and loan association, commercial
bank, savings bank or depository institution within a ten (10) mile radius of the former location of either of the Branches. Notwithstanding the foregoing, beginning one (1) year following the Closing Date, the limitations contained in this
Section 9.2 shall not apply with respect to the then-existing branch offices of a company that (a) merges with or results from a consolidation with or into Seller; or (b) purchases more than fifty percent (50%) of the assets or liabilities of
Seller or Seller’s Parent Company in the State of California; or (c) from whom Seller or Seller’s Parent Company purchases more than fifty percent (50%) of its assets or liabilities in the State of California. 
  
 9.3 SURVIVAL. This Article IX shall survive Closing. 
  
 ARTICLE X 
  
 CONDITIONS TO CLOSING 
  
 10.1 CONDITIONS TO THE OBLIGATIONS OF BUYER. Unless waived in writing by Buyer, the obligations of Buyer to consummate the transactions contemplated
hereby are subject to the satisfaction at or prior to Closing of the following conditions: 
  
 (a) PERFORMANCE. Each of the covenants, agreements, acts and undertakings of Seller to be performed at or before the Closing Date pursuant
to this Agreement shall have been duly performed in all material respects. 
  
 (b) REPRESENTATIONS AND WARRANTIES. The representations and warranties of Seller contained in Article VI shall be true and complete in all material respects on and as of the Closing Date with the same effect as
though made on and as of the Closing Date. It is understood and agreed that the representations being made on and as the Closing Date shall be made without giving effect to any updates made pursuant to Section 8.12. 
  
 (c) ABSENCE OF PROCEEDINGS AND LITIGATION. No order,
judgment, decree or proceeding shall have been entered and remain in force on the Closing Date restraining or prohibiting any of the transactions contemplated hereby in any legal, administrative or other proceeding. 
  
 (d) REGULATORY APPROVALS. All required licenses, approvals
and consents of any relevant federal, state or other regulatory agency shall have been obtained and all applicable waiting periods shall have expired. 
  

 (e) DOCUMENTS. In addition to the documents described elsewhere in this Section
10.1, Buyer shall have received the following documents from Seller, duly executed: 
  
 (1) A General Bill of Sale and Assignment and Assumption substantially in the form of Exhibit 10.1(e)(1) hereto; 
  
 (2) A certificate of the Secretary or Assistant Secretary of
Seller as to the incumbency and signatures of officers; 
  
 (3) A certificate signed by duly authorized officers of Seller stating that the representations and warranties of Seller under Article VI are true in all material respects as of the Closing Date and that the
respective covenants of Seller to be performed on or before the Closing Date have been performed in all material respects; 
  
 (4) An appointment of Buyer as successor trustee under any IRAs that are included in the Assumed Liabilities; 
  
 (5) Resolutions of Seller’s Board of Directors
authorizing the execution and delivery of this Agreement and the consummation of the transactions contemplated hereby, certified by the Secretary or Assistant Secretary of Seller; 
  
 (6) An opinion from Seller’s general counsel, or such other counsel as Seller has retained, dated as of
the Closing Date, in the form attached hereto as Exhibit 10.1(e)(6). 
  
 (7) A Retirement Account Transfer Agreement, dated as of the Closing Date, in the form attached hereto as Exhibit 10.1(e)(7); 
  
 (8) A final customer list as set forth in Section 13.1 of this Agreement; 
  
 (9) As to each Branch Lease, an executed Assignment and
Assumption Agreement in the form of Exhibit 10.1(e)(9), or such other form agreed upon by Seller and Buyer; 
  
 (10) A Landlord Estoppel Certificate for each Branch Lease in the form attached hereto as Exhibit 10.1(e)(10), or such other form
as the landlord shall reasonably request and which is reasonably acceptable to Buyer; 
  
 (11) A Records Agreement in the form attached hereto as Exhibit 10.1(e)(11), pursuant to which Seller shall provide Buyer access to
certain Records with respect to each Branch; 
  
 (12) Such other instruments and documents as counsel for Buyer may reasonably request as necessary and desirable to consummate the transactions contemplated hereby. 
  

 (f) MATERIAL ADVERSE EFFECT. Between the Signature Date and the Closing Date, there shall
not have occurred any event that has had or reasonably could be expected to have, either individually or in the aggregate, a material adverse effect on the Assets, either of the Branches or the Assumed Liabilities to be acquired hereunder. 

  
 (g) APPROVALS AND CONSENTS. Any and all
approvals or consents of any governmental entity and non-governmental third party which are necessary to consummate the transactions contemplated hereby, including, but not limited to, any and all approvals to transfer the Realty and Service
Contracts to Buyer, shall all have been granted without the imposition of any conditions which Buyer deems, in its reasonable opinion, to materially adversely affect Buyer or to be materially burdensome. 
  
 (h) ASSUMED LIABILITIES. At Closing, the amount of the
Assumed Liabilities at each Branch shall be no less than eighty-five percent (85%) of the Deposits at the respective Branch as of the date hereof. 
  
 10.2 CONDITIONS TO THE OBLIGATIONS OF SELLER. Unless waived in writing by Seller, the obligations of Seller to consummate the transactions contemplated
hereby are subject to the satisfaction at or prior to Closing of the following conditions: 
  
 (a) PERFORMANCE. Each of the covenants, agreements, acts and undertakings of Buyer to be performed at or before the Closing Date pursuant
to this Agreement shall have been duly performed in all material respects. 
  
 (b) REPRESENTATIONS AND WARRANTIES. The representations and warranties of Buyer contained in Article V shall be true and complete in all material respects on and as of the Closing Date with the same effect as
though made on and as of the Closing Date. 
  
 (c) ABSENCE OF PROCEEDINGS AND LITIGATION. No order, judgment, decree or proceeding shall have been entered and remain in force at the Closing Date restraining or prohibiting any of the transactions contemplated hereby in any legal,
administrative or other proceeding. 
  
 (d)
REGULATORY APPROVAL. All required licenses, approvals and consents of any relevant federal, state or other regulatory agency shall have been obtained and all applicable waiting periods shall have expired. 
  
 (e) DOCUMENTS. In addition to the documents described
elsewhere in this Section 10.2, Seller shall have received the following documents from Buyer, duly executed: 
  
 (1) A General Bill of Sale and Assignment and Assumption substantially in the form of Exhibit 10.1(e)(1) hereto; 
  
 (2) An Assumption of Deposit Liabilities substantially in
the form of Exhibit 10.2(e)(2) hereto; 
  

 (3) A certificate of the Secretary or Assistant Secretary of Buyer as to the incumbency
and signatures of officers; 
  
 (4) An opinion
from Buyer’s counsel, dated as of the Closing Date, in the form attached hereto as Exhibit 10.2(e)(4). 
  
 (5) Resolutions of Buyer’s Board of Directors authorizing the execution and delivery of the Agreement and the consummation of the
transactions contemplated hereby, certified by the Secretary or Assistant Secretary of Buyer; 
  
 (6) A certificate signed by duly authorized officers of Buyer stating that the representations and warranties of Buyer under Article
V are true in all material respects as of the Closing Date, and that the respective covenants of Buyer to be performed on or before the Closing Date have been performed in all material respects; 
  
 (7) As to each Branch Lease, an executed Assignment and
Assumption Agreement in the form of Exhibit 10.1(e)(9), or such other form agreed upon by Seller and Buyer; 
  
 (8) The Records Agreement; 
  
 (9) Such other instruments and documents as counsel for Seller may reasonably request as necessary and desirable to consummate the
transactions contemplated hereby. 
  
 (f)
SECURITIZATION. Seller shall have completed the transaction previously disclosed to Buyer regarding the securitization of Seller’s auto loans (“Securitization”). Seller shall complete the Securitization prior to or contemporaneously
with the occurrence of all other conditions set forth in Section 10.1(e). 
  
 ARTICLE XI 
  
 TERMINATION

  
 11.1 CONDITIONS FOR TERMINATION. This Agreement shall
terminate and be of no further force and effect as between the Parties, upon the occurrence of any of the following: 
  
 (a) Upon giving of notice by either Party to the other after the expiration of fifteen (15) calendar days after the refusal or denial by
any governmental agency of any approvals or consents required to be obtained pursuant to this Agreement, unless, within such 15-calendar-day period, the relevant Party resubmits the application or appeals the decision of the governmental entity that
has denied or refused to grant such consent or approval and, in such event, upon giving of notice by either Party to the other after the expiration of five (5) days after the denial or refusal by such governmental agency of such appeal or
resubmitted application; 
  

 (b) Upon giving of notice by either Party to the other after the expiration of ten (10)
Business Days following the date that such Party has given written notice to the other Party of such other Party’s material breach or material misrepresentation of any condition, warranty, representation or covenant in this Agreement;
provided, however, that no such termination shall take effect if within such 10-Business-Day period the Party so notified shall have corrected the grounds for termination in all material respects; 
  
 (c) By Seller if any of the conditions set forth in Section
10.2 shall not have been met, or by Buyer if any of the conditions set forth in Section 10.1 shall not have been met by October 30, 2004, or such earlier time as it becomes apparent such condition shall not be met; provided, however, that
this Agreement shall not be terminated pursuant to this Section 10.1(c) if the relevant conditions shall have failed to occur as a result of any act or omission by the Party seeking to terminate; 
  
 (d) By Buyer, under the conditions specified in Section 3.2;
or 
  
 (e) Upon mutual written consent of the
Parties to terminate. 
  
 Notwithstanding anything to the contrary
contained herein, neither Party shall have the right to terminate this Agreement on account of its own breach or any immaterial breach by the other Party. 
  
 11.2 EFFECT OF TERMINATION. In the event of termination of this Agreement by either Seller or Buyer as provided in Article XI, neither Seller nor Buyer
shall have any further obligation or liability to the other Party except (a) with respect to Sections 7.5, 8.9, 11.2, 11.3, and Article XV, and (b) to the extent such termination results from a Party’s willful and material breach of the
warranties and representations made by it, or willful and material failure in performance of its covenants, agreements or obligations hereunder. 
  
 11.3 EXPENSES. If this Agreement is terminated by Seller pursuant to Section 11.1(b), Buyer shall promptly, and in any event within ten (10)
calendar days after such termination, pay Seller all Expenses of Seller, but not to exceed One Hundred Thousand Dollars ($100,000). If this Agreement is terminated by Buyer pursuant to Section 11.1(b), Seller shall promptly, and in any event
within ten (10) calendar days after such termination, pay Buyer all Expenses of Buyer, but not to exceed One Hundred Thousand Dollars ($100,000). 
  
 Except as otherwise provided herein, all Expenses incurred by Seller or Buyer in connection with or related to the authorization, preparation and
execution of this Agreement, and all matters related to Closing, including, but not limited to, all fees and expenses of agents, representatives, counsel and accountants employed by either Party or its Affiliates, shall be borne solely and entirely
by the Party which has incurred the same. 
  
 11.4 LIQUIDATED
DAMAGES. The failure to consummate the transactions contemplated hereby due to Seller’s inability or failure to close the Securitization shall be considered a material breach by Seller under Section 11.1(c). Seller and Buyer agree that, in such
event, (a) Buyer would suffer substantial material damages; (b) the actual amount of such damages might be difficult to ascertain; (c) Buyer shall therefore be entitled to Liquidated Damages in the amount of Two Hundred Fifty Thousand Dollars
($250,000) in addition to 

  

 
reimbursement by Seller of Buyer’s Expenses; and (d) the amount of the Liquidated Damages is reasonable and should not be considered a penalty under
applicable law. The term “Liquidated Damages,” as used herein, means the amount contractually stipulated as a reasonable estimate of actual damages to be recovered by Buyer as a result of Seller’s material breach under Section
11.1(c). 
  
 ARTICLE XII 
  
 BRANCH EMPLOYEES 
  
 12.1 BRANCH EMPLOYEES. Buyer shall have no obligation to employ any of the Branch Employees. Buyer may offer employment to
certain Branch Employees in Buyer’s sole and absolute discretion. Seller shall pay all Branch Employees their respective earned compensation and accrued vacation time compensation in full through the Closing Date. Nothing herein shall be
construed as an employment contract or agreement enforceable by any Branch Employee, including those Branch Employees to whom Buyer offers employment. 
  
 12.2 EMPLOYEE MATTERS. Seller and Buyer shall follow the procedures outlined below in dealing with Branch Employees regarding employment after the Closing
Date: 
  
 (a) A complete list of all active
Branch Employees is attached hereto as Schedule 12.2. Buyer, in its sole discretion, may interview all Branch Employees, and, if hired by Buyer, such Branch Employees shall be employed subject to the terms and conditions determined by Buyer
in its sole discretion. 
  
 (b) Buyer shall have
the right, but not the obligation, prior to Closing, to provide training to any Branch Employees who will become employees of Buyer after Closing, as set forth in this Section 12.2. Such training shall be at the expense of Buyer and shall be
conducted during normal business hours or, if the foregoing is not possible, after business hours at a location other than the Branches. At the request of Buyer, Seller shall compensate Branch Employees, in accordance with Seller’s customary
policies and practices, for the Branch Employee’s time spent being trained by Buyer. Seller shall cooperate with Buyer to make such Branch Employees available for such training prior to Closing. Training shall not exceed forty (40) hours per
Branch Employee. Training during business hours shall occur only when the Branch is fully staffed and is limited to one Branch Employee per Branch at any given time. All travel and other reimbursable expense incurred by the Branch Employee for
training shall be the responsibility of Buyer. 
  
 (c) Immediately prior to Closing, Seller shall terminate all Branch Employees, and Buyer shall offer employment to such Branch Employees as Buyer has determined, in its sole discretion, to hire. Buyer’s offers of employment shall be on
an “at-will” basis, and Buyer shall have no obligation to continue employment of any Branch Employee and may, at its option, terminate employment at any time. Seller may employ Branch Employees who do not receive an offer of employment
with Buyer at Seller’s other locations. 
  
 (d) Seller agrees to cooperate in and not interfere with Buyer’s consideration of or attempt to hire any Branch Employee. 
  

 30 

 Nothing in this Article 12 is intended, nor shall it be construed, to confer any rights or benefits upon any person other
than Seller and Buyer. 
  
 12.3 EMPLOYEE BENEFITS. 
  
 (a) Subject to any limitation or restriction imposed by
ERISA, as amended, or any insurance or benefit plan of Buyer, each Branch Employee who becomes an Employee of Buyer (“Transferred Employee”) shall retain the initial date of service shown on Seller’s records in order to calculate
tenure for the determination of vacation benefits and eligibility for retirement (but not for determination of retirement benefits); provided however, that vacation days for Transferred Employees shall be prorated as of the Closing Date on
the basis of a 365-day year. 
  
 (b) Buyer shall
not assume, nor shall it have responsibility for the continuation of, any liabilities under or in connection with (i) any employment contract, collective bargaining agreement, plan or arrangement providing for insurance coverage or for deferred
compensation, bonuses, stock options or other forms of incentive compensation, or post termination or post-retirement compensation or benefits, written or implied, which is entered into or maintained, as the case may be, by Seller; or (ii) any
“employee benefit plan,” as defined in Section 3(3) of ERISA, as maintained, administered or contributed to by Seller and covering any Branch Employees. 
  
 (c) Transferred Employees shall be entitled to participate in the benefit plans and arrangements of Buyer
subject to all of the terms and conditions of such plans or arrangements, and Buyer shall, to the extent permissible, waive any waiting period for participation in Buyer’s health insurance plan. 
  
 12.4 EMPLOYEE DOCUMENTS. Within fifteen (15) Business Days following the
Signature Date, Seller shall deliver to Buyer copies of its corporate benefit information. Seller shall give Buyer access to Branch Employees and, upon receipt of a written consent and release from a Branch Employee, shall have the opportunity to
review such Branch Employee’s personnel files during normal business hours, including, but not limited to, copies of each written employment agreement and a written description of the oral terms of employment agreements for such Branch
Employee, if any. Upon receipt of a written consent and release from a Branch Employee, Buyer shall have the right to review all of such Branch Employee’s personnel file. 
  
 12.5 COMPLIANCE WITH COBRA. Notwithstanding anything herein to the contrary, to the extent required by the Consolidated
Omnibus Budget Reconciliation Act of 1985, as amended (“COBRA”) or applicable state law, any Branch Employee terminated by Seller as a result of the transactions contemplated hereby shall be entitled to continued coverage which shall be
administered by Seller, and the required notices concerning such coverage shall be provided by Seller. 
  

 ARTICLE XIII 
  
 TRANSITION OF DEPOSIT PROCESSING 
  
 13.1 NOTICES TO DEPOSITORS. Seller shall provide Buyer, as soon as practicable, with a customer list regarding the accounts to be assumed by Buyer as
contemplated hereby, together with data tapes. On the Closing Date, Seller shall provide Buyer a final customer list of the Assumed Liabilities. At the time Seller provides to Buyer the customer lists pursuant to this Section 13.1, Seller
shall notify Buyer of any customer addresses which Seller is aware are invalid. Within fourteen (14) Business Days following the Signature Date, Seller and Buyer shall notify the holders of the Assumed Liabilities’ accounts that, subject to
Closing requirements, Buyer will assume liability for the Assumed Liabilities. Each Party shall obtain the approval of the other on its notification letter, and each Party shall be solely responsible for any costs or expenses incurred in performing
the actions required by this Section 13.1. 
  
 13.2 PAYMENT
OF INSTRUMENTS. From and after Closing, Buyer shall pay, in accordance with applicable law, all checks, drafts and withdrawal orders that are properly drawn by depositors with respect to the Assumed Liabilities, to the extent such documents are
properly endorsed and otherwise properly payable, and in light of credit balances and overdraft privileges, if any, applicable to such depositors, whether such documents are presented to Buyer by mail, over its counters or through the check-clearing
system, and in all other respects shall discharge the duties and obligations of Seller with respect to the balances due and owing to the depositors with respect to the Assumed Liabilities. 
  
 13.3 FOREIGN CHECKS, SAVINGS BONDS OR COUPONS. Seller shall notify Buyer of
any information received regarding the settlement and clearance of any foreign checks, savings bonds or coupons deposited with Seller prior to the Closing Date. 
  

13.4 HOLDS AND STOP PAYMENTS. Seller shall deliver to Buyer at Closing a schedule of holds, stop-payment orders and post-dated check orders placed on
Assumed Liabilities accounts and the terms of such holds. Buyer shall continue such holds and stop-payment orders under the same terms reflected on the schedule of holds and stop-payment orders. 
  
 13.5 INCOMING DEPOSITS AND MAIL. In the event Seller receives, after the
Closing Date, a deposit, legal process or mail with respect to the Assumed Liabilities, Seller shall, at Buyer’s expense, mail such deposit, payment, legal process or other mail to Buyer within five (5) Business Days after receipt thereof at
the address Buyer may from time to time designate pursuant to the notice provisions herein. 
  
 13.6 RETURNED ITEMS. Any items credited prior to Closing for deposit to, or cashed against, an Assumed Liability which are returned unpaid at any time after Closing (“Returned Items”) shall be handled as
follows within ninety (90) calendar days following Closing: 
  
 (a) If Buyer’s bank account is charged for the Returned Item, Buyer shall use its reasonable efforts to obtain reimbursement from the account to which, or from the 

  

 
party to whom, the item was credited; provided, that if Seller receives notification of a large Returned Item ($2,500 or more) before 2:00 p.m. Pacific Time
on any Business Day, Seller shall notify Buyer of such Returned Item as soon as practicable on the same day notification is received. If there are sufficient funds in the account to which such Returned Item was credited or any other accounts on
deposit with Buyer standing in the name of the party liable for such Returned Item, upon proper identification of such party, Buyer shall debit any or all of such accounts an amount equal in the aggregate to the Returned Item, provided that such
debit is permissible under Buyer’s agreement with such party and applicable laws and regulations. If those accounts which may be debited do not contain funds sufficient to reimburse Buyer fully (for reasons other than Buyer’s breach of the
above conditions), Seller shall, upon notice from Buyer, reimburse Buyer to the extent sufficient funds are available and immediately repay to Buyer the balance of the Returned Item not reimbursed and Buyer shall assign the Returned Item to Seller
for collection. 
  
 (b) If Seller’s bank
account is charged for the Returned Item, Seller shall notify Buyer as soon as practicable. If there are sufficient funds in the account to which such Returned Item was credited or any other accounts on deposit with Buyer standing in the name of the
party liable for such Returned Item, upon proper identification of such party, Buyer shall debit any or all of such accounts an amount equal in the aggregate to the Returned Item and shall repay that amount to Seller. If there are not sufficient
funds in the accounts which may be debited (for reasons other than Buyer’s breach of the above conditions), Buyer shall have no obligation to repay Seller unless and until Buyer obtains reimbursement from the party liable for the Returned Item.

  
 13.7 FORGERIES, ALTERATIONS, CHECK KITES AND OTHER
UNAUTHORIZED TRANSACTIONS. Prior to the Closing Date, Seller shall be responsible for all forgeries, alterations, check kites and other unauthorized transactions and the losses resulting therefrom, to the extent the illegal part of the transactions
occurred or began prior to the Closing Date. 
  
 13.8 SETTLEMENT.
In settlement of the transactions described in Sections 13.2 -13.8, Seller and Buyer agree that by 12:00 p.m. Pacific Time on each Business Day, Seller shall provide Buyer with a daily net settlement figure for all such transactions then
pending to the knowledge of Seller or Buyer. The Parties agree that the Party obligated to remit any funds thereunder shall do so by 3:00 p.m. Pacific Time of such day. Any such settlement shall be provisional pending receipt by Buyer of the
physical items relating to such settlement, and Buyer shall adjust the next daily settlement to reflect any adjustments resulting from its receipt of the physical items. 
  
 13.9 ACH ITEMS AND WIRE TRANSFERS. Seller and Buyer shall use commercially reasonable efforts to transfer all ACH
arrangements to Buyer as soon as practicable after the Closing Date. Buyer shall continue such ACH arrangements and such recurring debit and credit arrangements. After the Closing Date, Seller shall use commercially reasonable efforts to (a)
telecopy or deliver to Buyer on each Business Day after receipt, at the address designated by Buyer, a summary of ACH Items affecting the Assumed Liabilities (such summary to include claim number, suffix (if applicable), source name, trace ID,
client name and effective date), and (b) remit by wire transfer to Buyer all ACH Item funds that are intended for 

  

 
Assumed Liabilities; provided, however, that Seller’s obligation to deliver such summaries and to forward such ACH Items shall continue for not
more than one hundred eighty (180) days after the Closing Date. ACH transfers which have not been rerouted directly to Buyer after said 180-day period shall be handled as follows: (i) Buyer shall notify ACH users that they must contact the ACH
originator and complete the transfer, and (ii) Seller shall return the ACH transaction to the originator, marked “Account sold to another DFI.” For a period of thirty (30) days following Closing, Seller shall, upon receipt thereof, notify
Buyer of incoming wire transfers to account(s) of Assumed Liabilities and shall use commercially reasonable efforts to wire to Buyer on the same day or the following day the funds of such incoming wire transfer for the account(s) of such Assumed
Liabilities. 
  
 13.10 CHECKING ACCOUNTS. On a daily basis,
Seller, at Buyer’s expense, shall outsort all checks received by it drawn on accounts assumed by Buyer and prepare such checks for delivery to Buyer’s service center within one (1) Business Day. Buyer shall either pay the items or return
them in accordance with the customer agreement, the California Uniform Commercial Code and all applicable federal laws and regulations. Seller’s obligation to outsort and deliver such checks shall continue for one hundred eighty (180) days
following the Closing Date. After said 180-day period, Seller shall stop accepting such items and shall return such items marked “Refer to Maker.” 
  
 Seller shall furnish to Buyer a daily accounting of debits to its clearing account. On a daily basis, Seller and Buyer shall agree on the settlement
amounts of inclearing items transferred by Seller to Buyer. Buyer shall remit the settlement amount to Seller on the next Business Day by immediately available funds. 
  
 13.11 HOLDS. Holds that have been placed by Seller on particular accounts or on individual checks, drafts or other
instruments shall be continued by Buyer under the same terms. Seller shall deliver to Buyer at Closing a schedule of such holds which describes the terms thereof. 
  
 13.12 CARD PROCESSING. Prior to Closing, Seller shall provide Buyer with the necessary data and tapes required to
accommodate the processing of ATM and debit cards, which may then be issued prior to Closing. Furthermore, the Parties agree to settle on a daily basis all transactions occurring during the conversion period. 
  
 13.13 REGULATION E CLAIMS. Any claim submitted under Federal Reserve
Regulation E for transactions processed prior to the Closing Date shall be settled as follows: 
  
 (a) If such claim is submitted to Seller, Seller shall process the claim under the guidelines specified in “Regulation E,” and
if a reimbursement to the customer is determined necessary, Seller shall directly reimburse the customer. 
  
 (b) If the claim is submitted to Buyer, Buyer shall process the claim under the guidelines specified in “Regulation E,” and if a
reimbursement to the customer is determined necessary, Buyer shall directly reimburse the customer and notify Seller of such reimbursement. Seller shall remit by wire transfer within twenty-four (24) hours of notice an amount equal to the
reimbursement paid by Buyer to the customer. 
  

 (c) Such settlement shall continue for ninety (90) calendar days following the Closing
Date. All claims submitted after such 90-day period shall be returned by Seller to the originator of the claim. 
  
 13.14 GOVERNMENT BENEFIT PAYMENT RECLAMATION ITEMS. Any government benefit payment reclamation item notification received for a social security deposit
that was received prior to the Closing Date shall be sent by Seller to Buyer. If funds are available, Buyer shall forward such funds to satisfy said claim within twenty-four (24) hours following receipt. If Buyer determines that the funds are not
available, Buyer shall use its best efforts to recover the funds. Any liability for additional reclamation relative to items referenced in this Section 13.14 shall be the responsibility of Seller except to the extent Buyer is aware of the
death of a customer. 
  
 13.15 DATA PROCESSING CONVERSION. The
Parties shall take commercially reasonable steps to facilitate the orderly transfer of all data tapes and processing information and shall facilitate an electronic and systematic conversion of all applicable data regarding Account Loans, ATM and
debit cards and Assumed Liabilities, and each Party will bear the cost associated with the transfer of its tapes and information and the conversion of its data except as otherwise agreed upon. Seller shall pay all accrued interest on
interest-bearing accounts (excluding certificates of deposit) which are Assumed Liabilities, send statements on all accounts as required by Regulation DD, and by 10:00 a.m. Pacific Time one (1) calendar day following the Closing Date, provide two
sets of final data conversion file tapes. Immediately prior to or at the date of conversion of the data processing information at the Branches, Seller shall deconvert accounts and block any further activity with respect thereto. 
  
 13.16 INTEREST REPORTING. Seller shall report for the current calendar year
through and including the Closing Date all interest credited to, interest premiums paid to, interest withheld from and early withdrawal penalties charged to the Assumed Liabilities. Buyer shall report from, but not including the Closing Date,
through the end of the calendar year all interest credited to, interest withheld from, and early withdrawal penalties charged to the Assumed Liabilities. Said reports shall be made to the holders of these accounts and to the applicable federal and
state regulatory agencies. 
  
 13.17 WITHHOLDING. Seller shall
deliver to Buyer on or before the Closing Date data indicating all “B” notices (TINs do not match) and “C” notices (under reporting/IRS imposed withholding) issued by the IRS related to the Assumed Liabilities. Any and all
listings of similar notices regarding the Assumed Liabilities received by Seller from the IRS shall be promptly delivered to Buyer. All notices received by Seller from the IRS releasing withholding restrictions on the Assumed Liabilities shall be
promptly delivered to Buyer. Any amounts required by any governmental agency to be withheld from any of the Assumed Liabilities (“Withholding Obligations”) or any penalties imposed by any governmental agency shall be handled as follows:

  
 (a) Any Withholding Obligations required to
be remitted to the appropriate governmental agency on or prior to the Closing Date shall be withheld and remitted by Seller and any other sums withheld by Seller pursuant to Withholding Obligations on or prior 

  

 
to the Closing Date shall also be remitted by Seller to the appropriate governmental agency on or prior to the time they are due. 
  
 (b) Any Withholding Obligations required to be remitted to
the appropriate governmental agency after the Closing Date with respect to Withholding Obligations after the Closing Date and not withheld by Seller as set forth in Section 13.17(a) above shall be withheld and remitted by Buyer. Within two
(2) Business Days following receipt of such notice, Seller shall notify Buyer and Buyer shall comply with notification requirements. 
  
 (c) Any penalties described on “B” notices from the IRS or any similar penalties which relate to Assumed Liabilities opened by
Seller prior to the Closing Date shall be paid by Seller promptly upon receipt of the notice providing such penalty assessment resulted from Seller’s acts, policies or omissions; provided, however, that Buyer shall use commercially
reasonable efforts to reduce such penalties. 
  
 (d) Any penalties assessed due to information missing from information filings regarding the Assumed Liabilities, including, but not limited to, 1099 forms, shall be paid by Seller promptly upon receipt of the notice providing such penalty
assessment resulting from Seller’s acts, policies or omissions, but Seller shall be entitled to negotiate such penalties with the IRS. 
  
 13.18 TAXPAYER INFORMATION. Seller shall deliver to Buyer within three (3) Business Days following the Closing Date (a) TINs (or record of appropriate
exemption) for all holders of the Assumed Liabilities, and (b) all other information in Seller’s possession or reasonably available to Seller required by applicable law to be provided to the IRS and/or account holders with respect to the
Assumed Liabilities and Account Loans, except for such information which Seller is obligated to report pursuant to Sections 13.16 and 13.17 (collectively, “Taxpayer Information”). 
  
 13.19 SELLER’S COOPERATION. From and after Closing, Seller shall
cooperate with Buyer and shall provide reasonable assistance in responding to inquiries and requests of customers related to the Assumed Liabilities and Assets to the extent such inquiries and requests relate to facts and circumstances that occurred
prior to Closing. 
  
 ARTICLE XIV 
  
 JOINDER AND ASSUMPTION 
  
 Seller’s Parent Company acknowledges and agrees that, due to the
uncertainty concerning the continued existence of Seller after Closing, Buyer would not enter into this Agreement; therefore, as a material inducement and specific consideration to Buyer to enter into this Agreement and consummate the transactions
contemplated hereby, Seller’s Parent Company, by its execution hereof, specifically undertakes with Seller the representations, warranties, covenants, agreements, obligations and indemnifications of Seller and agrees to perform any and all such
undertakings after Closing. Seller’s Parent Company covenants that all corporate actions necessary to authorize this undertaking on its part have been obtained and a certificate of resolution to this effect shall be delivered to Buyer at or
prior to Closing. 
  

 ARTICLE XV 
  
 GENERAL PROVISIONS 
  
 15.1 SURVIVAL. The respective representations and warranties made by the Parties and their respective covenants and obligations to be performed under the
terms hereof prior to, at or after Closing shall survive Closing, notwithstanding any investigation of the facts constituting the basis of the representations and warranties of either Party by the other Party. 
  
 15.2 INDEMNIFICATION. 
  
 (a) Seller shall indemnify, hold harmless and defend Buyer
(and its Affiliates, successors, directors, officers and employees) from and against any and all damage, loss, liability, cost, suit, proceeding, claim or expense (including reasonable legal fees and expenses) incurred or suffered by Buyer (or its
Affiliates, successors, directors, officers and employees) in connection with: 
  

	 	(i)	any misrepresentation or breach of any warranty, covenant or agreement made or to be performed by Seller pursuant to this Agreement and the transactions contemplated hereby;

  

	 	(ii)	all liabilities and obligations incurred by Buyer which Buyer did not expressly assume hereunder; 

  

	 	(iii)	any claim against Buyer arising out of any act or omission of Seller prior to Closing in connection with any of the Deposits, Assets, Service Contracts or the operation of the
Branches; and 

  

	 	(iv)	any employee benefits described in Section 12.3(b) arising on or prior to the Closing Date. 

  
 (b) Buyer shall indemnify, hold harmless and defend Seller (and its Affiliates, successors, directors,
officers and employees) from and against any and all damage, loss, liability, cost, suit, proceeding, claim or expense (including reasonable legal fees and expenses) incurred or suffered by Seller (or its Affiliates, successors, directors, officers
and employees) in connection with: 
  

	 	(i)	any misrepresentation or breach of any warranty, covenant or agreement made or to be performed by Buyer pursuant to this Agreement and the transactions contemplated hereby;

  

	 	(ii)	any claim against Seller arising out of any act or omission of Buyer after Closing with respect to any of the Assumed Liabilities, Assets, operation of the Branches, or the Service
Contracts assumed by Buyer hereunder; and 

  

	 	(iii)	all liabilities and obligations arising after the Closing Date and expressly assumed by Buyer hereunder including, but not limited to, liabilities and obligations related to any and
all Transferred Employees. 

  
 (c)
A Party seeking indemnification pursuant to this Section 15.2 (“Indemnified Party”) shall give prompt notice to the Party from whom such indemnification is sought (“Indemnifying Party”) of the assertion of any claim, or
the commencement of any action or proceeding, with respect to which indemnity may be sought hereunder. The Indemnified Party shall assist the Indemnifying Party in the defense of any such action or proceeding. The Indemnifying Party shall have the
right to, and shall at the request of the Indemnified Party, assume the defense of any such action or proceeding at its own expense. In any such action or proceeding, the Indemnified Party shall have the right to retain its own counsel, but the fees
and expenses of such counsel shall be at its own expense unless: 
  

	 	(i)	the Indemnifying Party and the Indemnified Party shall have mutually agreed to the retention of such counsel; or 

  

	 	(ii)	the named parties to any such suit, action or proceeding (including any impleaded parties) include both the Indemnifying Party and the Indemnified Party and, in the reasonable
judgment of the Indemnified Party, representation of both Parties by the same counsel would be inappropriate due to actual or potential differing interests between them. 

  
 (d) An Indemnifying Party shall not be liable under this Section 15.2 for any settlement effected
without its consent of any claim, litigation or proceeding with respect to which indemnity may be sought hereunder. The Indemnifying Party may settle any claim without the consent of the Indemnified Party, but only if the sole relief awarded is
monetary damages that are paid in full by the Indemnifying Party. An Indemnified Party shall, subject to its reasonable business needs, use reasonable efforts to minimize the indemnification sought from the Indemnifying Party hereunder.
Notwithstanding the foregoing, no investigation by an Indemnified Party at or prior to Closing shall relieve an Indemnifying Party of any liability hereunder, unless the Indemnified Party seeks indemnity with respect to a representation or warranty
which it knew or should have known based on information in its possession prior to Closing and the Indemnified Party intentionally failed to bring such belief to the attention of the Indemnifying Party prior to Closing. 
  
 15.3 INDEMNIFICATION NON-EXCLUSIVE. The foregoing indemnification provisions
are in addition to, and not in derogation of, any statutory, equitable or common-law remedy either Party may have for breach of representation, warranty, covenant or agreement or any other cause of action under this Agreement. 
  
 15.4 INDEMNIFICATION IN CASE OF STRICT LIABILITY OR INDEMNITEE NEGLIGENCE.
The indemnification provisions of this Article XV shall be 

  

 
enforceable regardless of whether the liability is based upon past, present or future acts, claims or legal requirements. 
  
 15.5 BROKER’S FEES. With the exception of Sandler O’Neill &
Partners, L.P., whose fees are being paid by Seller, each of the Parties represents and warrants to the other that it has dealt with no broker or finder in connection with any of the transactions contemplated hereby and that no action has been taken
that would give rise to any valid claim for brokerage commission, finder’s fee or other like commission. Seller and Buyer each undertake to indemnify and hold each other harmless against any loss, liability, damage, cost, claim or expense
incurred by reason of any brokerage commission or finder’s fee alleged to be payable because of any act, omission or statement of the Indemnifying Party. 
  

15.6 PUBLICITY AND NOTICES. Neither Party shall issue a press release announcing this Agreement or the transactions contemplated hereby to the public
or make any public announcements of this Agreement or the transactions contemplated hereby without consulting with and obtaining approval of the other Party, which approval shall not be unreasonably withheld. 
  
 15.7 ATTORNEYS’ FEES. Each Party shall bear the cost of its own
attorneys’ fees incurred in connection with the preparation of this Agreement and consummation of the transactions contemplated hereby. 
  
 15.8 SALES AND TRANSFER TAXES. All excise, sales, use, transfer, documentary transfer taxes and recording taxes and any other taxes or assessments which
are payable or arise as a result of this Agreement or the assumption of the Assumed Liabilities or acquisition of the Assets (not including the Account Loans, which are addressed in Section 2.4) as contemplated hereby (except income taxes determined
by reference to the income of one of the Parties) shall be paid by Buyer to Seller upon Buyer’s receipt of satisfactory evidence that Seller has paid such taxes or is legally obligated to pay such taxes. Seller shall report such tax on
Seller’s sales tax return. This Section 15.8 shall survive Closing. 
  
 15.9 NOTICES. All notices, requests, demands and other communication given or required to be given under this Agreement shall be in writing, duly addressed to the Parties as follows: 
  

			
	 To Seller:
	  	 Pan American Bank, FSB
 1801 El Camino Real

Burlingame, California 94010
 Attn: Ray Thousand

		
	 With a copy to:
	  	 Manatt, Phelps & Phillips, LLP
 695 Town Center
Drive
 14th
Floor
 Costa Mesa, California 92626
 Attn: John
Grosvenor

  

			
	 To Seller’s Parent Company:
	  	 United PanAm Financial Corp.
 3990 Westerly Place,
Suite 200
 Newport Beach, California 92660
 Attn: Ray
Thousand

		
	 To Buyer:
	  	 Guaranty Bank
 8333 Douglas Avenue
 Dallas, Texas 75225
 Attn: Ronald D. Murff

		
	 With a copy to:
	  	 Guaranty Bank
 1300 South Mopac Expressway

Austin, Texas 78746
 Attn: J. Bradley Johnston, Esq.

		
	 With a copy to:
	  	 Wm. E. Livingstone, III, Esq.
 8333 Douglas Avenue,
Suite 990
 Dallas, Texas 75225

  
 Any such notice sent
by registered or certified mail, return receipt requested, shall be deemed to have been duly given and received seventy-two (72) hours after the same is addressed and mailed with postage prepaid. Notice sent by any other manner shall be effective
only upon actual receipt thereof. Either Party may change the address for receipt of Notices at any time upon delivering Notice of such change to the other Party in accordance with this Section 15.9, but such Notice shall be effective only
upon actual receipt. This Section 15.9 shall survive Closing. 
  
 15.10 ARM’S-LENGTH TRANSACTION. This Agreement has been negotiated at arm’s length and between persons sophisticated and knowledgeable in the matters contemplated hereby. In addition, each Party has been represented by experienced
and knowledgeable legal counsel. Accordingly, any rule of law (including California Civil Code Section 1654) or legal decision that would require interpretation of any ambiguities in this Agreement against the Party that has drafted it is not
applicable and is waived. 
  
 15.11 SUCCESSORS AND ASSIGNS. All of
the terms and provisions of this Agreement shall be binding upon and inure to the benefit of the Parties and their respective transferees, successors and assigns, but this Agreement may not be assigned by either Party without the prior written
consent of the other, and any attempted assignment by a Party without the other Party’s consent shall be null and void; provided, however, that the foregoing shall not prohibit or require the consent of the other Party for an assignment
by a Party in connection with a merger or consolidation of such Party with, or the sale of a substantial portion of such Party’s assets with, another federally insured depository institution. 
  
 15.12 THIRD-PARTY BENEFICIARIES. Each Party intends that this Agreement shall
not benefit or create any right or cause of action in or on behalf of any Person other than the Parties. 
  
 15.13 GOVERNING LAW; VENUE. This Agreement 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 the laws of such state. The Parties expressly submit to the exclusive jurisdiction and venue of the Superior Court of the County of Los
Angeles or the United States District Court for the Central District of California (the “California Courts”). Any action, suit or proceeding arising out of or related to this Agreement or any agreement or instrument delivered pursuant
hereto, the subject matter thereof or the transactions contemplated hereby shall be brought in the California Courts, and in such event the Parties irrevocably waive, for themselves and their respective successors and assigns, all rights they may
have to bring or have tried elsewhere any such action, suit or proceeding. This Section 15.13 shall survive Closing. 
  
 15.14 ENTIRE AGREEMENT. This Agreement, including all schedules and exhibits, contains all the agreements of the Parties with respect to the matters
contemplated hereby, and no prior or contemporaneous agreement or understanding, oral or written, pertaining to any such matters shall be effective for any purpose. No provision of this Agreement may be amended or added to except by an agreement in
writing signed by the Parties or their respective successors in interest and expressly stating that it is an amendment hereof. 
  
 15.15 HEADINGS. The headings of this Agreement are for purposes of reference only and shall not limit or define the meaning of the provisions hereof.

  
 15.16 SEVERABILITY. If any provision of this Agreement shall
become illegal, null or void or against public policy for any reason, or shall be held by any court of competent jurisdiction to be illegal, null or void or against public policy, the remaining provisions hereof shall not be affected thereby.

  
 15.17 WAIVER. The waiver of any breach of any provision under
this Agreement by either Party shall not be deemed to be a waiver of any preceding or subsequent breach hereunder. 
  
 15.18 NUMBER(S). Whenever the context of this Agreement so requires, the singular includes the plural, the plural includes the singular and the whole
includes any part thereof. 
  
 15.19 TIME. All references to hours
of the day in this Agreement shall be references to Pacific Time. 
  
 15.20 TIME IS OF THE ESSENCE. TIME IS OF THE ESSENCE WITH RESPECT TO EACH AND EVERY PROVISION OF THIS AGREEMENT. 
  
 15.21 FORCE MAJEURE. Seller and Buyer agree that, notwithstanding anything to the contrary contained herein, in the event this Agreement is terminated as
a result of failure of a condition, which failure is due to a natural disaster or other act of God, or an act of war or terrorism, and provided neither Party has materially failed to observe the obligations of such Party hereunder, neither Party
shall be obligated to pay to the other Party any Expenses or otherwise be liable hereunder. 
  
 15.22 KNOWLEDGE. Whenever any statement contained in this Agreement or in any list, certificate or other document delivered to either Party pursuant hereto is made “to the knowledge” of either Party, such
Party shall make such statement only after conducting an 

  

 
investigation reasonable under the circumstances of the subject matter thereof, and each statement shall constitute a representation that such investigation
has been conducted. 
  
 15.23 COUNTERPARTS. This Agreement may be
executed in any number of counterparts, each of which shall be an original but all of which shall constitute one and the same instrument. 
  
 IN WITNESS WHEREOF, the Parties have duly authorized and executed this Agreement as of the date first above written. 
  

			
	 PAN AMERICAN BANK, FSB

		
	 By:
	 	 /s/ Ray Thousand

	 Name:
	 	 Ray Thousand

	 Title:
	 	 President and Chief Executive Officer

	
	 UNITED PANAM FINANCIAL CORP.

		
	 By:
	 	 /s/ Ray Thousand

	 Name:
	 	 Ray Thousand

	 Title:
	 	 President and Chief Executive Officer

  

			
	 GUARANTY BANK

		
	 By:
	 	 /s/ Ronald D. Murff

	 Name:
	 	 Ronald D. Murff

	 Title:
	 	 President-Retail BankAgreement to Assume Liabilities

  
 EXHIBIT 10.124

  
 AGREEMENT TO ASSUME LIABILITIES 
  
 AND TO ACQUIRE ASSETS 
  
 OF BRANCH BANKING OFFICE 
  
 By and Among 
  
 KAISER FEDERAL BANK 
  
 and 
  
 PAN AMERICAN BANK, FSB 
  
 and 
  
 UNITED PANAM FINANCIAL CORP. 
  
 July 2, 2004 
  

  
 INDEX 
  

					
	 Article

	  	 	  	Page

		
	 KAISER FEDERAL BANK
	  	1
	 ARTICLE I. Definitions
	  	1
	 1.1.
	  	 Account
	  	1
	 1.2.
	  	 Account Related Loans
	  	1
	 1.3.
	  	 Agreement
	  	2
	 1.4.
	  	 Assets
	  	2
	 1.5.
	  	 Branch Financial Statements
	  	2
	 1.6.
	  	 Branch
	  	2
	 1.7.
	  	 Cash
	  	2
	 1.8.
	  	 Claim
	  	2
	 1.9.
	  	 Closing Date and Closing
	  	2
	 1.10.
	  	 Deposits
	  	2
	 1.11.
	  	 Deposit Premium
	  	2
	 1.12.
	  	 Deposit Transfer
	  	2
	 1.13.
	  	 Governmental Body
	  	2
	 1.14.
	  	 Hazardous Substances
	  	2
	 1.15.
	  	 Independent Accountants
	  	2
	 1.16.
	  	 Independent Determination
	  	3
	 1.17.
	  	 Initial Determination
	  	3
	 1.18.
	  	 Knowledge
	  	3
	 1.19.
	  	 Leased Premises
	  	3
	 1.20.
	  	 Liabilities
	  	3
	 1.21.
	  	 Postponed Closing Date
	  	3
	 1.22.
	  	 OTS
	  	3
	 1.23.
	  	 Retained Assets
	  	3
	 1.24.  
	  	 Retained Liabilities
	  	3
	 ARTICLE II. Assumption of Liabilities and Acquisition of Assets
	  	3
	 2.1.
	  	 Assumption of Deposits, and Interest
	  	3
	 2.2.
	  	 Assumption of Obligations
	  	3
	 2.3.
	  	 Retained Liabilities
	  	4
	 2.4.
	  	 Transfer of Assets
	  	4
	 2.5.
	  	 Retained Assets
	  	5
	 2.6.
	  	 Costs of Conversion
	  	6
	 2.7.
	  	 Conversion Procedures
	  	6
	 ARTICLE III. Deposit Transfer; Assumption Price; Independent Accounting
	  	10
	 3.1.
	  	 Determination of Deposit Transfer and Deposit Premium
	  	10
	 3.2.
	  	 Independent Accounting
	  	11
	 ARTICLE IV. Representations, Warranties, and Covenants
	  	12
	 4.1.
	  	 Representations, Warranties and Covenants of the Company and the Seller
	  	12
	 4.2.
	  	 Representations. Warranties and Covenants of the Buyer
	  	17

  

 - i - 

					
	 ARTICLE V. Obligations of Both Parties
	  	18
	 5.1.
	  	 Obligations of Both Parties
	  	18
	 5.2.
	  	 Obligations of the Seller
	  	19
	 5.3.
	  	 Obligations of the Buyer
	  	22
	 ARTICLE VI. Conditions Precedent to Closing
	  	23
	 6.1.
	  	 Conditions Precedent to Performance by Both Parties
	  	23
	 6.2.
	  	 Conditions Precedent to the Buyer’s Performance
	  	24
	 6.3.
	  	 Conditions Precedent to the Seller’s Performance
	  	24
	 ARTICLE VII. Closing
	  	25
	 7.1.
	  	 Closing
	  	25
	 7.2.
	  	 Seller’s Obligations at the Closing
	  	25
	 7.3.
	  	 Buyer’s Obligations at the Closing
	  	26
	 ARTICLE VIII. Obligations of the Parties After the Closing
	  	26
	 8.1.
	  	 Confidentiality
	  	26
	 8.2.
	  	 Notification of Account Debtors and Creditors
	  	26
	 8.3.
	  	 Right to Hire Employees of the Branch; Non-solicitation of Employees by Seller
	  	27
	 8.4.
	  	 Non-solicitation of Branch Customers by Seller
	  	27
	 8.5.
	  	 Buyer’s Obligations
	  	27
	 8.6.
	  	 Transit Items
	  	27
	 8.7.
	  	 Further Documents
	  	28
	 8.8.
	  	 Prorations; Sales and Use Taxes; Insurance
	  	28
	 8.9.
	  	 Obligations of the Company
	  	29
	 ARTICLE IX. Remedies
	  	29
	 9.1.
	  	 Termination
	  	29
	 9.2.
	  	 Litigation Costs
	  	29
	 9.3.
	  	 Liquidated Damages
	  	30
	 ARTICLE X. Miscellaneous Provisions
	  	30
	 10.1.
	  	 Notices
	  	31
	 10.2.
	  	 Entire Agreement
	  	31
	 10.3.
	  	 Third Party Rights
	  	32
	 10.4.
	  	 Successors and Assigns
	  	32
	 10.5.
	  	 Brokers
	  	32
	 10.6.
	  	 Survival of Warranties and Obligations
	  	33
	 10.7.
	  	 Severability
	  	33
	 10.8.
	  	 Expenses
	  	33
	 10.9.
	  	 Counterparts
	  	33
	 10.10.
	  	 Headings and Construction
	  	33
	 10.11.
	  	 Governing Law
	  	33
	 10.12.
	  	 Indemnification
	  	33
	 10.13.
	  	 Damage or Destruction
	  	34
	 10.14.
	  	 No Consequential Damages
	  	35
	 10.15.  
	  	 Publicity
	  	35

  

 - ii - 

 LIST OF EXHIBITS AND SCHEDULES 
  

					
	 Exhibit A
	 	 -
	 	 Branch Financial Statements

	 Exhibit B
	 	 -
	 	 Contracts, Commitments, and Agreements

	 Exhibit C
	 	 -
	 	 Furniture, Fixtures and Equipment

	 Exhibit D
	 	 -
	 	 Licenses and Permits

	 Exhibit E
	 	 -
	 	 Material Adverse Changes

	 Exhibit F
	 	 -
	 	 Branch Lease

	 Exhibit G
	 	 -
	 	 List of Employees

	 Exhibit H
	 	 -
	 	 Branch Assignment and Assumption Agreement

	 Exhibit I
	 	 -
	 	 Bill of Sale

	 Exhibit J
	 	 -
	 	 Assignment and Assumption Agreement

	 Schedule
	 	 -
	 	 Deposit Transfer and Purchase Price

  

 - iii - 

  
 AGREEMENT TO ASSUME
LIABILITIES 
 AND TO ACQUIRE ASSETS OF 
 BRANCH BANKING OFFICE 
  
 THIS AGREEMENT
(“Agreement”) entered into on this 2nd day of July, 2004 between UNITED PANAM FINANCIAL CORP. (the “Company”), PAN AMERICAN BANK, FSB, a savings bank chartered under the laws of the United States (the “Seller”), having
its principal office and place of business in Burlingame, California, and KAISER FEDERAL BANK, a savings bank chartered under the laws of the United States (the “Buyer”), having its principal office and place of business in Covina,
California, is made with reference to the following facts: 
  
 A.
The Seller owns and operates a branch banking office (the “Branch”) located at 8501 Van Nuys Boulevard, Panorama City, California 91402, and conducts a savings bank business at such location. The Seller is willing to transfer to the Buyer
certain assets of the Branch in consideration of the Buyer’s assumption of certain liabilities, duties and obligations of the Seller in respect of the Branch and payment of certain sums to the Buyer therefor, all upon the terms and subject to
the conditions set forth herein; 
  
 B. The Buyer is willing to
purchase, receive and acquire said assets, to assume said liabilities, duties and obligations of the Seller and to commence a banking business at the Branch upon the terms and subject to the conditions set forth herein; and 
  
 C. The Seller is a wholly-owned subsidiary of the Company and the Company is
willing to assume the obligations of the Seller under this Agreement following the liquidation of the Seller in consideration for the Buyer to enter into this Agreement. 
  
 NOW, THEREFORE, in consideration of the premises and of the mutual covenants, conditions, representations and warranties
contained in this Agreement, the Buyer, the Seller and the Company agree as follows: 
  
 ARTICLE I. 
 Definitions 
  
 Unless the context otherwise specifies and requires, each of the terms defined in this Article I shall, for all purposes of
this Agreement, have the meaning set forth herein, and all of the following definitions shall be equally applicable to both the singular and the plural forms of the terms defined: 
  
 1.1. Account. The term “Account” shall have the meaning specified in Section 2.7.1. 
  
 1.2. Account Related Loans. The term “Account Related Loans”
means all overdraft loans shown on the Branch Financial Statements not more than thirty (30) days delinquent on the Closing Date. 
  

 1 

 1.3. Agreement. The term “Agreement” means this Agreement to Assume Liabilities and to
Acquire Assets of Branch Banking Office. 
  
 1.4. Assets.
The term “Assets” means the assets and properties owned, held or used by the Seller in connection, in whole or in part, with the business or affairs of the Branch, tangible and intangible, real, personal and mixed, which are to be
transferred to and purchased by the Buyer as provided in Section 2.4 hereof. 
  
 1.5. Branch Financial Statements. The term “Branch Financial Statements” means the Monthly Statement of Condition and the Monthly Income and Expense Summary for the Branch as of and for the month
ended May 31, 2004, in the form attached hereto as Exhibit A. 
  
 1.6. Branch. The term “Branch” means the branch banking office of the Seller located at 8501 Van Nuys Boulevard, Panorama City, California 91402. 
  
 1.7. Cash. The term “Cash” shall mean currency of the United States of America in the form of immediately
available funds. 
  
 1.8. Claim. The term “Claim”
shall have the meaning specified in Section 4.1.6. 
  
 1.9.
Closing Date and Closing. The term “Closing Date” means the date when the transactions contemplated by this Agreement shall be consummated, as set forth in Section 7.1 hereof, and the term “Closing” means the consummation
of the transactions contemplated in this Agreement, as set forth in Section 7.1. 
  
 1.10. Deposits. The term “Deposits” means all liabilities of the Seller carried on the books of the Branch to customers arising from deposits which are demand deposits, savings deposits, commercial
deposits, deposits in retirement accounts, certificates of deposit, or time deposits, excluding any deposits associated with or securing a line of credit excluded under Section 1.2. 
  
 1.11. Deposit Premium. The term “Deposit Premium” shall have the meaning specified in Section 3.1(b).

  
 1.12. Deposit Transfer. The term “Deposit
Transfer” shall have the meaning specified in Section 3.1(a). 
  
 1.13. Governmental Body. The term “Governmental Body” means any federal, state, municipal or other governmental authority, department, commission, board, agency, or other instrumentality having jurisdiction over Seller,
Buyer or the transactions contemplated in this Agreement. 
  
 1.14. Hazardous Substances. The term “Hazardous Substances” shall have the meaning specified in Section 4.1.9. 
  
 1.15. Independent Accountants. The term “Independent Accountants” shall have the meaning specified in Section 3.2. 
  

 2 

 1.16. Independent Determination. The term “Independent Determination” shall have the
meaning specified in Section 3.2. 
  
 1.17. Initial
Determination. The term “Initial Determination” shall have the meaning specified in Section 3.2. 
  
 1.18. Knowledge. The term “Knowledge” means to the actual knowledge of the President or the Chief Financial Officer of the Buyer and, of
the President or the Chief Financial Officer of the Seller, respectively. 
  
 1.19. Leased Premises. The term “Leased Premises” means the real property occupied by the Branch. 
  
 1.20. Liabilities. The term “Liabilities” means only those certain liabilities, duties and obligations of the Seller in connection, in
whole or in part, with the business or affairs of the Branch which are to be assumed by the Buyer pursuant to Sections 2.1 and 2.2 hereof. 
  
 1.21. Postponed Closing Date. The term “Postponed Closing Date” shall have the meaning specified in Section 3.2. 
  
 1.22. OTS. The term “OTS” shall mean the Office of Thrift
Supervision. 
  
 1.23. Retained Assets. The term
“Retained Assets” means the assets of the Seller which are referred to in Section 2.5 hereof. 
  
 1.24. Retained Liabilities. The term “Retained Liabilities” means all liabilities and obligations of the Seller, of any kind or
description, whether known, unknown, disclosed, undisclosed, direct, indirect, absolute, fixed, contingent or otherwise, other than the Liabilities. 
  
 ARTICLE II. 
 Assumption of
Liabilities and Acquisition of Assets 
  
 2.1. Assumption
of Deposits, and Interest. In reliance on the covenants, conditions, representations and warranties of the Seller included herein, at the Closing the Buyer shall assume at book value as reflected on the books and records of the Branch, and agree
to pay, perform and discharge, as and when such payments or performances are due: 
  
 (a) All liabilities of the Seller existing as of the Closing Date which are Deposits (as provided in Schedule I hereto) together with
accrued interest thereon through the Closing Date. 
  
 2.2.
Assumption of Obligations. At the Closing, the Buyer shall also assume and agree to pay and discharge all of the obligations of the Seller arising on or after the Closing Date or to be performed on or after the Closing Date under the
following contracts, commitments and agreements, subject to the provisions of Section 2.3 hereof: 
  
 (a) The contracts, commitments and agreements, if any, set forth on Exhibit B hereto, including contracts for the safety deposit boxes
located at the Branch; and 
  

 3 

 (b) All of the obligations of the Seller in respect of the Branch reflected in an Amended
and Restated Exhibit B delivered no less than (2) two business days prior to Closing which shall include only such obligations permitted by the terms of this Agreement with the prior written consent or approval of the Buyer or as otherwise permitted
by the terms of this Agreement. 
  
 In the event that, after the
Closing Date, either Buyer or Seller discover that Buyer has not succeeded to the rights and benefits of the Seller under any contract under which the Liabilities with respect thereto have been assumed by Buyer, Seller shall to the extent possible
shall cause such rights and benefits to be transferred to Buyer. In the event Seller is unable to do so, Seller agrees to reassume such Liabilities and Seller and Buyer shall execute such documentation as is reasonably necessary to effect such
reassumption. 
  
 2.3. Retained Liabilities. The Seller
agrees that, except for the Liabilities which the Buyer has specifically agreed to assume pursuant to Sections 2.1 and 2.2 hereof, the Buyer has not agreed to assume or pay, shall not be required to assume or be obligated to pay, perform or
discharge, and shall have no liability or obligation with respect to, whether on the Closing Date or otherwise, all Retained Liabilities or obligations not assumed under Section 2.2 hereof including, but not limited to: 
  
 (a) Any liability or obligation of the Seller to the extent
the same shall have been paid, performed or discharged or which by its terms was required to be paid, performed or discharged on or prior to the Closing Date, except that certain expenses in connection with the operation of the Branch are to be
prorated in accordance with the provisions of Section 8.8(a) hereof; 
  
 (b) Except as provided in Section 8.8(b) hereof, any liability or obligation of the Seller for federal, state or local taxes on or measured by income of Seller; and 
  
 (c) Any other liability or obligation of the Seller arising
out of or in connection with any contract, agreement or commitment or otherwise which is not assigned to the Buyer. 
  
 2.4. Transfer of Assets. In consideration of assumption of the Liabilities and payment of the amounts called for by Article III at the Closing, the
Seller shall irrevocably sell, transfer, assign and deliver to the Buyer and the Buyer shall purchase and accept delivery of the following: 
  
 (a) The specific furniture, fixtures, and equipment and other tangible personal property, at an aggregate, fully-depreciated net book
value as of the Closing Date and in an as-is, where-is condition, at the Branch, listed on Exhibit C hereto; 
  
 (b) All of the Seller’s right, title and interest in and to all contracts, commitments and agreements which the Buyer is assuming
pursuant to Sections 2.1 and 2.2 hereof at book value as of the Closing Date. If any such contract, commitment or other agreement of the Seller is not transferable to the Buyer either by virtue of the provisions thereof or under applicable law, or
if any such contract, commitment or agreement of the Seller would limit or restrict a transfer contemplated herein, neither this Agreement nor any document delivered pursuant hereto shall be deemed an assignment of such nontransferable contract,
commitment or other agreement and such contracts, commitments and agreements shall be subject to the provisions of the penultimate paragraph of this Section 2.4. To the extent such contracts, commitments or other agreements relate to the conduct of

  

 4 

 
business by the Seller at the Branch and at locations other than the Branch, such contracts, commitments or agreements shall be assigned to the Buyer only to
the extent the same are applicable to the Branch; 
  
 (c) All claims and causes of action the Seller has or might have against any third party arising out of, in connection with or with respect to the Assets or the Liabilities; 
  
 (d) All of the Seller’s right, title and interest in and to all Cash on hand at the Branch on the
Closing Date and all of the Seller’s rights in and to the Deposits at book value as of the Closing Date, subject, in the case of the Deposits, to the individual depositors’ continuing right of withdrawal; 
  
 (e) All of the Seller’s right, title and interest in
and to all of the Account Related Loans set forth on the Branch Financial Statements; 
  
 (f) Subject to Section 5.2.5, the assignment of the Seller’s lease of the Leased Premises; and 
  
 (g) All books and records (including computer records),
files and documentation relating to the Assets and the Liabilities. To the extent such books and records relate to the conduct of business by the Seller at the Branch and at locations other than the Branch, such books and records shall be assigned
to the Buyer only to the extent the same are applicable to the Branch. 
  
 Notwithstanding the foregoing provisions of this Section 2.4, any Asset, the assignment or attempted assignment of which would be invalid or would constitute a breach of any contract, agreement or commitment to which the Seller is a party
or by which it may be bound shall be used, held and/or received by the Seller for the benefit of the Buyer in accordance with the Buyer’s instruction and at the Seller’s expense, and the Seller shall, without further consideration, convey,
transfer, assign and deliver to the Buyer all such Assets at the earliest time practicable. 
  
 All such sales, conveyances, transfers, assignment and deliveries shall be effected by such assignments, endorsements, deeds, bills of sale and other instruments as shall be reasonably requested by counsel for the
Buyer. 
  
 2.5. Retained Assets. The following assets and
the Seller’s right, title and interest therein shall not be transferred to or purchased by the Buyer at the Closing: 
  
 (a) All funds relating to retirement and pension plans or programs benefiting employees employed at the Branch; 
  
 (b) All insurance policies maintained with respect to the
Branch; and 
  
 (c) All assets of the Seller not
listed in Section 2.4 hereof. 
  

 5 

 2.6. Costs of Conversion. In connection with transfer of the Assets and assumption of Liabilities
hereunder, the Buyer and Seller hereby acknowledge and agree that certain computer systems and data may need to be converted upon transfer, and that conversion and deconversion costs may be incurred by the parties. Buyer and Seller agree that, with
respect to the transfer of the Assets and/or the assumption of the Liabilities hereunder (i) Seller shall bear, at its sole expense, any and all costs of deconversion to facilitate the conversion of the Assets and/or Liabilities to Buyer’s data
processing system and (ii) Buyer shall bear, at its sole expense, any and all costs of conversion. Neither party shall incur any such costs on behalf of the other party without the prior written consent of the other party. 
  
 2.7. Conversion Procedures. Seller and Buyer shall, before and after
the Closing Date, cooperate in good faith to ensure the orderly and efficient transfer and conversion of the Assets and Liabilities as provided herein, to Buyer’s ownership and operation. The provisions of Sections 2.7.1 through 2.7.15 shall
apply unless other provisions to accomplish the same results are agreed to in writing by the parties. 
  
 2.7.1. Tapes and File Packages. Seller will provide Buyer with copies of the electronic record on magnetic media containing the
information set forth on the master file with respect to each Liability which is a Deposit (each, an “Account”) as such information exists on the original system of Seller’s data processor (master files) no later than fifteen (15)
calendar days following execution of this Agreement and updated as of the Closing Date. Seller shall bear all costs incurred by Seller in complying with this Section 2.7.1. Materials provided on magnetic media shall be in the format (i) reasonably
requested by Buyer’s data processor, as supplied by Buyer to Seller or Seller’s agent and (ii) agreed to by Seller. 
  
 2.7.2. Statement of Accounts. Seller shall, at its sole expense, prepare and distribute all account statements regarding the
Accounts, other than certificates of deposit and IRA accounts, as of the Closing Date, such statements to be in the form used by Seller in the ordinary course of its business. Seller shall be responsible for all accrued interest on such Accounts as
of the Closing Date and shall prorate fees and charges on such Accounts as of the Closing Date. 
  
 2.7.3. Account Histories. Within five (5) business days after the Closing Date, Seller shall provide Buyer with a copy of an
account history for each Account, all at Seller’s expense. For the purpose of this Agreement, the term “account history” means (i) a copy of the last statement Seller cuts on the Closing Date and (ii) a history of each certificate of
deposit for the current term thereof and each IRA containing such information, and in such form, as is mutually acceptable to the parties. 
  
 2.7.4. Payment Items. Buyer shall establish a correspondent account with Seller prior to the Closing. Then, for a period of one
hundred and twenty (120) calendar days after the Closing Date, Seller shall forward to Buyer all items presented to Seller for payment against the Accounts (“Payment Items”) on the next business day after such Payment Items are received.
Buyer and Seller agree that any costs incurred to retain a third party to provide timely forwarding of such Payment Items to Buyer shall be borne equally by Buyer and Seller. Seller will deduct payment for these items from Buyer’s correspondent
account held by Seller on or before such time as is required for Seller to 

  

 6 

 
meet its midnight deadline with respect to such items. Seller shall notify Buyer by noon each business day of the items presented to Seller for payment
against the Accounts on the prior business day and Buyer shall wire funds sufficient to cover the items presented to the Buyer each business day to the Buyer correspondent account held by Seller. Buyer shall issue Payment Items bearing Buyer’s
routing transit and account number to Account customers within ten (10) business days following the Closing Date. These items shall replace items issued with Seller’s identification on them. Seller shall have no obligation to pay such Payment
Items and Seller shall use its commercially reasonable efforts to return any Payment Item. Seller shall establish a correspondent account with another financial institution, reasonably acceptable to the Buyer, with such institution to assume its
obligations under this section following the liquidation of the Seller. Any costs imposed by such institution shall be borne by Seller and provided further, the Company shall not be relieved of its obligation to perform Seller’s duties due to
the appointment of a successor institution. 
  
 2.7.5. Customer Names and Addresses. Upon Buyer’s written request, no earlier than ten (10) business days prior to the anticipated Closing Date, Seller shall provide Buyer with a magnetic tape, containing the name and complete
mailing address for each of the Accounts of the Branch as of a recent date in such form as the Buyer may reasonably request, provided that, Seller shall bear all costs incurred by Seller in complying with this Section 2.7.5. 
  
 2.7.6. Deposit Interest Reporting and Withholding.
Buyer will timely report to applicable taxing authorities and to Account customers including, without limitation by sending all required IRS Forms 1098 or 1099, with respect to the entire calendar year in which the Closing occurs, all interest
credited to or withheld from, and any early withdrawal penalties imposed upon, the Accounts (including for any period prior to the Closing Date, which would otherwise be the reporting obligation of Seller). Any amounts required by any Governmental
Bodies to be withheld from any of the Accounts through the Closing Date will be withheld by Seller in accordance with applicable law or appropriate notice from any Governmental Body and will be remitted by Seller to the appropriate agency on or
prior to the applicable due date. Any such withholding required to be made subsequent to the Closing Date shall be withheld by Buyer in accordance with applicable law or the appropriate notice from any Governmental Body and will be remitted by Buyer
to the appropriate agency on or prior to the applicable due date. Promptly after the Closing Date, but in no event later than the date such amounts are required to be remitted to the applicable Governmental Body, Seller will pay to Buyer that
portion of any sums theretofore withheld by Seller from any of the Accounts which are or may be required to be remitted by Buyer pursuant to the foregoing and shall directly remit to the applicable governmental agency that portion of any such sums
which are required to be remitted by Seller. Seller shall be responsible for delivering to payees all Internal Revenue Service (“IRS”) notices received by Seller that are required to be delivered with respect to the Accounts, and Buyer
shall be responsible for delivery to payees all such notices received by Buyer that are required to be delivered with respect to the Accounts. Seller shall deliver to Buyer, within five (5) business days after the Closing Date, a list of all
“B” notices (TINs do not match) and “C” notices (under reporting/IRS imposed withholding) issued by the IRS imposing withholding restrictions, relating to the Accounts. Seller shall continue to provide Buyer with notice of such
IRS notices it receives regarding Account customers for a period of one hundred and eighty (180) days from the Closing Date. All notices received by Seller on or prior to one hundred and eighty (180) days from the Closing Date from the IRS releasing
withholding restrictions on accounts will be forwarded promptly 

  

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to Buyer. Seller agrees to reimburse Buyer for an amount equal to any penalty and interest imposed upon Buyer by the IRS or state taxing authority or
self-assessed by Buyer on IRS Form 8210 or corresponding state form which Buyer is thereafter required to, and does, pay to the IRS or state taxing authority, where such penalty and interest arises out of actions taken or omitted to be taken by
Buyer in reliance upon information provided by Seller under this Section 2.7.6, and such penalty and interest does not result from an act or omission of Buyer not made in reliance upon such information. 
  
 2.7.7. Returned Items. Any items credited prior to
Closing for deposit to, or cashed against, any Liability, which are returned unpaid at any time after Closing (“Returned Items”) shall be handled as follows within ninety (90) calendar days following Closing: 
  
 (a) If Buyer’s bank account is charged for the Returned
Item, Buyer shall use its reasonable efforts to obtain reimbursement from the account to which, or from the party to whom, the item was credited; provided, that if Seller receives notification of a large Returned Item ($2,500 or more) before 2:00
p.m. Pacific Time on any business day, Seller shall notify Buyer of such Returned Item as soon as practicable on the same day notification is received. If there are sufficient funds in the account to which such Returned Item was credited or any
other accounts on deposit with Buyer standing in the name of the party liable for such Returned Item, upon proper identification of such party, Buyer shall debit any or all of such accounts an amount equal in the aggregate to the Returned Item,
provided that such debit is permissible under Buyer’s agreement with such party and applicable laws and regulations. If those accounts which may be debited do not contain funds sufficient to reimburse Buyer fully (for reasons other than
Buyer’s breach of the above conditions) or if such debit is not permissible under Buyer’s agreement with such party and applicable laws and regulations, Seller shall, upon notice from Buyer, reimburse Buyer to the extent sufficient funds
are available and immediately repay to Buyer the balance of the Returned Item not reimbursed and Buyer shall assign the Returned Item to Seller for collection. The Deposit Premium shall be adjusted for any Returned Item and such amount shall be
refunded to Buyer within five (5) business days of notice by Buyer to Seller. 
  
 (b) If Seller’s bank account is charged for the Returned Item, Seller shall notify Buyer as soon as practicable. If there are sufficient funds in the account to which such Returned Item was credited or any other
accounts on deposit with Buyer standing in the name of the party liable for such Returned Item, upon proper identification of such party, Buyer shall debit any or all of such accounts an amount equal in the aggregate to the Returned Item and shall
repay that amount to Seller. If there are not sufficient funds in the accounts which may be debited (for reasons other than Buyer’s breach of the above conditions) or if such debit is not permissible under Buyer’s Agreement with such party
and applicable laws and regulations, Buyer shall have no obligation to repay Seller unless and until Buyer obtains reimbursement from the party liable for the Returned Item. 
  
 (c) Seller shall establish a correspondent account with another financial institution, reasonably acceptable
to the Buyer, with such institution to assume its obligations under this section following the liquidation of the Seller. 
  
 2.7.8. IRA Reporting. Unless applicable law does not permit Seller to engage another person to perform such reporting
responsibility (in which case Seller will perform these tasks), Buyer shall prepare and file all required annual reports for all activity under IRA accounts at 

  

 8 

 
the Branch, including but not limited to IRS Form W-2P, IRS Form 1099R, IRS Form 5498, and state tax forms for the portion of the year prior to the Closing
Date, to and including the Closing Date. Buyer shall prepare and file such reports, where applicable, for the balance of the calendar year of the Closing Date and thereafter. It is further agreed that Buyer and Seller will each report their portion
of withholding for the IRA accounts to the appropriate state and federal agencies. 
  
 2.7.9. Further Documents. After the Closing Date, Seller and Buyer shall each permit the other reasonable access to and the right
to inspect and copy, the books and records of such party with respect to the transactions contemplated hereby as may be reasonably necessary or appropriate to enable the other party to prepare any additional documents, instruments, reports, or tax
returns as it or its counsel determines to be necessary or appropriate under the circumstances. Such right of access and right to inspect and copy shall be exercised so as to minimize disruption of the business activities of the party whose books
and records are being inspected and/or copied. Notwithstanding any other provision of this Agreement, the party requesting assistance or cooperation shall pay the other party’s out-of-pocket expenses in complying with such request to the extent
that such expenses are attributable to fees and other costs of unaffiliated third party service providers. 
  
 2.7.10. Cooperation on Certain Tax Matters. After the Closing Date, Seller and Buyer shall each (a) assist (and cause their
respective affiliates to assist) the other party in preparing any tax returns that such other party is responsible for preparing and filing in accordance with this Agreement; (b) cooperate fully in responding to any audits of or disputes with taxing
authorities regarding any tax returns with respect to the Liabilities or payments in respect thereof, or the operation of the Branch; (c) make available to the other and to any taxing authority as reasonably requested all relevant information,
records, and documents relating to taxes with respect to the Liabilities or payments in respect thereof, or the operation of the Branch; (d) provide timely written notice to the other of any pending proposed tax audits or assessments with respect to
the Liabilities or payments in respect thereof, or the operation of the Branch for taxable periods for which the other may have liability under this Agreement; and (e) furnish the other with copies of all relevant correspondence received from any
taxing authority in connections with any tax audit or information request with respect to any taxable period referred to in clause (d) above. Notwithstanding any other provision of this Agreement, the party requesting assistance or cooperation shall
pay the other party’s reasonable out-of-pocket expenses in complying with such request to the extent that such expenses are attributable to fees and other costs of unaffiliated third party service providers. 
  
 2.7.11. Holds and Stop Payment Orders. Holds and stop
payment orders that have been placed by Seller on particular accounts or on individual checks, drafts or other instruments before the Closing Date will be continued by Buyer under the same terms after the Closing Date. Seller will deliver to Buyer
at Closing a complete schedule of such holds and stop payment orders. 
  
 2.7.12. ACH, etc., Items. Seller and Buyer will use their best efforts to transfer all Automated Clearing House (“ACH”) arrangements, automatic debit and automatic credit arrangements to Buyer as soon
as possible after the Closing Date. The Buyer, at its expense, will timely notify all ACH and Fed-wire originators of the transfers and assumptions to be made pursuant to the Agreement as of the Closing Date. For a period of sixty (60) calendar days
beginning on the Closing Date, Seller will honor, in accordance with applicable laws and regulations, all ACH and 

  

 9 

 
Fed-wire items related to accounts assumed under this Agreement which are mistakenly routed or presented to Seller. Seller will make no charge to Buyer for
honoring such items, and will promptly electronically transmit such ACH and Fed-wire data to Buyer, provided that Buyer shall promptly reimburse Seller for any processed ACH and Fed-wire items. If Buyer cannot receive an electronic transmission,
Seller will make available to Buyer at Seller’s operations center receiving items from the ACH and Fed-wire tapes containing such ACH and Fed-wire data. Items mistakenly routed or presented after the sixty (60) day period will be returned to
the presenting party. Seller shall establish a correspondent account with another financial institution, reasonably acceptable to the Buyer, with such institution to assume its obligations under this section following the liquidation of the Seller.

  
 2.7.13. Retirement Accounts. Seller
will provide Buyer with the proper trust documents for any retirement accounts assumed by Buyer hereunder. Seller shall be responsible for all federal and state income tax reporting of retirement accounts for the period of time during the calendar
year 2004 prior to the Closing Date. Buyer shall be responsible for all federal and state income tax reporting for the period of time during the calendar year 2004 from and after the Closing Date. 
  
 2.7.14. Safe Deposit Business. Seller shall provide
Buyer with all documentation, keys and other materials relating to the safe deposit business conducted at the Branch. Buyer shall continue to conduct such safe deposit business after the Closing. Nothing herein shall preclude Buyer from terminating
such business at the Branch following the Closing. 
  
 2.7.15. ATM Cards. Seller and Buyer shall cooperate in the transfer of all ATM cards and related arrangements to Buyer at the Closing. 
  
 ARTICLE III. 
 Deposit Transfer;
Assumption Price; Independent Accounting 
  
 3.1.
Determination of Deposit Transfer and Deposit Premium. 
  
 (a) The Seller and the Buyer agree that on the Closing Date the Seller will owe to the Buyer an amount (the “Deposit Transfer”) equal to all Deposit Liabilities assumed by Buyer less: (i) the Cash on hand at
the Branch to be transferred to the Buyer on the Closing Date; (ii) the net book value of all other assets of the Branch to be transferred to the Buyer pursuant to Section 2.4 hereof on the Closing Date; (iii) the outstanding balance of the Account
Related Loans; and (iv) the Deposit Premium (as defined below). The calculation of the Deposit Transfer and the Deposit Premium will be specified in Schedule I hereto. 
  
 (b) The Seller and the Buyer agree that on the Closing Date the Buyer will owe to the Seller (as a deduction
from the amount to be transferred pursuant to the preceding paragraph, and not in addition thereto) an amount which represents the premium on the Deposits (the “Deposit Premium”), equal to: 7.25% of the lesser of the balance of Deposits at
the close of business on March 31, 2004 or on the Closing Date to be acquired by Buyer. By way of example, (x) if the total of all Deposits as of the Closing Date were $50,000,000 then the Deposit Premium would be Three Million Six Hundred and
Twenty Five Thousand Dollars ($3,625,000.00). 
  

 10 

 (c) The amount of such Cash on hand at the Branch transferred to the Buyer hereunder and
the amount of such Liabilities shall be determined in accordance with said Schedule I in good faith by an accounting to be conducted jointly by the Buyer and the Seller (the “Initial Determination”) based upon the books and records of the
Branch maintained by the Seller in the ordinary and regular course of its business. The Buyer and the Seller shall complete the Initial Determination as of the close of business on the third (3rd) business day preceding the Closing Date and shall jointly execute, and deliver to each other on such date, a certificate, certified by the Chief Executive
Officer or Chief Financial Officer of each party, setting forth the amount of such Cash on hand at the Branch transferred to the Buyer hereunder, and the amount of such Liabilities and stating the Deposit Transfer to be paid by the Seller to the
Buyer and the Deposit Premium to be paid by the Buyer to the Seller as of the Closing Date. Within thirty (30) days following the Closing Date, and when all Branch office data up to and including the Closing Date is available, Seller shall present
Buyer with a list of the balances of the Assets and the Liabilities as of the Closing Date, certified by the Chief Executive Officer or Chief Financial Officer of Seller to be true and correct as of the date reflected thereon (the “Final
Determination”). The Final Determination shall become final and binding on Buyer and Seller ten (10) business days after its delivery to Buyer, unless Buyer gives written notice to Seller of its disagreement with respect to any item included in
such statement. Seller and Buyer shall use reasonable efforts to resolve the disagreement during the ten (10) day period following receipt by the seller of the notice, whereupon the Final Determination shall become final and binding. When the Final
Determination becomes final and binding, an appropriate adjusting settlement payment from Seller to Buyer or from Buyer to Seller, as the case may be, will be made together with accrued interest calculated at the federal funds rate in effect on the
Closing Date for the number of days elapsed between the Closing Date and the date of such adjusting settlement payment. 
  
 3.2. Independent Accounting. The Buyer and the Seller agree that if they are unable to agree as to the amount of the Cash on hand at the Branch to
be transferred to the Buyer hereunder, the amount of the Liabilities to be assumed by the Buyer pursuant hereto, the amount of the Deposit Transfer, and/or the Deposit Premium, then each of the Buyer and the Seller shall prepare in good faith and
execute and deliver to the other a certificate setting forth the amount of such Liabilities, the amount of such Cash on hand at the Branch and the Deposit Transfer and Deposit Premium, and the Closing shall be postponed to the seventh (7th) day next
following the Closing Date specified in Section 7.1 hereof, subject to the terms and conditions of this Agreement (the “Postponed Closing Date”). The Buyer and the Seller hereby agree to appoint the accounting firm of McGladrey &
Pullen, LLP (the “Accountants”) or, in the event that the Accountants decline to accept such appointment, a single independent accounting firm as selected by agreement of the Buyer and Seller (the Accountants or such other accounting firm
referred to herein below as the “Independent Accountants”) such that, during such seven (7) day postponement, the Independent Accountants shall determine (the “Independent Determination”) the amount of the Cash on hand at the
Branch to be transferred to the Buyer hereunder, the amount of the Liabilities to be assumed by the Buyer pursuant hereto and the Deposit Transfer and Deposit Premium, in accordance with Section 3.1 hereof and Schedule I attached hereto, based upon
the books and records maintained by the Seller with respect to the Branch in the ordinary and regular course of its business. The Seller shall provide to the Independent Accountants access to the books, records and affairs of the Seller and the
Branch in the same manner as specified in Section 5.2.1 hereof, in connection with the Independent Determination. 

  

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The Independent Accountants shall, on the day next preceding the Postponed Closing Date, deliver to each of the Buyer and the Seller a report stating the
Independent Accountants’ determination of the amount of such Cash on hand at the Branch, the amount of such Liabilities and the amount of the Deposit Transfer and Deposit Premium on such day. The Independent Determination shall be final,
binding and conclusive on the Buyer and the Seller with respect to the aggregate amount of the Liabilities to be assumed by the Buyer pursuant hereto, the amount of Cash on hand at the Branch transferred to the Buyer on the Postponed Closing Date
and the amount of the Deposit Transfer and Deposit Premium payable at the Closing on the Postponed Closing Date. The Buyer and the Seller shall share equally all costs and expenses of the Independent Accountants relating to the Independent
Determination and their services performed in connection therewith. 
  
 ARTICLE IV. 
 Representations, Warranties, and Covenants 
  
 4.1. Representations, Warranties and Covenants of the Company and the Seller. The Company and the Seller hereby
represent, warrant and covenant to Buyer as follows: 
  
 4.1.1. Powers and Authority. The Seller is a federal savings bank duly organized and validly existing under the laws of the United States with full power and authority to conduct a savings bank business at the Branch as now conducted
by it, to own all of the assets owned by it at the Branch and to sell the Branch. The Seller conducts, and on the Closing Date will conduct, a savings bank business at the Branch and does not, and will not on the Closing Date, operate a trust
department at the Branch. The execution and delivery of this Agreement by the Company and the Seller have been duly authorized by all necessary corporate action on the part of the Company and the Seller, as the case may be, which authorization will
not have been altered, amended, modified or revoked before the Closing Date, and upon execution and delivery this Agreement shall constitute a valid and binding obligation of the Company and the Seller, respectively, enforceable in accordance with
its terms (except as may be limited by bankruptcy, insolvency, moratorium, reorganization or other similar laws affecting the rights of creditors generally and those of federally insured depository institutions in particular and the availability of
equitable remedies). Further, provided all of the conditions specified in Sections 6.1.1 through 6.1.5 hereof have been satisfied prior to the Closing Date, on the Closing Date, the Seller will have the full power and authority to grant, sell and
assign all rights and properties to be sold and assigned hereunder and each of the Company and the Seller the full power and authority to perform their obligations hereunder. A complete, correct and current copy of the Charter and Bylaws of the
Seller has been delivered to the Buyer and no changes therein have been made since the date of delivery or will be made prior to the Closing Date. 
  
 4.1.2. Other Agreements. Provided all of the conditions specified in Section 6.1 have been satisfied prior to the Closing Date, the
execution and delivery of this Agreement by the Seller and the consummation of the transactions contemplated herein will not: 
  
 (a) (i) Result in a breach or violation, or constitute a default under, any of the terms or conditions of, or constitute a default under,
Seller’s or the Company’s Charter, Articles or Incorporation or Bylaws or result in a material breach or violation of, or constitute a material default under, any contract, agreement, commitment, indenture, note, bond, license, mortgage,
deed 

  

 12 

 
of trust or other instrument or obligation to which the Company or the Seller are a party or by which it or any of any of its properties or assets is bound;
or 
  
 (b) Violate any law, or any rule or
regulation of any Governmental Body, or any order, writ, injunction, judgment or decree of any court or Governmental Body applicable to the Company, the Seller, the Assets, or the business of the Branch. 
  
 4.1.3. Branch Financial Statements. The Branch
Financial Statements: (i) are in accordance with the books and records of the Seller maintained by the Seller in the ordinary and regular course of its business relating to the conduct of business at the Branch: (ii) are correct and complete and
fairly present the financial position of the Branch as of May 31, 2004, and the results of operations of the Branch for the period ended May 31, 2004; (iii) reflect all of the assets and liabilities of the Branch as of May 31, 2004, which at such
date were material to the business conducted by the Seller at the Branch; and (iv) have been prepared on an accrual basis in accordance with the accounting principles, including the method of depreciation used in accounting for furniture, fixtures
and equipment, followed by the Seller with respect to each of its branch offices, applied on a basis consistent with prior periods. All monthly reports and other reports, the books and records maintained by the Seller and the financial information
used in determining the amount of the Liabilities, and the Cash on hand at the Branch, in accordance with the provisions of Sections 3.1 and 3.2 hereof are, and until the Closing Date will be, complete and correct and shall comply with the
representations and warranties set forth in this Section 4.1.3 applicable to the Branch Financial Statements. The books and records of the Seller maintained by the Seller with respect to its business at the Branch are, and until the Closing Date
will be, kept and prepared in accordance with the accounting principles applied by the Seller with respect to its other branch offices. A copy of the Branch Financial Statements, duly certified by the Chief Financial Officer of the Seller to be in
accordance with the representations and warranties set forth herein, is delivered concurrently with the execution of this Agreement. 
  
 4.1.4. Deposits at the Branch. The Seller has provided to the Buyer: (i) a complete and correct list of all certificates of deposit
at the Branch as of June 8, 2004, stating, among other things, with respect to each such certificate of deposit, the name of the depositor, the date of issuance, the maturity date, the applicable interest rate, and the redemption value thereof and
(ii) books and records of the Branch which provide a complete and correct list, as of June 8, 2004, of all Deposits at the Branch and which state, among other things, with respect to each such Deposit, the principal amount thereof, the name of the
depositor and the interest rate applicable thereto. During the six (6) month period prior to the date hereof, the Seller has not transferred and between the date hereof and the Closing Date, the Seller will not transfer, any Deposits (y) to any
other branch of the Seller, or (z) from any other branch of the Seller, except in accordance with the express request (not solicited by the Seller) of a depositor in the ordinary and regular course of business. 
  
 4.1.5. Contracts and Agreements. 
  
 (a) Exhibit B hereto is, to the Knowledge of the Seller, a
complete and correct list of all material contracts, agreements and other commitments (other than policies of insurance and retirement, pension, bonus, profit-sharing, stock option, stock purchase and other fringe benefit plans), entered into in
connection, in whole or in part, with the business of the Branch and to be 

  

 13 

 
assumed by the Buyer pursuant to Section 2.2 hereof, whether written or oral, and of all proposed or uncompleted capital expenditures or major maintenance
projects heretofore authorized in connection, in whole or in part, with the business of the Branch. Each contract, agreement and other commitment set forth on Exhibit B is, or, if so amended, on the Amended and Restated Exhibit B will be on the
Closing Date, valid and enforceable in accordance with its terms (except as may be limited by bankruptcy, insolvency, moratorium, reorganization or other similar laws affecting the rights of creditors generally (and in the case of enforceability
against the Seller, by laws affecting the rights of creditors of federally insured depository institutions) and the availability of equitable remedies). 
  
 (b) A complete and correct copy of each written contract, agreement and other commitment and of each uncompleted and proposed capital
expenditure on major maintenance project, set forth on Exhibit B, has been delivered to the Buyer, and a summary of each oral contract, agreement and other commitment whose terms do not prohibit assignment or transfer by the Seller is listed in said
Exhibit B. 
  
 (c) Except as otherwise set forth
on said Exhibit B, or on Amended and Restated Exhibit B, if applicable, each contract, agreement and other commitment listed therein is, and on the Closing Date will be, assignable to the Buyer by the Seller without the consent of any third party
and without any payment or penalty, and the Seller has not taken any action which impairs the right of further assignment thereof by any immediate or remote assignee of the Seller. The Seller is not, and on the Closing Date will not be, in material
default under any contract, agreement or commitment set forth in Exhibit B or Amended and Restated Exhibit B, if applicable, and to the Knowledge of the Seller, no other party under any such contract, agreement or commitment is in material default
thereunder. 
  
 4.1.6. Pending Litigation,
Statutory Constraints. There is no existing or proposed statute or regulation, nor any claim, litigation or investigation (a “Claim”), pending or threatened, involving the Company’s or the Seller that would materially adversely
affect the transactions contemplated hereby or the Company’s or the Seller’s ability to perform their obligations hereunder. There are no outstanding judgments, orders, writs, injunctions or decrees, of any court, any arbitrator or
arbitration tribunal or any Governmental Body against Seller which may have a material adverse affect on the business of the Branch. 
  
 4.1.7. Compliance with the Law. The Seller has obtained and kept in force all licenses, permits, authorizations and approvals
required by any Governmental Body to conduct its banking business at the Branch as now conducted by it and to own and operate the properties and assets utilized by it in such business. The Branch has been operated in all material respects in
accordance with applicable laws, rules and regulations. Such licenses and permits, listed on Exhibit D attached hereto and incorporated herein, are and will be at the Closing in full force and effect. No Claim is pending nor has the Seller been
threatened with any Claim wherein the remedy sought is the revocation or limitation of any such governmental license or permit and the Seller does not know of any basis or grounds for any such revocation or limitation. 
  
 4.1.8. Zoning. The zoning for the Leased Premises
permits the presently existing improvements and the continuation of the business presently being conducted on the Leased 

  

 14 

 
Premises. The Seller has not commenced, nor has the Seller received notice of the commencement of, any proceeding that would affect the present zoning of the
Leased Premises. 
  
 4.1.9. Environmental
Matters. No portion of the Leased Premises is being used or has been used at any previous time by the Seller, or to the Knowledge of the Seller, by persons other than the Seller for the disposal, storage, treatment, processing or handling of
Hazardous Substances (as hereinafter defined) nor, to the Knowledge of the Seller, do the Leased Premises contain such Hazardous Substances nor have any such Hazardous Substances been brought or carried onto or migrated in or into the Leased
Premises. As used herein, the term “Hazardous Substances” means any waste, pollutant, toxic substance, petroleum product or byproduct, hazardous waste, or any constituent of such substance or waste, regulated or forming the basis of
liability under any environmental law; provided, however, that for purposes of this definition, Hazardous Substances shall not include: (a) any substance of a nature, quantity or concentration that is customarily used, stored or disposed of
as part of or incidental to the operation and maintenance of the Leased Premises in the ordinary course of business conducted thereon, or (b) any substances used in office areas or janitorial supplies, cleaning fluids or chemicals necessary for the
day-to-day operation or maintenance of the Leased Premises. 
  
 4.1.10. Government Notices. Seller has received no notice from any federal or other Governmental Body indicating that such agency would oppose or not grant or issue its consent or approval, if required, with
respect to the transactions contemplated hereby. 
  
 4.1.11. Community Reinvestment Act. Seller received a rating of “satisfactory” or greater in its most recent examination or interim review with respect to the Community Reinvestment Act. Seller has not been advised of any
supervisory concerns regarding its compliance with the Community Reinvestment Act. To Seller’s Knowledge, there are no threatened or pending actions, proceedings, or allegations by any person or regulatory agency which may cause the OTS, to
deny or fail to issue any required regulatory approval. 
  
 4.1.12. Leasehold. 
  
 (a) Seller has no Knowledge of any condemnation proceedings pending or threatened, which would preclude or impair the use of the Leased Premises as presently being used in the conduct of the business of the Seller . A
copy of the lease agreement for the Leased Premises is attached as Exhibit F. 
  
 (b) Seller has not entered into any agreement regarding the Leased Premises, and, to Seller’s Knowledge, neither Seller nor the Leased Premises is subject to any claim, demand, suit, unfiled lien, proceeding or
litigation of any kind, pending or outstanding, or threatened or likely to be made or instituted, which would in any way be binding upon Buyer or its successors or assigns or materially affect or limit Buyer’s or its successors’ or
assigns’ use and enjoyment of the Leased Premises for its intended use as a retail banking facility or which would materially limit or restrict Buyer’s right or ability to enter into this Agreement and consummate the sale and purchase
contemplated hereby. Seller has no Knowledge of any proposed assessments against the Leased Premises for public improvements. 
  

 15 

 4.1.13. Title to Assets. Seller has good and marketable title to all owned Assets
and the right to use any equipment subject to contracts assumed by Buyer under Section 2.4, free and clear of all security interests, mortgages, encumbrances, pledges, trust agreements, liens or other adverse claims. No person or entity other than
Seller has any right, title or interest in and to any of the Assets. Upon payment by Buyer of the amounts contemplated by this Agreement, Buyer will acquire good and indefeasible title to the owned Assets, free and clear of any lien, charge,
encumbrance, option or adverse claim. 
  
 4.1.14.
Absence of Certain Changes or Events. Since the date of the Branch Financial Statements, Seller has conducted its business at the Branch only in the ordinary course and has not, other than in the ordinary course of business and consistent
with past practices and safe and sound banking practices: 
  
 (a) Mortgaged, pledged or subjected to lien, charge, security interest or any other encumbrance or restriction any of the Assets; 
  
 (b) Sold, transferred, leased to others or otherwise disposed of any of the Assets; 
  
 (c) Terminated, canceled or surrendered, or received any
notice of or threat of termination or cancellation of any contract, lease or other agreement which is included in the Assets or suffered any damage, destruction or loss (whether or not covered by insurance) which, in any case or in the aggregate,
has had a materially adverse affect on the Assets; 
  
 (d) Entered into any agreement or made any commitment to take any of the types of action described in subsections (a) through (c) above. 
  
 4.1.15. No Adverse Change. Except as disclosed in the representations and warranties made hereunder or in Exhibit E, there has been
no material adverse change in the Assets or Liabilities since the date of the Branch Financial Statements; provided, however, that in determining whether a material adverse change has occurred, there shall be excluded any effect on the Seller
the cause of which is (i) any change in the banking or similar laws, rules or regulations of general applicability or interpretations thereof by courts or governmental authorities, (ii) any change in GAAP or regulatory accounting requirements
applicable to depository institutions or their holding companies generally, (iii) any change in general economic conditions affecting depository institutions or their holding companies generally; and (v) any action or omission of Seller taken with
the prior written consent of Buyer, as applicable or permitted by this Agreement. 
  
 4.1.16. Evidence of Indebtedness. All evidences of indebtedness constituting part of the Assets are legal, valid and binding
obligations of the respective obligors thereof enforceable in accordance with their respective terms (except as limited by applicable bankruptcy, insolvency, reorganization and similar laws affecting creditors generally and the availability of
injunctive relief, specific performance, and other equitable remedies) and are not subject to any defenses, offsets or counterclaims that may be asserted against Seller or the present holder thereof. 
  

 16 

 4.1.17. Books and Records. The books and records of the Branch have been kept
accurately in the ordinary course of business, the transactions entered therein represent bona fide transactions and the revenues, expenses, assets and liabilities of Seller have been properly recorded in such books and records. 
  
 4.1.18. Regulatory Compliance. To Seller’s
Knowledge, except as disclosed in writing to Buyer, all reports, records and other documents or information involving any of the Assets or the Liabilities or the operation of the Branch that are required to be filed by Seller with any regulatory
authority including, without limitation, the OTS, the Federal Deposit Insurance Corporation and the IRS have been duly and timely filed and all information and data contained in such reports, records or other documents is true, accurate and correct.

  
 4.1.19. Brokerage Fees. Except for
Sandler, O’Neill & Partners, L.P., whose fees are being paid by Seller, Seller has dealt with no broker or finder in connection with any of the transactions contemplated hereby and no action has been taken that would give rise to any valid
claim for brokerage commission, finder’s fee or other like commission. 
  
 4.1.20. Schedule of Employees. Exhibit G lists the names of all employees as of the date specified thereon and states for each such individual his or her position, dates of employment with Seller, years of
service, present compensation and benefits. There are no employment agreements, severance agreements or other agreements governing the employment relationship between any of the employees and the Seller. 
  
 4.2. Representations. Warranties and Covenants of the Buyer. The Buyer
hereby represents, warrants and covenants to Seller as follows: 
  
 4.2.1. Powers and Authority. The Buyer is a federal savings bank duly organized and validly existing under the laws of the United States with full power and authority to conduct a savings bank business as now
conducted by it. The execution and delivery of this Agreement by the Buyer have been duly authorized by all necessary action on the part of the Buyer, and upon execution and delivery this Agreement will constitute a valid and binding obligation of
the Buyer enforceable in accordance with its terms (except as may be limited by bankruptcy, insolvency, moratorium, reorganization or other similar laws affecting the rights of creditors generally and those of federally insured depository
institutions and the availability of equitable remedies). Further, provided all of the conditions specified in Sections 6.1.1 through 6.1.5 hereof have been satisfied prior to the Closing Date, on the Closing Date the Buyer will have the full power
and authority to perform its obligations hereunder. A complete, correct and current copy of the Charter and Bylaws of the Buyer has been delivered to the Seller and no changes therein have been made since the date of delivery or will be made prior
to the Closing Date. 
  
 4.2.2. Other
Agreements. Provided all of the conditions specified in Section 6.1 have been satisfied prior to the Closing Date, the execution and delivery of this Agreement on behalf of the Buyer and the consummation of the transaction contemplated herein
will not: 
  
 (a) Result in the breach of or
violate any of the terms or conditions of, or constitute a default under, the Buyer’s Charter or Bylaws or any contract, agreement, commitment, 

  

 17 

 
indenture, note, bond, license, mortgage, deed of trust or other instrument or obligation to which the Buyer is a party or by which it or any of its
properties or assets may be bound or affected; or 
  
 (b) Violate any law, or any rule or regulation of any Governmental Body, or any order, writ, injunction, judgment or decree of any court or Governmental Body applicable to the Buyer. 
  
 4.2.3. Pending Litigation. There is no Claim, pending
or threatened, involving the Buyer which would materially adversely affect the transactions contemplated hereby or the Buyer’s ability to perform its obligations hereunder 
  
 4.2.4. Government Notices. Buyer has received no notice from any federal or other governmental agency
indicating that such agency would oppose or not grant or issue its consent or approval, if required, with respect to the transactions contemplated hereby. 
  
 4.2.5. Community Reinvestment Act. Buyer received a rating of “satisfactory” or greater in its most recent examination or
interim review with respect to the Community Reinvestment Act. Buyer has not been advised of any supervisory concerns regarding its compliance with the Community Reinvestment Act. To Buyer’s Knowledge, there are no threatened or pending
actions, proceedings, or allegations by any person or regulatory agency which may cause the OTS, to deny or fail to issue any required regulatory approval. 
  
 4.2.6. Brokerage Fees. Except for Keefe, Bruyette & Woods, Inc., whose fees are being paid by Buyer, Buyer has dealt with no broker or
finder in connection with any of the transactions contemplated hereby and no action has been taken that would give rise to any valid claim for brokerage commission, finder’s fee or other like commission. 
  
 ARTICLE V. 
 Obligations of Both Parties 
  
 5.1. Obligations of Both Parties. The Seller and the Buyer agree that subsequent to the date hereof and prior to the Closing Date: 
  
 5.1.1. Administrative Approvals. Promptly, and in any event not later than five (5-) calendar days
following execution of this Agreement by the Seller and the Buyer, (a) the Buyer shall, submit any necessary application or notice to the OTS for approval, as required in 12 C.F.R. Section 563.22 et seq. for Buyer to acquire the Branch. The
Buyer shall afford the Seller a reasonable opportunity to review and comment on such application prior to its submission to the OTS. The parties hereto shall also promptly file, either individually or jointly as may be required, all other
applications, amendments thereto, supporting documents and affidavits, and shall publish all other notices and perform all other acts which may be required by law or regulation to obtain the final approvals of the OTS, and any other Governmental
Body whose approval is a prerequisite to the consummation of the transactions contemplated herein. The Seller and the Buyer shall furnish the other upon request all such information and material concerning the Branch, the Seller or the Buyer, as the
case may be, required for inclusion in, or preparation of, any applications required to be made for any regulatory approvals to the acquisition by the Buyer of the Branch from the Seller hereunder 

  

 18 

 
and the transactions hereby contemplated, and shall keep each other apprised on a current basis of the processing and status of all such filings and
applications for regulatory approvals. Draft copies of such applications shall be submitted by each party to the other for review prior to filing, and each party shall provide to the other copies of any communications from any Governmental Body with
respect to such applications. 
  
 5.1.2.
Commercially Reasonable Efforts. Each party hereto will use its commercially reasonable efforts to effectuate the transactions hereby contemplated and to fulfill the conditions of its obligations under this Agreement. 
  
 5.1.3. Public Announcements. Seller and Buyer agree
that, from the date hereof, neither shall make any public announcement or public comment regarding this Agreement or the transactions contemplated herein without first obtaining the consent of the other party hereto and reaching an agreement upon
the substance and timing of such announcement or comment. 
  
 5.1.4. No Disclosure or Negotiation with Others. Seller shall prevent the disclosure of any of the terms or conditions hereof to any other person except for disclosure required by appropriate regulatory
authorities, and as long as this Agreement shall remain effective, Seller shall not, directly or indirectly, nor shall it permit any of its officers, directors, employees, representatives or agents to, directly or indirectly, encourage, solicit or
initiate discussions or negotiations with, or discuss or negotiate with, or provide any information to, any corporation, partnership, person or other entity or group (other than Buyer or an affiliate or an associate of Buyer or an officer, partner,
employee or other authorized representative of Buyer or such affiliate or associate) concerning any merger, tender offer or other takeover offer, sale of substantial assets, sale of shares of capital stock or similar transaction involving the Assets
or the Liabilities, provided, however, that Seller and its officers and directors may take all such indications necessary to comply with any fiduciary duty to which such party is bound. 
  
 5.1.5. Notices to Customers. Prior to the Closing Date, to the extent required by applicable law or
as a condition of approval by any regulatory authority, Seller agrees to mail or cause to be mailed, to each of the Deposit holders, each holder of a safe deposit box domiciled at the Branch and to such other customers as may be required, notice of
the contemplated transfer of the Assets, Liabilities and operations of the Branch. Each such notice shall be in a form acceptable to Buyer and Seller, such approval not to be unreasonably withheld. 
  
 5.2. Obligations of the Seller. The Seller agrees that subsequent to
the date hereof and prior to the Closing Date: 
  
 5.2.1. Access to Information. Without interfering with the normal course of business at the Branch (or such other premises of the Seller at which the items described in this Section 5.2.1 are located), the Buyer and its counsel,
accountants and other representatives shall have full access at the Branch (or such other premises of the Seller at which the items described in this Section 5.2.1 are located) during normal business hours to all properties, assets, books, accounts,
records, contracts and documents of the Seller related to the collective Assets to be purchased and Liabilities to be assumed by the Buyer pursuant to the terms of this Agreement and, in addition thereto, the Seller shall furnish 

  

 19 

 
or cause to be furnished to the Buyer and its representatives, at the Buyer’s expense, such copies of said books, accounts, records, contracts and
documents as may be reasonably requested with respect to the collective Assets to be purchased and Liabilities to be assumed by the Buyer pursuant to the terms of this Agreement. Notwithstanding the foregoing, under no circumstances shall the Seller
be required to take any action hereunder which would result in the waiver or other loss of its attorney-client privilege as to any matter so privileged. 
  
 In addition, Seller shall afford to the employees or representatives of Buyer, during normal business hours or at such other times as
shall be mutually agreed upon by Seller and Buyer, access to the Branch, the employees and the fixtures and equipment at the Branch in order for Buyer to begin training the employees and to begin conversion and installation of computer, data
processing, communication and other equipment. 
  
 5.2.2. Conduct of Business. With respect to the collective Assets to be purchased and Liabilities to be assumed by the Buyer pursuant to the terms of this Agreement, the Seller shall: 
  
 (a) conduct business at the Branch only in the ordinary
course (except as required by changes in law, regulation or supervisory policy or as required by regulatory authorities having jurisdiction over the Seller); 
  

(b) carry on the Branch business practices and keep the Branch books of account, records and files in substantially the same manner as
heretofore carried on; 
  
 (c) use its
commercially reasonable efforts to preserve the Branch business organization intact, to retain the services of its present officers and employees of the Branch and to preserve the goodwill of Deposit holders; 
  
 (d) pay and perform all of the debts, obligations and
liabilities incurred in connection, in whole or in part, with the Assets to be purchased and Liabilities to be assumed by the Buyer pursuant to the terms of this Agreement; 
  
 (e) duly and timely file all reports and returns including the payment of any taxes, penalties, interest or
other charges, required to be filed with any Governmental Body with respect to the business of the Branch; 
  
 (f) cooperate with and assist Buyer in assuring the orderly transition of the business of the Branch to Buyer from Seller; 
  
 (g) maintain in full force and effect all insurance policies
now in effect affecting the Assets or the Liabilities or renewals thereof and give all notices and present all claims under all insurance policies in due and timely fashion; 
  
 (h) timely file all reports required to be filed with any Governmental Body and observe and conform to all
applicable laws, rules, regulations, ordinances, codes, orders, licenses and permits to the extent the failure to do so would have a material adverse effect on the Assets or the Liabilities; 
  

 20 

 (i) withhold from each payment made to each of its employees the amount of all taxes
(including, but not limited to, Federal income taxes, FICA taxes and state and local income and wage taxes) required to be withheld therefrom and pay the same to the proper tax receiving officer; and 
  
 (j) perform all of its obligations under contracts, leases
and documents relating to or affecting the Asserts or the Liabilities, except such obligations as Seller may in good faith reasonably dispute; 
  
 5.2.3. Ordinary Course and Other Activities. 
  
 The Seller shall not, without the prior written consent of the Buyer, which consent shall not be
unreasonably withheld: 
  
 (a) sell, lease,
abandon, assign, transfer, license, encumber or otherwise dispose of any Assets other than in the ordinary course of business, or enter into any agreement to do so; 
  
 (b) except as otherwise expressly provided herein, transfer any Assets or Deposits from the Branch to the
Seller’s other branches, subject, in the case of Deposits, to the individual depositors’ continuing right of withdrawal; 
  
 (c) settle or compromise any Claim now pending or commenced subsequent to the date hereof with respect to the Assets to be purchased and
Liabilities to be assumed by the Buyer pursuant to the terms of this Agreement; 
  
 (d) relocate, or file any application to relocate, the Branch, except as such an application may be necessary to relocate the Branch as a
result of a fire or other natural disaster; 
  
 (e) enter into any contract, agreement, commitment understanding or other arrangement to dispose of the Branch or the Assets or Liabilities other than pursuant to the terms of this Agreement; and 
  
 (f) not issue any new deposit or loan products at the Branch
that Buyer will not be able to offer upon and following the Closing Date; and only pay interest rates on the Deposits consistent with past practices; . 
  
 5.2.4. Condition of Assets. The Buyer has been allowed access to the Leased Premises at which the Branch conducts business and is
aware of its current condition. The Seller will continue to maintain the Leased Premises in accordance with its past practices up to the Closing Date. The Seller makes no implied or express warranties as to the condition of the Leased Premises,
except to the extent provided in this Agreement. Following the execution of this Agreement, and continuing through the Closing, the Seller shall maintain the furniture, fixtures and equipment in the condition it exists as of the date of execution of
this Agreement, with the exception of wear and tear arising from normal use in the Branch. 
  

 21 

 5.2.5. Consents. The Seller will use its commercially reasonable efforts to
obtain and deliver to the Buyer on or prior to the Closing Date all required consents authorizing the transfer and assignment to the Buyer of, or the substitution of the Buyer for the Seller under all contracts, agreements and commitments that are
to be sold, conveyed, transferred, assigned and delivered to the Buyer hereunder including, but not limited to, those set forth in Exhibit B hereto, or the Amended and Restated Exhibit B as the case may be, which are validly assignable by the Seller
and all other Assets, each such consent to be effective prior to or as of the Closing Date. All such consents shall be in form and substance reasonably satisfactory to counsel for the Buyer. Without limiting the generality of the foregoing, the
Seller shall use its commercially reasonable efforts to assist the Buyer to cause the lessor of the Leased Premises to consent to the assumption of the lease for the Leased Premises by the Buyer. If for any reason the Seller is unable to obtain such
consent, then the Seller and Buyer shall enter into a sublease for such premises from Seller to Buyer under the same terms and conditions contained in the lease agreement for the Leased Premises or other mutually acceptable alternatives.

  
 5.2.6. Deposits, Branch Financial
Statement and Exhibit B Update. At the end of each month between the date hereof and the Closing Date and on the business day next preceding the Closing Date, the Seller shall deliver to the Buyer: (i) a list of all Deposits setting forth with
respect to such Deposits the information referred to in Section 4.1.4 hereof; (ii) updated financial information on the Branch, in the form of updated Branch Financial Statements; and (iii) an Amended and Restated Exhibit B setting forth all
contracts and commitments which Seller and Buyer intend that Buyer assume at and after Closing. 
  
 5.2.7. No Breach. The Seller shall not take or fail to take any action which taking or failure would cause or constitute a breach,
or would, if it had been taken or failed to be taken prior to the date hereof, have caused or constituted a breach, of any of the representations and warranties set forth in Section 4.1 hereof; the Seller will, in the event of, or promptly after
becoming aware of the occurrence of, or the impending or threatened occurrence of, any event which would cause or constitute a breach or would, if it had occurred prior to the date hereof, have caused or constituted a breach of any of the
representations and warranties set forth in Section 4.1 or the covenants set forth in Sections 5.1 or 5.2 hereof, or which may result in the nonsatisfaction of any condition set forth in Sections 6.1 or 6.2 hereof, give detailed notice thereof to
the Buyer; and the Seller will use its commercially reasonable efforts to prevent or promptly to remedy such breach or failure, and to perform such covenant or satisfy such condition. 
  
 5.3. Obligations of the Buyer. The Buyer agrees that subsequent to the date hereof and prior to the Closing Date:

  
 5.3.1. No Breach. The Buyer shall not
take or fail to take any action which taking or failure would cause or constitute a breach, or would, if it had been taken or failed to be taken prior to the date hereof have caused or constituted a breach, of any of the representations and
warranties set forth in Section 4.2 hereof; the Buyer will, in the event or, or promptly after becoming aware of the occurrence of, or the impending or threatened occurrence of any event which would cause or constitute a breach, or would, if it had
occurred prior to the date hereof, have caused or constituted a breach of any of the representations or warranties contained in said Section 4.2 or the covenants set 

  

 22 

 
forth in Sections 5.1 or 5.3 hereof, or which may result in the nonsatisfaction of any condition set forth in Sections 6.1 or 6.3 hereof, give detailed
notice thereof to the Seller; and the Buyer will use its commercially reasonable efforts to prevent or promptly to remedy such breach or failure to perform such covenant or satisfy such condition. 
  
 ARTICLE VI. 
 Conditions Precedent to Closing 
  
 6.1. Conditions Precedent to Performance by Both Parties. The obligations of the Buyer and the Seller to consummate the transactions contemplated in this Agreement are expressly subject to the satisfaction, on
or before the Closing Date, of each and all of the conditions set forth below, which conditions may not be waived by either party: 
  
 6.1.1. Approval of the OTS. The OTS shall have approved the transactions contemplated in this Agreement, as provided in 12 C.F.R.
Section 563.22 et seq. 
  
 6.1.2. Other
Regulatory Approvals. All other required regulatory approvals and actions, if any, shall be obtained and taken as necessary to permit consummation of the transactions contemplated herein in accordance with all applicable laws, regulations and
orders, on terms which are not materially adverse to either party hereto. 
  
 6.1.3. No Claim. No Claim shall have been instituted by any Governmental Body challenging the transactions hereby contemplated or seeking to restrain their consummation and no Claim shall have been instituted
or, to the Knowledge of either party hereto, threatened, challenging the legality of such transactions or seeking to restrain their consummation which, in the reasonable opinion of counsel for either party hereto, would make it impossible or
inadvisable for the parties to consummate such transactions. 
  
 6.1.4. Lease Assumption. The Buyer shall have entered into an assumption of Seller’s current lease for the Branch, and the lessor shall have executed and delivered to the Buyer, evidence of acceptance of
the assumption in substantially the form attached hereto as Exhibit H; or Seller and Buyer shall have entered into a sublease or another mutually acceptable alternative as provided in Section 5.2.5. 
  
 6.1.5. No Litigation. No action shall have been
taken, and no statute, rule, regulation or order shall have been promulgated, enacted, entered, enforced or deemed applicable by any Federal or state governmental authority or by any court, domestic or foreign, including the entry of a preliminary
or permanent injunction, that would (a) make this Agreement or the transactions contemplated hereby illegal, invalid or unenforceable, (b) require the divestiture of a material portion of the Assets or the Liabilities once acquired by Buyer, (c)
impose material limits on the ability of Buyer to consummate the Agreement or the transaction contemplated hereby, (d) otherwise materially and adversely affect the Assets or the Liabilities or the Branch or (e) if the Agreement or the transactions
contemplated hereby are consummated, subject Buyer or any officer, director or employee of Buyer to criminal penalties or to civil liabilities. No action or proceeding before any 

  

 23 

 
court or governmental authority, domestic or foreign, by any government or governmental authority or by any other person, domestic or foreign, shall be
threatened, instituted or pending that would reasonably be expected to result in any of the consequences referred to in clauses (a) through (e) above. 
  
 6.2. Conditions Precedent to the Buyer’s Performance. The obligations of the Buyer to perform its obligations under this Agreement are subject
to the satisfaction, on or before the Closing Date, of each and all of the conditions set forth below in this Section 6.2. The Buyer may waive any or all of the following conditions in whole or in part without prior notice; provided, however,
that if the Seller shall be in default of any of its representations, warranties or covenants under this Agreement, no such waiver of a condition shall constitute a waiver by the Buyer of any of its rights or remedies at law or in equity.

  
 6.2.1. Accuracy of Warranties and
Performance of Obligations. The representations and warranties of the Company and the Seller contained in Section 4.1 hereof are true and correct as of the date of this Agreement and shall be true and correct as of the Closing Date as if made on
such date, and the obligations set forth in Sections 5.1 and 5.2 hereof to be performed by the Seller on or before the Closing Date shall have been so performed in all material respects; and the Company and the Seller shall have delivered to the
Buyer a certificate of its president and chief executive officer to such effect. 
  
 6.2.2. Copies of Documents. True and complete copies of all documents reasonably requested by the Buyer shall have been furnished
to the Buyer promptly after request therefor and, in any event, in advance of the Closing Date. 
  
 6.2.3. Assignments, Etc. Seller shall have delivered to Buyer a Bill of Sale substantially in the form of Exhibit I and such other
assignments of contracts, agreements, fixed assets and any other documents reasonably requested by Buyer so as effectively to transfer to Buyer the Assets as provided in Section 2.4 hereof. All costs of recording such assignments, and any other
documents supplied at the request of the Buyer shall be the sole responsibility of the Buyer. 
  
 6.3. Conditions Precedent to the Seller’s Performance. The obligations of the Seller to perform its obligations under this Agreement are subject to the satisfaction, on or before the Closing Date, of each
and all of the conditions set forth below in this Section 6.3. The Seller may waive any or all of the following conditions in whole or in part without prior notice; provided, however, that if the Buyer shall be in default of any of its
representations, warranties or covenants under this Agreement, no such waiver of a condition shall constitute a waiver by the Seller of any of its rights or remedies at law or in equity. 
  
 6.3.1. Accuracy of Warranties and Performance of Obligations. The representations and warranties of
the Buyer contained in Section 4.2 hereof are true and correct as of the date of this Agreement and shall be true and correct as of the Closing Date as if made on such date, and the obligations set forth in Sections 5.1 and 5.3 hereof to be
performed by the Buyer on or before the Closing Date shall have been so performed in all material respects; and the Buyer shall have delivered to the Seller a certificate of its president and chief executive officer to such effect. 
  

 24 

 6.3.2. Copies of Documents. True and complete copies of all documents reasonably
requested by the Seller shall have been furnished to the Seller promptly after request therefor and, in any event, in advance of the Closing Date. 
  
 6.3.3. Assumption of Liabilities. Buyer shall have executed assumption documentation effecting the assumption by Buyer of all
Liabilities to be assumed hereunder, substantially in the form of Exhibit J. 
  
 6.3.4 Securitization. Seller shall have completed the transaction previously disclosed to the Buyer regarding the securitization of its auto loans (the “Securitization”). Seller shall use its best efforts to
complete the Securitization prior to or contemporaneously with the occurrence of the conditions set forth subclause (a) of Section 7.1. 
  
 ARTICLE VII. 
 Closing 

 
 7.1. Closing. The closing (the “Closing”) of the
transactions contemplated by this Agreement shall take place as follows: 
  
 (a) The date of the Closing of the transactions contemplated by this Agreement (the “Closing Date”) shall be the earlier of September 30, 2004, or the first (1st) Friday after the expiration of five (5) business days after the last of the following to be achieved; (i) written approval of the transactions hereby
contemplated by the OTS shall have been received and have become effective and the statutory waiting period shall have expired; (ii) any other approvals required from any other Governmental Body having jurisdiction over the Seller; Buyer or the
transactions contemplated hereby shall have been received and (iii) the Seller shall have closed the Securitization. The Closing shall be deemed to occur at 11:59 p.m. Pacific Time on the Closing Date. Notwithstanding the foregoing, the Closing may
occur at such later time or date as mutually agreed upon by the Buyer and the Seller. 
  
 7.2. Seller’s Obligations at the Closing. At the closing, the Seller shall do the following: 
  
 7.2.1. Transfer of Assets. The Seller shall convey, transfer, assign and deliver to the Buyer, by an instrument satisfactory in
form and substance to the Buyer and its counsel, good and marketable title to the owned Assets. 
  
 7.2.2. Certificates and Further Documents. The Seller shall deliver to the Buyer all of the documents and other instruments to be
delivered to the Buyer pursuant to Sections 6.1 and 6.2 hereof and not previously furnished to the Buyer and such other certificates and documents as may reasonably be requested by the Buyer with respect to the satisfaction of the conditions
specified in Sections 6.1 and 6.2 hereof. 
  
 7.2.3. Premises, Books and Records. The Seller shall deliver physical possession of the Branch and, with regard to the Assets to be purchased and the Liabilities to be assumed by the Buyer pursuant to this Agreement only, all of the
files, documents, papers, agreements, books of account and records in the possession of the Seller, including all records in storage and keys to the Branch and safe deposit boxes. 
  

 25 

 7.2.4. Payment of Deposit Transfer. Pursuant to Section 3.1 hereof, and, in the
event of an Independent Determination, Section 3.2 hereof, the Seller shall pay to the Buyer in Cash to an account at the Buyer’s main office, in the manner directed by the Buyer in a notice to the Seller on the day next preceding the Closing
Date, the amount of the Deposit Transfer to be paid by the Seller to the Buyer hereunder. 
  
 7.3. Buyer’s Obligations at the Closing. At the Closing, the Buyer shall do the following: 
  
 7.3.1. Assumption of Liabilities. The Buyer shall deliver to the Seller an undertaking in form and substance satisfactory to the
Seller and its counsel whereby the Buyer assumes and agrees to perform and discharge: (i) all of the liabilities set forth in Section 2.1 hereof and (ii) all of the obligations which are set forth in Section 2.2 hereof and which arise after the
Closing Date or are to be performed after the Closing Date, except those obligations set forth in Sections 2.2 hereof, if any, which cannot be transferred without the consent of third parties and as to which the Seller shall have been unable to
obtain such consent. 
  
 7.3.2. Payment of
Deposit Premium. Pursuant to Section 3.1 hereof, and, in the event of an Independent Determination, Section 3.2 hereof, at the Closing the Buyer shall pay to the Seller in the manner provided by Section 3.1(b), the amount of the Deposit Premium
to be paid by the Buyer to the Seller hereunder. 
  
 7.3.3. Further Documents. The Buyer shall deliver the documents and other instruments to be delivered to the Seller pursuant to Sections 6.1 and 6.3 hereof and not previously furnished to the Seller and such other certificates and
documents as may reasonably be requested by the Seller with respect to the fulfillment of the conditions set forth in Sections 6.1 and 6.3 hereof. 
  
 ARTICLE VIII. 
 Obligations of the
Parties After the Closing 
  
 8.1. Confidentiality.
Neither party shall divulge or communicate, except as may be required by applicable law, use to the detriment of the other or for the benefit of any other person or persons, or misuse in any way, any confidential information or trade secrets of the
other acquired in connection with or in any manner relating to this Agreement and the transactions contemplated herein or any term or condition of this Agreement; provided, however, that the foregoing shall not apply to any information which
either party (hereinafter the first party) can demonstrate to the second party (i) is generally available to or known by the public other than as a result of disclosure by the first party or (ii) was obtained from a source other than the first
party, provided that such source was not bound by a duty of confidentiality to the second party with respect to such information. 
  
 8.2. Notification of Account Debtors and Creditors. Promptly after the Closing Date: (i) the Seller shall notify all persons obligated to make
payments under loans carried on the books and records of the Branch as of the close of business on the Closing Date and not transferred to the Buyer under the terms hereof to make all future payments in respect of said obligations to a specified
address other than that of the Branch and (ii) the Seller shall, if the Buyer so elects, notify all persons 

  

 26 

 
obligated to make payments under loans carried on the books and records of the Branch which are acquired by the Buyer pursuant to this Agreement, to make
payments thereof to the order of the Buyer. 
  
 8.3. Right to
Hire Employees of the Branch; Non-solicitation of Employees by Seller.  
  
 (a) During the 30-day period following the date of this Agreement, Buyer shall have the right to designate, by notifying Seller, those employees of the Branch that Buyer desires to make offers of employment. Buyer
shall not be obligated to hire any employees other than those so designated. The Buyer and Seller agree that such employees, if hired, shall be employees of Buyer effective as of the Closing Date and they shall be eligible to participate in
all benefit plans of the Buyer, subject to the same rules applicable to all Buyer’s employees. Retained employees will be given credit for service with Seller for purposes of eligibility and vesting but not for benefit accrual. With respect to
any employees of the Branch prior to the Closing Date that accept employment with the Buyer on and after the Closing Date, the Seller shall pay all compensation owed to such employees up to and including the day prior to the Closing Date. Seller
shall use its best efforts to retain the employees at the Branch. The Seller shall not transfer employees now employed in the Branch (including employees on the list of employees provided by Buyer) to other branches of Seller or offer any
employee(s) of the Branch continued employment with Seller without the prior written approval of the Buyer. 
  
 (b) For a period of one (1) year following the Closing Date, Seller will not seek to employ any persons who were employees of the Branch
and who accept employment with Buyer on the Closing Date. Nothing herein shall prevent Seller from advertising generally any employment opportunities or from hiring any persons who were employees of the Branch and who accept employment with Buyer on
the Closing Date who respond to such general advertising or who seek employment without inducement from Seller. 
  
 8.4. Non-solicitation of Branch Customers by Seller. 
  
 For a period of one (1) year following the Closing Date, the Seller, including its directors, officers and employees, will not directly
and knowingly solicit deposits, loans or other business from or to persons who were Branch customers and depositors on the Closing Date, except as may occur in connection with advertising or solicitations directed to the public generally.

  
 8.5. Buyer’s Obligations. The Buyer shall mail
notification as and when may be required by, and pursuant to, the Federal Deposit Insurance Act to all persons holding Deposits assumed by the Buyer hereunder. In addition, the Buyer may, but shall not be obligated to, notify all persons holding
safety deposit boxes to make all payments in respect of said safety deposit box rental agreements payable to the order of the Buyer at the Branch. The Seller hereby agrees to cooperate with and assist the Buyer in preparing name and address
lists of the depositors, safety deposit box holders and borrowers referred to in this Section 8.2 and, at the request of the Buyer, shall execute any such notices given to borrowers with respect to loans acquired by the Buyer hereunder. 

 
 8.6. Transit Items. After the Closing, each party hereto shall use
its commercially reasonable efforts to assist the other party in the adjustment and delivery of all overages and shortages 

  

 27 

 
of documentary and cash items in transit and items in collection as of the Closing Date, as the interest in such items of the respective parties hereto may
appear. 
  
 8.7. Further Documents. After the Closing: (i)
each of the parties hereto shall execute and deliver, or cause to be executed and delivered, all such deeds, documents and other instruments, and will take or cause to be taken all further or other action, as the other party or its counsel may
reasonably deem necessary or desirable in order to vest in and confirm to the Buyer title to and possession of all of the Assets and to carry out the full intent and purpose of this Agreement and (ii) each of the parties will permit the other access
to and the right to inspect and copy the books and records of such party as may be reasonably necessary or appropriate to enable such other party to prepare such further documents, instruments, reports or tax returns as such other party or its
counsel determine to be necessary. 
  
 8.8. Prorations; Sales
and Use Taxes; Insurance. 
  
 (a) Prorations. The
Seller and the Buyer agree that all periodic expenses of operating the Branch prior to, on or after the Closing Date which are paid either by Seller before, or by Buyer after, the Closing Date but which payments cover a period of time both before
and after the Closing Date, including but not limited to, state and local personal property taxes, expenses for utilities, telephone, rent, and payments in respect of the contracts, commitments and agreements referred to in Section 2.2 hereof, but
excluding (i) wages, salaries, accrued vacations and other employee expenses up to and including the Closing Date and (ii) federal deposit insurance premiums and FICO assessments paid by the Buyer which shall be the sole obligation of the Seller,
shall, to the extent possible, be determined and prorated as of the Closing Date in connection with the Initial Determination, or the Independent Accounting, if necessary. To the extent that such expenses are not capable of being prorated as of the
Closing Date, such expenses shall, to the extent possible, be prorated by the Buyer and the Seller within thirty (30) days after the Closing Date and all such expenses 
  
 (i) paid by the Seller on or prior to the Closing Date and attributable to the operation of the Branch after
the Closing Date (including any payments by the Seller in respect of any of the contracts, commitments and agreements referred to in Section 2.2 hereof) shall be paid within ten (10) calendar days after notice from the Seller to the Buyer of the
amount thereof not prorated as of the Closing Date in connection with the Initial Determination, or the Independent Accounting, if necessary; and 
  
 (ii) all such expenses unpaid at the Closing Date and attributable to the operation of the Branch on or prior to the Closing Date
(including any payments by the Buyer in respect of any of the contracts, commitments and agreements referred to in Section 2.2 hereof) shall be paid within ten (10) calendar days after notice from the Buyer to the Seller of the amount thereof not
prorated as of the Closing Date in connection with the Initial Determination, or the Independent Accounting, if necessary. 
  
 The Buyer shall, after the Closing, hold the Seller harmless from any liability on account of and shall pay to the Seller, within ten (10)
calendar days after notice from the Seller to the 

  

 28 

 
Buyer of the amount thereof, any payments by the Seller on account of any amounts to be paid by the Buyer pursuant to clause (i) of the immediately preceding
sentence, and the Seller shall, after the Closing, hold the Buyer harmless from any liability on account of and shall pay to the Buyer, within ten (10) calendar days after notice from the Buyer to the Seller of the amount thereof, any payment by the
Buyer on account of any amounts to be paid by the Seller pursuant to clause (ii) of the immediately preceding sentence. The party making any such request for reimbursement pursuant to the provisions of this Section 8.8 shall be assumed to have made
such payment to the ultimate recipient of each such prorated payment. 
  
 (b) Sales and Use Taxes. The Buyer and the Seller agree that all sales and use taxes, if any, payable in connection with this Agreement and the transactions hereby contemplated, shall be paid one-half (1/2) by the Buyer and one-half
(1/2) by the Seller. 
  
 (c) Insurance. The Buyer and
Seller agree that no insurance policies are to be prorated, that the Buyer will procure or maintain its own insurance with respect to the Branch effective as of the Closing Date, and that the Seller shall have no responsibility to maintain insurance
with respect to the Assets or the operations of the Branch after the Closing Date and shall be entitled to retain any refunds of premiums previously paid in respect of the cancellation of such insurance on and as of the Closing Date. 
  
 (d) Lease and other Assumed Liabilities. Buyer agrees to timely
perform all of its obligations under the Lease and all other Liabilities, including transfer of the Leased Premises. 
  
 8.9. Obligations of the Company. The Company agrees to perform all obligations of the Seller under this Agreement following the effective date of the
Seller’s voluntary liquidation under the Home Owners’ Loan Act and applicable OTS regulations. 
  
 ARTICLE IX. 
 Remedies 
  
 9.1. Termination. 
  
 (a) Notwithstanding any provision to the contrary herein, this Agreement may
be terminated: 
  
 (1) At any time at or prior to
the Closing Date: 
  

	 	(i)	by mutual written agreement authorized by the Boards of Directors of the Seller and the Buyer; 

  

	 	(ii)	by either the Seller or the Buyer if the Closing shall not have taken place prior to the date specified in Section 7.1; 

  

	 	(iii)	 by the Seller if (A) any of the conditions set forth in Sections 6.1 or 6.3 

  

 29 

	 	 
hereof shall not have been satisfied on or prior to the Closing Date or shall become incapable of satisfaction by such date; or (B) a Claim of the type
referred to in Section 6.1.3 hereof shall have been instituted; and 

  

	 	(iv)	by the Buyer if: (A) any of the conditions set forth in Sections 6.1 or 6.2 hereof shall not have been satisfied on or prior to the Closing Date or shall become incapable of
satisfaction by such date or if the condition set forth in Section 6.3.4 shall not have been satisfied on or before September 30, 2004; (B) a Claim of the type referred to in Section 6.1.3 hereof shall have been instituted; (C) subsequent to the
date hereof and prior to the Closing Date any legislation, rule, regulation, proclamation, order or action by any Governmental Body has been enacted, adopted, promulgated, taken or otherwise become effective, which materially and adversely affects
the business, operations, prospects or assets of the Branch; or (D) a ten percent (10%) reduction in the Deposits maintained at the Branch shall have occurred between the date of this Agreement and the Closing Date. 

  
 (b) If any party hereto desires to terminate the Agreement pursuant to
Section 9.1(a) hereof, such power of termination may be exercised only by giving written notice, signed on behalf of such party by its Chairman of the Board of Directors or President, to the other party. 
  
 (c) If any party hereto breaches or defaults on any representation, warranty,
covenant or agreement made by it hereunder in any material respect, the nondefaulting party may, on or before the Closing Date, give notice of termination of this Agreement in the manner provided in Section 10.1 hereof. Such notice shall specify
with particularity the breach or defaults upon which such notice is based, and termination shall be effective thirty (30) calendar days after the date of such notice unless the specified breach or default has been cured on or before such effective
date. 
  
 9.2. Litigation Costs. If any legal action or
other proceeding is brought for the enforcement of this Agreement, or because of an alleged dispute, breach, default or misrepresentation in connection with any of its provisions, the successful or prevailing party shall be entitled to recover
reasonable attorneys’ fees and other costs incurred in such action or proceeding, in addition to any other relief to which it may be entitled; and, the Seller shall hold harmless and pay to the Buyer the amount of any damages, costs or expenses
with respect to any Claim arising out of a condition, transaction or event with respect to the Branch occurring on or before the Closing Date, and the Buyer shall hold harmless and pay to the Seller the amount of any damages, costs or expenses with
respect to any Claim arising out of a condition, transaction or event with respect to the Branch occurring after the Closing Date. 
  
 9.3 Liquidated Damages. The parties have determined that, in the event the Agreement is terminated by the Buyer or the Seller for any reason other
than reasons specified herein below, the terminating party would suffer damages which would be difficult or impossible to ascertain. 
  

 30 

 For this reason, the parties have determined by mutual agreement that: 
  
 (a) If the Seller terminates the Agreement for any reason other than (i) as a
result of a mutual written agreement authorized by the Boards of Directors of the Seller and the Buyer to so terminate the Agreement; (ii) as a result of the Closing having not taken place prior to September 30, 2004, other than due to a breach of
this Agreement by the Seller or the nonsatisfaction of the condition in Section 6.3.4 prior to October 1, 2004; or (iii) as a result of the nonsatisfaction on or prior to the Closing Date of any of the conditions set forth in Sections 6.1and, 6.3
(except the condition contained in Section 6.3.4) other than due to a breach of this Agreement by the Seller, the Seller shall pay the Buyer on or before the date ninety (90) days after termination, as liquidated damages, $500,000.00 in Cash;

  
 (b) If the Buyer terminates the Agreement for any reason other
than (i) as a result of a mutual written agreement authorized by the Boards of Directors of the Seller and the Buyer to so terminate the Agreement; (ii) as a result of the Closing having not taken place prior to September 30, 2004 other than due to
a breach of this Agreement by the Buyer; or (iii) as a result of the nonsatisfaction on or prior to the Closing Date of any of the conditions set forth in Sections 6.1 and 6.2 other than due to a breach of this Agreement by the Buyer, the Buyer
shall pay the Seller on or before the date ninety (90) days after termination, as liquidated damages, $200,000.00 in Cash; and 
  
 (c ) If the Buyer terminates the Agreement because of the nonsatisfaction of the condition set forth in Section 6.3.4 prior to October 1, 2004, the Seller
shall pay the Buyer on or before the date ninety (90) days after termination, as liquidated damages, $500,000in Cash. 
  
 (d) Any such amount shall bear interest on the unpaid amount thereof from the date due at a rate equal to The Wall Street Journal prime rate, calculated
on a daily basis, until paid in full. 
  
 (e) The liquidated
damages prescribed hereunder shall be each party’s sole and exclusive remedy in the event the Closing shall not occur. 
  
 ARTICLE X. 
 Miscellaneous Provisions

  
 10.1. Notices. All notices, requests, demands,
waivers or other communications hereunder must be in writing and shall be deemed given on the date delivered if delivered personally or two (2) days after posted if sent by registered or certified mail, return receipt requested, proper postage
prepaid, to the parties at the following addresses or at such other addresses as may be specified by a like notice: 
  

			
	If to the Seller:	  	Pan American Bank, FSB
	 	  	3990 Westerly Place, Suite 200
	 	  	Newport Beach, California 92679
	 	  	Attn.: Ray Thousand
	 	  	Fax: 949-224-1912
	 	  	 
	 	  	 
	 	  	 
	 	  	 
	 	  	 

  

 31 

			
	With a copy to:	  	Manatt, Phelps & Phillips, LLP
	 	  	11355 West Olympic Boulevard
	 	  	Los Angeles, California 90064
	 	  	Attn.: Mick Grasmick
	 	  	Fax: 310-312-4224
		
	If to the Buyer:	  	Kaiser Federal Bank
	 	  	1359 N. Grand Avenue
	 	  	Covina, California 91724
	 	  	Attn.: Kay M. Hoveland
	 	  	Fax: 626-858-5745
		
	 	  	With a copy to:
	 	  	Luse Gorman Pomerenk & Schick, P.C.
	 	  	5335 Wisconsin Avenue, Suite 400
	 	  	Washington, D.C. 20015-2035
	 	  	Attn.: Richard S. Garabedian
	 	  	Fax: 202-362-2902

  
 10.2. Entire
Agreement. This Agreement constitutes the entire agreement between the parties pertaining to the subject matter hereof and supersedes any and all prior and contemporaneous agreements, representations and understandings of the parties with
respect to the subject matter hereof. No supplement, modification or amendment of this Agreement shall be binding unless executed in writing by all of the parties hereto. No waiver of any of the provisions of this Agreement shall be deemed, or shall
constitute, a waiver of any other provision, whether or not similar, nor shall any waiver constitute a continuing waiver. No waiver shall be binding unless in a writing executed by the party making the waiver. 
  
 10.3. Third Party Rights. Nothing in the Agreement, whether expressed
or implied, is intended to confer any rights or remedies upon any persons other than the parties hereto and their respective legal representatives, successors and assigns; nor is anything in this Agreement intended to relieve or discharge the
obligations or liabilities of any third persons to any party to this Agreement; nor shall any provision hereof give any third person any right of subrogation or action over or against any party to this Agreement. 
  
 10.4. Successors and Assigns. This Agreement shall be binding on, and
shall inure to the benefit of, the parties hereto and their legal representatives, successors and assigns; provided, however, that no assignment of this Agreement or any rights or obligations hereunder may be made by any party hereto
without the prior written consent of the other party and no assignment by any party hereunder shall relieve said party of any of its obligations or duties hereunder. 
  

 32 

 10.5. Brokers. Each party shall bear the fees and expenses of any agent or broker engaged by such
party relating to this Agreement and each party hereby agrees to indemnify the other party and hold it harmless from and against any claims for any commissions relating to this Agreement or to the transactions contemplated hereby resulting from the
engagement of any agent or broker by such indemnifying party. 
  
 10.6. Survival of Warranties and Obligations. Except as hereinafter set forth, all indemnifications, representations and warranties made herein by the parties to this Agreement, shall survive the Closing Date for a period of eighteen
(18) months; provided, (i) that any action arising under any such indemnification, representation or warranty must be commenced within said eighteen (18) month period, and (ii) that all matters respecting determination of the Deposit Transfer
and Deposit Premium and related calculations under Article III shall survive for a period of three (3) months only following the Closing Date. Notwithstanding the foregoing, the obligation of Seller to timely perform its obligations under the
Retained Liabilities and the obligation of Buyer to timely perform its obligations under the Liabilities (including without limitation the Lease) and any right of indemnification with respect thereto shall not terminate pursuant to this Section.

  
 10.7. Severability. If any provision of this Agreement,
as applied by any party or to any circumstance, shall be adjudged by a court to be void, invalid or unenforceable, the same shall in no way affect any other provision of this Agreement, the application of any such provision in any other
circumstance, or the validity or enforceability of the other provisions of this Agreement. 
  
 10.8. Expenses. Except as otherwise specifically provided herein, all expenses incurred by the Buyer in connection with this Agreement shall be paid and discharged by the Buyer and all expenses incurred by the
Seller in connection with this Agreement shall be paid and discharged by the Seller and none of the Seller’s expenses in connection herewith shall be charged to the Branch. Provided, however, the filing fee related to the Form
1639 regulatory application with the OTS shall be paid one-half each by the Seller and the Buyer. 
  
 10.9. Counterparts. The Agreement may be executed simultaneously or in one (1) or more counterparts, each of which may be deemed an original, but
all of which together shall constitute one (1) and the same instrument, it not being necessary in making proof of this Agreement to produce or account for more than one (1) counterpart executed by each party hereto. 
  
 10.10. Headings and Construction. All section headings are included
only for convenience and are not intended to be a full and accurate description of the contents of the sections hereof and in no way limit, define or describe the scope or intent of this Agreement or any provisions hereof. 
  
 10.11. Governing Law. This Agreement, to the extent applicable, shall
be construed in accordance with, and governed by, federal banking laws and the laws of the State of California. 
  

 33 

 10.12. Indemnification Seller and Buyer each agree to indemnify and hold the other (references in
this Section 10.12 to either party to indemnify the other party shall include indemnity for such party’s stockholders, officers and directors) harmless for a period of eighteen (18) months after the Closing Date as follows: 
  
 (a) Buyer agrees to indemnify and hold Seller harmless from
and against, and to reimburse Seller promptly for, any and all loss, liability, damage, expense or cost (including court costs, litigation expenses and reasonable attorneys’ fees) arising from any claim made or asserted by a bona fide third
party not a party or an affiliate of a party to this Agreement which Seller may suffer as a result of any action or omission of Buyer on or following the Closing Date or after the Closing Date with respect to Buyer’s post Closing Date
obligations in connection with the Deposits or other liabilities assumed by Buyer hereunder or any other aspect of the business operations of the Branch or the lease covering the Branch. 
  
 (b) Seller agrees to indemnify and hold Buyer harmless from and against, and to reimburse Buyer promptly
for, any and all loss, liability, damage, expense or cost (including court costs, litigation expenses and reasonable attorneys’ fees) arising from any claim made or asserted by a bona fide third party not a party or an affiliate of a party to
this Agreement which Buyer may suffer a result of any action or omission of Seller prior to the Closing Date or after the Closing Date with respect to the Seller’s post Closing Date obligations in connection with the Deposits or other
liabilities assumed by Buyer hereunder or any other aspect of the business operations of the Branch or the lease covering the Branch as in effect prior to the Closing Date. 
  
 (c) The amounts recoverable by either party with respect to any such claims against the other shall reflect,
and such other party shall only be obligated to pay, the net amount of damages suffered by the other party entitled to recovery after giving effect to any insurance proceeds recoverable with respect to such matters. Each party shall select counsel
and pay for the defense of the other party with respect to any claim against which such paying party is obligated to indemnify such other party as provided in this Section 10.12. If such other party chooses to have counsel of its choosing in
addition to that provided by the paying party, it may do so at its sole expense. Each party shall provide to the other written notice of any claim to which such other party’s indemnity obligations hereunder do or may apply within thirty (30)
calendar days after becoming aware of the existence of such claim, setting forth in such notice, in reasonable detail, the facts giving rise to such claim of indemnity. An indemnifying party shall not be liable under this Section for any settlement
entered into without its consent of any claim, litigation or proceeding in respect of which indemnity may be sought hereunder. An indemnifying party may settle any claim without the consent of the indemnified party, but only if the sole relief
awarded is monetary damages that are paid in full by the indemnifying party. 
  
 10.13. Damage or Destruction. Notwithstanding any other provision of this Agreement, in the event, prior to the Closing, Seller suffers a material loss due to earthquake, fire, flood, accident or other casualty
which in the good faith and reasonable opinion of Buyer substantially and adversely affects the value of the Assets, Buyer shall have the right to terminate this Agreement by giving written notice to Seller. Should Buyer not terminate this
Agreement, Buyer shall take the Assets and the Leased Premises as is, together with the insurance proceeds relating to the materially damaged Assets and/or the Leased Premises. 
  

 34 

 10.14. No Consequential Damages. Neither party shall be liable to the other party for such other
party’s consequential or special damages, including without limitation lost profits. The foregoing shall not affect the obligation of a party under Section 10.12 to indemnify the other party for consequential damages of a third party for which
such other party may be liable. 
  
 10.15. Publicity.
Except as required by law, prior to the Closing Date, neither Buyer nor Seller will issue any press release or make any public announcement relating to the transactions contemplated herein, without consulting with and obtaining the approval of the
other party, which approval shall not be unreasonably withheld or delayed. Each party agrees to forward copies of all public statements, whether written or oral, to the other party for prior review. The reviewing party shall have one (1)full
business day to object to the statement or any part thereof. Failure to respond within such period will be deemed to be approval and acceptance of such statement. 
  

 35 

 IN WITNESS WHEREOF, the Seller and the Buyer have caused this Agreement to be executed in counterparts by
their respective presidents and secretaries and their respective corporate seals to be hereunto affixed as of the date first above written. 
  

									
	BUYER:	 	 	 	KAISER FEDERAL BANK
					
	 	 	 	 	 	 	 By:
	 	 /s/ Kay M. Hoveland

	 	 	 	 	 	 	 	 	 Kay M. Hoveland

	 	 	 	 	 	 	 	 	 President and

	 	 	 	 	 	 	 	 	 Chief Executive Officer

					
	 	 	 	 	 	 	 By:
	 	 /s/ Daniel A. Cano

	 	 	 	 	 	 	 	 	 Daniel A. Cano

	 	 	 	 	 	 	 	 	 Assistant Corporate Secretary

				
	 	 	SELLER	 	 	 	PAN AMERICAN BANK, FSB
					
	 	 	 	 	 	 	 By:
	 	 /s/ Ray Thousand

	 	 	 	 	 	 	 	 	 Ray Thousand

	 	 	 	 	 	 	 	 	 President and Chief Executive Officer

					
	 	 	 	 	 	 	 By:
	 	 /s/ Sherry Landy

	 	 	 	 	 	 	 	 	 Assistant Secretary

				
	 	 	 	 	 	 	 UNITED PANAMERICAN FINANCIAL
 CORP.

					
	 	 	 	 	 	 	 By:
	 	 /s/ Ray Thousand

	 	 	 	 	 	 	 	 	 Ray Thousand

	 	 	 	 	 	 	 	 	 President and Chief Executive Officer

					
	 	 	 	 	 	 	 By:
	 	 /s/ Sherry Landy

	 	 	 	 	 	 	 	 	 Assistant Secretary

  

 36

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00074-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00074-of-00352.parquet"}]]