Document:

RPFINANCIAL, LC.

Financial Services Industry Consultants

January 7, 2002

Mr. Hans R. Ganz

President and Chief Executive Officer

Pacific Trust Bank

610 Bay Boulevard

Chula Vista, California  91910

Dear Mr. Ganz:

              This letter sets forth the agreement between Pacific Trust Bank, Chula Vista, California
("Pacific Trust" or the "Bank"), and RP Financial, LC. ("RP Financial"), whereby the Bank has
engaged RP Financial to prepare the regulatory business plan and financial projections to be adopted
by the Bank's Board of Directors in conjunction with the stock conversion transaction, whereby the
Bank will become a wholly-owned subsidiary of a stock holding company.  These services are
described in greater detail below.

Description of Proposed Services

              RP Financial's business planning services will include the following areas:  (1) evaluating
Pacific Trust's current financial and operating condition, business strategies and anticipated strategies
in the future; (2) analyzing and quantifying the impact of business strategies, incorporating the use of
net conversion proceeds both in the short and long term; (3) preparing detailed financial projections
on a quarterly basis for a period of at least three fiscal years to reflect the impact of Board approved
business strategies and use of proceeds; (4) preparing the written business plan document which
conforms with applicable regulatory guidelines including a description of the use of proceeds and
how the convenience and needs of the community will be addressed; and (5) preparing the detailed
schedules of the capitalization of the Bank and holding company and related cash flows.

              Contents of the business plan will include:  Philosophy/Goals; Economic Environment and
Background; Lending, Leasing and Investment Activities; Deposit, Savings and Borrowing Activity;
Asset and Liability Management; Operations; Records, Systems and Controls; Growth, Profitability
and Capital; Responsibility for Monitoring this Plan.

              RP Financial agrees to prepare the business plan and accompanying financial projections in
writing such that the business plan can be filed with the appropriate regulatory agencies prior to filing
the appropriate applications.  

Fee Structure and Payment Schedule

              The Bank agrees to compensate RP Financial for preparation of the business plan on a fixed
fee basis of $10,000.  Payment of the professional fees shall be made upon delivery of the completed
business plan.  

              The Bank also agrees to reimburse RP Financial for those direct out-of-pocket expenses
necessary and incidental to providing the business planning services.  Reimbursable expenses will
likely include shipping, telephone/facsimile printing, computer and data services, and shall be paid to
RP Financial as incurred and billed.  RP Financial will agree to limit reimbursable expenses in
conjunction with the appraisal engagement, subject to written authorization from the Bank to exceed
such level.  

              In the event the Bank shall, for any reason, discontinue this planning engagement prior to delivery
of the completed business plan and payment of the progress payment fee, the Bank agrees to compensate
RP Financial according to RP Financial's standard billing rates for consulting services based on
accumulated and verifiable time expenses, not to exceed the fixed fee described above, plus reimbursable
expenses incurred.

              If during the course of the planning engagement, unforeseen events occur so as to materially
change the nature or the work content of the business planning services described in this contract, the
terms of said contract shall be subject to renegotiation by the Bank and RP Financial.  Such
unforeseen events may include changes in regulatory requirements as it specifically relates to Pacific
Trust or potential transactions which will dramatically impact the Bank such as a pending acquisition
or branch transaction.  

*  *  *  *  *  *  *  *  *  *  *

              Please acknowledge your agreement to the foregoing by signing as indicated below and
returning to RP Financial a signed copy of this letter.

			Sincerely,

 

 
	  		
	  		
	  		
			Ronald S. Riggins

President and Managing Director

 

 
	  		
	Agreed To 
and Accepted By:	Hans R. Ganz

President and Chief Executive Officer	
 

	 	
	Upon Authorization by the Board of Directors For:

Pacific Trust Bank, Chula Vista, California
	 	
	 	
	Date Executed:   ___________________________________

End.CHANGE IN CONTROL SEVERANCE AGREEMENT

              	THIS CHANGE IN CONTROL SEVERANCE AGREEMENT ("Agreement") is made and
entered into as of this ___ day of __________, 2002, by and between Pacific Trust Bank (hereinafter
referred to as the "Bank") and __________________ (the "Employee").

              	WHEREAS, the Employee is currently serving as _____________________ of the Bank; and

              	WHEREAS, the Bank has adopted a plan of conversion whereby the Bank will convert to
capital stock form as the subsidiary of a holding company (the "Company"), subject to the approval
of the Bank's members and the Office of Thrift Supervision (the "Conversion"); and

              	WHEREAS, the Board of Directors of the Bank believes it is in the best interests of the Bank
to enter into this Agreement with the Employee in order to assure continuity of management of the
Bank and to reinforce and encourage the continued attention and dedication of the Employee; and

              	WHEREAS, the Board of Directors of the Bank has approved and authorized the execution
of this Agreement with the Employee to take effect as stated in Section 2 hereof;

              	NOW, THEREFORE, in consideration of the foregoing and of the respective covenants and
agreements of the parties herein, it is AGREED as follows:

              	1.  Definitions.

                     		(a)         The term "Change in Control" means (1) an acquisition of securities of the
Company or the Bank that is determined by the Board of Directors to constitute an acquisition  of
control of the Company or the Bank within the meaning of the Change in Bank Control Act, 12
U.S.C. § 1817(j) and the Savings and Loan Holding Company Act, 12 U.S.C. ��a, and applicable
regulations thereunder; (2) an event that would be required to be reported in response to Item 1 of
the current report on Form 8-K, as in effect on the Effective Date, pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934 (the "Exchange Act"); (3) any person (as the term is used in
Sections 13(d) and 14(d) of the Exchange Act) is or becomes the beneficial owner (as defined in
Rule 13d-3 under the Exchange Act) directly or indirectly of securities of the Company or the Bank
representing 20% or more of the combined voting power of the Company's or the Bank's outstanding
securities; (4) individuals who are members of the Board of Directors on the Effective Date (the
"Incumbent Board") cease for any reason to constitute at least a majority thereof, provided that any
person becoming a director subsequent to the Effective Date whose election was approved by a vote
of at least three-quarters of the directors comprising the Incumbent Board, or whose nomination for
election by the Company's stockholders was approved by a nominating committee serving under an
Incumbent Board, shall be considered a member of the Incumbent Board; or (5) approval by the
Company's stockholders of a plan of reorganization, merger or consolidation of the Company, sale
of all or substantially all of the assets of the Company, a similar transaction in which the Company
is not the resulting entity; provided that the term "change in control" shall not include an acquisition
of securities by an employee benefit plan of the Bank or the Company.  In the application of
regulations under the Change in Bank Control Act or the Savings and Loan Holding Company Act,

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determinations to be made by the applicable federal banking regulator shall be made by the Board
of Directors.

                     		(b)         The term "Commencement Date" means the effective date of the Conversion of
the Bank from mutual to stock form.

                     		(c)         The term "Date of Termination" means the date upon which the Employee ceases
to serve as an employee of the Bank.

                     		(d)        The terms "Termination for Cause" and "Terminated For Cause" mean
termination of the employment of the Employee because of the Employee's personal dishonesty,
incompetence, willful misconduct, breach of a fiduciary duty involving personal profit, intentional
failure to perform stated duties, willful violation of any law, rule, or regulation (other than traffic
violations or similar offenses) or final cease-and-desist order, or material breach of any provision of
this Agreement.  The Employee shall not be deemed to have been Terminated for Cause unless and
until there shall have been delivered to the Employee a copy of a resolution, duly adopted by the
affirmative vote of not less than a majority of the entire membership of the Board of Directors of the
Bank at a meeting of the Board called and held for such purpose (after reasonable notice to the
Employee and an opportunity for the Employee, together with the Employee's counsel, to be heard
before the Board), stating that in the good faith opinion of the Board the Employee has engaged in
conduct described in the preceding sentence and specifying the particulars thereof in detail.

              	2. 	Term.  The term of this Agreement shall be a period of three years beginning on the
Commencement Date, subject to earlier termination as provided herein.  Beginning on the first
anniversary of the Commencement Date, and on each anniversary thereafter, the term of this
Agreement shall be extended for a period of one year in addition to the then-remaining term,
provided that, prior to such anniversary, the Board of Directors explicitly reviews and approves the
extension.  Reference herein to the term of this Agreement shall refer to both such initial term and
such extended terms.

              	3.	Severance Benefits; Regulatory Provisions.

                     		(a)       	Severance Benefits in Connection With a Change in Control.  In the event of
a Change in Control which occurs during the term of this Agreement, the Bank shall, subject to
Section 4 of this Agreement, (1) pay to the Employee in a lump sum in cash within 25 business days
after the Date of Termination an amount equal to [299% for Hans Ganz and 200% for Jim Sheehy
and Melanie Stewart] of Employee's "base amount" as defined in Section 280G of the Internal
Revenue Code of 1986, as amended (the "Code"); and (2) provide to the Employee during the
remaining term of this Agreement following the Date of Termination, such health insurance benefits
as the Bank maintained for the Employee at the Date of Termination on terms as favorable to the
Employee as applied at the Date of Termination.

                     		(b)         Temporary Suspension or Prohibition.  If the Employee is suspended and/or
temporarily prohibited from participating in the conduct of the Bank's affairs by a notice served
under Section 8(e)(3) or (g)(1) of the FDIA, 12 U.S.C. § 1818(e)(3) and (g)(1), the Bank's
obligations under this Agreement shall be suspended as of the date of service, unless stayed by

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appropriate proceedings.  If the charges in the notice are dismissed, the Bank may in its discretion
(i) pay the Employee all or part of the compensation withheld while its obligations under this
Agreement were suspended and (ii) reinstate in whole or in part any of its obligations which were
suspended.

                     		(c)         Permanent Suspension or Prohibition.  If the Employee is removed and/or
permanently prohibited from participating in the conduct of the Bank's affairs by an order issued
under Section 8(e)(4) or (g)(1) of the FDIA, 12 U.S.C. § 1818(e)(4) and (g)(1), all obligations of the
Bank under this Agreement shall terminate as of the effective date of the order, but vested rights of
the contracting parties shall not be affected.

                     		(d)         Default of the Bank.  If the Bank is in default (as defined in Section 3(x)(1) of
the FDIA), all obligations under this Agreement shall terminate as of the date of default, but this
provision shall not affect any vested rights of the contracting parties.

                     		(e)         Termination by Regulators.  All obligations of the Bank under this Agreement
shall be terminated, except to the extent determined that continuation of this Agreement is necessary
for the continued operation of the Bank:  (1) by the Director of the Office of Thrift Supervision (the
"Director") or his or her designee, at the time the Federal Deposit Insurance Corporation enters into
an agreement to provide assistance to or on behalf of the Bank under the authority contained in
Section 13(c) of the FDIA; or (2) by the Director or his or her designee, at the time the Director or
his or her designee approves a supervisory merger to resolve problems related to operation of the
Bank or when the Bank is determined by the Director to be in an unsafe or unsound condition.  Any
rights of the parties that have already vested, however, shall not be affected by any such action.

              	4.  Certain Reduction of Payments by the Bank.

                     		(a)         Notwithstanding any other provision of this Agreement, if payments under this
Agreement, together with any other payments received or to be received by the Employee in
connection with a Change in Control would cause any amount to be nondeductible for federal
income tax purposes pursuant to Section 280G of the Code, then benefits under this Agreement shall
be reduced (not less than zero) to the extent necessary so as to maximize payments to the Employee
without causing any amount to become nondeductible.  The Employee shall determine the allocation
of such reduction among payments to the Employee.

                     		(b)        Any payments made to the Employee pursuant to this Agreement, or otherwise,
are subject to and conditioned upon their compliance with 12 U.S.C. § 1828(k) and any regulations
promulgated thereunder.

              	5.  No Mitigation.  The Employee shall not be required to mitigate the amount of any salary
or other payment or benefit provided for in this Agreement by seeking other employment or
otherwise, nor shall the amount of any payment or benefit provided for in this Agreement be reduced
by any compensation earned by the Employee as the result of employment by another employer, by
retirement benefits after the Date of Termination or otherwise.  This Agreement shall not be
construed as providing the Employee any right to be retained in the employ of the Bank or any
affiliated of the Bank.

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              	6.  Attorneys Fees.  If the Employee is purportedly Terminated for Cause and the Bank denies
payments and/or benefits under Section 3(a) of this Agreement on the basis that the Employee
experienced Termination for Cause, but it is determined by a court of competent jurisdiction or by
an arbitrator pursuant to Section 13 that cause as contemplated by Section 1(e) of this Agreement
did not exist for termination of the Employee's employment, or if in any event it is determined by
any such court or arbitrator that the Bank has failed to make timely payment of any amounts or
provision of any benefits owed to the Employee under this Agreement, the Employee shall be
entitled to reimbursement for all reasonable costs, including attorneys' fees, incurred in challenging
such termination of employment or collecting such amounts or benefits.  Such reimbursement shall
be in addition to all rights to which the Employee is otherwise entitled under this Agreement.

              	7.  No Assignments.

                     		(a)         This Agreement is personal to each of the parties hereto, and no party may assign
or delegate any of its rights or obligations hereunder without first obtaining the written consent of
the other party; provided, however, that the Bank shall require any successor or assign (whether
direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the
business and/or assets of the Bank, by an assumption agreement in form and substance satisfactory
to the Employee, to expressly assume and agree to perform this Agreement in the same manner and
to the same extent that the Bank would be required to perform it if no such succession or assignment
had taken place.  Failure of the Bank to obtain such an assumption agreement prior to the
effectiveness of any such succession or assignment shall be a breach of this Agreement and shall
entitle the Employee to compensation from the Bank in the same amount and on the same terms as
the compensation pursuant to Section 3(a) hereof.  For purposes of implementing the provisions of
this Section 7(a), the date on which any such succession becomes effective shall be deemed the Date
of Termination.

                     		(b)        This Agreement and all rights of the Employee hereunder shall inure to the
benefit of and be enforceable by the Employee's personal and legal representatives, executors,
administrators, successors, heirs, distributees, devisees and legatees.  If the Employee should die
while any amounts would still be payable to the Employee hereunder if the Employee had continued
to live, all such amounts, unless otherwise provided herein, shall be paid in accordance with the
terms of this Agreement to the Employee's devisee, legatee or other designee or if there is no such
designee, to the Employee's estate.

              	8.  Notice.  For the purposes of this Agreement, notices and all other communications
provided for in the Agreement shall be in writing and shall be deemed to have been duly given when
personally delivered or sent by certified mail, return receipt requested, postage prepaid, to the Bank
at its home office, to the attention of the Board of Directors with a copy to the Secretary, or, if to the
Employee, to such home or other address as the Employee has most recently provided in writing to
the Bank.

              	9.  Amendments.  No amendments or additions to this Agreement shall be binding unless in
writing and signed by both parties, except as herein otherwise provided.  

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              	10.  Headings.  The headings used in this Agreement are included solely for convenience and
shall not affect, or be used in connection with, the interpretation of this Agreement.

              	11.  Severability. The provisions of this Agreement shall be deemed severable and the
invalidity or unenforceability of any provision shall not affect the validity or enforceability of the
other provisions hereof.

              	12.  Governing Law. This Agreement shall be governed by the laws of the United States to
the extent applicable and otherwise by the laws of the State of California.

              	13.  Arbitration.  Any dispute or controversy arising under or in connection with this
Agreement shall be settled exclusively by arbitration in accordance with the rules of the American
Arbitration Association then in effect.  Judgment may be entered on the arbitrator's award in any
court having jurisdiction.

              	IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and year
first above written.

              	THIS AGREEMENT CONTAINS A BINDING ARBITRATION PROVISION WHICH
MAY BE ENFORCED BY THE PARTIES.	 

	Attest:	 	PACIFIC TRUST BANK
 
 
 
	 
Secretary		 
By:
Its:

 

 

 
			Employee
 
 

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End.

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