Document:

Exhibit
10.1

 

AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT

 

Dated as of August 3, 2006

 

This Amended
and Restated Revolving Credit Agreement (this “Agreement”) is by and
between FIRST COMMUNITY BANCORP, a
corporation formed under the laws of the State of California (“Borrower”),
and U.S. BANK NATIONAL ASSOCIATION,
a national banking association (“Lender”), with a banking office at 777
East Wisconsin Avenue, Milwaukee, Wisconsin 53202.

 

As used in
this Agreement, capitalized terms not otherwise defined herein shall have the
meaning assigned to such term as set forth in Section 8.

 

SECTION 1. LOANS

 

SECTION
1.1.      REVOLVING CREDIT LOANS. Subject
to the terms and conditions of this Agreement, Lender agrees to make loans to
Borrower, from time to time from the date of this Agreement through August 2,
2007 (the “Maturity Date”), at such times and in such amounts, not to
exceed SEVENTY MILLION AND NO/100 UNITED STATES DOLLARS ($70,000,000.00) (the “Commitment”)
at any one time outstanding, as Borrower may request (the “Loan(s)”). During
such period Borrower may borrow, repay and reborrow hereunder. Each borrowing
shall be in the amount of at least $100,000 or the remaining unused amount of
the Commitment.

 

SECTION
1.2.      REVOLVING CREDIT NOTE. The Loans
shall be evidenced by a promissory note (the “Note”), substantially in
the form of Exhibit A, with appropriate insertions, dated the date
hereof, payable to the order of Lender and in the original principal amount of
the Commitment. Lender may at any time and from time to time at Lender’s sole
option attach a schedule (grid) to the Note and endorse thereon notations with
respect to each Loan specifying the date and principal amount thereof, the
Interest Period (if applicable), the applicable interest rate and rate option,
and the date and amount of each payment of principal and interest made by
Borrower with respect to each such Loan. Lender’s endorsements as well as its
records relating to the Loans shall be rebuttably presumptive evidence of the
outstanding principal and interest on the Loans, and, in the event of
inconsistency, shall prevail over any records of Borrower and any written
confirmations of the Loans given by Borrower. The principal of the Note shall
be payable on or before the Maturity Date.

 

SECTION
1.3.      EXTENSION OF MATURITY DATE.
Borrower may request an extension of the Maturity Date by submitting a request
for an extension to Lender (an “Extension Request”) no more than sixty
(60) days prior to the current Maturity Date. The Extension Request must specify
the new Maturity Date requested by Borrower and the date (which must be at
least thirty (30) days after the Extension Request is delivered to Lender) as
of which Lender must respond to the Extension Request (the “Extension Date”).
The new Maturity Date shall be 

 

 

no more than 364 days after the Maturity Date in effect at the time the
Extension Request is received, including such Maturity Date as one of the days
in the calculation of the days elapsed. If Lender fails to respond to an
Extension Request by the Extension Date, Lender shall be deemed to have denied
the Extension Request. If Lender, in its sole discretion, decides to approve
the Extension Request, Lender shall deliver its written consent to Borrower of
such extension no later than the Extension Date (provided it shall not be
liable to Borrower or any other Person for its failure to do so).

 

SECTION 2. INTEREST AND FEES

 

SECTION
2.1.      INTEREST RATE. Borrower agrees to pay interest on the unpaid principal
amount of the Loans from time to time outstanding hereunder at the following
rates per year:

 

(a)           Before maturity of
any Loan, whether by acceleration or otherwise, at the option of Borrower,
subject to the terms hereof at a rate equal to:

 

(i)            The “Prime-Based
Rate,” which shall mean the Prime Rate minus seventy-five hundredths of one
percent (-0.75%) per annum;

 

(ii)           “LIBOR,”
which shall mean the sum of (A) that fixed rate of interest per year for
deposits with Interest Periods of 1, 3 or 6 months (which Interest Period
Borrower shall select subject to the terms stated herein) in United States
Dollars offered to Lender in or through the London interbank market at or about
10:00 A.M., London time, two days (during which banks are generally open in
both Chicago and London) before the rate is to take effect in an amount
corresponding to the amount of the requested Loan or portion thereof and for
the London deposit Interest Period requested, divided  by one
minus any applicable reserve requirement (expressed as a decimal) on Eurodollar
deposits of the same amount and Interest Period as determined by Lender in its
sole discretion, plus (B) one and one-half percent (+1.50%) per annum;
or

 

(iii)          “Federal Funds
Rate,” which shall mean the sum of (A) the weighted average of the rates on
overnight Federal funds transactions, with members of the Federal Reserve
System only, arranged by Federal funds brokers, plus (B) one and
one-half percent (+1.50%) per annum. The Federal Funds Rate shall be determined
by Lender on the basis of reports by Federal funds brokers to, and published
daily by, the Federal Reserve Bank of New York in the Composite Closing
Quotations for U.S. Government Securities. If such publication is unavailable
or the Federal Funds Rate is not set forth therein, the Federal Funds Rate
shall be determined on the basis of any other source reasonably selected by
Lender. The Federal Funds Rate applicable each day shall be the Federal Funds
Rate reported as applicable to Federal funds transactions on that date. In the
case of Saturday, Sunday or a legal holiday, the Federal Funds Rate shall be
the rate applicable to Federal funds transactions on the immediately preceding
day for which the Federal Funds Rate is reported.

 

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(b)           After the maturity
of any Loan, whether by acceleration or otherwise, such Loan shall bear
interest until paid at a rate equal to two percent (2%) in addition to the rate
in effect immediately prior to maturity (but not less than the Prime-Based Rate
in effect at maturity).

 

SECTION
2.2.      RATE SELECTION. Borrower
shall select and change its selection of the interest rate as among LIBOR, the
Federal Funds Rate and the Prime-Based Rate, as applicable, to apply to at
least $100,000 and in integral multiples of $100,000 thereafter of any Loan or
portion thereof, subject to the requirements herein stated:

 

(a)           At the time any Loan
is made;

 

(b)           At the expiration of
a particular LIBOR Interest Period selected for the outstanding principal
balance of any Loan or portion of any Loan currently bearing interest at LIBOR;
and

 

(c)           At any time for the
outstanding principal balance of any Loan or portion thereof currently bearing
interest at the Prime-Based Rate or the Federal Funds Rate.

 

SECTION
2.3.      RATE CHANGES AND NOTIFICATIONS.

 

(a)           LIBOR. If
Borrower wishes to borrow funds at LIBOR or Borrower wishes to change the rate
of interest on any Loan or portion thereof, within the limits described above,
from any other rate to LIBOR, it shall, at or before 12:00 noon, Chicago time,
not less than two Banking Days of Lender prior to the Banking Day of Lender on
which such rate is to take effect, give Lender written notice thereof, which
shall be irrevocable. Such notice shall specify the Loan or portion thereof to
which LIBOR is to apply, and, in addition, the desired LIBOR Interest Period of
1, 3 or 6 months. Notwithstanding that any LIBOR Interest Period selected by
Borrower may extend beyond the Maturity Date, Borrower acknowledges and agrees
that all amounts owing by Borrower to Lender under this Agreement in respect of
principal, accrued interest, fees and expenses, including any amounts under
section 2.5(c), shall be due and payable on the Maturity Date.

 

(b)           Federal Funds
Rate or Prime-Based Rate. If Borrower wishes to borrow funds at the Federal
Funds Rate or the Prime-Based Rate or to change the rate of interest on any
Loan or any portion thereof, to such rate, it shall, at or before l2:00 noon,
Chicago time, on the date such borrowing or change is to take effect, which
shall be a Banking Day of Lender, give Lender written notice thereof, which
shall be irrevocable. Such notice shall specify the advance and the desired
interest rate option.

 

(c)           Failure to Notify.
If Borrower does not notify Lender at the expiration of a selected Interest
Period with respect to any principal outstanding at LIBOR, then in the absence
of such notice Borrower shall be deemed to have elected to have such principal
accrue interest after the respective LIBOR Interest Period at the Federal Funds
Rate. If Borrower does not notify Lender as to its selection of the interest
rate option with respect to any new Loan, then in the absence of such notice
Borrower shall be deemed to have elected to have such initial advance accrue
interest at the Federal Funds Rate.

 

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SECTION
2.4.      INTEREST PAYMENT DATES.
Accrued interest shall be paid in respect
of each portion of principal to which the Federal Funds Rate or Prime-Based
Rate applies on the last day of each month in each year, beginning with the
first of such dates to occur after the date of the first Loan or portion
thereof, at maturity, and upon payment in full, and to each portion of
principal to which any other interest rate option applies, the end of each
respective Interest Period, every three months, at maturity, and upon payment
in full, whichever is earlier or more frequent. After maturity, interest shall
be payable upon demand.

 

SECTION
2.5.      ADDITIONAL PROVISIONS WITH
RESPECT TO FEDERAL FUNDS RATE AND LIBOR LOANS.

 

The selection
by Borrower of the Federal Funds Rate or LIBOR and the maintenance of the Loans
or portions thereof at such rate shall be subject to the following additional
terms and conditions:

 

(a)           Availability of
Deposits at a Determinable Rate. If, after Borrower has elected to borrow
or maintain any Loan or portion thereof at the Federal Funds Rate or LIBOR,
Lender notifies Borrower that:

 

(i)            United States
dollar deposits in the amount and for the maturity requested are not available
to Lender (in the case of LIBOR, in the London interbank market); or

 

(ii)           Reasonable means do
not exist for Lender to determine the Federal Funds Rate or LIBOR for the
amount and maturity requested; all as determined by Lender in its sole
discretion, then the principal subject to the Federal Funds Rate or LIBOR shall
accrue or shall continue to accrue interest at the Prime-Based Rate.

 

(b)           Prohibition of
Making, Maintaining, or Repayment of Principal at the Federal Funds Rate or
LIBOR. If any treaty, statute, regulation, interpretation thereof, or any
directive, guideline, or otherwise by a central bank or fiscal authority
(whether or not having the force of law) shall either prohibit or extend the
time at which any principal subject to the Federal Funds Rate or LIBOR may be
purchased, maintained, or repaid, then on and as of the date the prohibition
becomes effective, the principal subject to that prohibition shall continue at
the Prime-Based Rate.

 

(c)           Payments of
Principal and Interest to be Inclusive of Any Taxes or Costs. All payments
of principal and interest shall include any taxes and costs incurred by Lender
resulting from having principal outstanding hereunder at the Federal Funds Rate
or LIBOR. Without limiting the generality of the preceding obligation,
illustrations of such taxes and costs are:

 

(i)            Taxes (or the
withholding of amounts for taxes) of any nature whatsoever including income,
excise, and interest equalization taxes (other than income taxes imposed by the
United States or any state or locality thereof on the income of Lender), as
well as all levies, imposts, duties, or fees whether now in existence or 

 

4

 

resulting from a change in, or promulgation of, any treaty, statute,
regulation, interpretation thereof, or any directive, guideline, or otherwise,
by a central bank or fiscal authority (whether or not having the force of law)
or a change in the basis of, or time of payment of, such taxes and other
amounts resulting therefrom;

 

(ii)           Any reserve or
special deposit requirements against assets or liabilities of, or deposits with
or for the account of, Lender with respect to principal outstanding at LIBOR
including those imposed under Regulation D of the Federal Reserve Board or
resulting from a change in, or the promulgation of, such requirements by
treaty, statute, regulation, interpretation thereof, or any directive,
guideline, or otherwise by a central bank or fiscal authority (whether or not
having the force of law);

 

(iii)          Any other costs
resulting from compliance with treaties, statutes, regulations,
interpretations, or any directives or guidelines, or otherwise by a central
bank or fiscal authority (whether or not having the force of law), including
capital adequacy regulations;

 

(iv)          Any loss (including
loss of anticipated profits) or expense incurred by reason of the liquidation
or re-employment of deposits acquired by Lender:

 

(A)          To make Loans or a portion thereof or
maintain principal outstanding at the LIBOR or the Federal Funds Rate;

 

(B)           As the result of a voluntary
prepayment at a date other than the Interim Maturity Date selected for
principal outstanding at LIBOR;

 

(C)           As the result of a mandatory
repayment at a date other than that Interim Maturity Date selected for
principal outstanding at LIBOR as the result of the occurrence of an Event of
Default (as defined in Section 7.1) and the acceleration of any portion
of the indebtedness hereunder; or

 

(D)          As the result of a prohibition on
making, maintaining, or repaying principal outstanding at the Federal Funds
Rate or LIBOR.

 

If Lender
incurs any such taxes or costs, Borrower, upon demand in writing specifying
such taxes and costs, shall promptly pay them; save for manifest error Lender’s
specification shall be presumptively deemed correct.

 

SECTION
2.6.      BASIS OF COMPUTATION. Interest
shall be computed for the actual number of days elapsed on the basis of a year
consisting of 360 days, including the date a Loan is made and excluding the
date a Loan or any portion thereof is paid or prepaid.

 

SECTION
2.7.      COMMITMENT FEE, REDUCTION OF
COMMITMENT. Borrower agrees to pay Lender a
commitment fee (the “Commitment Fee”) in arrears of twenty-five
hundredths of one percent (0.25%) per year on the average daily unused amount
of the Commitment. The Commitment Fee shall commence to accrue on the date of
this Agreement 

 

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and shall be paid on the last day of each calendar quarter in each
year, beginning with the first of such dates to occur after the date of this
Agreement, at maturity and upon payment in full. At any time or from time to
time, upon at least ten days’ prior written notice, which shall be irrevocable,
Borrower may reduce the Commitment in the amount of at least $100,000 or in
full; provided that Borrower may not reduce the Commitment below an amount
equal to the aggregate outstanding principal amount of all Loans. Upon any such
reduction of any part of the unused Commitment, any accrued and unpaid
Commitment Fee on the part reduced shall be paid in full as of the date of such
reduction.

 

SECTION 3. PAYMENTS AND PREPAYMENTS

 

SECTION
3.1.      PREPAYMENTS. Borrower may
prepay without penalty or premium any principal bearing interest at the
Prime-Based Rate or the Federal Funds Rate. If Borrower prepays any principal
bearing interest at LIBOR in whole or in part on a date other than the Interim
Maturity Date, or if the maturity of any such LIBOR principal is accelerated,
then, to the fullest extent permitted by law Borrower shall also pay Lender for
all losses and expenses incurred by reason of the liquidation or re-employment
of deposits acquired by Lender to make the Loan or maintain principal
outstanding at LIBOR. Upon Lender’s demand in writing specifying such losses
and expenses, Borrower shall promptly pay them; Lender’s specification shall be
deemed correct in the absence of manifest error. All Loans or portions thereof
made at LIBOR shall be conclusively deemed to have been funded by or on behalf
of Lender (in the London interbank market) by the purchase of deposits
corresponding in amount and maturity to the amount and Interest Periods
selected (or deemed to have been selected) by Borrower under this Agreement. Any
partial repayment or prepayment shall be in an amount equal to the lesser of
$500,000 and the outstanding principle balance of the Loans.

 

SECTION
3.2.      FUNDS. All payments
of principal, interest and the Commitment Fee shall be made in immediately
available funds to Lender at its banking office indicated above or as otherwise
directed by Lender.

 

SECTION 4. REPRESENTATIONS AND WARRANTIES

 

To induce
Lender to make each of the Loans, Borrower represents and warrants to Lender
that:

 

SECTION
4.1.      ORGANIZATION. Borrower is
existing and in good standing as a duly qualified and organized bank holding
company. Borrower and each Subsidiary is existing and in good standing under
the laws of their jurisdiction of formation, and are duly qualified, in good
standing and authorized to do business in each jurisdiction where failure to do
so might have a material adverse impact on the consolidated assets, condition
or prospects of Borrower. Borrower and each Subsidiary have the power and
authority to own their properties and to carry on their businesses as now being
conducted.

 

SECTION
4.2.      AUTHORIZATION; NO CONFLICT.
The execution, delivery and performance
of this Agreement, the Pledge Agreement (as defined in Section 5.11),
the Note and all related documents and instruments:  (a) are within Borrower’s powers; (b) have
been authorized by all necessary corporate action; (c) have received any and
all necessary 

 

6

 

governmental approvals; and (d) do not and will not contravene or
conflict with any provision of law or charter or by-laws of Borrower or any
agreement affecting Borrower or its property. This Agreement, the Pledge
Agreement and the Note when executed and delivered will be, legal, valid and
binding obligations of Borrower, enforceable against Borrower in accordance
with their respective terms.

 

SECTION
4.3.      FINANCIAL STATEMENTS. Borrower has
supplied to Lender copies of its audited consolidated financial statements as
of and for the twelve month period ended December 31, 2005. Such statements
have been furnished to Lender, have been prepared in conformity with generally
accepted accounting principles applied on a basis consistent with that of the
preceding fiscal year, except as disclosed in such statements, and fairly
present the financial condition of Borrower and its Subsidiaries as of such
dates and the results of their operations for the respective periods then ended.
Since the date of those financial statements, no material, adverse change in
the business, condition, properties, assets, operations, or prospects of
Borrower or its Subsidiaries has occurred except as disclosed on Schedule 4.3.
There is no known contingent liability of Borrower or any Subsidiary which is
known to be in an amount that is more than $1,000,000 (excluding loan
commitments, letters of credit, and other contingent liabilities incurred in
the ordinary course of the banking business) in excess of insurance for which
the insurer has confirmed coverage in writing which is not reflected in such
financial statements or disclosed on Schedule 4.3.

 

SECTION
4.4.      TAXES. Borrower and
each Subsidiary have filed or caused to be filed all federal, state and local
tax returns which, to the knowledge of Borrower or such Subsidiary, are
required to be filed, and have paid or have caused to be paid all taxes as
shown on such returns or on any assessment received by them, to the extent that
such taxes have become due (except for current taxes not delinquent and taxes
being contested in good faith and by appropriate proceedings for which adequate
reserves have been provided on the books of Borrower or the appropriate
Subsidiary, and as to which no foreclosure, sale or similar proceedings have
been commenced).

 

SECTION
4.5.      LIENS. None of the
assets of Borrower or any Subsidiary are subject to any mortgage, pledge, title
retention lien, or other lien, encumbrance or security interest except:  (a) for current taxes not delinquent or
taxes being contested in good faith and by appropriate proceedings;
(b) for liens arising in the ordinary course of business for sums not due
or sums being contested in good faith and by appropriate proceedings, but not
involving any deposits or loan or portion thereof or borrowed money or the
deferred purchase price of property or services; (c) to the extent
specifically shown in the financial statements referred to in Section 4.3;
and (d)  liens and security interests securing deposits of public funds,
repurchase agreements, Federal funds purchased, trust assets, advances from a
Federal Home Loan Bank, discount window borrowings from a Federal Reserve Bank
and other similar liens granted in the ordinary course of the banking business.

 

SECTION
4.6.      ADVERSE CONTRACTS. Neither
Borrower nor any Subsidiary is a party to any agreement or instrument or
subject to any charter or other corporate restriction, nor is it subject to any
judgment, decree or order of any court or governmental body, which may have a
material and adverse effect on the business, assets, liabilities, financial
condition, operations or business prospects of Borrower and its Subsidiaries
taken as a whole or on the 

 

7

 

ability of Borrower to perform its obligations under this Agreement,
the Pledge Agreement and the Note. Neither Borrower nor any Subsidiary has, nor
with reasonable diligence should have had, knowledge of or notice that it is in
default in the performance, observance or fulfillment of any of the
obligations, covenants or conditions contained in any such agreement,
instrument, restriction, judgment, decree or order.

 

SECTION
4.7.      REGULATION U. Borrower is
not engaged principally in, nor is one of Borrower’s important activities, the
business of extending credit for the purpose of purchasing or carrying “margin
stock” within the meaning of Regulation U of the Board of Governors of the
Federal Reserve System as now and from time to time hereinafter in effect.

 

SECTION
4.8.      LITIGATION AND CONTINGENT
LIABILITIES. No litigation (including derivative
actions), arbitration proceedings or governmental proceedings are pending or,
to Borrower’s knowledge, threatened against Borrower which would (singly or in
the aggregate), if adversely determined, have a material and adverse effect on
the consolidated assets, financial condition, continued operations or business
of Borrower and its Subsidiaries, except as and if set forth (including estimates
of the dollar amounts involved) in Schedule 4.8.

 

SECTION
4.9.      FDIC INSURANCE. The deposits
of each Subsidiary Bank of Borrower are insured by the FDIC and no act has
occurred which would adversely affect the status of such Subsidiary Bank as an FDIC
insured bank.

 

SECTION
4.10.   INVESTIGATIONS. Neither
Borrower nor any Subsidiary Bank is under investigation by, or is operating
under the restrictions imposed by or agreed to in connection with, any
regulatory authority, other than routine examinations by regulatory authorities
having jurisdiction over Borrower or such Subsidiary Bank.

 

SECTION
4.11.   SUBSIDIARIES. Attached
hereto as Schedule 4.11 is a correct and complete list of all
Subsidiaries of Borrower.

 

SECTION
4.12.   BANK HOLDING COMPANY.
Borrower has complied in all material respects with all federal, state and
local laws pertaining to bank holding companies, including without limitation
the Bank Holding Company Act of 1956, as amended, and to the best of its
knowledge there are no conditions to its engaging in the business of being a
registered bank holding company.

 

SECTION
4.13.   ERISA.

 

(a)           Borrower and the
ERISA Affiliates and the plan administrator of each Plan (other than a
Multiemployer Plan) have fulfilled in all material respects their respective
obligations under ERISA and the Code with respect to such Plan and such Plan is
currently in substantial compliance with the applicable provisions of ERISA and
the Code.

 

(b)           With respect to each
Plan, there has been no (i) “reportable event” within the meaning of Section
4043 of ERISA and the regulations thereunder which is not subject to the
provision for waiver of the 30-day notice requirement to the PBGC;
(ii) failure by Borrower or any ERISA Affiliate to timely make or properly
accrue any contribution 

 

8

 

which is due to any Plan; (iii) action under Section 4041(c) of
ERISA to terminate any Pension Plan; (iv) action under
Section 4041(b) of ERISA to terminate any Pension Plan which could require
Borrower to incur a liability or obligations to make a material contribution to
such Pension Plan; (v) withdrawal from any Pension Plan with two or more
contributing sponsors or the termination of any such Pension Plan that could
subject the Borrower to material liability pursuant to Section 4063 or 4064 of
ERISA; (vi) institution by PBGC of proceedings to terminate any Pension
Plan, or the occurrence of any event or condition which might constitute
grounds under ERISA for the termination of, or the appointment of a trustee to
administer, any Pension Plan (other than a Multiemployer Plan); (vii) the
imposition on Borrower or any ERISA Affiliate of liability pursuant to
Sections 4062(e), 4069 or 4212 of ERISA; (viii) complete or partial
withdrawal (within the meaning of Sections 4203 and 4205 of ERISA) by
Borrower or any ERISA Affiliate from any Pension Plan which is a Multiemployer
Plan that is in reorganization or insolvency pursuant to Sections 4241 or
4245 of ERISA, or that has terminated under Sections 4041A or 4042 of
ERISA; (ix) prohibited transaction described in Section 406 of ERISA
or 4975 of the Code which could subject Borrower to the imposition of any
material fines, penalties, taxes or related charges imposed by either
Section 4975 of the Code or Section 502(i) of ERISA;
(x) material pending claim (other than routine claims for benefits)
against any Plan (other than a Multiemployer Plan) which could reasonably be
expected to result in material liability; (xi) receipt from the Internal
Revenue Service of notice of the failure of any Plan (other than a
Multiemployer Plan) to qualify under Section 401(a) of the Code, or the
failure of any trust forming part of any Plan (other than a Multiemployer Plan)
to fail to qualify for exemption from taxation under Section 501(a) of the
Code, if applicable; or (xii) imposition of a lien pursuant to
Section 401(a)(29) or 412(n) of the Code or Section 302(f) of ERISA.

 

SECTION
4.14.   ENVIRONMENTAL LAWS.

 

(a)           Borrower and each of
its Subsidiaries have obtained all permits, licenses and other authorizations
which are required to be obtained by Borrower or such Subsidiaries, as the case
may be, under all Environmental Laws and are in compliance in all material
respects with any applicable Environmental Laws.

 

(b)           Borrower has not
received any notice, demand, request for information, citation, summons, order
or complaint, no penalty has been assessed and no investigation or review is
pending or, to Borrower’s knowledge, threatened by any governmental agency or
other Person, in each case, with respect to any alleged or suspected failure by
Borrower or any of its Subsidiaries to comply in any material respect with any
Environmental Laws.

 

(c)           There are no
material liens arising under or pursuant to any Environmental Laws on any of
the property owned or, to Borrower’s knowledge, leased by Borrower or any of
its Subsidiaries.

 

(d)           There are no
conditions existing currently or, to Borrower’s knowledge, likely to exist
during the term of this Agreement which would subject Borrower or any of its
Subsidiaries or any of their owned property or, to Borrower’s knowledge, any of
their 

 

9

 

leased property, to any material lien, damages, penalties, injunctive
relief or cleanup costs under any Environmental Laws or which require or are
reasonably likely to require cleanup, removal, remedial action or other
responses pursuant to Environmental Laws by Borrower and its Subsidiaries.

 

SECTION
4.15.   PLEDGED SHARES. The
Pledged Shares (as defined in Section 5.11) constitute 100% of the
issued and outstanding capital stock of Pacific Western National Bank, have
been duly authorized and validly issued and are fully paid and non-assessable. Borrower
owns the Pledged Shares free and clear of all other interests, liens or
encumbrances of any nature whatsoever, other than liens in favor of Lender.

 

SECTION 5. COVENANTS

 

Until all
obligations of Borrower hereunder, under the Pledge Agreement, the Note and all
other related documents and instruments are paid and fulfilled in full,
Borrower agrees that it shall, and shall cause each Subsidiary to, comply with
the following covenants, unless Lender consents otherwise in writing:

 

SECTION
5.1.      EXISTENCE, MERGERS, ETC. Borrower and
each Subsidiary shall preserve and maintain their respective corporate,
partnership or joint venture (as applicable) existence, rights, franchises,
licenses and privileges, and will not liquidate, dissolve, or merge, or
consolidate with or into any other entity, or sell, lease, transfer or
otherwise dispose of all or a substantial part of their assets other than in
the ordinary course of business as now conducted, except that:

 

(a)           Any Subsidiary may
merge or consolidate with or into Borrower or any one or more wholly-owned
Subsidiaries;

 

(b)           Any Subsidiary may
sell, lease, transfer or otherwise dispose of any of its assets to Borrower or
one or more wholly-owned Subsidiaries;

 

(c)           Any Insignificant
Subsidiary may (i) merge or consolidate with any other Person, (ii) sell,
lease, transfer or otherwise dispose of its assets to another Person or
(iii) liquidate or dissolve (“Insignificant Subsidiary” means a
Subsidiary with (1) net income that is less than 2.5% of the consolidated net
income of Borrower and its Subsidiaries for the most recent fiscal quarter
ended for which a consolidated income statement of Borrower is available and
(2) tangible assets that are less than 2.5% of consolidated tangible
assets of Borrower and its Subsidiaries as of the end of the most recent fiscal
quarter ended for which a consolidated balance sheet of Borrower is available);
and

 

(d)           Any Subsidiary may
merge or consolidate with any other Person provided that (i) the surviving
entity is a Subsidiary of Borrower (ii) before and after giving effect to
such merger or consolidation, no Event of Default or Unmatured Event of Default
exists or is continuing, (iii) following such merger or consolidation,
Borrower shall continue to own the same or greater percentage of the stock or
other ownership interests of such Subsidiary as it owned immediately prior to
such merger or consolidation, (iv) after 

 

10

 

giving effect to such merger or consolidation, Borrower is in pro forma
compliance with Section 5.4 of this Agreement and (v) if any
Subsidiary who is a party to such merger or consolidation is a Subsidiary whose
shares of capital stock constitute Pledged Shares under the Pledge Agreement,
then after giving effect to such merger or consolidation, Lender shall continue
to have a perfected first priority security interest in such Pledged Shares
subject only to any liens permitted in Section 5.5(b) hereof; provided,
however, this clause (d) shall not apply to any Insignificant
Subsidiary.

 

Borrower and
each Subsidiary shall take all steps to become and remain duly qualified, in
good standing and authorized to do business in each jurisdiction where failure
to do so might have a material adverse impact on the consolidated assets,
condition or prospects of Borrower.

 

SECTION
5.2.      REPORTS, CERTIFICATES AND
OTHER INFORMATION. Borrower shall furnish (or cause to be
furnished) to Lender:

 

(a)           Interim Reports.
Within forty-five (45) days after the end of each quarter of each fiscal year
of Borrower, a copy of an unaudited financial statement of Borrower and its
Subsidiaries prepared on a consolidated basis consistent with the consolidated
financial statements of Borrower and its Subsidiaries referred to in Section 4.3
above and prepared in accordance with generally accepted accounting principles,
signed by an authorized officer of Borrower and consisting of at least:  (i) a balance sheet as at the close of such
quarter; and (ii) a statement of earnings and source and application of funds
for such quarter and for the period from the beginning of such fiscal year to
the close of such quarter.

 

(b)           Annual Report.
Within ninety (90) days after the end of each fiscal year of Borrower, a copy
of an annual report of Borrower and its Subsidiaries prepared on a consolidated
basis and in conformity with generally accepted accounting principles applied
on a basis consistent with the consolidated financial statements of Borrower
and its Subsidiaries referred to in Section 4.3 above, duly
certified by independent certified public accountants of recognized standing
and accompanied by an opinion without qualification. Such independent certified
public accountants shall be selected by the Audit Committee of the Board of
Directors of Borrower (which Audit Committee members shall consist solely of
independent members of Borrower’s Board of Directors) using their good faith
business judgment.

 

(c)           Certificates.
Contemporaneously with the furnishing of a copy of each annual report and of
each quarterly statement provided for in this Section, a certificate dated the
date of such annual report or such quarterly statement and signed by either the
President, the Chief Financial Officer or the Treasurer of Borrower, to the
effect that no Event of Default or Unmatured Event of Default has occurred and
is continuing, or, if there is any such event, describing it and the steps, if
any, being taken to cure it, and containing (except in the case of the
certificate dated the date of the annual report) a computation of, and showing
compliance with, any financial ratio or restriction contained in this
Agreement.

 

11

 

(d)           Reports to SEC.
Notification of each filing and report made by Borrower or any Subsidiary with
or to any securities exchange or the Securities and Exchange Commission which
are made publicly available. Such notification shall be forwarded
electronically to Lender via e-mail at such addresses as Lender shall provide
to Borrower and shall indicate where copies of such filings and reports can be
obtained electronically (for avoidance of doubt, Borrower will notify Lender of
any such filings and reports if electronic means of notification is inoperable).
If copies of such documents are not available electronically, notification of
the filing of such documents shall still be made, and Borrower shall provide a
paper copy of such documents to Lender promptly upon Lender’s request.

 

(e)           Notice of
Default, Litigation and ERISA Matters. Immediately upon learning of the
occurrence of any of the following, written notice describing the same and the
steps being taken by Borrower or any Subsidiary affected in respect
thereof:  (i) the occurrence of an Event
of Default or an Unmatured Event of Default; (ii) the institution of, or any
adverse determination in, any litigation, arbitration or governmental
proceeding which is material to Borrower and its Subsidiaries on a consolidated
basis; (iii) the occurrence of any event referred to in Section 4.13(b);
or (iv) the issuance of any cease and desist order, memorandum of
understanding, cancellation of insurance, or proposed disciplinary action from
the FDIC or other regulatory entity.

 

(f)            Other
Information. From time to time such other information, financial or
otherwise, concerning Borrower or any Subsidiary as Lender may reasonably request.

 

SECTION
5.3.      INSPECTION. At Borrower’s
expense if an Event of Default or Unmatured Event of Default has occurred or is
continuing, Borrower and each Subsidiary shall permit Lender and its agents at
any time during normal business hours, and upon at least one business day’s
prior notice, to inspect their properties and to inspect and make copies of
their books and records. If no Event of Default or Unmatured Event of Default
shall have occurred and be continuing, Lender may conduct such inspections at any
time during normal business hours and upon reasonable notice to Borrower, and
such inspection and copies shall be at Lender’s expense.

 

SECTION
5.4.      FINANCIAL REQUIREMENTS.

 

(a)           Leverage Ratio.
Borrower and each Subsidiary Bank shall maintain at all times a ratio of Tier 1
Capital to average quarterly assets less all non-qualified intangible assets of
at least five percent (5%), all calculated on a consolidated basis.

 

(b)           Tier 1 Capital
Ratio. Borrower and each Subsidiary Bank shall maintain at all times a
ratio of Tier 1 Capital to risk-weighted assets of not less than six percent
(6%), all calculated on a consolidated basis.

 

(c)           Risk-Based
Capital Ratio. Borrower and each Subsidiary Bank shall maintain at all
times a ratio of Total Capital to risk-weighted assets of not less than ten
percent (10%), all calculated on a consolidated basis.

 

12

 

(d)           Nonperforming
Assets. All assets of all Subsidiary Banks and other Subsidiaries
classified as “non-performing” (which shall include all loans in non-accrual
status, more than ninety (90) days past due in principal or interest,
restructured or renegotiated, or listed as “other restructured” or “other real
estate owned”) on the FDIC or other regulatory agency call report shall not
exceed at any time three percent (3.0%) of the total loans of Borrower and its
Subsidiaries on a consolidated basis.

 

(e)           Loan Loss
Reserves Ratio. Each Subsidiary Bank shall maintain at all times on a
consolidated basis a ratio of (a) the sum of (i) loan loss reserves plus
(ii) reserves for unfunded commitments to (b) non-performing loans of
not less than one hundred percent (100%).

 

(f)            Minimum Tier 1
Capital. Borrower shall maintain a consolidated minimum Tier 1 Capital
equal to at least $125,000,000 at all times.

 

(g)           Total Debt to
Tier 1 Capital. Borrower’s total indebtedness for borrowed money
(specifically excluding the indebtedness for borrowed money of Borrower’s
Subsidiaries) shall not at any time exceed thirty-five percent (35%) of its
Tier 1 Capital.

 

(h)           Return on Average
Assets. Borrower’s consolidated net income shall be at least eighty-five
hundredths of one percent (0.85%) of its average assets, calculated on an
annualized basis as at the last day of each fiscal quarter of Borrower;
provided, however, that for purposes of determining return on average assets,
customary and reasonable, non-recurring expenses and charges incurred by
Borrower in connection with a permitted acquisition under Sections 5.1 and 5.6
hereof shall be excluded.

 

SECTION
5.5.      INDEBTEDNESS, LIENS AND TAXES. Borrower and
each Subsidiary shall:

 

(a)           Indebtedness.
Not incur, permit to remain outstanding, assume or in any way become committed
for indebtedness in respect of borrowed money (specifically including but not
limited to indebtedness in respect of money borrowed from financial
institutions, but excluding deposits), except: 
(i) indebtedness incurred by Borrower under this Agreement, and further
indebtedness of Borrower to Lender or to any other Person; provided that, the
aggregate amount of such indebtedness permitted pursuant to this clause (i)
shall not exceed at any time the lesser of $70,000,000 and an amount which
would cause Borrower to breach its Total Debt to Tier 1 Capital financial
covenant in Section 5.4(g); and provided further, such indebtedness
shall be unsecured except as permitted under Section 5.5(b);
(ii) in addition to the indebtedness permitted under the foregoing clause
(i), in the case of Borrower, Trust Indebtedness and Trust Guarantees, and
in the case of any Trust Issue, Trust Preferred Securities; and
(iii) indebtedness incurred by the Subsidiary Banks in their normal course
of business with the Federal Home Loan Bank, any Federal Reserve Bank or for
Federal Funds with correspondent banks for liquidity management.

 

(b)           Liens. Not
create, suffer or permit to exist any lien or encumbrance of any kind or nature
upon any of their assets now or hereafter owned or acquired (specifically 

 

13

 

including but not limited to the capital stock of any of the Subsidiary
Banks), or acquire or agree to acquire any property or assets of any character
under any conditional sale agreement or other title retention agreement, but
this Section shall not be deemed to apply to: 
(i) liens existing on the date of this Agreement and disclosed on Schedule 5.5(b);
(ii) liens of landlords, contractors, laborers or suppliers, tax liens, or
liens securing performance or appeal bonds, or other similar liens or charges
arising out of Borrower’s business, provided that tax liens are removed before
related taxes become delinquent and other liens are promptly removed, in either
case unless contested in good faith and by appropriate proceedings, and as to
which adequate reserves shall have been established and no foreclosure, sale or
similar proceedings have commenced; (iii) liens in favor of Lender; (iv) liens
on the assets of any Subsidiary Bank arising in the ordinary course of the
banking business of such Subsidiary Bank; and (v) liens contemplated by Section 4.5.

 

(c)           Taxes. Pay
and discharge all taxes, assessments and governmental charges or levies imposed
upon them, upon their income or profits or upon any properties belonging to
them, prior to the date on which penalties attach thereto, and all lawful
claims for labor, materials and supplies when due, except that no such tax,
assessment, charge, levy or claim need be paid which is being contested in good
faith by appropriate proceedings as to which adequate reserves shall have been
established, and no foreclosure, sale or similar proceedings have commenced.

 

(d)           Guaranties. Not
assume, guarantee, endorse or otherwise become or be responsible in any manner
(whether by agreement to purchase any obligations, stock, assets, goods or
services, or to supply or loan any funds, assets, goods or services, or
otherwise) with respect to the obligation of any other Person, except:  (i) by the endorsement of negotiable
instruments for deposit or collection in the ordinary course of business,
issuance of letters of credit or similar instruments or documents in the
ordinary course of business; (ii) in the case of Borrower, Trust Guarantees;
and (iii) guarantees by Borrower of any of its Subsidiary’s obligations,
provided the liability to Borrower on account of such guarantees shall not in
the aggregate exceed $10,000,000 at anytime outstanding.

 

SECTION
5.6.      INVESTMENTS AND LOANS. Neither
Borrower nor any Subsidiary shall make any loan, advance, extension of credit
or capital contribution to, or purchase or otherwise acquire for consideration,
evidences of indebtedness, capital stock or other securities of any Person,
except that Borrower and any Subsidiary may:

 

(a)           purchase or
otherwise acquire and own short-term money market items;

 

(b)           invest, by way of
purchase of securities or capital contributions, in the Subsidiary Banks or any
other bank or banks, and upon Borrower’s purchase or other acquisition of
twenty-five percent (25%) or more of the stock of any bank, such bank shall
thereupon become a “Subsidiary Bank” for all purposes under this Agreement;

 

14

 

(c)           invest, by way of
loan, advance, extension of credit (whether in the form of lease, conditional
sales agreement, or otherwise), purchase of securities, capital contributions,
or otherwise, in Subsidiaries other than banks or Subsidiary Banks;

 

(d)           invest, by way of
purchase of securities or capital contributions, in other Persons so long as
before and after giving effect thereto no Event of Default or Unmatured Event
of Default shall have occurred and be continuing and the investment is in
compliance with Regulation Y of the Federal Reserve Board; and

 

(e)           in the case of any
Trust Issuer, purchase any Trust Indebtedness and, in the case of Borrower,
purchase any common securities of any Trust Issuer and issue any Trust
Guarantees.

 

Nothing in
this Section 5.6 shall prohibit a Subsidiary Bank from making
investments, loans, advances, or other extensions of credit in the ordinary
course of the banking business upon such terms as may at the time be customary
in the banking business.

 

SECTION
5.7.      OWNERSHIP OF SUBSIDIARIES.
Borrower shall not, and shall not permit
any Subsidiary to, (i) purchase or redeem, or obligate itself to purchase or
redeem, any shares of Borrower’s capital stock, of any class, issued and
outstanding from time to time, or any partnership, joint venture or other
equity interest in Borrower or any Subsidiary; or (ii) declare or pay any
dividend (other than dividends payable in its own common stock or to Borrower)
or make any other distribution in respect of such shares or interest other than
to Borrower, in each case if an Unmatured Event of Default or an Event of
Default shall have occurred and be continuing, or would result therefrom. Except
as provided in Section 5.1, Borrower shall continue to own,
directly or indirectly, the same (or greater) percentage of the stock and
partnership, joint venture, or other equity interest in each Subsidiary that it
held on the date of this Agreement, and no Subsidiary shall issue any
additional stock or partnership, joint venture or other equity interests,
options or warrants in respect thereof, or securities convertible into such
securities or interests, other than to Borrower.

 

SECTION
5.8.      MAINTENANCE OF PROPERTIES.
Borrower and each Subsidiary shall
maintain, or cause to be maintained, in good repair, working order and
condition, all their properties (whether owned or held under lease), and from
time to time make or cause to be made all needed and appropriate repairs,
renewals, replacements, additions, and improvements thereto, so that the
business carried on in connection therewith may be properly and advantageously
conducted at all times (for avoidance of doubt, this Section 5.8 does
not limit or restrict Borrower or any Subsidiary from opening, closing or
moving any of their branch offices or other office properties).

 

SECTION
5.9.      INSURANCE. Borrower and
each Subsidiary shall maintain insurance in responsible companies in such amounts
and against such risks as is required by law and such other insurance, in such
amount and against such hazards and liabilities, as is customarily maintained
by bank holding companies and banks similarly situated. Each Subsidiary Bank
shall have deposits insured by the FDIC.

 

15

 

SECTION
5.10.   USE OF PROCEEDS.

 

(a)           General. The
proceeds of the Loans shall be used for general corporate purposes. Neither
Borrower nor any Subsidiary shall use or permit any proceeds of the Loans to be
used, either directly or indirectly, for the purpose, whether immediate,
incidental or ultimate, of “purchasing or carrying any margin stock” within the
meaning of Regulations U or X of the Board of Governors of the Federal Reserve
System, as amended from time to time. If requested by Lender, Borrower and each
Subsidiary will furnish to Lender a statement in conformity with the
requirements of Federal Reserve Form U-1. No part of the proceeds of the Loans
will be used for any purpose which violates or is inconsistent with the
provisions of Regulation U or X of the Board of Governors.

 

(b)           Tender Offers and
Going Private. Neither Borrower nor any Subsidiary shall use (or permit to
be used) any proceeds of the Loans to acquire any security in any transaction
which is subject to Section 13 or 14 of the Securities Exchange Act of 1934, as
amended, or any regulations or rulings thereunder.

 

SECTION
5.11.   COLLATERAL. Borrower
and Lender hereby agree that the Loans and all other obligations owing from
time to time from Borrower to Lender under this Agreement and the Note shall be
secured pursuant to that certain Pledge Agreement, dated as of the date hereof,
executed by Borrower in favor of Lender (as amended, restated, modified or
supplemented from time to time, the “Pledge Agreement”), pursuant to
which Borrower has pledged to Lender all of the issued and outstanding shares
of capital stock owned by Borrower of Pacific Western National Bank (herein
collectively referred to as the “Pledged Shares”).

 

SECTION
5.12.   COMPLIANCE WITH LAW. Borrower and
each Subsidiary shall comply with all applicable laws and regulations (whether
federal, state or local and whether statutory, administrative, judicial or
otherwise) and with every lawful governmental order or similar actions (whether
administrative or judicial), specifically including but not limited to all
requirements of the Bank Holding Company Act of 1956, as amended, and with the
regulations of the Board of Governors of the Federal Reserve System relating to
bank holding companies.

 

SECTION 6. CONDITIONS OF LENDING

 

SECTION
6.1.      DOCUMENTATION; NO DEFAULT.
The obligation of Lender to make any Loan
is subject to the following conditions precedent:

 

(a)           Initial
Documentation. Lender shall have received all of the following concurrently
with the execution and delivery hereof, each duly executed and dated the date
hereof or other date satisfactory to Lender, in form and substance satisfactory
to Lender and its counsel, at the expense of Borrower, and in such number of
signed counterparts as Lender may request (except for the Note, of which only
the original shall be signed):

 

16

 

(i)            Note. The
Note duly executed.

 

(ii)           Pledge Agreement.
The Pledge Agreement duly executed, together with the original certificates
evidencing the Pledged Shares and stock powers, duly executed in blank.

 

(iii)          Loan
Participation Certificate and Agreement. A Loan Participation Certificate
and Agreement dated the date hereof, duly executed by Lender and The Northern
Trust Company, substantially in the form of Exhibit B.

 

(iv)          Resolution;
Certificate of Incumbency. A copy of a resolution of the Board of Directors
of Borrower authorizing the execution, delivery and performance of this
Agreement, the Note, the Pledge Agreement and other documents provided for in
this Agreement, certified by the secretary or assistant secretary of Borrower,
together with a certificate of such officer of Borrower, certifying the names
of the officer(s) of Borrower authorized to sign this Agreement, the Pledge
Agreement, the Note and any other documents provided for in this Agreement,
together with a sample of the true signature of each such Person (Lender may
conclusively rely on such certificate until formally advised by a like
certificate of any changes therein).

 

(v)           Governing
Documents. A copy of the articles of incorporation and by-laws of Borrower,
certified by the secretary or assistant secretary of Borrower.

 

(vi)          Certificate of No
Default. A certificate signed by an appropriate officer of Borrower to the
effect that: (A) no Event of Default or Unmatured Event of Default has occurred
and is continuing or will result from the making of the first Loan; and (B) the
representations and warranties of Borrower contained herein are true and
correct as at the date of the first Loan as though made on that date.

 

(vii)         Opinion of
Counsel to Borrower. An opinion of counsel to Borrower substantially in the
form of Exhibit C attached hereto.

 

(viii)        Good Standing
Certificate. A good standing certificate from Borrower’s Federal Reserve
Bank and from the Secretary of State of California.

 

(ix)           Payoff Letter;
UCC-3 Termination Statement. Satisfactory pay-off letters for all indebtedness,
obligations and liabilities of Borrower to The Northern Trust Company,
confirming that all liens and security interests in favor of The Northern Trust
Company upon any of the property of Borrower will be terminated on the date
hereof, together with any UCC-3 Termination Statements necessary to evidence
the release of such liens and security interests.

 

(x)            Termination of
the Intercreditor Agreement. An agreement terminating the Intercreditor and
Collateral Agency Agreement dated as of August 15, 2003 entered into between
Lender and The Northern Trust Company.

 

17

 

(xi)           Miscellaneous.
Such other documents and certificates as Lender may reasonably request.

 

(b)           Representations
and Warranties True. At the date of each Loan, Borrower’s representations
and warranties set forth herein shall be true and correct as of such date as
though made on such date.

 

(c)           No Default. At
the time of each Loan, and immediately after giving effect to such Loan, no
Event of Default or Unmatured Event of Default shall have occurred and be
continuing at the time of such Loan, or would result from the making of such
Loan.

 

SECTION
6.2.      AUTOMATIC UPDATE OF
REPRESENTATIONS AND WARRANTIES AND NO-DEFAULT CERTIFICATE; CERTIFICATE AT
LENDER’S OPTION. The request by Borrower for any Loan
shall be deemed a representation and warranty by Borrower that the statements
in subsections (b) and (c) of Section 6.l are true
and correct on and as at the date of each succeeding Loan, as the case may be. Upon
receipt of each Loan request Lender in its sole discretion shall have the right
to request that Borrower provide to Lender, prior to Lender’s funding of the
Loan, a certificate executed by Borrower’s President, Treasurer, or Chief
Financial Officer to such effect.

 

SECTION 7. DEFAULT

 

SECTION
7.1.      EVENTS OF DEFAULT. The
occurrence of any of the following shall constitute an “Event of Default”:

 

(a)           failure to pay, when
and as due, any principal, interest or other amounts payable hereunder or under
the Note; provided that, in the case of interest only, such failure shall
continue for three (3) days after its due date;

 

(b)           any default, event
of default, or similar event shall occur or continue under any other
instrument, document, note or agreement delivered to Lender in connection with
this Agreement, including without limitation, the Pledge Agreement, and any
applicable cure period provided therein shall have expired; or any such
instrument, document, note or agreement shall not be, or shall cease to be,
enforceable in accordance with its terms;

 

(c)           there shall occur
any default or event of default, or any event or condition that might become
such with notice or the passage of time or both, or any similar event, or any
event that requires the prepayment of borrowed money or the acceleration of the
maturity thereof, under the terms of any evidence of indebtedness or other
agreement issued or assumed or entered into by Borrower or any Subsidiary for
obligations in an aggregate amount in excess of Two Million and No/100 United
States Dollars ($2,000,000.00), or under the terms of any indenture, agreement,
or instrument under which any such evidence of indebtedness or other agreement
is issued, assumed, secured, or guaranteed, and such event shall continue
beyond any applicable period of grace provided therein;

 

(d)           any representation,
warranty, schedule, certificate, financial statement, report, notice, or other
writing furnished by or on behalf of Borrower or any Subsidiary to 

 

18

 

Lender is false or misleading in any material respect on the date as of
which the facts therein set forth are stated or certified;

 

(e)           Any guaranty of or
pledge of collateral security for the Loans shall be repudiated or become
unenforceable or incapable of performance or Borrower shall fail to pledge and
deliver to Lender any share certificate of Pacific Western National Bank as
provided in Section 3(c) of the Pledge Agreement;

 

(f)            Borrower or any
Subsidiary shall fail to comply with Sections 5.l, 5.2(e) and
(f), 5.4, 5.5, 5.6, 5.7 and 5.11 hereof;
or fail to comply with or perform any agreement or covenant of Borrower or any
Subsidiary contained herein, which failure does not otherwise constitute an
Event of Default, and such failure shall continue unremedied for thirty (30)
days after notice thereof to Borrower by Lender;

 

(g)           an event or
condition specified in Section 4.13(b) shall occur or exist and if as a
result of such event or condition, together with all other such events or
conditions if any, Borrower or any ERISA Affiliate shall incur, or, in the
reasonable opinion of Lender, shall be reasonably likely to incur, a liability
to a Plan, a Multiemployer Plan or the PBGC (or any combination of the
foregoing) which is, in the reasonable determination of Lender, materially
adverse to the consolidated assets, financial condition business or operations
taken as a whole of Borrower and its Subsidiaries;

 

(h)           any Person, or two
or more Persons acting in concert, shall acquire beneficial ownership (within
the meaning of Rule 13d-3 of the Securities and Exchange Commission under the
Securities Exchange Act of 1934) of 50% or more of the outstanding shares of
voting stock of Borrower;

 

(i)            any proceeding
(judicial or administrative) shall be commenced against Borrower or any
Subsidiary, or with respect to any assets of Borrower or any Subsidiary which
could reasonably be expected to have a material and adverse effect on the
consolidated assets, financial condition, business or operations of Borrower
and its Subsidiaries and which is not dismissed within thirty (30) days after
it is commenced against Borrower or any Subsidiary; or final judgment(s) and/or
settlement(s) in an aggregate amount that is more than FIVE MILLION UNITED
STATES DOLLARS ($5,000,000) in excess of insurance for which the insurer has
confirmed coverage in writing, a copy of which writing has been furnished to
Lender, shall be entered or agreed to in any suit or action commenced against
Borrower or any Subsidiary, and which are not satisfied within thirty (30) days
after they have been entered or agreed to in any suit or action commenced
against Borrower or any Subsidiary;

 

(j)            Borrower shall
grant or any Person shall obtain a security interest in any collateral for the
Loans; Borrower or any other Person shall perfect (or attempt to perfect) such
a security interest; a court shall determine that Lender does not have a first
priority security interest in any of the collateral for the Loans enforceable
in accordance with the terms of the related documents; or any notice of a
federal tax lien against Borrower shall be filed with any public recorder and
is not satisfied within thirty (30) days from the time of such filing, unless
Borrower is contesting the validity thereof in good faith by appropriate 

 

19

 

proceedings and has set aside on its books adequate reserves with
respect thereto in accordance with generally accepted accounting principles;

 

(k)           There shall be any
material loss or depreciation in the value of any collateral for the Loans for
any reason, or, unless expressly permitted by the related documents, all or any
part of any collateral for the Loans or any direct, indirect, legal, equitable
or beneficial interest therein is assigned, transferred or sold without Lender’s
prior written consent;

 

(l)            any Federal Reserve
Bank, the FDIC or other regulatory entity shall issue or agree to enter into
any formal enforcement action with or against Borrower or any Subsidiary
(including, but not limited to, a formal written agreement, cease and desist
order, suspension, removal or prohibition order or capital directive, but
excluding a civil money penalty), or any Federal Reserve Bank, the FDIC or
other regulatory entity shall issue or enter into any informal enforcement
action with or against Borrower or any Subsidiary (including, but not limited
to, a commitment letter, memorandum of understanding or any similar action) or
assess a civil money penalty, which in each case is materially adverse to the
consolidated assets, financial condition, business or operations of Borrower or
any Subsidiary;

 

(m)          Borrower or any
Subsidiary (other than an Insignificant Subsidiary) shall fail to comply with Section
5.1 hereof or shall suspend the transaction of all or a substantial portion
of its usual business or Borrower or any Subsidiary (other than an
Insignificant Subsidiary) shall take any corporation action to approve or
authorize to approve any action or omission that would result in any of the
foregoing;

 

(n)           any bankruptcy,
insolvency, reorganization, arrangement, readjustment or similar proceeding,
domestic or foreign, is instituted by or against Borrower or any Subsidiary,
and in the case of an involuntary bankruptcy proceeding, such proceeding is not
dismissed within sixty (60) days (it is acknowledged and agreed that Lender has
no obligation to make Loans during such cure period); or Borrower or any
Subsidiary shall take any steps toward, or to authorize, such a proceeding; or

 

(o)           Borrower or any
Subsidiary shall become insolvent, generally shall fail or be unable to pay its
debts as they mature, shall admit in writing its inability to pay its debts as
they mature, shall make a general assignment for the benefit of its creditors
or shall enter into any composition or similar agreement.

 

SECTION
7.2.      DEFAULT REMEDIES.

 

(a)           Upon the occurrence
and during the continuance of any Event of Default specified in Section
7.l(a)-(m), Lender at its option may declare the Note (principal, interest
and other amounts) and any other amounts owed to Lender, including without
limitation any accrued but unpaid Commitment Fee, immediately due and payable
without notice or demand of any kind. Upon the occurrence of any Event of
Default specified in Section 7.l(n)-(o), the Note (principal, interest
and other amounts) and any other amounts owed to Lender, including without
limitation any accrued but unpaid Commitment Fee, 

 

20

 

shall be immediately and automatically due and payable without action of
any kind on the part of Lender. Upon the occurrence and during the continuance
of any Event of Default, any obligation of Lender to make any Loan shall
immediately and automatically terminate without action of any kind on the part
of Lender, and Lender may exercise any rights and remedies under this
Agreement, the Pledge Agreement, the Note, any related document or instrument,
and at law or in equity.

 

(b)           Lender may, by
written notice to Borrower, at any time and from time to time, waive any Event
of Default or Unmatured Event of Default, which shall be for such period and
subject to such conditions as shall be specified in any such notice. In the
case of any such waiver, Lender and Borrower shall be restored to their former
position and rights hereunder, and any Event of Default or Unmatured Event of
Default so waived shall be deemed to be cured and not continuing; but no such
waiver shall extend to or impair any subsequent or other Event of Default or
Unmatured Event of Default. No failure to exercise, and no delay in exercising,
on the part of Lender of any right, power or privilege hereunder shall preclude
any other or further exercise thereof or the exercise of any other right, power
or privilege. The rights and remedies of Lender herein provided are cumulative
and not exclusive of any rights or remedies provided by law.

 

SECTION 8. DEFINITIONS

 

SECTION
8.1.      GENERAL. As used
herein:

 

(a)           The term “Banking
Day” means a day on which Lender is open at its main office for the purpose
of conducting a commercial banking business and is not authorized to close.

 

(b)           The term “Code”
shall mean the Internal Revenue Code of 1986, as amended form time to time.

 

(c)           The term “Environmental
Laws” shall mean all federal, state and local laws, including statutes,
regulations, ordinances, codes, rules and other governmental restrictions and
requirements, relating to the discharge of air pollutants, water pollutants or
process waste water or otherwise relating to the environment or hazardous
substances or the treatment, processing, storage, disposal, release, transport
or other handling thereof, including, but not limited to, the federal Solid
Waste Disposal Act, the federal Clean Air Act, the federal Clean Water Act, the
federal Resource Conservation and Recovery Act, the federal Hazardous Materials
Transportation Act, the federal Comprehensive Environmental Response,
Compensation and Liability Act of 1980, the federal Toxic Substances Control
Act, regulations of the Nuclear Regulatory Agency, and regulations of any state
department of natural resources or state environmental protection agency, in
each case as now or at any time hereafter in effect.

 

(d)           The term “ERISA”
shall mean the Employee Retirement Income Security Act of 1974, as amended from
time to time.

 

(e)           The term “ERISA
Affiliate” shall mean any corporation or trade or business which is a
member of the same controlled group of corporations (within the meaning of 

 

21

 

Section 414(b) of the Code) as Borrower or is under common control
(within the meaning of Section 414(c) of the Code) with Borrower.

 

(f)            The term “FDIC”
means the Federal Deposit Insurance Corporation and any successor thereof.

 

(g)           The term “Interest
Period” means, with regard to LIBOR Loans, the amount of days from the date
an interest rate is to be in effect to the date such interest period matures
according to its terms.

 

(h)           The term “Interim
Maturity Date” means the last day of any Interest Period.

 

(i)            The term “Multiemployer
Plan” shall mean a multiemployer plan defined as such in Section 3(37) of
ERISA to which contributions have been made by Borrower or any ERISA Affiliate
as a “contributing sponsor” (within the meaning of Section 4001(a)(13) of
ERISA).

 

(j)            The term “PBGC”
shall mean the Pension Benefit Guaranty Corporation or any entity succeeding to
any or all of its functions under ERISA.

 

(k)           The term “Pension
Plan” shall mean any Plan which is a “defined benefit plan” within the
meaning of Section 3(35) of ERISA.

 

(l)            The term “Person”
shall mean any individual, corporation, company, limited liability company,
voluntary association, partnership, trust, estate, unincorporated organization
or government (or any agency, instrumentality or political subdivision
thereof).

 

(m)          The term “Plan”
shall mean any plan, program or arrangement covering current or former
employees of Borrower or any of its ERISA Affiliates which constitutes an “employee
benefit plan” within the meaning of Section 3(3) of ERISA.

 

(n)           The term “Prime
Rate” means that rate of interest announced from time to time by Lender
called its prime rate, which rate may not at any time be the lowest rate
charged by Lender. Changes in the rate of interest on the Loans resulting from
a change in the Prime Rate shall take effect on the date set forth in each
announcement of a change in the Prime Rate.

 

(o)           The term “Subsidiary”
means any corporation, partnership, joint venture, trust, or other legal entity
of which Borrower owns directly or indirectly twenty-five percent (25%) or more
of the outstanding voting stock or interest, or of which Borrower has effective
control, by contract or otherwise. The term Subsidiary includes each Subsidiary
Bank unless stated otherwise explicitly.

 

(p)           The term “Subsidiary
Bank” means each Subsidiary which is a bank.

 

(q)           The
term “Tier 1 Capital” means the same as that determined under the
capital formula currently used by the Federal Reserve Board.

 

22

 

(r)            The term “Total
Capital” means the same as that determined under the capital formula
currently used by the Federal Reserve Board.

 

(s)           The term “Trust
Guarantee” means any guarantee of Borrower of the Trust Preferred
Securities, which guarantee is subordinate and junior in right of payment to
the prior payment of the obligations of Borrower hereunder and under the Note
on terms satisfactory to Lender.

 

(t)            The term “Trust
Indebtedness” means indebtedness of Borrower payable to the Trust Issuer or
its transferees (a) which is due not earlier than the date thirty (30) years
after its issuance, (b) which may not be redeemed earlier than five (5)
years after issuance and (c) the payment of which is subordinate and junior in
right of payment to the prior payment of the obligations of Borrower hereunder
and under the Note on terms satisfactory to Lender.

 

(u)           The term “Trust
Issuer” means a wholly-owned Subsidiary of Borrower which qualifies as a
Delaware or Connecticut statutory business trust.

 

(v)           The term “Trust
Preferred Securities” means preferred securities issued by the Trust Issuer
(a) which are subject to mandatory redemption not earlier than the date
thirty (30) years after issuance and (b) which may not be optionally
redeemed earlier than five (5) years after issuance.

 

(w)          The term “Unmatured
Event of Default” means an event or condition which would become an Event
of Default with notice or the passage of time or both.

 

Except as and unless otherwise
specifically provided herein, all accounting terms shall have the meanings
given to them by generally accepted accounting principles and shall be applied
and all reports required by this Agreement shall be prepared, in a manner
consistent with the financial statements referred to in Section 4.3
above.

 

SECTION
8.2.      APPLICABILITY OF SUBSIDIARY
REFERENCES. Terms hereof pertaining to any Subsidiary
shall apply only during such times as Borrower has any Subsidiary.

 

SECTION 9. NO INTEREST OVER LEGAL RATE.

 

Borrower does
not intend or expect to pay, nor does Lender intend or expect to charge, accept
or collect any interest which, when added to any fee or other charge upon the
principal which may legally be treated as interest, shall be in excess of the
highest lawful rate. If acceleration, prepayment or any other charges upon the
principal or any portion thereof, or any other circumstance, result in the
computation or earning of interest in excess of the highest lawful rate, then
any and all such excess is hereby waived and shall be applied against the
remaining principal balance. Without limiting the generality of the foregoing,
and notwithstanding anything to the contrary contained herein or otherwise, no
deposit of funds shall be required in connection herewith which will, when
deducted from the principal amount outstanding hereunder, cause the rate of
interest hereunder to exceed the highest lawful rate.

 

23

 

SECTION 10. PAYMENTS, ETC.

 

All payments
hereunder shall be made in immediately available funds, and shall be applied
first to accrued interest and then to principal; however, if an Event of
Default occurs, Lender may, in its sole discretion, and in such order as it may
choose, apply any payment to interest, principal and/or lawful charges and
expenses then accrued. Borrower shall receive immediate credit on payments
received during Lender’s normal banking hours if made in cash, immediately
available funds, or by debit to available balances in an account at Lender;
otherwise payments shall be credited after clearance through normal banking
channels. Borrower authorizes Lender to charge any account of Borrower
maintained with Lender for any amounts of principal, interest, taxes, duties,
or other charges or amounts due or payable hereunder, with the amount of such
payment subject to availability of collected balances in Lender’s discretion;
unless Borrower instructs otherwise, all Loans shall be made in immediately
available funds and shall be credited to an account(s) of Borrower with Lender.
All payments shall be made without deduction for or on account of any present
or future taxes, duties or other charges levied or imposed on this Agreement,
the Pledge Agreement, the Note, the Loans or the proceeds, Lender or Borrower
by any government or political subdivision thereof. Borrower shall upon request
of Lender pay all such taxes, duties or other charges in addition to principal
and interest, including without limitation all documentary stamp and intangible
taxes, but excluding income taxes based solely on Lender’s income.

 

SECTION 11. SETOFF.

 

At any time
after an Event of Default of Unmatured Event of Default shall have occurred and
be continuing, and upon notice to Borrower, any account, deposit or other
indebtedness owing by Lender to Borrower, and any securities or other property
of Borrower delivered to or left in the possession of Lender or its nominee or
bailee, may be set off against and applied in payment of any obligation
hereunder, whether due or not. The setoff provision in this Section 11
shall not be applicable to any accounts (and deposits or property therein)
maintained at Lender in the name of Borrower or any of its Subsidiaries for
which Borrower or such Subsidiaries have established and maintained in trust
for the benefit of any third party (not including, however, any affiliate of
Borrower or any such Subsidiary). Borrower shall be obligated to notify Lender
promptly upon the receipt of any such notice of setoff, and provide supporting
documentation, in form and substance reasonably satisfactory to Lender, to
establish, in the reasonable opinion of Lender, that any account subject to
such setoff is in fact held by Borrower or any of its Subsidiaries, as the case
may be, in trust for the benefit of any third party (not including, however,
any affiliate or Borrower or any such Subsidiary). If Borrower fails to comply
with the foregoing sentence, Lender may assume that its setoff of any account
or other property is valid and permissible.

 

SECTION 12. NOTICES

 

All notices,
requests and demands to or upon the respective parties hereto shall be made, if
to Lender, to its office indicated above (Attention:  Jon B. Beggs, Vice President), and if to
Borrower, to its address set forth below, or to such other address as may be
hereafter designated in writing by the respective parties hereto or, as to
Borrower, may appear in Lender’s records. Notices sent by facsimile
transmission shall be deemed to have been given upon electronic 

 

24

 

confirmation; notices sent by mail shall be deemed to have been given
three (3) business days after the date when sent by registered or certified
mail, postage prepaid; notices sent by personal delivery or by a nationally
recognized overnight delivery service (e.g.,
Federal Express) shall be deemed to have been given when received.

 

SECTION 13. MISCELLANEOUS.

 

This Agreement
and any document or instrument executed in connection herewith shall be
governed by and construed in accordance with the internal law of the State of
New York. This Agreement may only be amended, supplemented or modified at any
time by written instrument duly executed by Lender and Borrower. Unless the
context requires otherwise, wherever used herein the singular shall include the
plural and vice versa, and the use of one gender shall also denote the other. Captions
herein are for convenience of reference only and shall not define or limit any
of the terms or provisions hereof; references herein to Sections or provisions
without reference to the document in which they are contained are references to
this Agreement. This Agreement shall bind Borrower, its successors and assigns,
and shall inure to the benefit of Lender, its successors and assigns, except
that Borrower may not transfer or assign any of its rights or interest
hereunder without the prior written consent of Lender. Borrower agrees to pay
upon demand all expenses (including without limitation reasonable attorneys’
fees, legal costs and expenses, whether in or out of court, in original or
appellate proceedings or in bankruptcy) incurred or paid by Lender or any holder
of the Note in connection with (a) the negotiation, preparation, execution and
delivery of this Agreement, the Note, the Pledge Agreement and the other
documents to be delivered hereunder, (b) any amendment, modification or
waiver of any of the terms of this Agreement, the Pledge Agreement or the Note,
(c) any Event of Default or Unmatured Event of Default and any enforcement or
collection proceedings resulting therefrom, and (d) any transfer, stamp,
documentary or other similar taxes, assessments or charges levied by any
governmental or revenue authority in respect of this Agreement, the Pledge
Agreement, the Note or any other document referred to herein; provided, that,
Borrower shall not be obligated to pay Lender for Lender’s attorneys’ fees and
expenses for the matters described in the foregoing clause (a) which
exceed $7,500. Except as otherwise specifically provided herein, Borrower
expressly and irrevocably waives presentment, protest, demand and notice of any
kind in connection herewith.

 

SECTION 14. ARBITRATION AND WAIVER OF JURY TRIAL

 

(a)           This Section
concerns the resolution of any controversies or claims between Lender and
Borrower, whether arising in contract, tort or by statute, including but not
limited to controversies or claims that arise out of or relate to:  (i) this Agreement (including any
renewals, extensions or modifications); or (ii) any document executed in
connection with this Agreement (collectively, a “Claim”).

 

(b)           At the request of
Lender or Borrower, any Claim shall be resolved by binding arbitration in
accordance with the Federal Arbitration Act (Title 9, U.S. Code) (the “Act”).
The Act will apply even though this Agreement provides that it is governed by
the law of a specified state.

 

25

 

(c)           Arbitration
proceedings will be determined in accordance with the Act, the applicable rules
and procedures for the arbitration of disputes of JAMS or any successor thereof
(“JAMS”), and the terms of this Section. In the event of any inconsistency,
the terms of this Section shall control.

 

(d)           The arbitration
shall be administered by JAMS and conducted, unless otherwise required by law,
in the State of California. All Claims shall be determined by one arbitrator;
however, if Claims exceed Five Million Dollars ($5,000,000), upon the request
of Lender or Borrower, the Claims shall be decided by three arbitrators. All
arbitration hearings shall commence within thirty (30) days of the demand for
arbitration and close within thirty (30) days of commencement and the award of
the arbitrator(s) shall be issued within thirty (30) days of the close of the
hearing. However, the arbitrator(s), upon a showing of good cause, may extend
the commencement of the hearing for up to an additional sixty (60) days. The
arbitrator(s) shall provide a concise written statement of reasons for the
award. The arbitration award may be submitted to any court having jurisdiction
to be confirmed and enforced.

 

(e)           The arbitrator(s)
will have the authority to decide whether any Claim is barred by the statute of
limitations and, if so, to dismiss the arbitration on that basis. For purposes
of the application of the statute of limitations, the service on JAMS under
applicable JAMS rules of a notice of Claim is the equivalent of the filing of a
lawsuit. Any dispute concerning this arbitration provision or whether a Claim
is arbitrable shall be determined by the arbitrator(s). The arbitrator(s) shall
have the power to award legal fees pursuant to the terms of this Agreement.

 

(f)            This Section does
not limit the right of Lender or Borrower to: 
(i) exercise self-help remedies, such as, but not limited to,
setoff; (ii) initiate judicial or non-judicial foreclosure against any
real or personal property collateral; (iii) exercise any judicial or power
of sale rights, or (iv) act in a court of law to obtain an interim remedy,
such as, but not limited to, injunctive relief, writ of possession or
appointment of a receiver, or additional or supplementary remedies.

 

(g)           The filing of a
court action is not intended to constitute a waiver of the right of any party,
including the suing party, thereafter to require submittal of the Claim to
arbitration.

 

(h)           By agreeing to
binding arbitration, the parties irrevocably and voluntarily waive any right they
may have to a trial by jury in respect of any Claim. Furthermore, without
intending in any way to limit this Agreement to arbitrate, to the extent any
claim is not arbitrated, the parties irrevocably and voluntarily waive any
right they may have to a trial by jury in respect of such Claim. This provision
is a material inducement for the parties entering into this Agreement.

 

[Signature
Page Follows]

 

26

 

IN WITNESS WHEREOF, the parties hereto have
caused this Agreement to be duly executed as of the date first above written.

 

 

	
   

  	
  FIRST COMMUNITY BANCORP

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Lynn M. Hopkins

  	
   

  
	
   

  	
   

  	
  Lynn M. Hopkins, Executive Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Address for notices:

  
	
   

  	
   

  
	
   

  	
  120 Wilshire Blvd.

  
	
   

  	
  Santa Monica, California 90401

  
	
   

  	
  Attention:

  	
  Vic Santoro

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  U.S. BANK NATIONAL ASSOCIATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Jon B. Beggs

  	
   

  
	
   

  	
   

  	
  Jon B. Beggs, Vice President

  
						

 

 

 

Signature Page to Amended and Restated Revolving Credit Agreement

 

 

EXHIBIT A

 

REVOLVING CREDIT NOTE

 

	
  $70,000,000.00

  	
  Milwaukee, Wisconsin

  
	
   

  	
  August 3, 2006

  

 

FOR VALUE RECEIVED, on or before the Maturity
Date, FIRST COMMUNITY BANCORP, a
corporation formed under the laws of the State of California (“Borrower”),
promises to pay to the order of U.S. BANK
NATIONAL ASSOCIATION, a national banking association (hereafter,
together with any subsequent holder hereof, called “Lender”), at its
banking office at 777 East Wisconsin Avenue, Milwaukee, Wisconsin 53202, or at
such other place as Lender may direct, the aggregate unpaid principal balance
of each advance (a “Loan” and collectively the “Loans”) made by
Lender to Borrower hereunder. The total principal amount of Loans outstanding
at any one time hereunder shall not exceed SEVENTY MILLION AND 00/100 UNITED
STATES DOLLARS ($70,000,000.00).

 

Lender is hereby authorized by Borrower at
any time and from time to time at Lender’s sole option to attach a schedule
(grid) to this Note and to endorse thereon notations with respect to each Loan
specifying the date and principal amount thereof, and the date and amount of
each payment of principal and interest made by Borrower with respect to each
such Loan. Lender’s endorsements as well as its records relating to Loans shall
be rebuttably presumptive evidence of the outstanding principal and interest on
the Loans, and, in the event of inconsistency, shall prevail over any records
of Borrower and any written confirmations of Loans given by Borrower.

 

Borrower agrees to pay interest on the unpaid
principal amount from time to time outstanding hereunder on the dates and at
the rate or rates as set forth in the Revolving Credit Agreement (as
hereinafter defined).

 

Payments of both principal and interest are
to be made in immediately available funds in lawful money of the United States
of America.

 

This Note evidences indebtedness incurred
under that certain Amended and Restated Revolving Credit Agreement dated as of
the date hereof executed by and between Borrower and Lender (and, if amended,
restated or replaced, all amendments, restatements and replacements thereto or
therefor, if any) (the “Revolving Credit Agreement;” capitalized terms
not otherwise defined herein have the same meaning herein as in the Revolving
Credit Agreement). Reference is hereby made to the Revolving Credit Agreement
for a statement of its terms and provisions, including without limitation those
under which this Note may be paid prior to its due date or have its due date
accelerated. This Note replaces that certain Revolving Credit Note dated
August 4, 2005, in the stated principal amount of $50,000,000, from
Borrower to Lender, and Borrower acknowledges and agrees that the indebtedness
evidenced thereby has not been extinguished and that no novation has occurred.

 

 

Borrower agrees to pay upon demand all
expenses (including without limitation attorneys’ fees, legal costs and
expenses, in each case whether in or out of court, in original or appellate
proceedings or in bankruptcy) incurred or paid by Lender or any holder hereof
in connection with the enforcement or preservation of its rights hereunder or
under any document or instrument executed in connection herewith. Borrower
expressly and irrevocably waives presentment, protest, demand and notice of any
kind in connection herewith.

 

This Note is secured by the property described
in the Pledge Agreement (as such term is defined in the Revolving Credit
Agreement), to which reference is made for a description of the collateral
provided thereby and the rights of Lender and Borrower in respect of such
collateral.

 

This Note and any document or instrument
executed in connection herewith shall be governed by and construed in
accordance with the internal law of the State of New York. Unless the context
requires otherwise, wherever used herein the singular shall include the plural
and vice versa, and the use of one gender shall also denote the other. Captions
herein are for convenience of reference only and shall not define or limit any
of the terms or provisions hereof; references herein to Sections or provisions
without reference to the document in which they are contained are references to
this Note. This Note shall bind Borrower, its successors and assigns, and shall
inure to the benefit of Lender, its successors and assigns, except that
Borrower may not transfer or assign any of its rights or interest hereunder
without the prior written consent of Lender.

 

	
   

  	
  FIRST COMMUNITY BANCORP

  
	
   

  	
   

  
	
   

  	
  BY

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  
					

 

2Exhibit
10.2

 

PLEDGE
AGREEMENT

 

PLEDGE AGREEMENT (this “Agreement”) dated as
of August 3, 2006 between FIRST COMMUNITY BANCORP (the “Pledgor”) and U.S.
BANK NATIONAL ASSOCIATION (the “Pledgee”), for the benefit of the
Pledgee.

 

WHEREAS, the Pledgor and Pledgee are concurrently
herewith entering into an Amended and Restated Revolving Credit Agreement dated
as of even date herewith (as amended, restated, modified or supplemented from
time to time, the “Credit Agreement”), pursuant to which the Pledgee,
subject to the terms and conditions contained herein, will make a revolving credit
facility in the amount of $70,000,000 available to the Pledgor.

 

WHEREAS, the Pledgee requires, as a condition to
making such revolving credit facility available to the Pledgor, that the
Pledgor grant to Pledgee, a security interest in the Collateral and undertake
the obligations set forth in this Agreement.

 

NOW, THEREFORE, in consideration of the promises
contained herein and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:

 

1.             Definitions.  Terms used herein (including the Recitals) and
not defined herein that are defined in the Uniform Commercial Code in effect
from time to time in the State of New York have such defined meanings herein
(with terms used in Article 9 controlling over terms used in another Article of
the Uniform Commercial Code), unless the context otherwise indicates or
requires, and the following terms shall have the following meanings:

 

“Collateral” shall mean the Pledged Shares,
the Stock Rights, and the proceeds of each.

 

“Credit Documents” shall mean, collectively,
the Credit Agreement and Note (as defined in the Credit Agreement), each as
amended, restated, replaced or extended from time to time.

 

“Default” shall mean any “Event of Default”
as defined in the Credit Agreement.

 

“Liabilities” shall mean all of the duties,
liabilities and obligations of the Pledgor under the Credit Documents and this
Agreement.

 

“Pledged Shares” shall mean 100% of the
issued and outstanding shares of capital stock of Pacific Western National Bank
held by the Pledgor or otherwise held from time to time by Pledgor.

 

“Stock Rights” shall mean any dividend or
other distribution (whether in cash, securities or other property) and any
other right or property which the Pledgor shall receive or shall become
entitled to receive for any reason whatsoever as a result of its being a holder
of the Pledged Shares, or with respect to, in substitution for, or in exchange
for, Pledged Shares.

 

 

2.             Grant
of Security Interest.  To secure the
payment and performance of the Liabilities, the Pledgor hereby pledges,
hypothecates, assigns, sets over and delivers to the Pledgee, for the benefit
of the Pledgee, and grants the Pledgee, for the benefit of the Pledgee a
security interest in the Collateral.

 

3.             Representations,
Warranties and Covenants.  The
Pledgor represents, warrants and covenants that:

 

a)             The
Pledgor is the lawful owner of the Collateral, free and clear of all claims,
security interests, liens, encumbrances and rights of others, other than the
security interest hereunder, with full right to deliver, pledge, assign and
transfer the Collateral to the Pledgee, for the benefit of the Pledgee, as
Collateral hereunder and, until all Liabilities have been fully, finally and irrevocably
satisfied and discharged, the Pledgor shall maintain the lien of this Agreement
as a first priority lien on the Collateral and shall not sell or otherwise
dispose of all or any part of the Collateral (except, prior to the occurrence
of a Default, ordinary cash dividends received by the Pledgor) and shall keep
all of the Collateral free of any liens, security interests, claims,
encumbrances and rights of others except those arising hereunder.

 

b)            The
Pledgor agrees to deliver to the Pledgee from time to time upon request of the
Pledgee such stock powers, financing statements and other documents,
satisfactory in form and substance to the Pledgee, with respect to the
Collateral as the Pledgee may reasonably request.

 

c)             The
Pledgor shall deliver to the Pledgee, to be held by the Pledgee for the benefit
of the Pledgee, the certificate(s) evidencing any Pledged Shares held or
acquired by the Pledgor from time to time, not later than two Banking Days (as
defined in the Credit Agreement) following the acquisition thereof by the
Pledgor, together with stock powers covering such certificate(s) duly executed
in blank by the Pledgor.

 

d)            The
Pledgor agrees to hold in trust for the Pledgee, for the benefit of the Pledgee,
upon receipt and immediately thereafter as provided in Section 3(c)
pledge and deliver to the Pledgee, to be held by the Pledgee for the benefit of
the Pledgee, any stock certificate, instrument or other document evidencing or
constituting Collateral (except, prior to the occurrence of a Default, ordinary
cash dividends paid with respect to the Pledged Shares).

 

The Pledgor agrees to pay when due all taxes,
assignments and governmental charges and levies upon the Collateral.

 

4.             Care
of Collateral.  The Pledgee shall use
reasonable care with respect to the preservation and maintenance of the
Collateral; provided that the Pledgee shall not be liable to the Pledgor for
any action taken by it in good faith, nor shall the Pledgee be responsible for
the consequences of any action or failure to act except to the extent that such
action or failure to act is the proximate result of the gross negligence, lack
of good faith or willful misconduct of the Pledgee, its agents or employees.

 

5.             Dividends
and Voting.  Prior to the occurrence
of a Default, the Pledgor shall be entitled (a) to receive and retain all
ordinary cash dividends in respect of the Pledged Shares and (b) to exercise
all voting rights in respect of the Pledged Shares.  If any Default occurs and is 

 

2

 

continuing, all cash
dividends distributed in respect of the Pledged Shares shall be delivered to
the Pledgee and held as Collateral hereunder, for the benefit of the Pledgee
and the Secured Parties.

 

6.             Remedies
Upon Default.  In addition to rights
granted under other provisions of this Agreement, upon the occurrence of a
Default hereunder the Pledgee may from time to time exercise any one or more of
the following remedies:

 

a)             The
Pledgee may exercise, as to all or any part of the Collateral, any one or more
or all of the rights and remedies granted to a secured party under the Uniform
Commercial Code as in effect from time to time in the State of New York or
otherwise available at law or in equity, to assure that the Collateral is
devoted to the satisfaction of all Liabilities.

 

b)            The
Pledgee may exercise all voting and corporate rights respecting the Collateral,
including, without limitation, exchange, subscription or any other rights,
privileges or options pertaining to any of the Pledged Shares and the Stock
Rights as if the Pledgee were the absolute owner thereof.

 

c)             (1)           The Pledgee may sell, assign,
contract to sell or otherwise dispose of all or any portion of the Collateral
in any commercially reasonable manner, including by private or public sale at
such prices and on such terms as the Pledgee deems reasonable under the
circumstances, for cash or on credit or for future delivery and without the
assumption of any credit risk.  The
Pledgee shall give the Pledgor at least fifteen (15) days’ written notice of
the time and place of any public sale of the Collateral, or any portion
thereof; or of the time after which any private sale or other disposition
thereof is to be made, it being expressly acknowledged that said fifteen (15)
days’ notice, when given as herein provided, constitutes reasonable notice.  The Pledgee may purchase all or any portion
of the Collateral at any sale, and in that event payment of the purchase price
may be made by credit against the Liabilities. 
Any sale, assignment, contract to sell or other disposition shall be
made free of any right or equity of redemption in the Pledgor, which right or
equity, if any, is hereby released.  The
net proceeds of any disposition of the Collateral by the Pledgee, after
deduction of all expenses specified in Section 7, shall be applied
toward satisfaction of the Liabilities.

 

(2)           The
Pledgor hereby agrees that in any sale of any of the Collateral hereunder, the
Pledgee is hereby authorized to comply with any limitation or restriction in
connection with such sale as it may be advised by counsel is necessary in order
to avoid any violation of applicable securities or other law (including,
without limitation, compliance with such procedures as may restrict the number
of prospective bidders and purchasers, require that such prospective bidders
and purchasers have certain qualifications, and restrict such prospective
bidders and purchasers to persons who will represent and agree that they are
purchasing for their own account for investment and not with a view to the
distribution or resale of such Collateral), or in order to obtain any required
approval of the sale or of the purchaser by any governmental regulatory
authority or official, and the Pledgor further agrees that such compliance shall
not result in such sale being considered or deemed not to have been made in a
commercially reasonable manner, nor shall the Pledgee be liable nor accountable
to the Pledgor for any discount allowed by reason of the fact that such
Collateral is sold in compliance with any such limitation or restriction.

 

3

 

d)            To
the extent permitted by applicable law and upon any notice required by law, the
Pledgee may (but need not) retain the Collateral on behalf of the Pledgee in
full satisfaction of the Liabilities.

 

e)             Without
prior notice to the Pledgor, the Pledgee may transfer all or any part of the
Collateral into the name of the Pledgee or its nominee, for the benefit of the
Pledgee.  The Pledgee shall give notice
to the Pledgor of such transfer after the completion thereof.

 

f)             The
Pledgee may, instead of or concurrently with exercising the power of sale or
any other right or remedy herein conferred upon it, while a Default exists,
proceed by a suit or suits at law or in equity to foreclose the lien on the
Collateral or any portion thereof and sell the same under a judgment or decree
of a court or courts of competent jurisdiction.

 

7.             Certain
Expenses.  In connection with any
disposition of the Collateral as in Section 6 provided, the Pledgor
shall pay and discharge all expenses, if any, of retaking, insuring, holding,
preparing for sale, selling and the like, including, without limiting the
generality of the foregoing, accounting and other professional fees and
expenses and reasonable attorneys’ fees and legal expenses incurred by the
Pledgee in connection with the enforcement of any of its rights hereunder.  Any such expenses may be deducted and retained
by the Pledgee from the proceeds of any disposition of the Collateral.

 

8.             Deficiency.  Notwithstanding that the Pledgee may take or
refrain from taking any right or remedy hereunder or hold the Collateral and
regardless of the value thereof, the Pledgor shall remain liable for the
payment in full of the Liabilities.

 

9.             Indemnity.  The Pledgor hereby agrees to indemnify the
Pledgee and each officer, director, employee and agent of the Pledgee (herein
individually each called an “Indemnitee” and collectively called the “Indemnitees”)
from and against any and all losses, claims, damages, reasonable expenses
(including, without limitation, reasonable attorneys’ fees other than document
preparation expenses of the Pledgee) and liabilities (all of the foregoing
being herein called the “Indemnified Obligations”) incurred by any
Indemnitee in connection with the Credit Documents, except for any portion of
such losses, claims, damages, expenses or liabilities incurred solely as a
result of the gross negligence or willful misconduct of the applicable
Indemnitee or for obligations of such Indemnitee to the Pledgor.  If and to the extent that the foregoing
indemnity may be unenforceable for any reason, the Pledgor hereby agrees to
make the maximum contribution to the payment and satisfaction of each of the
Indemnified Obligations which is permissible under applicable law.  All obligations provided for in this Section
shall survive any termination of the Credit Documents.

 

10.           Pledgee
Appointed Attorney-in-Fact.  The
Pledgor hereby grants to the Pledgee a power of attorney to execute on the
Pledgor’s behalf all assignments, licenses and transfers of the Collateral, and
to do all other acts which the Pledgor is obligated to execute or do under any
provision of this Agreement or any of the Credit Documents if the Pledgor has
not acted within three business days after request by the Pledgee.  This power of attorney is coupled with an
interest and is irrevocable.

 

4

 

11.           Notices.  Any notice hereunder to the Pledgor or the
Pledgee shall be in writing and shall be given to such party at its address set
forth below its name on the signature page.

 

12.           Binding
Agreement; Assignment.  This
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their successors and assigns, except that the Pledgor shall not assign this
Agreement.

 

13.           Miscellaneous.

 

a)             No
Default shall be waived by the Pledgee except in writing and no waiver by the
Pledgee of any Default shall operate as a waiver of any other or of the same
Default at a future occasion.  No single
or partial exercise of any right, power or privilege hereunder or under
applicable law shall preclude any other or further exercise thereof or the
exercise of any other right, power or privilege.

 

b)            The
Section headings used herein are for convenience of reference only and shall
not define or limit the provisions of this Agreement.

 

c)             Any
modification or amendment of or waiver of rights under this Agreement shall be
binding only if contained in a writing signed by the parties hereto.

 

d)            This
Agreement shall be governed by the internal laws (not the laws of conflict) of
the State of New York.

 

e)             Each
provision of this Agreement shall be interpreted in such manner as to be
effective and valid under applicable law, but if any provision of this
Agreement shall be prohibited by or invalid under such law, such provision
shall be ineffective to the extent of such prohibition or invalidity, without
invalidating the remainder of such provision or the remaining provisions of
this Agreement.

 

[Signature
Page follows]

 

5

 

                IN
WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed as of the date first above written.

 

	
   

  	
  FIRST
  COMMUNITY BANCORP

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Lynn M. Hopkins

  
	
   

  	
   

  	
  Lynn
  M. Hopkins, Executive Vice President

  
	
   

  	
   

  
	
   

  	
  Address:

  	
  120
  Wilshire Blvd

  
	
   

  	
   

  	
  Santa
  Monica, CA 90401

  
	
   

  	
  Attention:

  	
  President
  and

  
	
   

  	
   

  	
  Chief
  Executive Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  U.S.
  BANK NATIONAL ASSOCIATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Jon B. Beggs

  
	
   

  	
   

  	
  Jon
  B. Beggs, Vice President

  
	
   

  	
   

  
	
   

  	
  Address:

  	
  777
  East Wisconsin Avenue

  
	
   

  	
   

  	
  Milwaukee,
  WI 53202

  
	
   

  	
  Attention:

  	
  Jon
  B. Beggs, Vice President

  
					

 

 

 

Signature Page to Pledge Agreement

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