10-Q

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)

[X] Quarterly report pursuant to section 13 or 15 (d) of the Securities Exchange Act of 1934

For the quarterly period ended September 30, 2003 or

[   ] Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the transition period from              to             

Commission File Number: 000-50245

NARA BANCORP, INC.

(Exact name of registrant as specified in its charter)

Delaware	95-4849715
(State or other jurisdiction of incorporation or organization)	(IRS Employer Identification Number)

3701 Wilshire Boulevard, Suite 220, Los Angeles, California	90010
(Address of Principal executive offices)	(ZIP Code)

(213) 639-1700
(Registrant’s telephone number, including area code)

(Former name, former address and former fiscal year, if changed since last report)

     Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [X]   No [  ]

     Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act). Yes [X]   No [  ]

     As of October 31, 2003, there were 11,525,089 outstanding shares of the issuer’s Common Stock, $0.001 par value.

TABLE OF CONTENTS

PART I FINANCIAL INFORMATION
	Item 1. Financial Statements
		CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
		CONDENSED CONSOLIDATED STATEMENTS OF INCOME
		CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY
		CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
		Notes to unaudited Condensed Consolidated Financial Statements
	Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
	Item 3. Quantitative and qualitative disclosures about market risk
	Item 4. Controls and Procedures
PART II OTHER INFORMATION
	Item 1. Legal Proceedings
	Item 2. Changes in Securities and Use of Proceeds
	Item 3. Defaults upon Senior Securities
	Item 4. Submission of Matters to a vote of Security Holders
	Item 5. Other information
	Item 6. Exhibits and Reports on Form 8-K
SIGNATURES
INDEX TO EXHIBITS
EXHIBIT 10.19
EXHIBIT 10.20
EXHIBIT 31.1
EXHIBIT 31.2
EXHIBIT 32.1

Table of Contents

		Page
PART I FINANCIAL INFORMATION
Item 1.	FINANCIAL STATEMENTS
	Condensed Consolidated Statements of Financial Condition - September 30, 2003 and December 31, 2002 (unaudited)	3
	Condensed Consolidated Statements of Income - Three and Nine Months Ended September 30, 2003 and 2002 (unaudited)	5
	Condensed Consolidated Statement of Stockholders’ Equity - Nine Months Ended September 30, 2003 and 2002 (unaudited)	7
	Condensed Consolidated Statements of Cash Flows - Nine Months Ended September 30, 2003 and 2002 (unaudited)	8
	Notes to Unaudited Consolidated Financial Statements	10
Item 2.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	20
Item 3.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	39
Item 4.	CONTROLS AND PROCEDURES	42
PART II OTHER INFORMATION
Item 1.	Legal Proceeding	43
Item 2	Change in Securities and Use of Proceeds	43
Item 3.	Defaults upon Senior Securities	43
Item 4.	Submission of Matters to a vote of Securities Holders	43
Item 5.	Other information	43
Item 6.	Exhibits and Reports on Form 8-K	43
	Signature	44
	Certification	45
	Index to Exhibits	47

2

PART I

FINANCIAL INFORMATION

Item 1. Financial Statements

NARA BANCORP, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(Unaudited)

ASSETS

			September 30, 2003		December 31,
			2003		2002
Cash and due from banks			$	34,732,183	$	31,442,728
Federal funds sold				3,000,000		73,300,000
	Total cash and cash equivalent			37,732,183		104,742,728
Interest-bearing deposits in other banks				95,000		95,000
Securities available for sale, at fair value				132,966,072		101,622,635
Securities held to maturity, at amortized cost (fair value:
		September 30, 2003 - $2,161,641; December 31, 2002-$2,926,750)		2,001,599		2,779,618
Interest-only strips, at fair value				442,430		273,219
Interest rate swaps, at fair value				3,588,482		3,444,780
Loan held for sale, at the lower of cost or market				5,415,211		6,337,519
Loans receivable, net of allowance for loan losses
	(September 30, 2003 - $11,792,829; December 31, 2002-$8,457,917)			898,337,035		715,019,110
Federal Reserve Bank stock, at cost				1,263,300		963,465
Federal Home Loan Bank Stock, at cost				5,797,200		3,783,400
Premises and equipment				5,386,290		4,995,052
Accrued interest receivable				4,394,018		4,195,498
Servicing assets				2,614,495		2,078,790
Deferred income taxes, net				7,526,880		4,908,701
Customers’ acceptance liabilities				7,016,758		5,580,838
Cash surrender value of life insurance				14,163,022		13,744,037
Goodwill and intangible assets, net				4,213,071		2,394,322
Other assets				7,710,566		2,290,304
TOTAL			$	1,140,663,612	$	979,249,016

See notes to condensed consolidated financial statements (Continued)

3

LIABILITIES AND STOCKHOLDERS’ EQUITY

LIABILITIES:

					September 30,			December 31,
					2003			2002
	Deposits:
		Noninterest-bearing			$	295,372,165		$	236,922,962
		Interest-bearing:
			Money market and other			98,706,856			83,868,595
			Savings deposits			154,944,575			141,281,701
			Time deposits of $100,000 or more			306,171,676			268,167,603
			Other time deposits			94,178,394			86,677,370
				Total deposits		949,373,666			816,918,231
Borrowings from Federal Home Loan Bank						70,000,000			65,000,000
Accrued interest payable						3,619,480			2,860,627
Acceptances outstanding						7,016,758			5,580,838
Trust Preferred Securities						22,304,495			17,412,755
Other liabilities						6,485,300			6,107,498
				Total liabilities		1,058,799,699			913,879,949
Commitments and Contingencies (Note 10)
Stockholders’ equity:
	Common stock, $0.001 par value; authorized, 20,000,000 shares; issued and outstanding, 11,395,057 and 10,690,630 shares at September 30, 2003 and December 31, 2002 respectively					11,395			10,690
	Capital surplus					42,340,270			32,930,307
	Deferred compensation					(12,139	)		—
	Retained earnings					38,613,653			29,903,338
	Accumulated other comprehensive income - unrealized gain on interest rate swap, securities available for sale and interest-only-strips, net of taxes of $607,155 and $1,682,704 at September 30, 2003 and December 31, 2002					910,734			2,524,732
				Total stockholders’ equity		81,863,913			65,369,067
				Total liabilities and stockholders’ equity	$	1,140,663,612		$	979,249,016

See notes to condensed consolidated financial statements

4

CONDENSED CONSOLIDATED STATEMENTS OF INCOME
For the three and nine months ended September 30, 2003 and 2002
(Unaudited)

				Three Months Ended September 30,					Nine Months Ended September 30,
				2003		2002			2003			2002
INTEREST INCOME:
	Interest and fees on loans			$	13,073,545	$	11,162,035		$	37,035,395		$	30,365,180
	Interest on securities				1,443,256		1,172,070			4,353,614			3,850,317
	Interest on interest rate swaps				893,278		252,000			2,542,750			420,000
	Interest on other investments, including TCD with other financial institutions				78,914		53,143			213,703			95,903
		Interest on federal funds sold			86,519		99,114			477,822			371,759
			Total interest income		15,575,512		12,738,362			44,623,284			35,103,159
INTEREST EXPENSE:
	Interest expense on deposits				3,097,597		2,675,713			9,707,533			7,594,474
	Interest expense on trust preferred securities				404,149		368,784			1,126,751			998,280
	Interest expense on borrowings				424,919		463,131			1,244,221			1,033,109
			Total interest expense		3,926,665		3,507,628			12,078,505			9,625,863
			Net interest income before provision for loan losses		11,648,847		9,230,734			32,544,779			25,477,296
Provision for loan losses					1,350,000		400,000			3,750,000			1,350,000
Net interest income after provision for loan losses					10,298,847		8,830,734			28,794,779			24,127,296
NON-INTEREST INCOME:
	Service charges on deposit accounts				1,978,846		1,656,025			5,580,023			4,608,576
	Other charges and fees				1,828,737		1,662,815			5,216,500			4,642,661
	Gain (loss) on sale of securities avaliable-for sale				219,244		(69,973	)		405,526			975,135
	(Loss) gain on sale of fixed assets				9,209		10,752			(6,294	)		44,936
	(Loss) gains on sale of other real estate owned				—		(6,835	)		77,521			29,963
	Gain on valuation of interest rate swaps				9,408		83,733			437,332			110,103
	Gain on sale of SBA loans				1,133,656		1,190,166			3,170,839			1,971,387
			Total non-interest income		5,179,100		4,526,683			14,881,447			12,382,761
NON-INTEREST EXPENSE:
	Salaries, wages and employee benefits				4,906,119		4,276,944			14,715,051			12,500,122
	Net occupancy expense				1,296,706		1,093,329			3,406,788			3,146,264
	Furniture and equipment expense				402,895		388,212			1,141,868			1,149,596
	Advertising and marketing expense				274,023		469,829			932,815			1,067,972
	Communications				181,296		143,676			479,749			442,892
	Data and item processing expense				516,095		463,443			1,522,254			1,243,962
	Professional fees				730,765		681,911			1,640,943			1,473,479
	Office supplies and forms				119,966		85,754			297,996			257,244
	Other				987,408		688,995			2,650,121			2,283,489
			Total non-interest expense		9,415,273		8,292,093			26,787,585			23,565,020
Income before income taxes and cumulative effect of a change in accounting principle					6,062,674		5,065,324			16,888,641			12,945,037
Income tax provision					2,358,340		1,956,000			6,531,864			4,781,000
Income before cumulative effect of a change in accounting principle					3,704,334		3,109,324			10,356,777			8,164,037
Cumulative effect of change in accounting principle					—		—			—			4,192,334
Net Income				$	3,704,334	$	3,109,324		$	10,356,777		$	12,356,371

5

CONDENSED CONSOLIDATED STATEMENTS OF INCOME
For the three and nine months ended, September 30, 2003 and 2002
(Unaudited)

		Three Months Ended September 30,				Nine Months Ended September 30,
		2003		2002		2003		2002
Earnings Per Share:
Earnings before cumulative effect of a change in accounting principle
	Basic	$	0.33	$	0.29	$	0.95	$	0.74
	Diluted		0.32		0.27		0.91		0.70
Cumulative effect of a change in accounting principle
	Basic	$	—	$	—	$	—	$	0.38
	Diluted		—		—		—		0.36
Earnings before cumulative effect of a change in accounting principle
	Basic		0.33		0.29		0.95		1.12
	Diluted	$	0.32	$	0.27	$	0.91	$	1.06

See notes to condensed consolidated financial statements

6

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY
NINE MONTHS ENDED SEPTEMBER 30, 2003 and 2002
(Unaudited)

																		Accumulated
			Number of															Other
			Shares			Common			Capital			Deferred			Retained			Comprehensive			Comprehensive
			Outstanding			Stock			Surplus			Compensation			Earnings			Income (Loss)			Income
BALANCE, JANUARY 1, 2003				10,690,630		$	10,690		$	32,930,307		$	—		$	29,903,338		$	2,524,732
Warrants exercised				52,550			53			341,972
Stock options exercised				223,688			224			893,642
Issuance of restricted stock				2,000			2			22,998			(23,000	)
Stock issuance for acquisition				426,189			426			7,999,575
Tax benefit from stock options exercisd										151,776
Amortization of deferred compensation													10,861
Cash dividend declared																(1,646,460	)
Comprehensive income:
	Net income															10,356,777					$	10,356,777
	Other comprehensive income:
		Net change in unrealized gain on securities available for sale, interest-only-strips and interest rate swap - net of taxes																	(1,613,998	)		(1,613,998	)
Comprehensive income																					$	8,742,779
BALANCE, SEPTEMBER 30, 2003				11,395,057		$	11,395		$	42,340,270		$	(12,139	)	$	38,613,655		$	910,734
BALANCE, JANUARY 1, 2002				11,145,674			11,146		$	32,989,549		$	—		$	22,075,612		$	356,674
Warrants exercised				120,000			120			719,940
Stock options exercised				19,354			19			69,759
Stock repurchased				(564,298	)		(564	)		(5,950,274	)
Cash dividend declared																(1,659,044	)
Comprehensive income:
	Net income															12,356,371					$	12,356,371
	Other comprehensive income:
		Net change in unrealized gain on securities available for sale, interest-only-strips and interest rate swaps - net of tax																	2,099,181			2,099,181
Comprehensive income																					$	14,455,552
BALANCE, SEPTEMBER 30, 2002				10,720,730		$	10,721		$	27,828,974		$	—		$	32,772,939		$	2,455,855

See notes to condensed consolidated financial statements

7

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
NINE MONTHS ENDED SEPTEMBER 30, 2003 AND 2002
(Unaudited)

			2003			2002
CASH FLOW FROM OPERATING ACTIVITIES
	Net income		$	10,356,777		$	12,356,371
	Adjustments to reconcile net income to net cash provided (used in ) by operating activities:
		Depreciation, amortization, and accretion		(635,390	)		740,710
		Provision for loan losses		3,750,000			1,350,000
		Provision for other real estate owned		—			16,414
		Proceeds from sales of SBA loans		42,344,689			34,607,973
		Originations of SBA loans held for sale		(56,541,500	)		(50,801,656	)
		Net gain on sales of SBA loans		(3,170,839	)		(1,971,387	)
		Gain on sales of securities available for sale		(405,526	)		(975,135	)
		Loss (gain) on sales of fixed assets		6,294			(44,936	)
		Gain on sale of other real estate owned		(77,521	)		(29,963	)
		Gain on interest rate swaps		(437,332	)		(110,103	)
		(Increase) decrease in accrued interest receivable		(198,520	)		(150,083	)
		Deferred income taxes		(1,388,487	)		—
		Decrease (increase) in other assets		(6,080,797	)		(1,838,170	)
		(Decrease) increase in accrued interest payable		758,853			(417,891	)
		Increase (decrease) in other liabilities		409,641			1,700,399
		Cumulative effect of a change in accounting principle		—			(4,192,334	)
		Net cash (used in) operating activities		(11,309,658	)		(9,759,791	)
CASH FLOWS FROM INVESTING ACTIVITIES
		Net increase in loans receivable		(168,742,423	)		(142,495,520	)
		Net increase in cash surrender value		(418,985	)		(259,405	)
		Purchase of premises and equipment		(1,515,608	)		(587,829	)
		Purchase of investment securities available for sale		(81,257,739	)		(77,854,164	)
		Proceeds from sale of other real estate owned		166,805			131,759
		Proceeds from sale of equipment		247,175			39,000
		Proceeds from sale of investment securities available for sale		10,982,706			39,236,934
		Proceeds from matured or called investment securities held to maturity		793,535			1,662,949
		Proceeds from matured or called investment securities available for sale		36,546,697			22,012,009
		Purchase of Federal Home Loan Bank Stock		(2,013,800	)		(2,983,300	)
		Purchase of Federal Reserve Stock		(299,835	)		(45,165	)
		(Decrease) increase in interest-only strip		(109,282	)		(9,762	)
		Proceeds from interest-bearing deposits in other banks		—			(4,850,000	)
		Proceeds from matured interest-bearing deposits in other banks		—			5,242,000
		Net cash used in investing activities		(205,620,754	)		(160,760,494	)

8

			2003			2002
CASH FLOWS FROM FINANCING ACTIVITIES
		Net increase in deposits		132,455,435			81,260,055
		Proceeds from issuance of Trust Preferred Securities, net		4,875,000			7,729,459
		Payment of cash dividend		(1,646,460	)		(1,122,182	)
		Paydown on subordinated notes		—			(4,300,000	)
		Repurchase of common stock		—			(5,950,556	)
		Stock issuance for acquisition		8,000,001			—
		Proceeds from Federal Home Loan Bank borrowing		5,000,000			60,000,000
		Proceeds from warrants exercised		342,025			69,768
		Proceeds from stock options exercised		893,866			720,000
		Net cash provided by financing activities		149,919,867			138,406,544
	NET DECREASE IN CASH AND CASH EQUIVALENTS			(67,010,545	)		(32,113,741	)
	CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD			104,742,728			72,594,996
	CASH AND CASH EQUIVALENTS, END OF PERIOD		$	37,732,183		$	40,481,255
	SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
		Interest Paid	$	11,319,652		$	10,043,754
		Income Taxes Paid	$	8,328,865		$	2,820,400
	SUPPLEMENTAL SCHEDULE OF NONCASH INVESTMENT ACTIVITIES
		Transfer of loans to other real estate owned	$	15,601		$	75,684
		Net appreciation on Bank-Owned Life Insurance	$	358,445		$	259,405

See notes to consolidated financial statements

9

Notes to unaudited Condensed Consolidated Financial Statements

1. Nara Bancorp, Inc.

     Nara Bancorp, Inc. (“Nara Bancorp”, on a parent-only basis, and “we” or “our” on a consolidated basis), incorporated under the laws of the State of Delaware in 2000, is a bank holding company, headquartered in Los Angeles, California, offering a wide range of commercial banking and consumer financial services through its wholly owned subsidiary, Nara Bank, N.A., a national bank (“Nara Bank”) with branches in California and New York as well as Loan Production Offices in Seattle, Chicago, New Jersey , Atlanta, and Virginia.

2. Basis of Presentation

     Our condensed consolidated financial statements included herein have been prepared without an audit, pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Certain information and footnote disclosures, normally included in consolidated financial statements prepared in accordance with accounting principles generally accepted in the United States of America, have been condensed or omitted pursuant to such SEC rules and regulations.

     The condensed consolidated financial statements include the accounts of Nara Bancorp and its wholly owned subsidiary, Nara Bank. In addition, we have the following consolidated subsidiaries which issued trust preferred securities and purchased Nara Bancorp’s junior subordinated deferrable interest debentures: Nara Bancorp Capital Trust I, Nara Statutory Trust II, and Nara Capital Trust III. We also created Nara Real Estate Trust (“REIT”), a Maryland real estate investment trust and wholly owned second-tier operating subsidiary of Nara Bank. All intercompany transactions and balances have been eliminated in consolidation.

     We also believe that we have made all adjustments necessary to fairly present our financial position and the results of our operations for the interim period ended September 30, 2003. Certain reclassifications have been made to prior period amounts in order to conform to the September 30, 2003 presentation. The results of operations for the interim period are not necessarily indicative of results for the full year.

     These condensed consolidated financial statements should be read along with the audited consolidated financial statements and accompanying notes included in our 2002 Annual Report on Form 10-K.

3. Stock-Based Compensation

     Statement of Financial Accounting Standards (“SFAS”) No. 123, Accounting for Stock-Based Compensation, encourages, but does not require, companies to record compensation cost for stock-based employees compensation plans at fair value. We have elected to continue to account for stock-based compensation using the intrinsic value method prescribed in Accounting Principles Board Opinion (“APB”) No. 25, Accounting for Stock Issued to Employees, and related interpretations. Accordingly, compensation cost for stock options is measured as the excess, if any, of the fair value of our stock at the date of grant over the grant price.

     We have adopted the disclosure only provisions of SFAS No. 123. Had compensation cost for our stock-based compensation plans been determined base on the fair value at the grant date for awards consistent with the provisions of SFAS No. 123, our net income would have been reduced to the pro forma amounts as follows:

10

		For the three months ended September 30,				For the nine months ended September 30,
		2003		2002		2003		2002
Before cumulative effect of a change in accounting principle:
Income—as reported		$	3,704,334	$	3,109,324	$	10,356,777	$	8,164,037
Deduct: Total stock-based employee compensation expense determined under fair value-based method for all awards—net of related tax effects			229,084		103,857		386,081		179,975
Pro forma net income		$	3,475,250	$	3,005,467	$	9,970,696	$	7,984,062
EPS:
	Basic—as reported	$	0.33	$	0.29	$	0.95	$	0.74
	Basic—pro forma		0.31		0.28		0.92		0.73
	Diluted—as reported	$	0.32	$	0.27	$	0.91	$	0.70
	Diluted—pro forma		0.30		0.26		0.87		0.69

		For the three months ended September 30,				For the nine months ended September 30,
		2003		2002		2003		2002
After cumulative effect of a change in accounting principle:
Net income—as reported		$	3,704,334	$	3,109,324	$	10,356,777	$	12,356,371
Deduct: Total stock-based employee compensation expense determined under fair value-based method for all awards—net of related tax effects			229,084		103,857		386,081		179,975
Pro forma net income		$	3,475,250	$	3,005,467	$	9,970,696	$	12,176,396
EPS:
	Basic—as reported	$	0.33	$	0.29	$	0.95	$	1.12
	Basic—pro forma		0.31		0.28		0.92		1.11
	Diluted—as reported	$	0.32	$	0.27	$	0.91	$	1.06
	Diluted—pro forma		0.30		0.26		0.87		1.05

The weighted-average fair value of options granted during the third quarter of 2003 was $4.63. No options were granted during the third quarter of 2002. The fair value of options granted under our stock option plans during the third quarter of 2003 was estimated on the date of grant using the Black-Scholes option-pricing model, with the following weighted-average assumptions used: 0.5% dividends yield, volatility of 28.16%, risk-free interest rate of 2.8% and expected lives of three years.

4. Dividends

     On August 25, 2003, we declared a $0.05 per share cash dividend paid on October 10, 2003 to stockholders of record at the close of business on September 30, 2003.

11

5. Stock Splits

     On February 14, 2003, Nara Bancorp announced that its Board of Directors approved a two-for-one stock split of its common stock, effected in the form of a 100% stock dividend, which was payable on March 17, 2003 to stockholders of record on close of business on March 3, 2003. The effect of this dividend is that Stockholders received one additional share of Nara Bancorp common stock for each share owned. All per share amounts and number of shares outstanding in this report have been retroactively restated for this stock split.

6. Earnings Per Share

     Basic earnings-per-share excludes the number of shares of common stock that could be purchased from those who hold stock options or warrants and is computed by dividing our earnings for the period by the weighted-average number of common shares outstanding for the period. Diluted earnings-per-share includes the weighted-average number of common shares outstanding, plus the number of shares that could be issued upon the exercise of stock options and/or warrants where the exercise price is less than the period average market value of our common stock.

     The following table shows how we computed basic and diluted earnings per share (“EPS”) for the periods ended September 30, 2003 and 2002.

	For the nine months ended September 30,
	2003						2002
	Income		Shares		Per Share		Income		Shares		Per Share
	(Numerator)		(Denominator)		(Amount)		(Numerator)		(Denominator)		(Amount)
Before cumulative effect of a change in accounting Principle
Basic EPS	$	10,356,777		10,854,137	$	0.95	$	8,164,037		11,000,056	$	0.74
Effect of Dilutive Securities:
Options				527,225						574,556
Restricted stock				546						—
Warrants		—		51,217				—		74,568
Diluted EPS	$	10,356,777		11,433,125	$	0.91	$	8,164,037		11,649,180	$	0.70
Cumulative effect of a change in accounting principle
Basic EPS	$	—		—	$	—	$	4,192,334		11,000,056	$	0.38
Options				—						574,556
Warrants		—		—				—		74,568
Diluted EPS	$	—		—	$	—	$	4,192,334		11,649,180	$	0.36
Net income
Basic EPS	$	10,356,777		10,854,137	$	0.95	$	12,356,371		11,000,056	$	1.12
Effect of Dilutive Securities:
Options				527,225						574,556
Restricted stock				546						—
Warrants		—		51,217						74,568
Diluted EPS	$	10,356,777		11,433,125	$	0.91	$	12,356,371		11,649,180	$	1.06

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	For the three months ended September 30,
	2003						2002
	Income		Shares		Per Share		Income		Shares		Per Share
	(Numerator)		(Denominator)		(Amount)		(Numerator)		(Denominator)		(Amount)
Basic EPS	$	3,704,334		11,090,549	$	0.33	$	3,109,324		10,877,652	$	0.29
Effect of Dilutive Securities:
Options				538,878						575,482
Restricted stock				700						—
Warrants		—		41,841				—		59,252
Diluted EPS	$	3,704,334		11,671,968	$	0.32	$	3,109,324		11,512,386	$	0.27

7. SBA

     Certain Small Business Administration (“SBA”) loans that we have the intent to sell prior to maturity have been designated as held for sale at origination and are recorded at the lower of cost or market value on an aggregate basis. A valuation allowance is established if the aggregate market value of such loans is lower than their cost, and operations are charged or credited for valuation adjustments. A portion of the premium on sale of SBA loans is recognized as gain on sale of loans at the time of the sale. The remaining portion of the premium (relating to the portion of the loan retained) is deferred and amortized over the remaining life of the loan as an adjustment to yield. Servicing assets are recognized when loans are sold with servicing retained. Servicing assets are recorded based on the present value of the contractually specified servicing fee, net of servicing costs, over the estimated life of the loan, using a discounted rate based on the related note rate, plus 1 to 2%. Servicing assets are amortized in proportion to and over the period of estimated future net servicing income.

     We periodically evaluate servicing assets for impairment. At September 30, 2003, the fair value of servicing assets was determined using a weighted-average discount rate of 6.9% and a prepayment speed of 11.1%. At September 30, 2002, the fair value of servicing assets was determined using a weighted-average discount rate of 7.6% and a prepayment speed of 11.4%. For purposes of measuring impairment, servicing assets are stratified by loan type. An impairment is recognized if the carrying value of servicing assets exceeds the fair value of the stratum. The fair values of servicing assets were approximately $3,238,000 and $2,433,000 at September 30, 2003 and December 31, 2002, respectively.

     An interest-only strip is recorded based on the present value of the excess of the total future income from serviced loans over the contractually specified servicing fee, calculated using the same assumptions as used to value the related servicing assets. Such interest-only strip is accounted for at the estimated fair value, with unrealized gain or loss, net of tax, recorded as a component of accumulated other comprehensive income (loss).

     We offer direct financing leases to customers whereby the assets leased are acquired without additional financing from other sources. Direct financing leases are carried net of unearned income, unamortized nonrefundable fees and related direct costs associated with the origination or purchase of leases.

8. Goodwill and Other Intangible Assets

     In July 2001, the Financial Accounting Standards Board (“FASB”) issued SFAS No. 141, Business Combinations, and SFAS No. 142, Goodwill and Other Intangible Assets. SFAS No. 141 requires that the purchase method of accounting be used for all business combinations completed after June 30, 2001 and also specifies the types of acquired intangible assets that are required to be recognized and reported separately from goodwill and those acquired intangible assets that are required to be included in goodwill. SFAS No. 142 requires that goodwill no longer be amortized, but instead be tested for impairment at least annually. Additionally, SFAS

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No. 142 requires recognized intangible assets to be amortized over their respective estimated useful lives and reviewed for impairment. Any recognized intangible asset determined to have an indefinite useful life will not be amortized, but instead it must be tested for impairment until its life is determined to no longer be indefinite. We adopted SFAS No. 142 on January 1, 2002.

     In connection with the transitional impairment evaluation required by SFAS No. 142, we performed an assessment of whether there was an indication that goodwill was impaired as of January 1, 2002. We completed our evaluation of any transitional impairment of goodwill and determined that there was no impairment as of January 1, 2002. We also tested goodwill for impairment as of December 31, 2002, noting no impairment in the recorded goodwill of $874,968. No conditions indicated any further impairment as of September 30, 2003.

     At December 31, 2001, we had negative goodwill (the amount by which the fair value of assets acquired and liabilities assumed exceeds the cost of an acquired company) of $4,192,334. In accordance with SFAS No. 142, such amount was recognized in the consolidated statement of income as the cumulative effect of a change in accounting principle on January 1, 2002. The recognition of negative goodwill is not tax effected, as no deferred taxes were allocated to it in the initial purchase accounting. We will continue to amortize its other intangible assets, representing core deposit intangibles, over the original estimated useful life of seven years.

     In August 2003, we acquired Asiana Bank and recorded a core deposit intangible of $1.0 million, which we will amortize over an estimated useful life of seven years. We also recognized $1.0 million in goodwill, which will be tested for impairment on an annual basis. Refer to footnote 15 for more information.

     As of September 30, 2003, intangible assets that continue to be subject to amortization include core deposits of $2,303,921 (net of $782,882 accumulated amortization) and servicing assets of $2,614,495 (net of $897,394 accumulated amortization). Amortization expense for such intangible asset was $576,932 for the nine months ended September 30, 2003. Estimated amortization expense for intangible assets for the remainder of 2003 and the five succeeding fiscal years are as follows:

2003 (remaining three months)	$	125,376
2004		847,700
2005		759,047
2006		613,616
2007		568,078
2008 thereafter		2,004,599

9. Recent Accounting Pronouncements

     FASB issued Interpretation (“FIN”) No. 45, Guarantor’s Accounting and Disclosure Requirements for Guarantees, Including Indirect Guarantees and Indebtedness of Others, an interpretation of SFAS Nos. 5, 57 and 107, and rescission of FIN No. 34, Disclosure of Indirect Guarantees of Indebtedness of Others, in November 2002. FIN No. 45 elaborates on the disclosures to be made by the guarantor in its interim and annual financial statements about its obligations under certain guarantees that it has issued. It also requires that a guarantor recognize, at the inception of a guarantee, a liability for the fair value of the obligation undertaken in issuing the guarantee. The initial recognition and measurement provisions of the interpretation are applicable on a prospective basis to guarantees issued or modified after December 31, 2002, while the provisions of the disclosure requirements are effective for financial statements of interim or annual periods ending after December 15, 2002. The adoption of such interpretation did not have a material impact on our results of operations, financial position or cash flows.

     In April 2003, the FASB issued SFAS No. 149, Amendment of Statement 133 on Derivative Instruments and Hedging Activities, which clarifies and amends financial accounting and reporting for derivative instruments, including certain derivative instruments embedded in other contracts and for hedging activities under SFAS No. 133, Accounting for Derivative Instruments and Hedging Activities. In general, SFAS No. 149 is effective for

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contracts entered into or modified after June 30, 2003 and for hedging relationships designated after June 30, 2003. The adoption of such statement did not have a material impact on our results of operations, financial position or cash flows.

     The FASB issued FIN 46, Consolidation of Variable Interest Entities - an interpretation of ARB No. 51, in January 2003. FIN 46 requires that variable interest entities be consolidated by a company if that company is subject to a majority of the risk of loss from the variable interest entity’s activities or is entitled to receive a majority of the entity’s residual returns or both. FIN 46 also requires disclosures about variable interest entities that companies are not required to consolidate but in which a company has a significant variable interest. The consolidation requirements of FIN 46 will apply immediately to variable interest entities created after January 31, 2003. The consolidation requirements will apply to entities established prior to January 31, 2003 in the first fiscal year or interim period beginning after December 15, 2003. We do not believe the adoption of such interpretation will have a material impact on our results of operations, financial position or cash flows.

10. Commitments and Contingencies

     We are a party to financial instruments with off-balance-sheet risk in the normal course of business to meet the financing needs of our customers. These financial instruments include commitments to extend credit, standby letters of credit, and commercial letters of credit. These instruments involve, to varying degrees, elements of credit and interest rate risk in excess of the amount recognized in the consolidated statements of financial condition. Our exposure to credit loss in the event of nonperformance by the other party to commitments to extend credit and standby letters of credit is represented by the contractual notional amount of those instruments. We use the same credit policies in making commitments and conditional obligations as we do for extending loan facilities to customers. We evaluate each customer’s creditworthiness on a case-by-case basis. The amount of collateral obtained, if deemed necessary upon extension of credit, is based on our credit evaluation of the counterparty. Collateral held varies but may include accounts receivable; inventory; property, plant, and equipment; and income-producing properties.

Commitments at September 30, 2003 are summarized as follows:

Commitments to extend credit	$	156,809,644
Standby letters of credit		4,773,687
Commercial letters of credit		28,282,257

     In the normal course of business, we are involved in various legal claims. We have reviewed all legal claims against us with counsel and have taken into consideration the views of such counsel as to the outcome of the claims. In our opinion, the final disposition of all such claims will not have a material adverse effect on our financial position and results of operations.

11. Derivative Financial Instruments and Hedging Activities

     As part of our asset and liability management strategy, we may engage in derivative financial instruments, such as interest rate swaps, with the overall goal of minimizing the impact of interest rate fluctuations on our net interest margin. During the second and fourth quarters of 2002, we entered into various interest rate swap agreements as summarized in the table below. Our objective for the interest rate swaps is to manage asset and liability positions in connection with our overall strategy of minimizing the interest rate fluctuations on our interest rate margin and equity.

     Under the interest rate swap agreements, we receive a fixed rate and pay a variable rate based on H.15 Prime. The swaps qualify as cash flow hedges under SFAS No. 133, as amended, and are designated as hedges of the variability of cash flows we receive from certain of our Prime-indexed loans. In accordance with SFAS No. 133, these swap agreements are measured at fair value and reported as assets or liabilities on the consolidated

15

statement of financial condition. The portion of the change in the fair value of the swaps that is deemed effective in hedging the cash flows of the designated assets are recorded in accumulated other comprehensive income (“OCI”) and reclassified into interest income when such cash flows occur in the future. Any ineffectiveness resulting from the hedges is recorded as a gain or loss in the consolidated statement of income as a part of non-interest income. As of September 30, 2003, the amounts in accumulated OCI associated with these cash flows totaled $1,625,504 (net of tax of $1,083,670), of which $211,763 is expected to be reclassified into interest income within the next 12 months. As of September 30, 2003, the maximum length of time over which we are hedging our exposure to the variability of future cash flow is approximately 9.5 years.

Interest rate swap information at September 30, 2003 is summarized as follows:

Current Notional											Realized
Amount			Floating Rate	Fixed Rate			Maturity Date		Unrealized Gain		Gain (Loss) 1
	$	20,000,000	H.15 Prime 2		6.95	%		4/29/2005	$	709,517	$	20,610
		20,000,000	H.15 Prime 2		7.59	%		4/30/2007		1,223,483		66,667
		20,000,000	H.15 Prime 2		6.09	%		10/09/2007		165,990		86,470
		20,000,000	H.15 Prime 2		6.58	%		10/09/2009		12,342		128,845
		20,000,000	H.15 Prime 2		7.03	%		10/09/2012		—		(29,498	)
		20,000,000	H.15 Prime 2		5.60	%		12/17/2005		297,479		48,909
		10,000,000	H.15 Prime 2		6.32	%		12/17/2007		160,008		47,255
		10,000,000	H.15 Prime 2		6.83	%		12/17/2009		140,355		68,074
	$	140,000,000							$	2,709,174	$	437,332

1.	Gain included in the consolidated statement of earnings for the nine months ended September 30, 2003, representing hedge ineffectiveness
2.	Prime rate is based on Federal Reserve statistical release H.15

     During the 3rd quarter of 2003, interest income received from the swap counterparties was $893,000 compared to $252,000 for the same quarter of 2003. During the first nine months of 2003, interest income received from swap counterparties was $2.5 million compared to $420,000 for the same period of 2002. At September 30, 2003, we pledged to the interest rate swap counterparty as collateral agency securities with a book value of $2.0 million and real estate loans of $1.0 million.

12. Business Segments

     Our management utilizes an internal reporting system to measure the performance of our various operating segments. We have identified three principal operating segments for the purposes of management reporting: banking operation, trade finance (“TFS”), and small business administration (“SBA”). Information related to our remaining centralized functions and eliminations of intersegment amounts have been aggregated and included in banking operation. Although all three operating segments offer financial products and services, they are managed separately based on each segment’s strategic focus. The banking operation segment focuses primarily on commercial and consumer lending and deposit operations throughout our branch network. The TFS segment focuses primarily on allowing our import/export customers to handle their international transactions. Trade finance products include the issuance and collection of letters of credit, international collection, and import/export financing. The SBA segment provides our customers with the U.S. SBA guaranteed lending program.

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     Operating segment results are based on our internal management reporting process, which reflects assignments and allocations of capital, certain operating and administrative costs and the provision for loan losses. Noninterest income and noninterest expense, including depreciation and amortization, directly attributable to a segment are assigned to that business. We allocate indirect costs, including overhead expense, to the various segments based on several factors, including, but not limited to, full-time equivalent employees, loan volume and deposit volume. We allocate the provision for loan losses based on the origination of new loans for the period. We evaluate the overall performance based on profit or loss from operations before income taxes excluding nonrecurring gains and losses. Future changes in our management structure or reporting methodologies may result in changes to the measurement of operating segment results.

     The following tables present the operating results and other key financial measures for the individual operating segments for the nine and three months ended September 30, 2003 and 2002.

For the Nine Months Ended September 30

	Business Segment
	Banking
	Operations		TFS		SBA		Company
2003
Net interest income, before provision for loan loss	$	25,262	$	3,215	$	4,068	$	32,545
Less provision for loan losses		2,845		535		370		3,750
Non-interest income		8,843		2,070		3,968		14,881
Net revenue		31,260		4,750		7,666		43,676
Non-interest expense		21,032		3,115		2,641		26,788
Earnings before taxes	$	10,228	$	1,635	$	5,025	$	16,888
Total assets	$	875,162	$	88,784	$	176,718	$	1,140,664
2002
Net interest income, before provision for loan loss	$	19,839	$	2,579	$	3,059	$	25,477
Less provision for loan losses		1,250		30		70		1,350
Non-interest income		7,782		2,079		2,522		12,383
Net revenue		26,371		4,628		5,511		36,510
Non-interest expense		18,724		2,772		2,069		23,565
Earnings before taxes	$	7,647	$	1,856	$	3,442	$	12,945
Total assets	$	648,720	$	68,216	$	115,974	$	832,910

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For the Three Months Ended September 30

	Business Segment
	Banking
	Operations		TFS		SBA		Company
2003
Net interest income, before provision for loan loss	$	9,063	$	1,042	$	1,544	$	11,649
Less provision for loan losses		960		250		140		1,350
Non-interest income		3,118		670		1,391		5,179
Net revenue		11,221		1,462		2,795		15,478
Non-interest expense		7,488		1,058		869		9,415
Earnings before taxes	$	3,733	$	404	$	1,926	$	6,063
Total assets	$	875,162	$	88,784	$	176,718	$	1,140,664
2002
Net interest income, before provision for loan loss	$	7,152	$	878	$	1,200	$	9,230
Less provision for loan losses		400		—		—		400
Non-interest income		2,434		759		1,334		4,527
Net revenue		9,186		1,637		2,534		13,357
Non-interest expense		6,304		1,066		922		8,292
Earnings before taxes	$	2,882	$	571	$	1,612	$	5,065
Total assets	$	648,720	$	68,216	$	115,974	$	832,910

13. Other Comprehensive Income

     The following table shows the reclassification of other comprehensive income as of September 30, 2003 and 2002.

			2003			2002
Unrealized gain on securities available for sale and interest-only strips:
		Unrealized holding gains arising during the period - net of tax of $796,336 in 2003 and $959,877 in 2002	$	(1,194,504	)	$	1,439,816
		Less: Reclassification adjustment for gain included in net earnings, net of tax expense of $162,210 in 2003 and $390,054 in 2002		(243,316	)		(585,081	)
Net change in unrealized gain of securities available for sale and interest-only strips, net of tax of $958,547 in 2003 and $569,823 in 2002			$	(1,437,820	)	$	854,735
Unrealized gain on interest rate swaps:
		Unrealized holding gains arising during the period - net of tax of $899,648 in 2003 and $873,671 in 2002	$	1,349,472		$	1,310,508
		Less: Reclassification adjustments to interest income - net of tax expense of $1,017,100 in 2003 and $44,041 in 2002		(1,525,650	)		(66,062	)
	Net Change in unrealized gain of interest rate swaps - net of tax expense of of $117,452 in 2003 and $829,630 in 2002		$	(176,178	)	$	1,244,446
Total change in unrealized gain of securities available for sale, interest-only strips and interest rate swaps			$	(1,613,998	)	$	2,099,181

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14. Trust preferred

     On June 5, 2003, Nara Bancorp completed a $5.0 million offering of trust preferred securities, through Nara Capital Trust III, issued as part of a private placement pooled offering with several other financial institutions. Cohen Bros. & Company acted as placement agent for the pooled offering. For the period beginning on June 5, 2003 to September 15, 2003, the trust preferred securities bore the interest rate of 4.43 percent per annum with interest payable quarterly. Beginning September 15, 2003, the interest rate is adjusted quarterly on March 15, June 15, September 15, and December 15 during the 30-year term based on the 3-month LIBOR plus 3.15 percent. However, prior to June 15, 2008, the interest rate cannot exceed 12.0 percent.

     The trust preferred securities mature on June 15, 2003 and are callable at par in whole or in part beginning June 15, 2008. Nara Capital Trust III used the proceeds from the sale of the trust preferred securities to purchase junior subordinate deferrable interest debentures of Nara Bancorp.

15. Business Combination

     On August 25, 2003, we completed our acquisition of Asiana Bank (“Asiana”) at a price of $8.0 million in stocks. We have issued approximately 426,000 shares for this acquisition. The results of Asiana’s operations have been included in the consolidated financial statements since that date. The acquisition was accounted for under the purchase method of accounting, and accordingly, all assets and liabilities of Asiana were adjusted to and recorded at their estimated fair values as of the acquisition date. The estimated tax effect of differences between tax bases and market values has been reflected in deferred income taxes. The estimated fair values of assets, net loans, and deposits acquired were $37.7 million, $22.4 million, and $29.4 million, respectively. We recorded total goodwill of approximately $1.0 million and cored deposit premium of $1.0 million. Core deposit premium will be amortized using the straight-line method over 7 years.

16. Subsequent Event

     On August 11, 2003, we announced that Nara Bank, N.A, a wholly owned subsidiary of Nara Bancorp, Inc. and Korea Exchange Bank, entered into an agreement for the assumption by Nara Bank of FDIC insured deposits and certain loans of Korea Exchange Bank’s Broadway branch in New York City. The acquisition was completed on October 31, 2003. Nara assumed approximately $46 million in deposits and approximately $37 million in loans.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

     The following is management’s discussion and analysis of the major factors that influenced our consolidated results of operations and financial condition for the three and nine months ended September 30, 2003 and September 30, 2002. This analysis should be read in conjunction with our Annual Report on Form 10-K for the year ended December 31, 2002 and with the unaudited consolidated financial statements and notes as set forth in this report.

GENERAL

Selected Financial Data

     The following table sets forth certain selected financial data concerning the periods indicated:

		For The Nine Months Ended				For The Three Months Ended
		September 30,				September 30,
		2003		2002		2003		2002
		Dollars in thousands,				Dollars in thousands,
		except per share data				except per share data
Income Statement data:
	Interest income	$	44,623	$	35,103	$	15,576	$	12,738
	Interest expense		12,078		9,626		3,927		3,508
	Net interest income, before provision for loan losses		32,545		25,477		11,649		9,230
	Provision for loan losses		3,750		1,350		1,350		400
	Net interest income after provision for loan losses		28,795		24,127		10,299		8,830
	Noninterest operating income		14,881		12,383		5,179		4,527
	Noninterest operating expense		26,787		23,565		9,415		8,292
	Income before income taxes		16,889		12,945		6,063		5,065
	Income taxes		6,532		4,781		2,358		1,956
	Income before cumulative effect of a change in accounting principle		10,357		8,164		3,705		3,109
	Cumulative effect of a change in accounting principle				4,192				—
	Net income	$	10,357	$	12,356	$	3,705	$	3,109
Per Share Data:
	Earnings per share - basic	$	0.95	$	1.12	$	0.33	$	0.29
	Earnings per share - diluted		0.91		1.06		0.32		0.27
	Book value (period end)		7.18		5.88		7.18		5.88
	Common shares outstanding		11,395,057		10,720,730		11,395,057		10,720,730
	Weighted average shares - basic		10,854,137		11,000,056		11,090,549		10,877,652
	Weighted average shares - diluted		11,433,125		11,649,180		11,671,968		11,512,386
Balance Sheet Data - At Period End:
	Assets	$	1,140,664	$	832,910	$	1,140,598	$	832,910
	Investment Securities		134,968		86,944		134,968		86,944
	Net Loans		903,752		661,375		903,752		661,375
	Deposits		949,374		671,104		949,374		671,104
	Shareholder’ equity		81,864		63,063		81,864		63,063

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		For The Nine Months Ended						For The Three Months Ended
		September 30,						September 30,
		2003			2002			2003			2002
Average Balance Sheet Data:
	Assets	$	1,044,702		$	749,391		$	1,109,926		$	749,391
	Securities		136,332			89,874			145,633			89,874
	Net Loans		782,429			566,895			848,248			566,895
	Deposits		857,699			624,250			902,610			624,250
	Shareholders’ equity		72,186			61,479			77,580			61,479
Selected Performance Ratios:
	Return on average assets, excluding cumulative effect (1)		1.32	%		1.45	%		1.34	%		1.54	%
	Return on average shareholders’ equity, excluding cumulative effect (1)		19.13	%		17.71	%		19.10	%		20.08	%
	Operating expense to average assets (1)		3.42	%		4.19	%		3.39	%		4.11	%
	Efficiency ratio (2)		56.48	%		62.24	%		55.95	%		60.27	%
	Net interest margin (3)		4.47	%		4.95	%		4.54	%		4.98	%
Capital Ratio (4)
	Leverage capital ratio		9.05	%		9.52	%		9.05	%		9.52	%
	Tier 1 risk-based capital ratio		10.30	%		10.48	%		10.30	%		10.48	%
	Total risk-based capital ratio		11.51	%		11.45	%		11.51	%		11.45	%
Asset Quality Ratios:
	Allowance for loan losses to total gross loans		1.29	%		1.06	%		1.29	%		1.06	%
	Allowance for loan losses to non-accrual loans		296.53	%		643.13	%		296.53	%		643.13	%
	Total non-performing assets to total assets		0.39	%		0.25	%		0.39	%		0.25	%

(1)	Calculations are based on annulized net income
(2)	Efficiency ratio is defined as operating expense divided by the sum of net interest income and non-interst income
(3)	Net interest margin is calculated by dividing annualized net interest income by net average earning assets
(4)	The required ratios for the “well-capitalized” institution are 5% leverage capital, 6% tier 1 risk-based capital and 10% total risk-based capital

Forward-Looking Information

     Certain matters discussed under this caption may constitute forward-looking statements under Section 27A of the Securities Act and Section 21E of the Securities Exchange Act of 1934. There can be no assurance that the results described or implied in such forward-looking statements will, in fact, be achieved and actual results, performance, and achievements could differ materially because our business involves inherent risks and uncertainties. Risks and uncertainties include possible future deteriorating economic conditions in our areas of operation; interest rate risk associated with volatile interest rates and related asset-liability matching risk; liquidity risks; risk of significant non-earning assets, and net credit losses that could occur, particularly in times of weak economic conditions or times of rising interest rates; risks of available for sale securities declining significantly in value as interest rates rise; and regulatory risks associated with the variety of current and future regulations which we are subject to. For additional information concerning these factors, see “Item 1. Business - Factors That May Affect Business or the Value of Our Stock” contained in our Form 10-K for the year ended December 31, 2002.

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RESULTS OF OPERATIONS

Net income

     Our net income for the three months ended September 30, 2003 was $3.7 million or $0.32 per diluted share compared to $3.1 million or $0.27 per diluted shares for the same quarter of 2002, which represented an increase of approximately $0.6 million or 19.4%. The increase resulted primarily from an increase in net interest income. The annualized return on average assets was 1.34% for the third quarter or 2003 compared to 1.54% for the same period of 2002. The annualized return on average equity was 19.10 % for the third quarter of 2003 compared to 20.08% for the same period of 2002. The resulting efficiency ratio was 55.95% for the three months ended September 30, 2003 compared with 60.27% for the same period of 2002.

     Our net income before cumulative effect of a change in accounting principle for the nine months ended September 30, 2003 was $10.4 million or $0.91 per diluted share compared to $8.2 million or $0.70 per diluted share for the same period of 2002, which represented an increase of approximately $1.5 million or 26.8%. The increase was primarily due to an increase in net interest income and noninterest income, provided primarily by the from a growth in loans as well as the sale of loans we originated, which was partially offset by higher loan loss provision and noninterest expense. During the first quarter of 2002, we recognized $4.2 million as the cumulative effect of a change in accounting principle. The cumulative effect of a change in accounting principle was related to the one-time recognition of all negative goodwill in the consolidated statement of income at January 1, 2002 in accordance with SFAS No. 142, Goodwill and Other Intangible Assets, which resulted in total net income for the nine months of $12.4 million or $1.06 per diluted share.

     The annualized return on average assets was 1.32 % for the nine months ended September 30, 2003 compared to 1.45% for the same period of 2002. The annualized return on average equity was 19.13% for the nine months ended September 30, 2003 compared to 17.71% for the same period of 2002. The resulting efficiency ratios were 56.48% for the nine months ended September 30, 2003 compared with 62.24% for the corresponding period of the preceding year. This improvement was primarily due to the increase in net revenue. All 2002 ratios in this section exclude the cumulative effect of a change in accounting principle.

Net Interest Income and Net Interest Margin

Net Interest Income

     The principal component of our earnings is net interest income, which is the difference between the interest and fees earned on loans, swaps and investments and the interest paid on deposits, trust preferreds and borrowed funds. When net interest income is expressed as a percentage of average interest-earning assets, the result is the net interest margin. The net interest spread is the yield on average interest-earning assets less the cost of average interest-bearing deposits and borrowed funds. The net interest income is affected by changes in the volume of interest-earning assets and interest-bearing liabilities as well as by changes in yield earned on interest-earning assets and rates paid on interest-bearing liabilities.

     Net interest income before provision for loan losses was $11.6 million for the three months ended September 30, 2003, which represented an increase of $2.4 million, or 26.1% from net interest income of $9.2 million for the same quarter of 2002. This increase was primarily due to an increase in the balance of average earning assets, which increased $284.1 million or 38.3% to $1,026.1 million for the third quarter of 2003, from $742.0 million for the same quarter of 2002.

     Interest income for the third quarter of 2003 was $15.6 million, which represented an increase of $2.9 million or 22.8% over interest income of $12.7 million for the same quarter of 2002. The increase was the net result of a $4.4 million increase in average interest-earning assets (volume change) off-set by a $1.5 million decrease in the yield earned on those average interest-earning assets (rate change). Interest expense for the third

22

quarter of 2003 was $3.9 million, which represented an increase of $0.4 million or 11.4% over the interest expense of $3.5 million for the same quarter of 2002. The increase was the net result of a $1.3 million increase in average interest-bearing liabilities (volume change) offset by an $846,000 decrease in the cost of those interest-bearing liabilities (rate change).

     Net interest income before provision for loan losses was $32.5 million for the nine months ended September 30, 2003, which represented an increase of $8.4 million or 34.9% from net interest income of $24.1 million for the same period of 2002. The increase was the primarily due to an increase in average earning assets. Average earning assets increased $284.8 million or 41.5% to $971.2 million for the nine months ended September 30, 2003, from $686.4 million for the same period of 2002.

     Interest income for the nine months ended September 30, 2003 was $44.6 million, which represented an increase of $9.5 million or 27.1% over interest income of $35.1 million for the same period of 2002. The increase was the net result of $13.0 million increase in average interest-bearing assets (volume change) offset by $3.5 million in the cost of those interest-bearing liabilities (rate change). Interest expense for the nine months ended September 30, 2003 was $12.1 million, which represented an increase of $2.5 million or 26.0% over interest expense of $9.6 million for the same period of 2002. The increase was the net result of a $4.2 million increase in average interest-bearing liabilities (volume change) offset by a $1.8 million decrease in the cost of those interest-bearing liabilities (rate change).

Net Interest Margin

     The yield on average interest-earning assets decreased to 6.07% for the third quarter of 2003, from a yield of 6.87% for the same quarter of 2002. The decrease was primarily due to the two rate cuts in November of 2002 and June of 2003, a total of 75-basis. The average cost of interest-bearing liabilities decreased to 2.11 % for the third quarter of 2003 from 2.72% for the same quarter of 2002. The decrease was primarily due to the decreases in market interest rates. The net interest margin was 4.54% for the third quarter of 2003, down from 4.98% for the same quarter of 2002. The decrease in the net interest margin was primarily due to the decreases in interest rates.

     The yield on average interest-earning assets decreased to 6.13% for the nine months ended September 30, 2003, from a yield of 6.82% for the nine months ended September 30, 2002. The average cost of interest-bearing liabilities decreased to 2.28% for the nine months ended September 30, 2003 from 2.74% for the nine months ended September 30, 2002. These decreases are mainly due to the decreases in market interest rates. The net interest margin was 4.47% for the nine months ended September 30, 2003, down from 4.95% for the same period of 2002. The decrease in the net interest margin resulted primarily from the decreases in market interest rates.

23

     The following table presents our condensed average balance sheet information, together with interest rates earned and paid on the various sources and uses of funds for the three month and six months periods indicated:

			Three months ended							Three months ended
			September 30, 2003							September 30, 2002
					Interest		Average					Interest		Average
			Average		Income/		Yield/			Average		Income/		Yield/
			Balance		Expense		Rate			Balance		Expense		Rate
			(Dollars in thousands)
INTEREST EARNINGS ASSETS:
	Net loans, including interest rate swap		$	848,248	$	13,967		6.59	%	$	629,185	$	11,415		7.26	%
	Other investments			7,094		79		4.45	%		4,645		53		4.56	%
	Securitites			145,632		1,443		3.96	%		86,103		1,172		5.44	%
	Fed funds sold			25,154		87		1.38	%		22,064		99		1.79	%
		Total interest earning assets	$	1,026,128	$	15,576		6.07	%	$	741,997	$	12,739		6.87	%
INTEREST BEARING LIABILITITES:
	Demand, interest-bearing		$	91,175	$	294		1.29	%	$	80,202	$	362		1.81	%
	Savings			157,538		775		1.97	%		79,108		474		2.40	%
	Time certificates of deposits			383,082		2,029		2.12	%		285,886		1,840		2.57	%
	Subordinated debentures			—		—		—			4,105		93		9.06	%
	FHLB borrowings			89,924		425		1.89	%		50,079		370		2.96	%
	Trust preferred securities			22,301		404		7.25	%		17,412		369		8.48	%
		Total interest bearing liabilities	$	744,020	$	3,927		2.11	%	$	516,792	$	3,508		2.72	%
Net interest income					$	11,649						$	9,231
Net yield on interest-earning assets								4.54	%						4.98	%
Net interest spread								3.96	%						4.15	%
Average interest-earning assets to average interest-bearing liabilities								137.92	%						143.58	%

				Nine months ended							Nine months ended
				September 30, 2003							September 30, 2002
						Interest							Interest
						Income/		Average Yield/			Average		Income/		Average Yield/
				Average Balance		Expense		Rate			Balance		Expense		Rate
				(Dollars in thousands)
INTEREST EARNINGS ASSETS:
		Net loans, including interest rate swap		$	782,429	$	39,578		6.74	%	$	566,895	$	30,811		7.25	%
		Other investments			5,908		214		4.83	%		3,149		96		4.06	%
		Securitites			136,332		4,353		4.26	%		89,874		3,850		5.71	%
		Fed funds sold			46,512		478		1.37	%		26,437		346		1.75	%
			Total interest earning assets	$	971,181	$	44,623		6.13	%	$	686,355	$	35,103		6.82	%
INTEREST BEARING LIABILITITES:
		Demand, interest-bearing		$	84,086	$	879		1.39	%	$	83,643	$	1,124		1.79	%
		Savings			149,997		2,487		2.21	%		81,451		1,482		2.43	%
		Time certificates of deposits			374,099		6,342		2.26	%		253,221		4,989		2.63	%
		Subordinated debentures			—		—		0.00	%		4,189		283		9.00	%
		FHLB borrowings			79,434		1,243		2.09	%		30,549		750		3.27	%
	Trust preferred securities				19,420		1,127		7.74	%		15,035		998		8.85	%
			Total interest bearing liabilities	$	707,036	$	12,078		2.28	%	$	468,088	$	9,626		2.74	%
Net interest income						$	32,545						$	25,477
Net yield on interest-earning assets									4.47	%						4.95	%
Net interest spread									3.85	%						4.08	%
Average interest-earning assets to average interest-bearing liabilities									137.36	%						146.63	%

24

     The following table illustrates the changes in our interest income, interest expense, amount attributable to variations in interest rates, and volumes for the periods indicated. The variances attributable to simultaneous volume and rate changes have been allocated to the changes due to volume and the changes due to rate categories in proportion to the relationship of the absolute dollar amount attributable solely to the change in volume and to the change in rate.

				Three months ended
				September 30, 2003 over September 30, 2002
				Net			Change due to
				Increase
				(Decrease)			Rate			Volume
				(Dollars in thousands)
INTEREST INCOME
	Interest and fees on net loans and interest rate swap			$	2,553		$	(1,131	)	$	3,684
	Interest on other investments				26			(1	)		27
	Interest on securities				271			(381	)		652
	Interest on fed funds sold				(13	)		(25	)		12
			Total interest income	$	2,837		$	(1,538	)	$	4,375
INTEREST EXPENSE
	Interest on demand deposits			$	(68	)	$	(113	)	$	45
	Interest on savings				301			(98	)		399
	Interest on time certificate of deposits				189			(364	)		553
	Interest on subordinated debentures				(93	)		(47	)		(47	)
	Interest on FHLB borrowings				55			(166	)		221
	Interest on trust preferred securities				35			(59	)		94
		Total interest expense		$	419		$	(847	)	$	1,265

				Net			Change due to
				Increase
				(Decrease)			Rate			Volume
				(Dollars in thousands)
INTEREST INCOME
	Interest and fees on net loans and interest rate swap			$	8,767		$	(2,261	)	$	11,028
	Interest on other investments				118			21			97
	Interest on securities				243			(1,370	)		1,613
	Interest on fed funds sold				132			(87	)		219
			Total interest income	$	9,260		$	(3,697	)	$	12,957
INTEREST EXPENSE
	Interest on demand deposits			$	(245	)	$	(251	)	$	6
	Interest on savings				1,005			(142	)		1,147
	Interest on time certificate of deposits				1,353			(771	)		2,124
	Interest on subordinated debentures				(283	)		(142	)		(141	)
	Interest on FHLB borrowings				493			(352	)		845
	Interest on trust preferred securities				129			(136	)		265
		Total interest expense		$	2,452		$	(1,794	)	$	4,246

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Provision for Loan Losses

     The provision for loan losses reflects our judgment of the current period cost associated with credit risk inherent in our loan portfolio. The loan loss provision for each period is dependent upon many factors, including loan growth, net charge-offs, changes in the composition of the loan portfolio, delinquencies, assessments by management, third parties and regulators of the quality of the loan portfolio, the value of the underlying collateral on problem loans and the general economic conditions in our market areas. Specifically, the provision for loan losses represents the amount charged against current period earnings to achieve an allowance for loan losses that, in our judgment, is adequate to absorb losses inherent in our loan portfolio. Periodic fluctuations in the provision for loan losses result from management’s assessment of the adequacy of the allowance for loan losses; however, actual loan losses may vary from current estimates.

     We recorded a $1.4 million in provision for loan losses in the third quarter of 2003 compared to $400,000 in the same quarter of 2002. For the nine months ended September 30, 2003, we recorded $3.8 million in provision for loan losses compared to $1.4 million for the nine months ended September 30, 2002. This increase reflects the results of our review and analysis of the loan portfolio and the adequacy of our existing allowance for loan losses in light of the growth experienced in our loan portfolio. We believe that the allowance is sufficient for the known and inherent losses at September 30, 2003. Refer to Allowance and Provision for Loan Losses section for further discussion.

Non-interest Income

     Non-interest income includes revenues earned from sources other than interest income. It is primarily comprised of service charges and fees on deposits accounts, fees received from letter of credit operations, and gains on sale of SBA loans and investment securities.

     Non-interest income for the third quarter of 2003 was $5.2 million compared to $4.5 million for the same quarter of 2002, which represented an increase of $652,000, or 14.4%, primarily as a result of increase in service charges on deposits and gain on sale of investment securities available for sale. Service charges on deposits increased $322,000 or 19.4% to $2.0 million for the third quarter of 2003, from $1.7 million for the same quarter of 2002. This increase is mainly due to the increase in average demand deposits. Average demand deposits increased $57.4 million or 30.41% to $270.7 million for the third quarter of 2003, from $213.3 million for the same quarter of 2002. Gain on sale of investment securities increased $290,000 or 414.3% to $220,000 for the third quarter of 2003, from a loss of $70,000 for the same quarter of 2002. We sold $7.4 million in investment securities during the third quarter of 2003, compared to $8.2 million during the third quarter of 2002.

     Non-interest income for the nine months ended September 30, 2003 was $14.9 million compared to $12.4 million for the same period of 2002, which represented an increase of $2.5 million or 20.2%, primarily as a result of increase in service charges on deposits, gains on sale of SBA loans, and gain on interest rate swaps. Service charges on deposits increased $971,000 or 21.1% to $5.6 million for the nine months ended September 30, 2003, from $4.6 million for the same period of 2002. This increase is also due to an increase in average demand deposits. Average demand deposits increased $43.6 million or 21.2% to $249.5 million for the nine months ended September 30, 2003, from $205.9 million for the same period of 2002. Gain on sale of SBA loans for the nine months ended September 30, 2003 was $3.2 million, an increase of approximately $1.2 million or 60.9% from $2.0 million for the same period of 2002. We originated $56.5 million of SBA loans and sold $42.3 million during the nine months of 2003. During the same period of 2002, we originated $50.8 million and sold $34.6 million. Gain on sale of investment securities decreased $569 or 58.4% during the nine months of 2003 to $406,000, from $975,000 during the same period of 2002. We sold $11.0 million in securities during the nine months of 2003, compared to $39.2 million during the same period of 2002. We also recognized a gain of $437,000 from the interest rate swap transactions during the nine months of 2003, compared to $110,000 during the same period of 2002.

26

     The summary of our non-interest income by category is illustrated below:

		Three								Three
		Months								Months
		Ended		Increase (Decrease)						Ended
		9/30/2003		Amount			Percent (%)			9/30/2002
				(Dollars in thousands)
	Service charge on deposits	$	1,979	$	323			19.5	%	$	1,656
	International service fee income		650		(80	)		-11.0	%		730
	Wire transfer fees		264		29			12.3	%		235
	Service fee income - SBA		183		33			22.0	%		150
	Earnings on cash surrender value		181		52			40.3	%		129
	Gain (loss) on sale of SBA loans		1,134		(56	)		-4.7	%		1,190
	Gain (loss) on sale of securities available for sale		220		290			414.3	%		(70	)
	Gain (loss) on interest rate swaps		9		(75	)		-89.3	%		84
	Gain (loss) on sale of OREO		—		7			100.0	%		(7	)
	Other		559		129			30.0	%		430
Total noninterest income		$	5,179	$	652			14.4	%	$	4,527

		Nine								Nine
		Months								Months
		Ended		Increase (Decrease)						Ended
		9/30/2003		Amount			Percent (%)			9/30/2002
				(Dollars in thousands)
	Service charge on deposits	$	5,580	$	971			21.1	%	$	4,609
	International service fee income		1,989		(11	)		-0.6	%		2,000
	Wire transfer fees		778		59			8.2	%		719
	Service fee income - SBA		604		184			43.8	%		420
	Earnings on cash surrender value		542		186			52.2	%		356
	Gain (loss) on sale of SBA loans		3,171		1,200			60.9	%		1,971
	Gain (loss) on sale of securities available for sale		406		(569	)		-58.4	%		975
	Gain (loss) on interest rate swaps		437		327			297.3	%		110
	Gain (loss) on sale of OREO		78		48			160.0	%		30
	Other		1,296		103			8.6	%		1,193
Total noninterest income		$	14,881	$	2,498			20.2	%	$	12,383

Non-interest Expense

     Non-interest expense for the third quarter of 2003 was $9.4 million compared to $8.3 million for the same quarter of 2002, which represented an increase of $1.1 million or 13.5%, primarily due to increase in salaries and employee benefit expenses and occupancy expenses. Salaries and employee benefits expenses for the third quarter of 2003 increased $629,000 or 14.7% to $4.9 million from $4.3 million for the same quarter of 2002. This increase is primarily due to the hiring of additional staff to support new branches and growth. Net occupancy expenses for the third quarter of 2003 increased $204,000 or 18.7% to $1.3 million from $1.1 million for the same quarter of 2002. This increase is also due to opening of new branches in Diamond Bar and Wilshire in Los Angeles. The advertising and marketing expenses for the third quarter of 2003 decreased $196,000 or 41.7% to $274,000 from $470,000 for the same quarter of 2002. During 2002, we broadcasted television advertising in

27

California and began to broadcast in New York during the third quarter of 2002, which further increase the advertising expenses.

     Non-interest expense for the nine months ended September 30, 2003 was $26.8 million, compared to $23.6 million for the same period of 2002, which represented an increase of $3.2 million or 13.7%, primarily due to an increase in salaries and employee benefit expenses, data processing expenses, and the amortization of intangible assets. Salaries and employee benefits expenses for the nine months ended September 30, 2003 increased $2.2 million or 17.7% to $14.7 million from $12.5 million for the same period of 2002. This increase is primarily due to the hiring of additional staff to support the new branches and internal growth. Data and item processing expenses for the nine months ended September 30, 2003 increased $278,000 or 22.3% to $1.5 million from $1.2 million for the same period of 2002. This increase is primarily due to an increase in number of accounts from the acquisition of deposits from Industrial Bank of Korea, New York (“IBKNY”) in December of 2002, and internal growth. The amortization expenses on intangible assets for the nine months ended December 30, 2003 increased $140,000 or 148.9% to $234,000 from $94,000. This increase is primarily due to the amortization of core deposit intangible recognized from the assumption of deposits from IBKNY.

     The summary of our non-interest expenses is illustrated below:

		Three								Three
		Months								Months
		Ended		Increase (Decrease)						Ended
		9/30/2003		Amount			Percent (%)			9/30/2002
	Salaries and benefits	$	4,906	$	629			14.7	%	$	4,277
	Net occupancy		1,297		204			18.7	%		1,093
	Furniture and equipment		403		15			3.9	%		388
	Advertising and marketing		274		(196	)		-41.7	%		470
	Regulatory fees		187		54			40.6	%		133
	Communications		181		38			26.6	%		143
	Data and item processing		516		53			11.4	%		463
	Professional fees		731		50			7.3	%		681
	Office supplies & Forms		120		34			39.5	%		86
	Directors’ Fees		139		35			33.7	%		104
	Credit related expenses		169		87			106.1	%		82
	Amortization of intangibles		86		55			177.4	%		31
	Other		406		65			19.1	%		341
Total non-interest expense		$	9,415	$	1,123			13.5	%	$	8,292

28

		Nine								Nine
		Months								Months
		Ended		Increase (Decrease)						Ended
		9/30/2003		Amount			Percent (%)			9/30/2003
	Salaries and benefits	$	14,715	$	2,215			17.7	%	$	12,500
	Net occupancy		3,407		261			8.3	%		3,146
	Furniture and equipment		1,142		(8	)		-0.7	%		1,150
	Advertising and marketing		933		(135	)		-12.6	%		1,068
	Regulatory fees		528		127			31.7	%		401
	Communications		480		38			8.6	%		442
	Data and item processing		1,522		278			22.3	%		1,244
	Professional fees		1,641		168			11.4	%		1,473
	Office supplies & Forms		298		41			16.0	%		257
	Directors’ Fees		361		57			18.8	%		304
	Credit related expenses		451		(57	)		-11.2	%		508
	Amortization of intangibles		234		140			148.9	%		94
	Other		1,076		98			10.0	%		978
Total non-interest expense		$	26,788	$	3,223			13.7	%	$	23,565

Provision for Income Taxes

     The provision for income taxes was $2.4 million and $2.0 million on income before taxes of $6.1 million and $5.1 million for the three months ended September 30, 2003 and 2002, respectively. The effective tax rate for the quarter ended September 30, 2003 was 38.9%, compared with 38.6% for the quarter ended September 30, 2002.

     The provision for income taxes was $6.5 million and $4.8 million on income before taxes and cumulative effect of a change in accounting principle of $16.9 million and $12.9 million for the nine months ended September 30, 2003 and 2002, respectively. The effective tax rate for the nine months ended September 30, 2003 was 38.6%, compared with 36.9% for the nine months ended September 30, 2002. The lower tax rate in 2002 was primarily due to a permanent differences recognized from loan recoveries relating to the charged-off loans of Korea First Bank of New York prior to our acquisition and also due to an one time tax benefit recognized from a California State tax law change in which one-half of the cumulative loan losses through December 31, 2002 taken for income tax purposes were forgiven.

Financial Condition

     At September 30, 2003, our total assets were $1.1 billion, an increase of $161.4 million or 16.5%, from $979.2 million at December 31, 2002. The growth came primarily from the increases in the balance of our loans as a result of a continuing strong demand for loans in our market, funded by the growth in our deposits and other borrowings.

Investment Securities Portfolio

     We classify our securities as held-to-maturity or available-for-sale under SFAS No.115. Those securities that we have the ability and intent to hold to maturity are classified as “held-to-maturity securities”. All other

29

securities are classified as “available-for-sale”. We did not own any trading securities at September 30, 2003. Securities that are held to maturity are stated at cost, adjusted for amortization of premiums and accretion of discounts. Securities that are available for sale are stated at fair value. The securities we currently hold are government-sponsored agency bonds, corporate bonds, collateralized mortgage obligations, U.S. government agency preferred stocks, and municipal bonds.

     As of September 30, 2003, we had $2.0 million of held-to-maturity securities and $133.0 million of available-for-sale securities, compared to $2.8 million and $101.6 million at December 31, 2002, respectively. The total net unrealized loss on the available-for sale securities at September 30, 2003 was $1.3 million, compared to net unrealized gain of $1.1 million at December 31, 2002. During the nine months of 2003, we purchased a total of $81.3 million in available-for-sale securities, sold $11.0 million and $36.5 million in available-for-sale securities matured. We recognized total gross gains of $406,000 during the nine months of 2003 from the sale of securities available for sale.

     Securities with an amortized cost of $14.5 million were pledged to Federal Reserve Bank to secure public deposits and for other purposes as required or permitted by law at September 30, 2003. Securities with an amortized cost of $41.4 million and $58.7 million were pledged to FHLB of San Francisco and State of California Treasurer’s Office, respectively, at September 30, 2003.

     The following table summarizes the book value, market value and distribution of our investment securities portfolio as of dates indicated:

Investment Portfolio

			At September 30, 2003							At December 31, 2002
			Amortized		Market		Unrealized			Amortized		Market		Unrealized
			cost		Value		Gain (Loss)			cost		Value		Gain (Loss)
							(Dollars in thousands)
Held to Maturity:
	U.S. Corporate notes		$	2,002	$	2,162	$	160		$	2,780	$	2,927	$	147
		Total held-to-maturity	$	2,002	$	2,162	$	160		$	2,780	$	2,927	$	147
Available-for-sale:
	U.S. Government		$	23,085	$	23,308	$	223		$	34,546	$	35,157	$	611
	CMO’s			33,989		33,570		(419	)		6,227		6,324		97
	MBS			31,445		31,174		(271	)		16,151		16,343		192
	Asset Backed			—		—		—			88		88		—
	Municipal Bonds			33,924		33,726		(198	)		27,133		27,502		369
	U.S. Corporate notes			986		1,043		57			5,588		5,400		(188	)
	U.S. Agency Preferred Stock			10,833		10,145		(688	)		10,755		10,808		53
		Total available-for-sale	$	134,262	$	132,966	$	(1,296	)	$	100,488	$	101,622	$	1,134
Total investment portfolio			$	136,264	$	135,128	$	(1,136	)	$	103,268	$	104,549	$	1,281

     The carrying value and the yield of investment securities as of September 30, 2003, by contractual maturity, are shown below. Expected maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.

30

Investment Maturities and Repricing Schedule

								After One But					After Five But
			Within One Years					Within Five Years					Within Ten Years					After Ten Years					Total
			Amount		Yield			Amount		Yield			Amount		Yield			Amount		Yield			Amount		Yield
Held to Maturity:
	U.S. Corporate notes			—		—		$	2,002		7.01	%	$	—		—		$	—		—		$	2,002		7.01	%
		Total held-to-maturity		—		—		$	2,002		7.01	%	$	—		—		$	—		—		$	2,002		7.01	%
Available-for-sale:
	U.S. Government		$	301		3.03	%	$	11,139		3.58	%	$	11,868		4.06	%	$	—		—		$	23,308		3.82	%
	CMO’s			—		—			—		—			2,332		3.99	%		31,238		3.65	%		33,570		3.67	%
	MBS			—		—			2,745		2.79	%		515		2.86	%		27,914		3.41	%		31,174		3.35	%
	Municipal Bonds			—		—			—		—			840		3.78	%		32,886		4.85	%		33,726		4.82	%
	U.S. Corporate notes			—		—			1,043		7.02	%		—		—			—		—			1,043		7.02	%
	U.S. Agency Preferred Stock			—		—			—		—			—		—			10,145		3.96	%		10,145		3.96	%
	Total available-for-sale		$	301		3.03	%	$	14,927		3.68	%	$	15,555		3.99	%	$	102,183		4.00	%	$	132,966		3.96	%
Total investment portfolio			$	301		3.03	%	$	16,929		4.07	%	$	15,555		3.99	%	$	102,183		4.00	%	$	134,968		4.01	%

Loan Portfolio

     We carry all loans (except for certain SBA loans held-for-sale) at face amount, less payments collected, net of deferred loan origination fees and the allowance for loan losses. SBA loans held-for-sale are carried at the lower of cost or market. Interest on all loans is accrued daily. Once a loan is placed on non-accrual status, accrual of interest is discontinued and previously accrued interest is reversed. Loans are placed on a non-accrual status when principal and interest on a loan is past due 90 days or more, unless a loan is both well secured and in process of collection.

     As of September 30,2003, our gross loans (net of unearned fees), including loans held for sale, increased by $185.7 million or 25.4% to $915.5 million from $ 729.8 million at December 31, 2002. Asiana loans accounted for $23.1 million or 12.4% of the increase, which were mostly commercial and real estate loans. At September 30, 2003, the commercial loans, which include domestic commercial, international trade finance, SBA loans, and equipment leasing, increased by $43.3 million or 14.5 % to $342.2 million from $298.9 million at December 31, 2002. Real estate and construction loans increased by $138.3 million or 36.8% to $514.0 million from $375.7 million at December 31, 2002. There has been a continued high demand for real estate loans during the past months; however, we continue to monitor and maintain well-balanced loan portfolio.

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     The following table illustrates our loan portfolio by amount and percentage of gross loans in each major loan category at the dates indicated:

			September 30, 2003						December 31, 2002
			Amount			Percent			Amount			Percent
						(Dollars in thousands)
Loan Portfolio Composition:
	Commercial loans *		$	342,223			37.3	%	$	298,949			40.9	%
	Real estate and construction loans			514,035			56.0	%		375,743			51.4	%
	Consumer and other loans			61,244			6.7	%		56,449			7.7	%
		Total loans outstanding		917,502			100.0	%		731,141			100.0	%
	Unamortized loan fees, net of costs			(1,957	)					(1,326	)
	Less: Allowance for loan losses			(11,793	)					(8,458	)
Net Loans Receivable				903,752						721,357

     *     Includes loans held for sale of $5,415,000 at September 30, 2003 and $6,338,000 at December 31, 2002

     We do not normally extend lines of credit and make loan commitments to business customers for periods in excess of one year. We use the same credit policies in making commitments and conditional obligations as we do for extending loan facilities to our customers. We perform annual reviews of such commitments prior to the renewal. The following table shows our loan commitments and letters of credit outstanding at the dates indicated:

(Dollars in thousands)	September 30, 2003		December 31, 2002
Loan commitments	$	156,810	$	114,734
Standby letters of credit		4,774		4,830
Commercial letters of credit		28,282		26,952

     At September 30, 2003, our nonperforming assets (nonaccrual loans, loans 90 days or more past due and still accruing interest, restructured loans, and other real estate owned) were $4.5 million, which represented an increase of $2.3 million or 104.5% from $2.2 million at December 31, 2002. As of September 30, 2003, the restructured loans totaled $496,000 and are all current. At September 30, 2003, nonperforming assets to total assets was 0.39%, compared to 0.22% at December 31, 2002. The non-performing loans were $4.0 million, which represented an increase of approximately $2.9 million or 263.6% from $1.1 million at December 31, 2002. The non-performing loans consists of the following: two borrowers totaling $1.5 million that are fully secured by real estate and business properties that are valued higher than the loan amounts, a loan in the amount of $312,000 that was transferred from the acquisition of Asiana Bank, a loan for $271,000 that was fully paid subsequent to September 30, 2003, and various loans totaling $1.9 million that are attributable to all branches and departments. At September 30, 2003, nonperforming loans to total gross loans was 0.43%, compared to 0.15% at December 31, 2002. At December 30, 2003, we had $4.0 million in impaired loans with a reserved amount of $1.9 million, compared to $1.8 million in impaired loans with a reserved amount of $743,000 at December 30, 20032.

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     The following table illustrates the composition of our nonperforming assets as of the dates indicated.

		September 30, 2003			December 31, 2002
		(Dollars in thousands)
Nonaccrual loans		$	3,977		$	1,064
Loan past due 90 days or more, still accruing			—			18
	Total Nonperforming Loans		3,977			1,082
Other real estate owned			—			36
Restructured loans			496			1,067
	Total Nonperforming Assets	$	4,473		$	2,185
Nonperforming loans to total gross loans			0.43	%		0.15	%
Nonperforming assets to total assets			0.39	%		0.22	%

Allowance for Loan Losses

     We maintain an allowance for credit losses to absorb losses inherent in the loan portfolio. The allowance is based on our regular, quarterly assessments of the probable estimated losses inherent in the loan portfolio. Our methodology for measuring the appropriate level of the allowance relies on several key elements, which includes the formula allowance and specific allowances for identified problem loans.

     The Migration Analysis is a formula method based on our actual historical net charge-off experience for each loan type pools and undisbursed commitments graded Pass (less cash secured loans), Special Mention, Substandard, and Doubtful.

     Central to the migration analysis is our credit risk rating system. Both internal, contracted external, and regulatory credit reviews are used to determine and validate loan risk grades. Our credit review system takes into consideration factors such as: borrower’s background and experience; historical and current financial condition; credit history and payment performance; industry and the economy; type, market value, volatility of the market value of collateral, and our lien position; and the financial strength of the guarantors

     To calculate our various loan factors, we use an eight-quarter rolling average of historical losses detailing charge-offs, recoveries, and loan type pool balances to determine the estimated credit losses for non-classified and classified loans. Also, in order to reflect the impact of recent events, the eight-quarter rolling average has been weighted. The most recent four quarters have been assigned a 60% weighted average and the older four quarters have been assigned a 40% weighted average.

     The resulting migration risk factors, or our established minimum risk factor for loan type pools that have no historical loss, whichever is greater, for each loan type pool is used to calculate our General Reserve. We have established a minimum risk factor for each loan grade Pass (0.40% - 1.00%), Special Mention (3.0%), Substandard (10.0% - 15.0%), Doubtful (50.0%), and Loss (100.0%).

     Our parameters for making adjustments are established under a Credit Risk Matrix that provides seven possible scenarios for each of the factors below. The matrix allows for three positive/decrease (Major, Moderate, and Minor), three negative/increase (Major, Moderate, and Minor), and one neutral credit risk scenarios within each factor for each loan type pool. Generally, the factors are considered to have no impact (neutral) to our

33

migration ratios. However, if information exists to warrant adjustment to the Migration Analysis, we make the changes in accordance with the established parameters supported by narrative and/or statistical analysis. Our Credit Risk Matrix and the seven possible scenarios enable us to adjust the Migration Analysis as much as 50 basis points in either direction (positive or negative) for each loan type pool.

• Changes in lending policies and procedures, including underwriting standards and collection, charge-off, and recovery practices.

• Changes in national and local economic and business conditions and developments, including the condition of various market segments.

• Changes in the nature and volume of the loan portfolio.

• Changes in the experience, ability, and depth of lending management and staff.

• Changes in the trend of the volume and severity of past due and classified loans; and trends in the volume of nonaccrual loans and troubled debt restructurings, and other loan modifications.

• Changes in the quality of our loan review system and the degree of oversight by the Directors.

• The existence and effect of any concentrations of credit, and changes in the level of such concentrations.

• Transfer risk on cross-border lending activities.

     The effect of external factors such as competition and legal and regulatory requirements on the level of estimated losses in our loan portfolio.

     Under the Specific Allocation method, management establishes specific allowances for loans where management has identified significant conditions or circumstances related to a credit that are believed to indicate the probability that a loss may be incurred. The specific allowance amount is determined by a method prescribed by the Statement of Financial Accounting Standards (SFAS) No. 114, Accounting by Creditors for Impairment of a Loan. Our actual historical repayment experience and the borrower’s cash flow, together with an individual analysis of the collateral held on a loan, is taken into account in determining the allocated portion of the required Allowance under this method. As estimations and assumptions change, based on the most recent information available for a credit, the amount of the required specific allowance for a credit will increase or decrease.

     Executive management reviews these conditions quarterly in discussion with our senior credit officers. To the extent that any of these conditions is evidenced by a specifically identifiable problem credit or portfolio segment as of the evaluation date, management’s estimate of the effect of such conditions may be reflected as a specific allowance, applicable to such credit or portfolio segment. Where any of these conditions is not evidenced by a specifically identifiable problem credit or portfolio segment as of the evaluation date, management’s evaluation of the probable loss related to such condition is reflected in the unallocated allowance.

     The allowance for loan losses was $11.8 million at September 30, 2003, compared to $7.1 million at September 30, 2002. We recorded a provision of $3.8 million during the nine months ended September 30, 2003, mainly due to an increase in our loan portfolio and classified loans. Average gross loans (net of unearned) increased $220.1 million or 38.5% to $792.2 million for the nine months ended September 30, 2003, compared to $572.1 million for the same period of 2002. During the nine months of 2003, we charged off $1.4 million and recovered $267,000. The allowance for loan losses was 1.29% of gross loans at September 30, 2003, compared to 1.07% at September 30, 2002. The total classified loans at September 30, 2003 were $10.3 million, compared to $2.1 million at September 30, 2002.

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     We believe the level of allowance as of September 30, 2003 is adequate to absorb the estimated losses from any known or inherent risks in the loan portfolio and the loan growth for the quarter. However, no assurance can be given that economic conditions which adversely affect our service areas or other circumstances will not be reflected in increased provisions or loan losses in the future.

     The following table shows the provisions made for loan losses, the amount of loans charged off, the recoveries on loans previously charged off together with the balance in the allowance for possible loan losses at the beginning and end of each period, the amount of average and total loans outstanding, and other pertinent ratios as of the dates and for the periods indicated:

				Nine months ended September 30,
				2003			2002
				(Dollars in thousands)
LOANS:
Average gross loans				$	792,213		$	572,100
Total gross loans at end of period					915,545			663,444
ALLOWANCE:
Balance-beginning of period					8,458			6,710
Less: Loan Charged off:
	Commercial				923			1,737
	Consumer				416			150
	Real Estate and Construction				12			—
			Total loans charged off		1,351			1,887
Plus: Loan Recoveries
	Commercial				213			794
	Consumer				32			90
	Real Estate and Construction				22			11
			Total loan recoveries		267			895
	Net loans charged off				1,084			992
	Provision for loan losses				3,750			1,350
	Allowance made with business acquisition				669			—
		Balance-end of period		$	11,793		$	7,068
Net loan charge-offs to average total lonas					0.14	%		0.17	%
Net loan charge-offs to total loans at end of period					0.12	%		0.15	%
Allowance for loan losses to average total loans					1.49	%		1.24	%
Allowance for loan losses to total loans at end of period					1.29	%		1.07	%
Net loan charge-offs to beginning allowance					12.82	%		14.78	%
Net loan charge-offs to provision for loan losses					28.91	%		73.48	%

Deposits and Other Borrowings

     Deposits are our primary source of funds to use in lending and investment activities. At September 30, 2003, our deposits increased by $132.5 million or 16.2% to $949.4 million from $816.9 million at December 31, 2002. Asiana deposits accounted for $29.3 million or 22.1% of the increase. Demand deposits totaled $295.4 million, which represented an increase of $58.5 million or 24.7% from $236.9 million at December 31, 2002. Time deposits over $100,000 totaled $306.2 million, which represented an increase of $38.0 million or 14.2% from $268.2 million at December 31, 2002. Other interest-bearing demand deposits, including money market and

35

super now accounts, totaled $98.7 million, which represented an increase of $17.6 million or 17.6% from $83.9 million at December 31, 2002.

     At September 30, 2003, 31.1% of the total deposits were non-interest bearing demand deposits, 42.2% were time deposits, 16.3% were savings accounts, and 10.4% were interest bearing demand deposits. By comparison, at December 31, 2002, 29.0% of the total deposits were non-interest bearing demand deposits, 43.4% were time deposits, 17.3% were savings accounts, and 10.3% were interest bearing demand deposits.

     At September 30, 2003, we had a total of $40.9 million in time deposits brought in through brokers and $45.0 million in time deposits from the State of California Treasurer’s Office. The deposits from the Sate of California Treasurer’s Office were collateralized with our securities with an amortized cost of $58.7 million. The detail of those deposits is shown on the table below.

Brokered Deposits		Issue Date		Maturity Date		Rate
$	3,585,000		07/16/03		10/16/03	1.05	%
	14,931,000		07/16/03		01/16/04	1.25	%
	5,000,000		08/29/03		02/27/04	1.15	%
	5,233,000		08/29/03		05/28/04	1.35	%
	5,063,000		08/06/03		08/06/04	1.35	%
	5,000,000		08/29/03		08/27/04	1.45	%
	2,090,000		02/16/01		02/16/06	5.65	%
$	40,902,000					1.49	%

State Deposits		Issue Date		Maturity Date		Rate
$	$10,000,000		08/08/03		02/04/04	1.08	%
	10,000,000		09/11/03		03/12/04	1.08	%
	5,000,000		07/08/03		10/08/03	0.93	%
	20,000,000		04/23/03		10/23/03	1.25	%
$	45,000,000					1.14	%

     In October of 2000, we established a borrowing line with the FHLB of San Francisco. Advances may be obtained from the FHLB of San Francisco to supplement our supply of lendable funds. Advances from the FHLB of San Francisco are typically secured by a pledge of mortgage loan and/or securities with a market value at least equal to outstanding advances plus investment in FHLB stocks. The following table shows our outstanding borrowings from FHLB at September 30, 2003. All FHLB advances were fixed rates.

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FHLB Advances		Issue Date		Maturity Date		Rate
$	15,000,000		09/25/03		12/19/03	1.11	%
	5,000,000		02/04/02		02/04/04	3.39	%
	35,000,000		03/07/03		03/08/04	1.18	%
	5,000,000		04/26/02		03/31/04	3.53	%
	5,000,000		05/05/03		03/31/05	1.72	%
	5,000,000		10/19/00		10/19/07	6.70	%
$	70,000,000					1.92	%

     Nara Bancorp established special purpose trusts in 2001, 2002, and 2003 for the purpose of issuing Preferred Securities (the “Trust Securities”). The trusts exist for the sole purpose of issuing Trust Securities and investing the proceeds thereof in Junior Subordinated Debentures issued by Nara Bancorp. Payment of distributions out of the monies held by the trusts and payments on liquidation of the trusts or the redemption of the Junior Subordinated Debentures are guaranteed by Nara Bancorp to the extent the trusts have funds available thereof. The obligation of Nara Bancorp under the guarantees and the Junior Subordinated Debentures are subordinate and junior in right of payment to all indebtedness of Nara Bancorp and are structurally subordinated to all liabilities and obligations of Nara Bancorp’s subsidiaries. The table below summarizes the outstanding Junior Subordinated Debentures issued by each special purpose trust and the debentures issued by Nara Bancorp to each trust as of September 30, 2003.

(Dollars in Thousand)

TRUST SECURITIES AND JUNIOR

TRUST SECURITIES

SUBORDINATED DEBENTURES

PRINCIPAL

ANNUALIZED

INTEREST

TRUST

ISSUANCE

BALANCE OF

STATED

COUPON

DISTRIBUTION

NAME

DATE

AMOUNT

DEBENTURES

MATURITY

RATE

DATES

Nara Bancorp

March

$

10,000

$

10,400

6/8/2031

10.18

%

June 8 and December 8

Capital Trust I

2001

Nara Statutory

March

$

8,000

$

8,248

3/26/2032

3 Month

March 26, June 26

Trust II

2002

LIBOR + 3.60%

September 26 and

December 26

Nara Capital

June

$

5,000

$

5,063

6/15/2033

3 Month

March 15, June 15

Trust III

2003

LIBOR + 3.15%

September 15 and

December 15

     The Junior Subordinate Debentures are not redeemable prior to June 8, 2011 with respect to Nara Bancorp Capital Trust I, March 26, 2007 with respect to Nara Statutory Trust II and June 15, 2008 with respect to Nara Capital Trust III unless certain events have occurred. The proceeds from the issuance of the Trust Securities were used primarily for corporate purposes.

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     The following table shows our contractual obligation as of September 30, 2003:

	Payments due by period
			Less than 1
Contractual Obligations	Total		year		1-3 years		3-5 years		Over 5 years
Trust Preferred Securities	$	22,304,495	$	—	$	—	$	—		$	22,304,495
Federal Home Loan Bank borrowings		70,000,000		60,000,000		5,000,000		5,000,000			—
Operating Lease Obligations		34,810,592		3,571,782		7,566,237		6,200,513			17,472,060
Total	$	127,115,087	$	63,571,782	$	12,566,237	$	11,200,513		$	39,776,555

Stockholders’ Equity and Regulatory Capital

     In order to ensure adequate capital level, we conduct an ongoing assessment of projected sources and uses of capital in conjunction with projected increases in assets and levels of risk. We consider on an ongoing basis, among other things, cash generated from operations, access to capital from financial markets or the issuance of additional securities, including common stock or notes, to meet our capital needs. Total stockholders’ equity was $81.9 million at September 30, 2003. This represented an increase of $16.5 million or 25.2% over total stockholders’ equity of $65.4 million at December 31, 2002.

     The federal banking agencies require a minimum ratio of qualifying total capital to risk-adjusted assets of 8% and a minimum ratio of Tier 1 capital to risk-adjusted assets of 4%. In addition to the risk-based guidelines, federal banking regulators require banking organizations to maintain a minimum amount of Tier 1 capital to total assets, referred to as the leverage ratio. For a banking organization rated in the highest of the five categories used by regulators to rate banking organizations, the minimum leverage ratio of Tier 1 capital to total assets must be 3%. In addition to these uniform risk-based capital guidelines and leverage ratios that apply across the industry, the regulators have the discretion to set individual minimum capital requirements for specific institutions at rates significantly above the minimum guidelines and ratios.

     At September 30, 2003, Tier 1 capital, stockholders’ equity less intangible assets, plus proceeds from the Trust Securities, was $99.1 million. This represented an increase of $21.2 million or 27.2% over total Tier 1 capital of $77.9 million at December 31, 2002. This increase was due to an issuance of $4.7 million trust preferred during the second quarter, an issuance of $8.0 million in approximately 426,000 shares for purchase of Asiana Bank, and a net income of $10.4 million off-set by cash dividends of $1.6 million, of which $537,000, $540,000, and $569,000 were paid in April, July, and October of 2003, respectively. At September 30, 2003, we had a ratio of total capital to total risk-weighted assets of 11.4% and a ratio of Tier 1 capital to total risk weighted assets of 10.2%. The Tier 1 leverage ratio was 9.0% at September 30, 2003.

     As of September 30, 2003, Management believed that the Bank has continued to meet the criteria as a “well capitalized institution” under the regulating framework for prompt corrective action. The following table presents the amounts of our regulatory capital and capital ratios, compared to regulatory capital requirements for adequacy purposes as of September 30, 2003 and December 31, 2002.

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	As of September 30, 2003
	Actual					Required					Excess
(Dollars in thousands)	Amount		Ratio			Amount		Ratio			Amount		Ratio
Leverage ratio	$	99,057		9.0	%	$	44,229		4.0	%	$	54,828		5.0	%
Tier 1 risk-based capital ratio		99,057		10.2	%		38,862		4.0	%		60,195		6.2	%
Total risk-based capital ratio		110,850		11.4	%		77,724		8.0	%		33,126		3.4	%

	As of December 31, 2002
	Actual					Required					Excess
	Amount		Ratio			Amount		Ratio			Amount		Ratio
Leverage ratio	$	77,863		8.7	%	$	35,707		4.0	%	$	42,156		4.7	%
Tier 1 risk-based capital ratio		77,863		9.6	%		32,293		4.0	%		45,570		5.6	%
Total risk-based capital ratio		86,321		10.7	%		64,585		8.0	%		21,736		2.7	%

Liquidity Management

     Liquidity risk is the risk to earnings or capital resulting from our inability to fund assets when needed and liability obligations when they come due without incurring unacceptable losses. Liquidity risk includes the ability to manage unplanned decreases or changes in funding sources and to recognize or address changes in market conditions that affect our ability to liquidate assets quickly and with a minimum loss of value. Factors considered in liquidity risk management are stability of the deposit base, marketability of our assets, maturity and availability of pledgeable investments, and customer demand for credits.

     In general, our sources of liquidity are derived from financing activities, which include the acceptance of customer and broker deposits, federal funds facilities, and advances from the Federal Home Loan Bank of San Francisco. These funding sources are augmented by payments of principal and interest on loans and the routine liquidation of securities from principal paydown, maturity and sales. Our primary uses of funds include withdrawal of and interest payments on deposits, originations of loans, purchases of investment securities, and payment of operating expenses.

     We manage liquidity risk by controlling the level of federal funds and by maintaining lines with correspondent banks, the Federal Reserve Bank, and Federal Home Loan Bank of San Francisco. The sale of investment securities available-for-sale can also serve as a contingent source of funds. Increases in deposit rates are considered a last resort as a means of raising funds to increase liquidity.

     As a means of augmenting our liquidity, we have established federal funds lines with corresponding banks and Federal Home Loan Bank of San Francisco. At September 30, 2003, our borrowing capacity included $30.0 million in federal funds line facility from correspondent banks and $91.2 million in unused FHLB advances. In addition to the lines, our liquid assets include cash and cash equivalents, interest bearing deposits in other banks, federal funds sold and securities available for sale that are not pledged. The book value of the aggregate of these assets totaled $57.4 million at September 30, 2003, compared to $138.1 million at December 31, 2002. We believe our liquidity sources to be stable and adequate.

     Because our primary sources and uses of funds are loans and deposits, the relationship between gross loans and total deposits provides a useful measure of our liquidity. Typically, higher the ratio of loans to deposits is to 100%, the more we rely on our loan portfolio to provide for short-term liquidity needs. Because repayment of loans tends to be less predictable than the maturity of investments and other liquid resources, the higher the loan to deposit ratio, the less liquid are our assets. At September 30, 2003, our gross loan to deposit ratio was 96.4%.

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Item 3. Quantitative and qualitative disclosures about market risk

     The objective of our asset and liability management activities is to improve our earnings by adjusting the type and mix of assets and liabilities to effectively address changing condition and risks. Through overall management of our balance sheet and by controlling various risks, we seek to optimize our financial returns within safe and sound parameters. Our operating strategies for attaining this objective include managing net interest margin through appropriate risk/return pricing of asset and liabilities and emphasizing growth in retail deposits, as a percentage of interest-bearing liabilities, to reduce our cost of funds. We also seek to improve earnings by controlling noninterest expense, and enhancing noninterest income. We also use risk management instruments to modify interest rate characteristic of certain assets and liabilities to hedge against our exposure to interest rate fluctuations, reducing the effects these fluctuations might have on associated cash flows or values. Finally, we perform internal analyses to measure, evaluate and monitor risk.

     Interest Rate Risk

     Interest rate risk is the most significant market risk impacting us. Market risk is the risk of loss to future earnings, to fair values, or to future cash flow that may result from changes in the price of a financial instrument. Interest rate risk occurs when interest rate sensitive assets and liabilities do not reprice simultaneously and in equal volume. A key objective of asset and liability management is to manage interest rate risk associated with changing asset and liability cash flows and values and market interest rate movements. The management of interest risk is governed by policies reviewed and approved annually by the Board of Directors. Our Board delegates responsibility for interest risk management to the Asset and Liability Management Committee of Nara Bank (“ALCO”), which is composed of Nara Bank’s senior executives and other designated officers.

     The fundamental objective of the ALCO is to manage our exposure to interest rate fluctuations while maintaining adequate levels of liquidity and capital. The ALCO meets regularly to monitor the interest rate risk, the sensitivity of our assets and liabilities to interest rate changes, the book and market values of assets and liabilities, investment activities and directs changes in the composition of the balance sheet. Our strategy has been to reduce the sensitivity of our earnings to interest rate fluctuations by more closely matching the effective maturities or repricing characteristics of our assets and liabilities. Certain assets and liabilities, however, may react in different degrees to changes in market interest rates. Further, interest rates on certain types of assets and liabilities may fluctuate prior to changes in market interest rates, while rate on other types may lag behind. We consider the anticipated effects of these factors when implementing our interest rate risk management objectives.

     Swaps

     As part of our asset and liability management strategy, we may engage in derivative financial instruments, such as interest rate swaps, with the overall goal of minimizing the impact of interest rate fluctuations on our net interest margin. Interest rate swaps involve the exchange of fixed-rate and variable-rate interest payment obligations without the exchange of the underlying notional amounts. During 2002, we entered into eight different interest rate swap agreements as summarized in the table below.

     Under the swap agreements, we receive a fixed rate and pay a variable rate based on H.15 Prime. The swaps qualify as cash flow hedges under SFAS No. 133, Accounting for Derivative Instruments and Hedging Activities, as amended, and are designated as hedges of the variability of cash flows we receive from certain of our Prime-indexed loans. In accordance with SFAS No. 133, these swap agreements are measured at fair value and reported as assets or liabilities on the consolidated statement of financial condition. The portion of the change in the fair value of the swaps that is deemed effective in hedging the cash flows of the designated assets are recorded in accumulated other comprehensive income (“OCI”) and reclassified into interest income when such cash flows occur in the future. Any ineffectiveness resulting from the hedges is recorded as a gain or loss in the consolidated statement of income as a part of non-interest income. As of September 30, 2003, the amounts in

40

accumulated OCI associated with these cash flows totaled $1,625,504 (net of tax of $1,083,670), of which $221,763 is expected to be reclassified into interest income within the next 12 months.

Interest rate swaps information at September 30, 2003 is summarized as follows:

Current Notional
Amount		Floating Rate	Fixed Rate			Maturity Date		Unrealized Gain		Realized Gain 1
$	20,000,000	H.15 Prime 2		6.95	%		4/29/2005	$	709,517	$	20,610
	20,000,000	H.15 Prime 2		7.59	%		4/30/2007		1,223,483		66,667
	20,000,000	H.15 Prime 2		6.09	%		10/09/2007		165,990		86,470
	20,000,000	H.15 Prime 2		6.58	%		10/09/2009		12,342		128,845
	20,000,000	H.15 Prime 2		7.03	%		10/09/2012		—		(29,498	)
	20,000,000	H.15 Prime 2		5.60	%		12/17/2005		297,479		48,909
	10,000,000	H.15 Prime 2		6.32	%		12/17/2007		160,008		47,255
	10,000,000	H.15 Prime 2		6.83	%		12/17/2009		140,355		68,074
$	140,000,000							$	2,709,174	$	437,332

1.     Gain included in the consolidated statement of earnings for the nine months ended September 30, 2003, representing hedge ineffectiveness

2.     Prime rate is based on Federal Reserve statistical release H.15

     During the third quarter of 2003, interest income received from the swap counterparties was $893,000, compared to $252,000 for the same quarter of 2002. During the first nine months of 2003, interest income received from the swap counterparties was $2.5 million, compared to $420,000 for the first nine months of 2002. At September 30, 2003, we pledged to the interest rate swap counterparty as collateral agency securities with a book value of $2.0 million and real estate loans of $2.1 million.

     Interest Rate Sensitivity

     Our monitoring activities related to managing interest rate risk include both interest rate sensitivity “gap” analysis and the use of a simulation model. While traditional gap analysis provides a simple picture of the interest rate risk embedded in the balance sheet, it provides only a static view of interest rate sensitivity at a specific point in time and does not measure the potential volatility in forecasted results relating to changes in market interest rates over time. Accordingly, we combine the use of gap analysis with the use of a simulation model, which provides a dynamic assessment of interest rate sensitivity.

     The interest rate sensitivity gap is defined as the difference between the amount of interest-earning assets anticipated to reprice within a specific time period and the amount of interest-bearing liabilities anticipated to reprice within that same time period. A gap is considered positive when the amount of interest rate sensitive assets repricing within a specific time period exceeds the amount of interest-bearing liabilities repricing within that same time period. Positive cumulative gaps suggest that earnings will increase when interest rates rise. Negative cumulative gap suggest that earnings will increase when interest rates fall.

     The following table shows our gap position as of September 30, 2003

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			0-90 days			91-365 days			1-5 years		Over 5 yrs		Total
			(Dollars in thousands)
		Total Investments		11,376			17,215			45,306		71,144		145,041
		Total Loans		770,355			17,198			68,883		60,868		917,304
Rate Sensitive Assets				781,731			34,413			114,189		132,012		1,062,345
Deposits
	TCD, $100M +			131,365			170,950			3,706		150		306,171
	TCD, less than 100M			42,065			51,161			924		29		94,179
	MMDA			88,792			—			—		—		88,792
	NOW			9,915			—			—		—		9,915
	Savings			128,165			10,952			13,078		2,750		154,945
Other liabilities				—			—			—
	FHLB Borrowing			15,000			45,000			10,000		—		70,000
	Trust Preferred			—			—			—		22,304		22,304
Rate Sensitive Liabilities				415,302			278,063			27,708		25,233		746,306
Interest Rate Swap				(140,000	)		—			90,000		50,000		—
Periodic GAP				226,429			(243,650	)		176,481		156,779		316,039
Cumulative GAP				226,429			(17,221	)		159,260		316,039

     The simulation model discussed above also provides our ALCO with the ability to simulate our net interest income. In order to measure, at September 30, 2003, the sensitivity of our forecasted net interest income to changing interest rates, both a rising and falling interest scenario were projected and compared to a base market interest rate forecasts. One application of our simulation model measures the impact of market interest rate changes on the net present value of estimated cash flows from our assets and liabilities, defined as our market value of equity. This analysis assesses the changes in market values of interest rate sensitive financial instruments that would occur in response to an instantaneous and sustained increase in market interest rates.

     At September 30, 2003, our net interest income and market value of equity expose related to these hypothetical changes in market interest rates are illustrated in the following table.

	Estimated
	Net
	Interest			Market Value
Simulated	Income			Of Equity
Rate Changes	Sensitivity			Volatility
+300 basis points		14.27	%		(15.99	)%
+200 basis points		9.16	%		(11.00	)%
+100 basis points		4.40	%		(4.58	)%
- 100 basis points		(6.86	)%		5.32	%

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Item 4. Controls and Procedures

     Our Chief Executive Officer and Chief Financial Officer have concluded that our disclosure controls and procedures are sufficiently effective to ensure that the information we are required to be disclosed in the reports we file under the Exchange Act is gathered, analyzed and disclosed with adequate timeliness, accuracy and completeness, based on an evaluation of such controls and procedures conducted within 90 days prior to the date thereof.

     There have been no significant changes in our internal controls or in other factors that could significantly affect these controls subsequent to the date of the evaluation referred to above.

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PART II

OTHER INFORMATION

Item 1. Legal Proceedings

     We are a party to routine litigation incidental to our business, none of which is considered likely to have a material adverse effect on us.

Item 2. Changes in Securities and Use of Proceeds

(a)	None.
(b)	None.
(c)	None.

Item 3. Defaults upon Senior Securities

     None

Item 4. Submission of Matters to a vote of Security Holders

     None

Item 5. Other information

     None

Item 6. Exhibits and Reports on Form 8-K

(a) Exhibits

     The exhibits listed on the accompanying index to exhibits are filed or incorporated by reference (as stated herein) as part of this Quarterly Report on Form 10-Q.

(b) Reports on Form 8-K

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	NARA BANCORP, INC.
Date: November 13, 2003	/s/ Seong Hoon Hong
	Seong Hoon Hong
	President and Chief Executive Officer
	(Principal executive officer)
Date: November 13, 2003
	/s/ Timothy Chang
	Timothy Chang
	Chief Financial Officer
	(Principal financial officer)

45

INDEX TO EXHIBITS

Number	Description of Document
3.1	Certificate of Incorporation of Nara Bancorp, Inc.1
3.2	Bylaws of Nara Bancorp, Inc.1
3.3	Amended Bylaws of Nara Bancorp, Inc.3
4.1	Form of Stock Certificate of Nara Bancorp, Inc.2
4.12	Pursuant to Item 601(b)(4)(iii)(A) of Regulation S-K, copies of instruments defining the rights of holders of long-term debt and preferred securities are not filed. The Company agrees to furnish a copy thereof to the Securities and Exchange Commission upon request.
10.19	Agreement to assume deposits and loans from Korea Exchange Bank of New York, Broadway Branch *
10.20	Lease for premise located at 3600 Wilshire Blvd., Los Angeles, CA *
31.1	Rule 13a-14(a)/15d-14(a) Certifications*
31.2	Rule 13a-14(a)/15d-14(a) Certifications*
32.1	Certification of CEO and CFO pursuant to Section 906 of the Public Company Accounting Reform and Investor Protection Act of 2002 *

1.	Incorporated by reference to Exhibits filed with our Statement on Form S-4 filed with the Commission on November 16, 2000.
2.	Incorporated by reference to Exhibits filed with our Statement on Form S-4 filed with the Commission on December 5, 2000.
3.	Incorporated by reference to Exhibits filed with our Statement on Form 10-Q filed with the Commission on August 14, 2002.

* Filed herein

46 EX-10.19 3 v94422exv10w19.txt EXHIBIT 10.19 EXHIBIT 10.19 DEPOSIT ASSUMPTION AND LOAN PURCHASE AGREEMENT THIS AGREEMENT ("Agreement") is made and entered into as of the 7th day of August, 2003, by and between Korea Exchange Bank, Seoul, Republic of Korea ("Seller") and Nara Bank, N.A., Los Angeles, California ("Buyer"). WHEREAS, Seller and Buyer have entered into a letter of intent dated as of July 18, 2003; WHEREAS, Seller desires to divest itself of, and Buyer desires to assume, the deposit liabilities of the Broadway Branch, located at 49-51 West 33rd Street, New York, New York (the "Branch Office") of Seller, including personal checking and savings accounts, passbook savings accounts, business checking accounts, club savings accounts, NOW accounts, money market accounts, time deposits and IRA accounts (the "Accounts"), listed on Schedule A (which list is subject to change between the date hereof and the Closing Date consistent with the other terms and conditions of this Agreement); WHEREAS, Seller desires to sell, and Buyer desires to purchase, certain loans (the "Loans") (including collateral relating thereto and including overdraft lines of credit and letters of credit) listed on Schedule B and Schedule C (which lists are subject to change between the date hereof and the Closing Date consistent with the other terms and conditions of this Agreement); and WHEREAS, subject to the receipt of regulatory approvals or exemptions therefrom, Buyer proposes to assume the Accounts and purchase the Loans, all in accordance with the terms and conditions hereinafter set forth. NOW, THEREFORE, for and in consideration of the mutual promises and covenants contained herein, the parties hereby agree as follows: 1. CLOSING. (a) DATE. Subject to the satisfaction or waiver of the conditions set forth in Sections 6, 7 and 8 of this Agreement, the purchase of assets and assumption of liabilities provided for in this Agreement shall occur at a closing (the "Closing") to be held at the offices of Seller on the first Friday after thirty (30) calendar days following the date of all approvals by regulatory agencies and after all statutory waiting periods have expired, , or at such other place, time or date on which the parties mutually agree (the "Closing Date"). The effective time (the "Effective Time") shall be as of the close of business on the Closing Date. (b) DOCUMENTS, INSTRUMENTS, CERTIFICATES, ETC. TO BE DELIVERED BY THE PARTIES AT THE CLOSING. At the Closing, the parties shall deliver the documents required by Sections 6 and 7 hereof. In order to assign each Loan to Buyer, on or prior to Closing Seller will endorse the promissory note associated with each transferred Loan. On or prior to Closing, Seller will also prepare and execute assignments of trust deeds and amendments of Uniform Commercial Code filings. Buyer will be responsible for the filing of any such assignments and amendments following the Closing. After delivery of all documents pursuant to the foregoing, the Estimated Payment Amount (defined in subsection 3(b) below) shall be made by wire transfer on or before 4:00 p.m., pursuant to subsection 3(b) hereof. The calculation of balances of the Accounts, the Loans and the Payment Amount (defined in subsection 3(a) below) shall be as of the Effective Time. 2. TRANSFER OF ASSETS AND LIABILITIES. (a) ASSUMPTION OF ACCOUNTS. Buyer shall assume, as of and at the Effective Time and subject to the terms and conditions set forth herein, liability for payment and performance of all of Seller's duties, responsibilities, obligations and liabilities for the Accounts (including accrued but unpaid or uncredited interest thereon). Seller shall assign and transfer to Buyer all of its right, title and interest in the records and relationships pertaining to the Accounts. Other than those liabilities specifically assumed under this Section 2(a), Buyer is not assuming any other liabilities or obligations of Seller, whether known or unknown, disclosed or undisclosed, contingent or otherwise, which have arisen or may arise or be established in connection with the conduct of business of Seller prior to the Closing Date or thereafter (the "Excluded Liabilities"). Excluded Liabilities includes, but is not limited to the following: (i) Seller's cashier checks, accounts which are on overdraft status (other than those with overdraft lines of credit), money orders, traveler's checks and any cash items paid by Seller and not cleared prior to the Effective Time; and (ii) Liabilities or obligations with respect to any litigation, suits, claims, demands or governmental proceedings related to any fact, circumstance or event occurring prior to Closing and relating to the Accounts or Loans; (iii) All liabilities and obligations of Seller arising out of Seller's employment, or Seller's termination of employment, of employees of the Branch Office including without limitation Seller's compliance with all applicable laws relating to employment, payment of all compensation, payroll taxes, and benefits, obligations for providing COBRA health plan continuation coverage to former employees and their dependents, and giving any required notices under the Worker Adjustment and Retraining Notification Act of 1988, as amended, including similar state or local laws with respect to mass layoffs or similar events. (b) PURCHASE OF LOANS. (i) Seller shall sell, assign, transfer, convey and deliver to Buyer, and Buyer shall purchase and accept from Seller, as of and at the Effective Time and subject to the terms and conditions set forth herein, all of Seller's right, title and interest in the following loans, including any collateral, deeds of trust and security agreements related thereto: a. Those loans that are listed on Schedule B as of the date of this Agreement and that do not become Schedule C Loans or Excluded Loans between the date of this Agreement and the Closing Date; 2 b. Those loans that Seller makes on or after the date of this Agreement and that Buyer agrees to list on Schedule B (collectively with the loans described in subsection (a), the "Schedule B Loans"); c. The Schedule C Loans, as defined in subsection (ii) below; and d. Those letters of credit of Seller listed on Schedule B hereto (the "Letters of Credit"). (ii) For a period of five (5) days commencing on a date that is within one (1) week of the date of this Agreement, Buyer shall have the opportunity to perform due diligence on the loans and the Letters of Credit listed on Schedule B as of the date of this Agreement, to identify those loans and Letters of Credit that Buyer determines in good faith do not meet Buyer's credit or other standards ("Other Loans"), and to delete such Other Loans or Letters of Credit from Schedule B. Other Loans also include (a) loans 30 calendar days or more past due; (b) loans that Seller has classified as "substandard," "doubtful," or "loss," listed as "special mention," or otherwise not graded as "pass"; (c) nonaccruals (which term shall include loans in which the collateral securing the same has been repossessed or in which collection efforts have been instituted or claim and delivery or foreclosure proceedings have been filed); (d) loans upon which insurance has been force-placed; (e) loans in connection with which the borrower has filed, or has been forced to file, a petition or relief under the United States Bankruptcy Code prior to the Effective Time; (f) loans which are overdrafts (other than overdraft lines of credit) and that have been on overdraft status for 30 days or more; and (g) all loans that Seller makes or renews on or after the date of this Agreement and that Buyer does not agree to list on Schedule B. Buyer and Seller agree to negotiate in good faith reasonable terms for Buyer to acquire the Other Loans at the Closing. If prior to Closing, Buyer and Seller agree upon reasonable terms for Buyer to acquire any of the Other Loans, Buyer shall list such Other Loans on Schedule C (the "Schedule C Loans") along with the negotiated price therefore, and Buyer and Seller shall duly execute Schedule C. Any Other Loans not listed in Schedule C shall constitute "Excluded Loans" and Buyer shall not have any responsibility whatsoever with respect thereto. (iii) Buyer shall become the beneficiary of credit life insurance written on direct consumer installment loans and coverage will continue to be the obligation of the current insurer after the Effective Time and for the duration of such insurance as provided under the terms of the policy or certificate. If Buyer becomes the beneficiary of credit life insurance written on direct consumer installment loans, Seller and Buyer shall cooperate in good faith to develop a mutually satisfactory method by which the current insurer will make rebate payments to and satisfy claims of the holders of such certificates of insurance after the Effective Time. The parties' obligations in this section are subject to restrictions contained in existing insurance contracts as well as applicable laws and regulations. (iv) As of the Effective Time, Seller shall transfer and assign all files, documents and records related to the Loans (and collateral related thereto) to Buyer. 3 (v) Buyer shall after the Effective Time make trade receipt loans and/or acceptances under the Letters of Credit in accordance with the terms of such Letters of Credit which are listed on Schedule B on the Effective Time. (c) BOOKS AND RECORDS. From and after the Closing, Buyer will have the right to possession of any and all files, books of account and records directly relating to the Loans and the Accounts which are ordinarily maintained at the Branch Office. All books and records relating to the Loans or Accounts will be maintained for a period at least equal to the longer of the period required by law or the normal retention period under Seller's or Buyer's (as the case may be) records management program, unless the parties agree to a shorter period. (d) IRA ACCOUNTS. (i) Included in the Accounts are IRA accounts (which the parties acknowledge includes SEP IRA accounts, SIMPLE IRA accounts and any other type of retirement account reflected on the general ledgers of the Branch Office) pursuant to which Seller is currently acting as trustee or custodian. (ii) On or before the Closing Date, Seller shall resign as of the close of business on the Closing Date as the trustee or custodian, as applicable, of each IRA account and to the extent permitted by the documentation governing each such IRA account and applicable law, appoint Buyer as successor trustee or custodian, as applicable. Buyer hereby accepts each such trusteeship or custodianship under the terms and conditions of Buyer's plan documents for its IRA accounts and assumes all fiduciary and custodial obligations with respect thereto as of the close of business on the Closing Date. Within such period prior to the Closing Date as is required by applicable law or regulation, Seller will, at its sole cost and expense, notify the depositors who maintain such IRA accounts of Seller's intent to resign as custodian as of Closing and to appoint Buyer as successor custodian and the discharge and release of Seller from all liabilities as custodian from and after the effective time of its resignation. Such notification shall include such information as is required by the documentation governing each such IRA account and be accompanied by all such documents necessary to effect such replacement and release and to Buyer's master agreement. If, pursuant to the terms of the documentation governing any such IRA account or applicable law, Seller is not permitted to appoint Buyer as successor trustee or custodian, or the grantor objects in writing to such designation, or is entitled to, and does, in fact, name a successor trustee or custodian other than Buyer, all deposit liabilities of Seller held under such IRA accounts shall be excluded from the Accounts and deemed an Excluded Liability. (e) EMPLOYEES. (i) Employment by Buyer. Buyer shall have the right to make offers of employment to any employees of Seller, such employment to be effective no earlier than the Closing Date, and shall make offers to at least one-half of Seller's employees as of the date of this Agreement. Notwithstanding anything in this Agreement to the contrary, Buyer shall have complete discretion in determining which employees to hire and will hire such employees at will subject to Buyer's current employment policies and practices, provided however, that Buyer agrees not to terminate any of Seller's employees that accept Buyer's offer of employment for a 4 period of one year after the Closing Date, unless terminated for cause, as reasonably determined by Buyer. (ii) Obligations of Seller. Seller shall, effective as of the Closing Date, terminate the employment of all employees who have been offered and have accepted employment with Buyer. Seller shall perform and discharge all liabilities and obligations in connection with such employees through the Closing Date, including giving any required notices, paying all compensation or other amount owed to such employee through the Closing Date, including wages, bonuses, commissions, severance benefits, vacation pay, paid time off, sick leave, holiday pay, or other accrued and vested paid time off as of the Closing Date, employee benefit plan contributions, payroll taxes and any other form of compensation or benefits of any type or nature on account of such employees' employment through the Closing Date and their termination by Seller. Seller shall remain responsible and shall perform and discharge all liabilities and obligations of any type or nature in connection with all other employees of Seller that are not employed by Buyer and Buyer shall have no liability or obligations with respect thereto. 3. PRICE AND PAYMENT. (a) PAYMENT AMOUNT. (i) The price to be paid by Seller in consideration of the assumption of the Accounts by Buyer in accordance with this Agreement (the "Account Payment Amount") shall be an amount equal to one hundred percent (100%) of the net book value of the Accounts assumed by Buyer at the Effective Time, which book value shall include the total principal balance of the Accounts at the Effective Time plus accrued but uncredited or unpaid interest thereon, minus accrued but uncredited debits thereon, minus a premium ("Premium") paid by Buyer calculated pursuant to the formula set forth in Appendix I hereto. (ii) The price to be paid by the Buyer in consideration of the transfer of the Loans to the Buyer in accordance with this Agreement (the "Loan Payment Amount") shall be the sum of the following, without duplication: (a) an amount equal to one hundred percent (100%) of the net book value of the Schedule B Loans (excluding Letters of Credit), as recorded on the books and records of the Seller, which books and records shall reflect any write-downs or write-offs, and as adjusted by all earned interest as of the Effective Time and otherwise as required by generally accepted accounting principles consistently applied ("GAAP"), plus (b) the negotiated price for the Schedule C Loans as shown in Schedule C. (iii) The net amount to be paid by Seller ("Payment Amount") shall be the net of the Account Payment Amount and the Loan Payment Amount. (b) PAYMENT PROCEDURE. The Payment Amount shall be paid by Seller as follows: (i) Attached hereto as Schedule 3(b) is a trial settlement statement prepared for the transaction as if the Closing Date had occurred on June 30, 2003. At the Closing, the same calculations shall be made subject to adjustments in amounts reflecting transactions made between June 30, 2003 and the Closing Date and for any other adjustments 5 made in the ordinary course of business or in accordance with this Agreement. Not less than two (2) business days prior to the Closing Date, Seller shall deliver to Buyer its good faith estimate of the Payment Amount (the "Estimated Payment Amount"). (ii) At the Closing, Seller shall pay to Buyer by wire transfer to an account designated in writing by Buyer of immediately available funds an amount equal to the Estimated Payment Amount. (iii) As soon as practicable after the Closing but in no event later than thirty (30) business days after the Closing Date, Buyer and Seller shall, in good faith, make a final determination of the Payment Amount after the receipt by Seller of Buyer's statement setting forth the amount of the Payment Amount as determined in accordance with the provisions of this Agreement, including work papers, schedules and other supporting data as may be reasonably requested by Seller to enable it to verify such determination. If the Estimated Payment Amount paid at the Closing exceeds the Payment Amount, Buyer shall refund the excess to Seller, and, if the Payment Amount exceeds the Estimated Payment Amount paid at the Closing, Seller shall pay to Buyer the excess. (iv) Notwithstanding the provisions of subsection 3(b)(iii) hereof, and subject to the following sentence, Buyer shall reimburse Seller or Seller shall reimburse Buyer, as the case may be, for any amount by which the balance of any Account used in determining the Payment Amount did not accurately reflect the balance of such Account as of the close of Seller's books on the day before the Closing Date as a result of any error or inaccuracy in the books and records of Seller as of the close of business on such date (other than as a result of items in transit, which are to be handled as set forth in Section 10 hereof). Such reimbursement shall be made to the party entitled thereto promptly following the discovery of such error or inaccuracy; provided, however, that no reimbursement for any discrepancy shall be made after (i) the date that is ninety (90) days after the Closing Date or (ii) in the case of Accounts with maturities or withdrawal notice periods of fifteen (15) days or more, the date that is (A) one year after the Closing Date or (B) thirty (30) days after the maturity of such Accounts, whichever is earlier, provided, further, that the foregoing time limitations shall not apply if Buyer is entitled to indemnification from Seller because of the error or inaccuracy, in which case subsection 12(b) shall apply. 4. REPRESENTATIONS AND WARRANTIES OF SELLER. Seller hereby represents and warrants to Buyer as follows: (a) ORGANIZATION; GOOD STANDING; CORPORATE AUTHORITY. Seller is a banking corporation headquartered in Seoul, Republic of Korea duly licensed, validly existing and in good standing under the laws of the Republic of Korea and has the requisite corporate power and authority to execute, deliver and perform this Agreement The Branch Office is a New York State licensed branch duly licensed, validly existing and in good standing under the laws of the State of New York. (b) FDIC INSURANCE. The Branch Office is an insured depository institution within the meaning of the Federal Deposit Insurance Act, as amended (the "FDI Act"), and, to the 6 knowledge of Seller, other than in connection with Seller's proposed voluntary termination of the FDIC insurance upon consummation of the transactions contemplated hereby, there is no action pending or threatened to terminate its status as an insured depository institution. The Accounts are insured by the FDIC to the fullest extent permitted by the FDI Act and the rules and regulations of the FDIC thereunder. (c) DUE AUTHORIZATION. The execution, delivery and performance of this Agreement by Seller and the consummation of the transaction contemplated hereby by Seller have been duly and validly authorized and approved by Seller in accordance with its charter, bylaws or similar organizational documents and internal policies and procedures and all requisite corporate actions have been taken so that this Agreement is a valid and binding obligation of Seller, enforceable against Seller in accordance with its terms, except (i) as such enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or other similar laws now or hereafter in effect affecting the enforcement of creditors' rights in general, and (ii) as such enforceability may be limited by general principles of equity (whether considered in a suit at law or in equity). The execution, delivery and performance of this Agreement does not and will not conflict with any law, regulation or order applicable to Seller and will not result in a breach of Seller's charter, bylaws or similar organizational document or any license or of any agreement or instrument to which Seller is a party or by which Seller or the Accounts are bound. (d) NO VIOLATION. The execution and delivery of this Agreement and the consummation of the transactions contemplated hereby by Seller do not conflict with or result in any breach, violation of or default under (with or without notice or lapse of time, or both) or give rise to a right of termination, cancellation, modification or acceleration of any obligation or loss of any benefit under (a) any provision of the charter, bylaws or similar organizational documents of Seller, (b) any material contract to which Seller is a party or bound or by which any of its properties is bound, or (c) any judgment, order, decree, statute, law, ordinance, rule, regulation, writ or injunction applicable to Seller. (e) CONSENTS. No consent, waiver, approval, order or authorization of, or registration, declaration or filing with any Federal, state or local government or any foreign, national, provincial or local government, or any governmental, regulatory, legislative, executive or administrative authority, agency or commission, or any court, tribunal, or judicial body or any other person, including a party to any material contract with Seller, is required by or with respect to Seller in connection with the execution and delivery of this Agreement or the consummation of the transactions contemplated hereby other than any filings with or approval or waiver of approval by the Office of the Controller of the Currency, the Federal Deposit Insurance Corporation, the Board of Governors of the Federal Reserve System, the banking department of the State of New York, the Korean Ministry of Finance and Economy and the Korean Financial Supervisory Service. (f) PERMITS. Seller has all licenses, franchises, permits, certificates, approvals or other similar authorizations affecting, or relating in any way to, the assets or business of Seller required in connection with the operation of the Branch Office, and all such licenses, franchises, permits, certificates, approvals or other similar authorizations are valid and in full force and effect, except where failure to do so would not have a material adverse effect on the Branch Office. 7 (g) ACCOUNTS, LOANS AND LISTS. (i) Seller has delivered to Buyer a true and complete list of each Account as of the date of this Agreement (it being acknowledged by Buyer that such list is subject to change between the date hereof and the Closing Date), listing the balance of each Account as of the most recent practicable date, the interest rate, the accrued interest thereon, and the type of Account (the "Account List," attached as Schedule A hereto). Seller also has delivered to Buyer a true and complete copy of the account forms for all Accounts. (ii) Seller has delivered to Buyer a true and complete list of each Loan as of the date of this Agreement (it being acknowledged by Buyer and Seller that such list is subject to change between the date hereof and the Closing Date), listing the principal balance of each Loan as of the most recent practicable date, the interest rate, the earned interest thereon, the Account or other collateral which secures each Loan, and the type of Loan (the "Loan List," attached as Schedule B hereto and as of Closing, Schedules B and C). Seller also represents that Seller has timely booked any write-downs and write-offs as required by GAAP and any applicable rules or regulations. (h) NO BROKER. No agent, broker, investment banker, person or firm retained or allegedly retained by Seller is or will be entitled to any broker's or finder's fee or any other commission or similar fee, directly or indirectly, in connection with any of the transactions contemplated herein. (i) VALIDITY OF LOANS. (i) Seller has provided to Buyer true, complete and accurate information concerning the Loans, and no material information with respect to the Loans has been withheld from Buyer. (ii) (A) Each Loan and related security instruments are a legal, valid and binding obligation of the obligor named therein, are in full force and effect and are enforceable against the obligor named therein in accordance with their terms (except as may be limited by bankruptcy, insolvency, moratorium, reorganization or similar laws affecting the rights of creditors generally or equitable principles limiting the right to obtain specific performance or other similar relief); (B) Seller has good title to and is the sole owner of record of each Loan as of the date of this Agreement and of the indebtedness represented by the notes evidencing such Loans, and each is free of any lien, encumbrance or claim by any other person; (C) Seller has duly performed in all material respects all of its obligations thereunder to the extent that such obligations to perform have accrued; (D) all documents and agreements necessary for Seller to enforce such Loan and security instruments are in existence and in Seller's possession; (E) no claims, counterclaims, set-off rights or other rights exist, nor do the grounds for any such claim, counterclaim, set-off rights or other rights exist, with respect to any Loan which could impair the collectibility thereof; (F) each Loan has been, in all material respects, originated and serviced in accordance with Seller's then applicable underwriting guidelines, the terms of the relevant credit documents and agreements; (G) all Loans are in compliance with all applicable laws, orders and regulations and have been documented in such a manner so as to render the rights and remedies of the secured parties named in the security 8 instruments related thereto adequate for the realization against the collateral, if any, securing the obligations of such Loan (except as may be limited by bankruptcy, insolvency, moratorium, reorganization or similar laws affecting the rights of creditors generally or equitable principles limiting the right to obtain specific performance or other similar relief); and (H) to the knowledge of Seller, no approval or consent of the borrower is required with respect to the transfer to Buyer of any Loan. (j) ACCOUNTS. Seller has properly accrued interest on the Accounts and its records respecting the Accounts accurately reflect such accruals of interest except where failure to do so would not have a material adverse effect on the Branch Office. Seller has delivered to Buyer a true and correct copy of the current account forms for each of the types of Accounts offered by Seller out of the Branch Office. (k) LITIGATION. There are no actions, suits or proceedings pending or, to the knowledge of Seller, threatened against or affecting the Accounts or Loans. Seller has not received notice from any governmental agency, instrumentality or department of the United States, the State of New York or any other state indicating that it would oppose or not grant or issue its consent or approval, if required, with respect to the transactions contemplated by this Agreement. (l) COMPLIANCE WITH APPLICABLE LAW. The origination and administration of the Accounts and the Loans have been and are being conducted in compliance with all applicable laws, rules, regulations and authorities, except where failure to do so would not have and would not be reasonably expected to have in the aggregate a material adverse affect on the Accounts or the Loans. (m) EMPLOYEES. None of Seller's employees at the Branch Office are party to any written employment or deferred compensation agreement with Seller or any affiliate. Seller has no union contracts or collective bargaining agreements with, or any other obligations to, employee organizations or groups. (n) BRANCHES. Seller has no other branches or loan production offices within a twenty mile radius of the Branch Office except a wholesale branch located on the 14th floor at 460 Park Avenue, New York, New York (the "Park Avenue Wholesale Branch") nor does Seller currently contemplate opening a branch or loan production office within a twenty mile radius of the Branch Office. (o) REPRESENTATIONS COMPLETE. No representation or warranty by Seller in this Agreement or any certificate delivered pursuant hereto contains any untrue statement of a material fact or omits to state any material fact necessary to make such representation or warranty not misleading. 5. REPRESENTATIONS AND WARRANTIES OF BUYER. Buyer hereby represents and warrants to Seller as follows: 9 (a) ORGANIZATION; GOOD STANDING; CORPORATE AUTHORITY. Buyer is a national bank, duly organized, validly existing and in good standing under the laws of the United States and has the requisite corporate power and authority to execute, deliver and perform this Agreement. (b) FDIC INSURANCE, ETC. Buyer is an insured depository institution within the meaning of the FDI Act. There is no action, suit, proceeding, inquiry or investigation, at law or equity, or before or by any court, regulatory agency, public board or body pending or, to the best of Buyer's knowledge, threatened, which would either prevent or materially delay the consummation of the transactions contemplated hereby. (c) DUE AUTHORIZATION. The execution, delivery and performance of this Agreement by Buyer and the consummation of the transactions contemplated hereby by Buyer have been duly and validly authorized and approved and all requisite corporate actions have been taken so that this Agreement is a valid and binding obligation of Buyer, enforceable against Buyer in accordance with its terms, except (i) as such enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or other similar laws now or hereafter in effect affecting the enforcement of creditors' rights in general, (ii) as such enforceability may be limited by general principles of equity (whether considered in a suit at law or in equity), and (iii) as to the approval of the Board of Directors of Buyer, which is a condition to closing in Section 6(e). The execution, delivery and performance of this Agreement does not and will not conflict with any law, regulation or order applicable to Buyer and will not result in a breach of Buyer's charter, bylaws or of any agreement or instrument to which Buyer is a party or by which Buyer is bound. (d) NO BROKER. No agent, broker, investment banker, person or firm retained or allegedly retained by Buyer is or will be entitled to any broker's or finder's fee or any other commission or similar fee, directly or indirectly, in connection with any of the transactions contemplated herein. (e) LEGAL PROCEEDINGS. There are no actions, suits or proceedings pending or, to the knowledge of Buyer, threatened against or affecting Buyer which would have or be reasonably expected to have a material adverse effect on Buyer's ability to consummate the transactions contemplated by this Agreement. Buyer has not received notice from any governmental agency, instrumentality or department of the United States or any state indicating that it would oppose or not grant or issue its consent or approval, if required, with respect to the transactions contemplated by this Agreement. (f) REPRESENTATIONS COMPLETE. No representation or warranty made or given by Buyer in this Agreement or any certificate delivered pursuant hereto contains any untrue statement of a material fact or omits to state any material fact necessary to make such representation or warranty not misleading. 6. CONDITIONS TO OBLIGATIONS OF BUYER. The obligations of Buyer hereunder are subject to the satisfaction or waiver, on or before the Closing, of the following conditions: 10 (a) PERFORMANCE. Each of the acts and undertakings of Seller to be performed at or before the Closing pursuant to this Agreement shall have been duly performed in all material respects. (b) REPRESENTATIONS. All of the representations and warranties made by Seller herein shall be true and correct in all material respects as of the Closing Date with the same force and effect as though such representations and warranties had been made as of such date. (c) ABSENCE OF PROCEEDINGS AND LITIGATION. No order shall have been entered and remain in force at the Closing Date restraining or prohibiting the transactions contemplated by this Agreement in any legal, administrative or other proceeding and no action or proceeding shall have been instituted or threatened on or before the Closing Date pertaining to the transactions contemplated by this Agreement which, in the reasonable judgment of Buyer, could be materially adverse to Buyer or Buyer's assumption of the Accounts. (d) DOCUMENTS. Buyer shall have received at the Closing on the Closing Date the following documents from Seller: (i) Written approval by Seller's head office certified by an officer of Seller, authorizing the signing and delivery of this Agreement and the other agreements and instruments referred to herein and the consummation of the transactions contemplated hereby and thereby; (ii) A certificate signed by a duly authorized officer of Seller stating that the conditions set forth in subsections 6(a) and 6(b) have been fulfilled; (iii) An Assignment and Assumption Agreement substantially in the form of Exhibit A hereto. (iv) A Bill of Sale substantially in the form of Exhibit B hereto. (v) Such other documents and instruments as Buyer or its counsel may reasonably request to consummate the transaction contemplated herein. (e) BOARD APPROVAL. Buyer's Board of Directors shall have approved this Agreement. 7. CONDITIONS TO OBLIGATIONS OF SELLER. The obligations of Seller hereunder are subject to the satisfaction or waiver, on or before the Closing, of the following conditions: 11 (a) PERFORMANCE. Each of the acts and undertakings of Buyer to be performed at or before the Closing pursuant to this Agreement shall have been duly performed in all material respects. (b) REPRESENTATIONS. All of the representations and warranties made by Buyer herein shall be true and correct in all material respects as of the Closing Date with the same force and effect as though such representations and warranties had been made as of such date. (c) ABSENCE OF PROCEEDINGS AND LITIGATION. No order shall have been entered and remain in force at the Closing Date restraining or prohibiting the transactions contemplated by this Agreement in any legal, administrative or other proceeding and no action or proceeding shall have been instituted or threatened on or before the Closing Date pertaining to the transactions contemplated by this Agreement which, in the reasonable judgment of Seller, could be materially adverse to Seller. (d) DOCUMENTS. Seller shall have received at the Closing Date the following documents from Buyer: (i) Resolutions of Buyer's Board of Directors certified by Buyer's Secretary or an Assistant Secretary, authorizing the signing and delivery of this Agreement and the other agreements and instruments referred to herein and the consummation of the transactions contemplated hereby and thereby; (ii) A certificate signed by a duly authorized officer of Buyer stating that the conditions set forth in subsections 7(a) and 7(b) have been fulfilled; (iii) The Assignment and Assumption Agreement; and (iv) Such other documents and instruments as Seller or its counsel may reasonably request to consummate the transaction contemplated herein. 8. CONDITIONS TO OBLIGATIONS OF BOTH PARTIES. The obligations of both parties to this Agreement are subject to the condition that all filings and registrations with, and notifications to all federal and state authorities (including any notifications to Korean authorities) required for consummation of the transactions contemplated by this Agreement, shall have been made, all regulatory approvals shall have been received and shall be in full force and effect, and all applicable waiting periods shall have passed. 9. COVENANTS AND AGREEMENTS OF THE PARTIES. (a) COOPERATION. Seller and Buyer each agree to cooperate with the other and to use their commercially reasonable efforts to consummate the transactions contemplated by this Agreement. (b) CONDUCT OF BUSINESS PRIOR TO CLOSING. Except as provided herein and as may be otherwise required by any regulatory authority, between the date of this Agreement and the Closing Date, Seller will conduct its deposit business in the ordinary course and substantially in 12 the same manner as heretofore conducted. Buyer and Seller will work together to define and implement the operational procedures necessary to transfer the Accounts and Loans to Buyer. Within two (2) days after the execution of this Agreement, Buyer and Seller will each designate an individual to serve as liaison concerning operational matters. Seller will use its commercially reasonable efforts in good faith to provide Buyer, on a monthly basis, Seller's internal loan classifications for the Loans. From and after the date hereof through the Closing Date, except as may be required by a regulatory authority, Seller will not, without the prior written consent of Buyer: (i) Cause or permit the Branch Office to engage or participate in any material transaction or incur or sustain any material obligation except in the ordinary course of business consistent with past practice; (ii) Cause or encourage any customer of the Branch Office to transfer such customers Accounts or Loans to any office of Seller or withdraw from such Accounts or pay down such Loans (except upon the unsolicited request of a customer in the ordinary course of business); (iii) Effect any changes to the terms of any Account, including in the interest rate applicable thereto, except for changes in the ordinary course of business; (iv) Cause or permit the Branch Office to transfer to Seller's other operations any Loans or Accounts (except pursuant to an unsolicited customer request in the ordinary course of business); (v) Take any action that would cause the termination of or reduction in coverage of any insurance policy currently in effect on or relating to the Loans or Accounts; and (vi) Increase the number of personnel at the Branch Office. (c) ACCESS TO RECORDS AND INFORMATION. Between the date of this Agreement and the Closing Date, Seller will afford Buyer and its authorized agents and representatives reasonable access during normal business hours, upon reasonable notice to Seller, to records and other information within Seller's possession relating to the Accounts and the Loans. Seller shall provide to Buyer assistance in Buyer's investigation of matters relating to the Accounts and the Loans; provided, however, Buyer's investigations shall be conducted in a manner which does not unreasonably interfere with Seller's normal operations, customers and employee relations. Seller shall provide to Buyer information requested by Buyer sufficient to prepare and deliver necessary change of terms notices in sufficient time to allow for changes to the terms of the Accounts effective upon transfer to Buyer. Seller shall provide full access to the books and records necessary for servicing of the Accounts and the Loans commencing immediately after close of business on the business day immediately preceding the Closing Date for transfer to Buyer's premises. Buyer and Seller will provide each other promptly with information as to any significant developments in the performance of this Agreement and will promptly notify the other if either discovers that any of its representations or warranties contained in this Agreement was not true and correct in all material respects or becomes untrue or incorrect in any material respect. 13 (d) REGULATORY APPLICATIONS AND APPROVALS. Buyer and Seller shall file initial regulatory applications and notices required to consummate the transactions contemplated hereby as soon as reasonably practicable, but no later than five (5) business days from the date hereof. Buyer and Seller agree to use their commercially reasonable efforts to obtain and, where necessary, to assist the other party in obtaining as promptly as practicable such regulatory approval and other approvals or consents, if any, as may be necessary to consummate the transactions contemplated hereby. The parties shall promptly notify the other upon receipt of any regulatory approval or consent. Immediately following the Closing Date, Seller shall request that the FDIC terminate its FDIC insurance of the Branch Office. (e) COMPUTER SERVICES: TRIAL BALANCES. Buyer and Seller shall cooperate with each other and any applicable service bureau and shall use their commercially reasonable efforts to cause the transfer on the Closing Date of all information and records relating to the Accounts and the Loans from Seller's computer system to Buyer's computer system. Seller agrees to deliver to Buyer within one week of executing this Agreement a preliminary draft of certain data processing information (the "DP Information") then in existence on Seller's data processing system that relates to the Accounts and Loans. Additionally, Seller agrees to deliver to Buyer within 30 days prior to and at the Closing Date all DP Information on Seller's data processing system that relates to the Accounts and Loans. (f) DELINQUENT LOAN REPORT. At Closing, Seller will deliver to Buyer a report listing each transferred Loan that, as of such date, is 60 days delinquent and each transferred Loan that, as of such date, is 30 days delinquent. (g) FURTHER ASSURANCES. On and after the Closing Date, upon Buyer's request, Seller shall execute, acknowledge and deliver such assurances as may be reasonably necessary and appropriate to transfer all of the Accounts in full to Buyer and to vest in Buyer full, legal and equitable title to all of the Loans, including without limitation providing Buyer with access to any documents, records and other information in Seller's possession that are not already provided to Buyer and reasonably related to the Accounts or Loans. From the date hereof through Closing, Seller will provide Buyer all reasonable assistance requested by Buyer in order to effect as of Closing the orderly transfer of the Accounts and Loans, including providing information reasonably requested by Buyer to enable Buyer to provide the notifications and documents necessary hereunder or to effect the transfer, and except as otherwise provided in this Agreement, for a period of three (3) months after the Closing Date, Seller will provide such similar reasonable assistance to Buyer to effect the orderly transfer of the Accounts and Loans. (h) CONSENTS. Except as otherwise provided by this Agreement, Seller will use its commercially reasonable efforts to obtain and deliver to Buyer prior to Closing all consents reasonably necessary, if any, to authorize the transfer and assignment to Buyer of, or the substitution of Buyer for Seller under, all Account agreements, Loans and related documents. (i) TAX INFORMATION AND WITHHOLDING. All tax information reporting and filing requirements and all tax withholding requirements with respect to the Accounts and Loans are the responsibility of Seller up to and through the Closing Date and the responsibility of Buyer thereafter. 14 (j) EXCLUSIVITY. Neither Seller, nor any of its directors, executive officers, lawyers or accountants or other representatives will, directly or indirectly, encourage or solicit proposals or discussions with, or enter into negotiations with, or provide any information to, any person, entity or group other than Buyer concerning any sale or assumption of the Loans or Accounts or concerning any other possible transaction which would preclude or materially adversely affect the ability of Seller or Buyer to consummate the purchase and assumption of the Loans and Accounts contemplated by this Agreement. Neither Seller, nor any of its directors, executive officers, lawyers or accountants or other representatives have taken since July 18, 2003, any of the actions described in this section. 10. ITEMS IN TRANSIT; TRANSITIONAL MATTERS. (a) RETURNED ITEMS. Except as provided in this subsection, Buyer shall obtain the benefit of and shall bear the risk of all checks, drafts, withdrawal orders, and items of any kind which are deposited and credited to an Account by Seller prior to Closing ("Deposit Items") relating to or originating from the Accounts which are in transit as of the Effective Time. Any Deposit Items that were credited for deposit to an Account prior to the Effective Time and are returned unpaid ("Returned Item") on or after the Effective Time will be handled in following manner. (i) If there are sufficient funds in the Account to which such Returned Item was credited, and Buyer has a right of charge-back against such Account, Buyer will debit any or all of such Account an amount equal in the aggregate to such Returned Item and shall repay that amount to Seller, reduced however, by the amount of the Premium, if any, attributable to such Returned Item; or (ii) If there are not sufficient funds in the Account, Buyer will use its commercially reasonable efforts to obtain reimbursement from the party to whom the Returned Item was credited, but Buyer will have no obligation to repay Seller an amount in excess of what is in the Account unless and until Buyer obtains reimbursement from the party liable for such Returned Item. (iii) Any repayment obligation of the Buyer to the Seller for Returned Items shall be conditional upon such Returned Items being debited from the Seller's account with the Federal Reserve Bank after the Closing Date. To the extent that the processing of any item or transaction pursuant to this Section 10 requires the cooperation of the other party, that party will provide such cooperation. (b) ACH TRANSACTIONS. Seller agrees that for a period of three (3) months following the Closing Date it will effectuate direct pay and automated clearinghouse transactions in the same manner and with the same diligence as it would have prior to the Closing Date. Seller agrees timely to provide Buyer with the daily electronic detail necessary for Buyer to timely credit or debit the customer's account and to allow Buyer to send notifications of changes. Seller and Buyer agree to a timely net daily settlement of these transactions. At the end of such four month period, Seller will discontinue accepting and forwarding ACH entries and funds and will return them to the originators marked "Account Closed." Buyer agrees to reimburse Seller for any reasonable out of pocket expenses incurred by Seller in complying with this Section. 15 (c) OTHER TRANSITIONAL MATTERS. For a period of three (3) months beginning on the Closing Date, Seller shall timely provide Buyer with checks, deposits and payments it receives on the Accounts and Loans, including documentation for ACH transactions, to enable Buyer to timely pay checks drawn on the Accounts and process deposits to the Accounts and process payments on the Loans. 11. PRESS RELEASES; CONTACT WITH DEPOSITORS. (a) PRESS RELEASE. Unless otherwise required by law, the parties agree that, to the extent practicable, they will cooperate on any public announcements, communications or other publicity concerning the transactions contemplated by this Agreement. (b) NOTIFICATION OF CUSTOMERS. (i) Seller shall promptly but no later than one (1) business day following receipt by the parties of all required regulatory approvals, deliver to Buyer the names and addresses of the holders of the Accounts and of the borrowers on the Loans that are to be purchased by Buyer. Buyer may use the address list to send change of terms notices within sufficient time to permit change of terms of the Accounts on the Closing Date. Buyer shall give Seller a reasonable opportunity to review and comment upon Buyer's written communications (other than portions of said communications which set forth the specific changes proposed to the terms and rates of the Accounts) to the holders of the Accounts and to the borrowers on the Loans prior to the Closing. Commencing not earlier than two (2) weeks prior to the estimated Closing Date, Buyer may commence telephone and further written communications with holders of Accounts to be assumed under this Agreement and with borrowers on the Loans to be purchased under this Agreement for the purpose of assisting such Account holders in the transition of the Accounts to Buyer. Buyer shall give Seller a reasonable opportunity to review and comment on such written communications and Buyer's script, fact sheet or any other document used in connection with such telephonic communications (other than portions of said communications which set forth the specific changes proposed to the terms and rates of the Accounts). (ii) At least two (2) weeks prior to the estimated Closing Date, Seller will at its expense prepare and deliver a letter, in form and substance reasonably satisfactory to Buyer, informing customers and depositors of the Branch Office of the transfer of Accounts and Loans to Buyer. With respect to any customer notice which is required by applicable law or regulation to be mailed by Seller, Seller will, no later than the applicable deadline mail a letter prepared by Seller in form and substance reasonably satisfactory to Buyer to each customer. (iii) Within such period as may be required by applicable law and regulations but no later than five (5) business days following the Closing Date, Buyer will mail to each account holder of a checking, money market deposit or NOW account: (a) a letter prepared by Buyer, in form and substance reasonably satisfactory to Seller, notifying such depositor of the transfer of his or her account to Buyer, requesting that such account holder cease writing checks or drafts against his or her Seller's account immediately following receipt of such letter (or such other period as may be required by applicable law or regulation) and (b) check 16 order forms, replacement checks bearing Buyer's transit and routing number and any other documents to be signed by the account holder to establish a similar account with Buyer. (iv) Within five (5) business days after the Closing Date, Buyer will mail a letter prepared by Buyer, in form and substance reasonably satisfactory to Seller, to each customer whose Loan was transferred to Buyer and requesting that such customer remit all payments on such Loan to Buyer. (v) At Buyer's option, Seller agrees to do the mailings prior to Closing on Buyer's behalf provided that the costs of the mailings will remain the liability of Buyer. 12. INDEMNIFICATION. (a) INDEMNIFICATION BY SELLER. Seller shall indemnify and hold harmless Buyer and its directors, officers, employees and affiliates from, and shall reimburse Buyer and its directors, officers, employees and affiliates for, any loss, fee, cost, expense, damage, liability or claim (including, without limitation, any and all fees, costs and expenses whatsoever, reasonably incurred by Buyer or such other persons in investigating, preparing for, defending against, or providing evidence, producing documents or taking any other action in respect of any threatened or asserted claim) (hereinafter referred to as "Losses") arising out of, based upon, resulting from or relating to (i) the inaccuracy of any representation or warranty of Seller contained in Section 4 of this Agreement; (ii) Seller's breach of or failure to perform in any material respect any of its covenants or agreements contained in this Agreement; (iii) any obligation or liability of Seller arising out of the Accounts and Loans before the Effective Time which is not expressly assumed by Buyer pursuant to this Agreement, including, but not limited to, Seller's management or administration of the Accounts and Loans prior to the Effective Time (including without limitation any claims asserted after the Effective Time and attributable to the period before the Effective Time); (iv) any liability for payroll, withholding, property, excise, sales, use and transfer taxes imposed by the United States or by any other taxing authority relating to the Accounts which are due and payable by Seller for the period prior to the Effective Time; (v) any Excluded Liabilities; or (vi) any Excluded Loans. (b) INDEMNIFICATION BY BUYER. Buyer shall indemnify and hold harmless Seller and its respective directors, officers, employees and affiliates from, and shall reimburse Seller and its respective directors, officers, employees and affiliates for, any loss, fee, cost, expense, damage, liability or claim (including, without limitation, any and all fees, costs and expenses whatsoever, reasonably incurred by Seller or such other persons in investigating, preparing for, defending against, or providing evidence, producing documents or taking any other action in respect of any threatened or asserted claim) (hereinafter referred to as "Losses") arising out of, based upon or resulting from (i) the inaccuracy of any representation or warranty of Buyer which is contained in Section 5 of this Agreement; (ii) Buyer's breach of or failure to perform in any material respect any of its covenants or agreements contained in this Agreement, including, but not limited to, Buyer's assumption of the Accounts; (iii) any obligation or liability of Buyer arising out of the Accounts and Loans after the Effective Time, including, but not limited to, Buyer's management or administration of the Accounts and Loans after the Effective Time; or (iv) any liability for payroll, withholding, property, excise, sales, use or transfer taxes imposed by the 17 United States or by any other taxing authority relating to the Accounts which are due and payable by Buyer for the period after the Effective Time. (c) PROCEDURE. In the event of the occurrence of any event which any party asserts is an indemnifiable event pursuant to this Section 12, such party shall notify the indemnifying party promptly and, if such event involves the claim of any third party, the indemnifying party shall be entitled to assume the defense of any claim as to which this Section 12 requires it to indemnify the other party, provided that (i) the indemnified party may, if it so desires, employ counsel at its own expense to assist in the handling of such claim, and (ii) the indemnifying party shall obtain the prior written approval of the indemnified party, which approval shall not be unreasonable withheld, before entering into any settlement, adjustment or compromise of such claim or ceasing to defend against such claim. (d) SURVIVAL OF REPRESENTATIONS. All of the representations and warranties in this Agreement shall survive the Closing (even if the damaged party knew or had reason to know of any misrepresentation or breach of warranty at the time of Closing) and shall continue in full force and effect until the first anniversary of the Closing Date, except that all representations and warranties relating only to the Accounts in Section 4(b), 4(g)(i), and 4(j) shall survive the Closing and continue in full force and effect until the end of the sixth full month after the Closing Date. After the applicable survival period, all such representations and warranties shall terminate and be of no further force and effect, other than claims for indemnification with respect to which notice has been given to the indemnifying party prior to the end of the applicable survival period. (e) SURVIVAL OF INDEMNIFICATION OBLIGATIONS. After the first anniversary of the Closing Date, all indemnification obligations hereunder shall terminate and be of no further force and effect, other than (i) claims for indemnification with respect to which notice has been given to the indemnifying party prior to such anniversary (or prior to the time provided in Section 12(d), as applicable) and (ii) claims for indemnification arising from or relating to any claim or claims asserted by a third party (i.e., asserted against Buyer by a party other than Seller, or asserted against Seller by a party other than Buyer) which shall survive until expiration of the applicable statute of limitations. 13. TERMINATION. (a) TERMINATION EVENTS. This Agreement shall terminate and be of no further force or effect, upon the occurrence of any of the following: (i) Any regulatory authority whose consent or approval is necessary for consummation of the transactions contemplated hereby shall have issued a final order denying or refusing to grant any such approval or consent or shall have granted such approval but shall have imposed conditions that are or would become applicable to either Seller or Buyer that either Seller or Buyer reasonably and in good faith deems to be materially burdensome to it; or (ii) Mutual agreement of the parties evidenced in writing; or 18 (iii) Immediately upon the expiration of thirty (30) days from the date that either party hereto has given notice to the other party hereto of such other party's material breach or misrepresentation of any condition, warranty, representation or covenant herein; provided, however, that no such termination shall take effect if within said thirty (30) day period the party so notified shall have corrected in all material respects the grounds for termination as specified in the aforementioned notice; or (iv) Written notice by Buyer or Seller to the other party if the Closing shall not have taken place on or before ninety (90) days from the date of this Agreement, other than by reason of a matter within the control of the person asserting such termination provided that if, as of such date, all regulatory approvals necessary for the consummation of the transactions contemplated hereunder have been received but the Closing cannot take place because any applicable waiting period has not expired, the parties agree that this Agreement shall be extended for such period as shall be required for the expiration of such waiting period and, within a reasonable time thereafter, the Closing; or (v) Written notice by Buyer or Seller given to the other party after entry of a final, restraining order or injunction prohibiting the assumption of the Accounts. (b) NO TERMINATION FOR OWN BREACH. Notwithstanding anything to the contrary herein contained, neither party hereto shall have the right to terminate this Agreement on account of its own breach or any non-material breach by the other party hereto. 14. NOTICES. Any notice or other communications required or permitted hereunder shall be sufficiently given if sent by registered or certified mail, postage prepaid, or sent by facsimile transmission or otherwise actually delivered, addressed as follows: To Seller: Oh Kyung Kwon Regional Director Regional Headquarters for the Americas Korea Exchange Bank 460 Park Avenue 15th Floor New York, NY 10022 Telephone: (212) 350-7404 Facsimile: (212) 752-3964 Copy to: Kathleen E. Topelius, Esq. Bryan Cave LLP 700 13th Street, N.W. Washington, DC 20005 Telephone: (202) 508-6140 Facsimile: (202) 508-6200 19 To Buyer: Jungho Kim Senior Vice President Nara Bank, NA 29 W. 30th Street New York, NY 10001 Telephone: (212) 563-9130 Facsimile: (212) 279-0728 Copy to: Michel Urich, Esq. Director of Legal Affairs Nara Bank, NA 3701 Wilshire Blvd., Suite 220 Los Angeles, CA 90010 Telephone: (213) 235-3250 Facsimile: (213) 235-3257 or such other address as shall be furnished in writing by either party. 15. EXPENSES. Except as otherwise provided in this Agreement, each party hereto shall pay its own expenses. 16. CONFIDENTIALITY. Except to the extent disclosure is required by law, Buyer will maintain the confidentiality of all information obtained from Seller which is not publicly available (the "Information"), and will use the Information only for purposes reasonably related to this Agreement and the transactions contemplated herein. Buyer shall guard and protect the Information with the highest degree of care. In the event of termination of this Agreement, Buyer shall promptly deliver to Seller the Information, and all copies thereof which are in the possession or under the control of Buyer or its officers, directors, employees or agents, or (in the case of copies) certified to Seller that all such copies have been destroyed. That portion of Buyer's summaries, analysis, memoranda, correspondence, notes and other writings containing Information shall be modified to delete, destroy or render illegible material based in whole or in part on such Information and the deletion, destruction and/or rendering of portions of said material illegible shall be certified to Seller. The mutual covenants contained in this Section shall survive termination of this Agreement. 17. ENTIRE AGREEMENT, MODIFICATIONS, WAIVERS, HEADINGS. This Agreement constitutes the entire agreement between the parties hereto pertaining to the subject matter hereof, supersedes all prior and contemporaneous agreements and understandings of the parties in connection therewith, and confers no rights or benefits upon any person not a party hereto. No modification or termination of this Agreement shall be binding unless executed in writing by the parties hereto. No waiver of any provision of this Agreement shall be deemed or shall constitute a waiver of any other provision hereof (whether or not 20 similar) nor shall such waiver constitute a continuing waiver. Section and subsection headings are not to be considered part of this Agreement, are solely for convenience of reference, are not intended to be full or accurate descriptions of the contents of any section or subsection. 18. SUCCESSORS AND ASSIGNS. All of the terms and provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective transferees, successors and assigns, but rights under this Agreement may not be assigned and duties hereunder may not be delegated by either party without the written consent of the other. Nothing herein, express or implied, is intended to or shall confer upon any other person any right, benefit or remedy of any nature whatsoever under or by reason of this Agreement. 19. COUNTERPARTS. This Agreement may be executed in one or more counterparts, all of which taken together shall constitute one instrument. 20. NO SOLICITATION OF CUSTOMERS. (a) BY SELLER. Prior to the Closing, Seller will not knowingly solicit any of its customers, either directly or indirectly, to reduce, transfer or close any of the Accounts, or open deposit accounts or conduct any type of business at other branches of the Seller that are not the subject of this Agreement. For a period of twelve (12) months following the Closing Date, Seller will not, directly or indirectly, knowingly solicit deposits or loans, whether by the use of direct mail, telemarketing programs or other marketing methods, specifically directed at former customers whose Accounts and Loans were transferred to Buyer. For a period of twelve (12) months following the Closing Date, Seller will not open a branch or loan production office located within the State of New York and within a twenty (20) mile radius of the Branch Office. Notwithstanding the previous sentence, nothing herein will prohibit Seller from soliciting customers who are also customers of other operations of Seller or other products offered by Seller and through general marketing campaigns not directed at persons whose Accounts or Loans were transferred to Buyer. The parties agree that the covenants in this Section 20 are reasonable in scope, territory, and duration. If any court of competent jurisdiction shall at any time deem any covenant herein too broad or lengthy, the duration or scope of such covenant shall be deemed to be the longest and broadest permissible by law under the circumstances. (b) BY BUYER. From and after the date hereof and up to the Closing Date, Buyer will not cause or encourage any customer of the Branch Office to transfer such customer's Accounts or Loans to any office of Buyer. 21. GOVERNING LAW. This Agreement shall be construed and enforced in accordance with the laws of the State of New York without giving effect to the principles of the conflicts of laws, except to the extent matters may be governed as a matter of law by federal law. FURTHERMORE, THE PARTIES EACH WAIVE THEIR RESPECTIVE RIGHTS TO A TRIAL BY JURY OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF OR RELATED TO THIS 21 AGREEMENT, IN ANY ACTION, PROCEEDING OR OTHER LITIGATION OF ANY TYPE BROUGHT BY A PARTY AGAINST THE OTHER PARTY, WHETHER WITH RESPECT TO CONTRACT CLAIMS, TORT CLAIMS, OR OTHERWISE. THE PARTIES AGREE THAT ANY SUCH ACTION OR CAUSE OF ACTION SHALL BE TRIED BY A COURT TRIAL WITHOUT A JURY. THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT. 22. CONSENT TO JURISDICTION; WAIVER OF IMMUNITIES. Each party hereby irrevocably submits to the nonexclusive jurisdiction of any state or federal court sitting in the City of New York, borough of Manhattan, U.S.A., in any action or proceeding brought to enforce or otherwise arising out of or relating to this Agreement. Seller irrevocably appoints CT Corporation System, with an office on the date hereof at 111 Eighth Avenue, New York, NY 10011, U.S.A., as its agent for service of process to receive on behalf of Seller and its property service of copies of the summons and complaint and any other process which may be served in any such action or proceeding. Such service may be made by mailing or delivering a copy of such process to Seller in care of such process agent, at the address of such process agent stated above, and Seller hereby irrevocably authorizes and directs such process agent to accept such service on its behalf. Each party also irrevocably consents to the service of any and all process in any such action or proceeding by the mailing of copies of such process to such party by registered or certified mail at its address in accordance with Section 14 hereof. Nothing contained herein shall be deemed to limit in any way any right to serve process in any manner permitted by law. In addition, each party hereby irrevocably waives to the fullest extent permitted by law any objection which it may now or hereafter have to the laying of venue in any such action or proceeding in any state or federal court sitting in the City of New York, borough of Manhattan, U.S.A., and hereby further irrevocably waives any claim that any such forum is an inconvenient forum. Each party agrees that a final judgment in any such action or proceeding that is no longer subject to appeal shall be conclusive and may be enforced in any other jurisdiction by suit on the judgment or in any other manner provided by law. Nothing in this section shall impair the right of any party to bring any action or proceeding against the other or its property in the courts of any other jurisdiction, and each party irrevocably submits to the nonexclusive jurisdiction of the appropriate courts of the jurisdiction sitting in any place where the property or an office of such party is located. To the extent that any party or any of its property has or may hereafter acquire any immunity from jurisdiction of any court or from any legal process (whether through service or notice, attachment prior to judgment, attachment in aid of execution, execution, or otherwise) under the laws of any jurisdiction, such party hereby irrevocably waives such immunity in respect of its obligations under this Agreement and agrees that it shall be subject to civil and commercial law with respect to such obligations. 23. SEVERABILITY. Any provision of this Agreement which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability 22 without invalidating the remaining provisions hereof or affecting the validity or enforceability of such provision in any other jurisdiction. 24. ATTORNEYS' FEES. If any litigation with respect to the obligations of the parties under this Agreement results in a final nonappealable order of a court of competent jurisdiction that results in a final disposition of such litigation, the prevailing party, as determined by the court ordering such disposition, shall be entitled to reasonable attorneys' fees and costs of suit, including appeal, as shall be determined by such court. [Rest of the page left intentionally blank] 23 IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as of the day and year first above written. SELLER: KOREA EXCHANGE BANK By:___________________________________________ Name:_________________________________________ Title:________________________________________ BUYER: NARA BANK, NATIONAL ASSOCIATION By:___________________________________________ Name:_________________________________________ Title:________________________________________ 24 SCHEDULE A ACCOUNT LIST A-1 SCHEDULE B LOAN LIST B-1 SCHEDULE C LOAN LIST (To be prepared after due diligence) C-1 APPENDIX I 1. Eight percent (8%) of the Average Balance of all Accounts listed on Schedule A on the Closing Date which balance shall exclude: (i) the Average Balance of the business checking account and money market account of Seller or any of Seller's affiliates; and (ii) the accounts listed in item 2 below. The "Average Balance" as used herein shall mean the average amount calculated using the average of the daily closing balances over the period from the date of the Agreement to the Closing Date. 2. Zero percent (0%) of all certificates of deposit and club savings accounts listed on Schedule A on the Closing Date. I-1 EXHIBIT A DEPOSIT ASSUMPTION AND LOAN PURCHASE AGREEMENT BETWEEN KOREA EXCHANGE BANK AND NARA BANK, N.A. ASSIGNMENT AND ASSUMPTION AGREEMENT THIS ASSIGNMENT AND ASSUMPTION AGREEMENT is entered into this ____ day of ____________, 2003, by and between Korea Exchange Bank, Seoul, Republic of Korea ("Seller"), and Nara Bank, N.A., a national bank ("Buyer"). W I T N E S S E T H: WHEREAS, Seller and Buyer have entered into a Deposit Assumption and Loan Purchase Agreement dated as of _____________, 2003 (the "Agreement"), which provides for the assignment by Seller of all of its rights and interests in and to certain deposit liabilities related to Seller's office located at 49-51 West 33rd Street, New York, New York, and the assumption by Buyer of all of Seller's liabilities thereunder, all as set forth in the Agreement; NOW, THEREFORE, in consideration of the foregoing, and for other good and valuable consideration, receipt of which is hereby acknowledged by Seller and Buyer, Seller hereby assigns, transfers and sets over to Buyer all of Seller's rights and interest to, and Buyer does hereby assume all of Seller's liabilities and obligations in connection with, all Accounts set forth on Schedule A attached hereto on the Closing Date. Nothing contained herein shall require Buyer to pay or discharge any debts or obligations expressly assumed hereby so long as Buyer shall in good faith contest or cause to be contested the amount or validity thereof. Other than as specifically stated above or in the Agreement, Buyer assumes no debt, liability or obligation of Seller by this Assignment and Assumption Agreement, and it is expressly understood and agreed that all debts, liabilities and obligations not assumed hereby by Buyer shall remain the sole obligation of Seller, its successors and assigns. No person other than Seller, its successors and assigns shall have any rights under this Assignment and Assumption Agreement or the provisions contained herein. AA-1 This Assignment and Assumption Agreement is intended to evidence the consummation of the transactions contemplated by the Agreement and is made without representation or warranty except as provided in and by the Agreement. This Assignment and Assumption Agreement is in all respects subject to the provisions of the Agreement and is not intended in any way to supersede, limit, expand or qualify any provision of the Agreement. Capitalized terms used herein and not defined herein shall have the meanings assigned to them in the Agreement. This Assumption Agreement may be executed in any number of counterparts, each of which will be deemed an original, but all of which together will constitute one and the same instrument. This Assignment and Assumption Agreement shall be governed by and construed in accordance with the laws of the State of New York applicable to a contract executed and performed in such State without giving effect to the conflicts of law principles thereof. Section 22 of the Agreement on consent to jurisdiction and waiver of immunities is incorporated herein by reference and made a part hereof as if fully set forth herein. IN WITNESS WHEREOF, the undersigned have caused their duly authorized officers to execute this Assignment and Assumption Agreement on the day and year first above written. BUYER: NARA BANK NATIONAL ASSOCIATION By: ___________________________ Name: Benjamin Hong Title: President SELLER: KOREA EXCHANGE BANK By:_____________________________ Name:___________________________ Title:__________________________ AA-2 EXHIBIT B DEPOSIT ASSUMPTION AND LOAN PURCHASE AGREEMENT BETWEEN KOREA EXCHANGE BANK AND NARA BANK, N.A. BILL OF SALE THIS BILL OF SALE is dated this ____ day of _____________, 2003, by Korea Exchange Bank, Seoul, Republic of Korea ("Seller"). W I T N E S S E T H: WHEREAS, Seller and Nara Bank, N.A., a national bank ("Buyer"), have entered into a Deposit Assumption and Loan Purchase Agreement dated as of August __, 2003 (the "Agreement"), which provides for the sale by Seller to Buyer of certain loans related to Seller's Broadway Branch located at 49-51 West 33rd Street, New York, New York, all as set forth in the Agreement; NOW, THEREFORE, Seller, for good and valuable consideration, receipt of which is hereby acknowledged, does hereby grant, bargain, sell, assign, set over, convey and transfer to Buyer all of its right, title and interest in and to the following assets (the "Assets"): (a) All of the Loans (including the Letters of Credit but excluding the Excluded Loans under Section 2(b) of the Agreement) set forth on Schedule B and Schedule C attached hereto on the Closing Date; and (b) All of Seller's files and records related to the Loans. Seller, for itself and its successors and assigns, does hereby covenant and agree to and with Buyer and its successors and assigns that it (i) is seized of, and has the right to convey to Buyer, such title to the Assets as is provided in the Agreement, (ii) shall warrant and defend said title to the Assets in the manner provided in the Agreement, and (iii) shall, from time to time at the request of Buyer, provide Buyer with such information and assistance as may be necessary to give full force and effect to the intent and purposes of this Bill of Sale. This Bill of Sale is intended to evidence the consummation of the transactions contemplated by the Agreement and is made without representation or warranty except as provided in and by the BB-1 Agreement. This Bill of Sale is in all respects subject to the provisions of the Agreement and is not intended in any way to supersede, limit, expand or qualify any provision of the Agreement. Capitalized terms not defined herein shall have the meaning assigned to them in the Agreement. IN WITNESS WHEREOF, Seller has caused this Bill of Sale to be duly executed by its duly authorized officer, all as of the day and year first above written. KOREA EXCHANGE BANK By:__________________________ Name:________________________ Title:_______________________ BB-2 EX-10.20 4 v94422exv10w20.txt EXHIBIT 10.20 RETAIL LEASE BETWEEN 3600 WILS HIRE,LLC, A CALIFORNIA LIMITED LIABILITY COMPANY (LANDLORD) AND NARA BANK, NATIONAL ASSOCIATION (TENANT) SUITE 100A 3600 WILSHIRE BOULEVARD LOS ANGELES, CALIFORNIA, 90010 JANUARY 17,2003 TABLE OF CONTENTS RETAIL LEASE

Article Title Page - ------- ----- ---- 1 Definitions 1 2 Premises 2 3 Term 2 4 Rental 2 5 Security Deposit 6 6 Use of Premises 6 7 Utilities and Services 7 8 Maintenance and Repairs 8 9 Alterations, Additions and Improvements 8 10 Indemnification and Insurance 9 11 Damage or Destruction 11 12 Condemnation 11 13 Relocation 12 14 Assignment and Subletting 12 15 Default and Remedies 13 16 Attorneys' Fees; Costs of Suits 15 17 Subordination and Attornment 15 18 Quiet Enjoyment 16 19 Rules and Regulations 16 20 Estoppel Certificates 16 21 Entry by Landlord 17 22 Landlord's Lease Undertakings-Exculpation from Personal Liability; Transfer of Landlord's Interest 17 23 Holdover Tenancy 17 24 Notices 18 25 Brokers 18 26 Electronic Services 18 27 Parking 20 28 Miscellaneous 20

EXHIBITS Exhibit A As - Built Plan Exhibit A-1 Premises Floor Plan Exhibit A-2 Parking Plan Exhibit B Work Letter Agreement Exhibit C Agreement Rules and Regulations Exhibit D Personal Guaranty Exhibit E Suite Acceptance Agreement Exhibit F Asbestos Notification Exhibit G Parking Agreement Addendum RETAIL LEASE THIS RETAIL LEASE ("Lease"), dated JANUARY 17,2003, is made and entered into by and between 3600 Wilshire, LLC, a California limited liability company, c/o JPB Partners, Inc., a California corporation, ("Landlord") NARA BANK, NATIONAL ASSOCIATION, ("Tenant") upon the following terms and conditions: ARTICLE I - DEFINITIONS Unless the context otherwise specifies or requires, the following terms shall have the meanings specified herein; 1.01 BUILDING. The term "Building" shall mean that certain office building located at 3600 Wilshire Boulevard, Los Angeles, California 90010 commonly known as The Wilshire Financial Tower together with any related land, improvements, parking facilities, common areas, driveways, sidewalks and landscaping. 1.02 PREMISES. The term "Premises" shall mean SUITE 100A in the 3600 Building, as more particularly outlined on the drawing attached hereto as Exhibit A and incorporated herein by reference. As used herein, "Premises" shall not include any storage area in the Building, which shall be leased or rented pursuant to separate agreement. 1.03 RENTABLE AREA OF THE PREMISES. The term "Rentable Area of the Premises" shall mean approximately 7,961 rentable square feet, more or less, which Landlord and Tenant have stipulated as the Rentable Area of the Premises, the exact size and location shall be further determined upon final acceptance of a mutually approved space plan by Landlord's architect using Building Owners and Managers Association International ("BOMA") Standards for the measurement of commercial office space (ANSIZ65-1-1996). Tenant acknowledges that (he Rentable Area of the Premises include the usable area, without deduction for columns or projections, multiplied by a load factor to reflect a share of certain areas, which may include common or shared areas such as lobbies, corridors, mechanical, utility, janitorial, boiler and service rooms and closets, restrooms and other public, common and service areas of the Building. 1.04 LEASE TERM. The term "Lease Term" shall mean the period between the Commencement Date and the Expiration Date (as such terms are hereinafter defined), unless sooner terminated as otherwise provided in this Lease. The term of the Lease shall be for TEN (10) YEARS. 1.05 COMMENCEMENT DATE. Subject to adjustment as provided in Article 3, the term "Commencement Date" shall mean JULY 1,2003. 1.06 EXPIRATION DATE. Subject to adjustment as provided in Article 3, the term "Expiration Date" shall mean JUNE 30,2013. 1.07 BASE RENT. Subject to adjustment as provided in Article 4, the term "Base Rent" shall mean Fifteen Thousand Five Hundred Twenty Three and 95/100ths Dollars ($15,523.95) per month for months One (1) through Twelve (12), Fifteen Thousand Nine Hundred Eighty Nine and 67/100ths Dollars ($15,989.67) per month for months TWELVE (12) through Twenty Four (24), Sixteen Thousand Four Hundred Sixty Nine and 36/100ths Dollars ($16,469.36) per month for months Twenty Five (25) through Thirty Six (36), Sixteen Thousand Nine Hundred Sixty Three and 44/100ths Dollars ($16,963.44) per month for months Thirty Seven (37) through Forty Eight (48), Seventeen Thousand Four Seventy Two Hundred and 34/100ths Dollars ($17,472.34) per month for months Forty Nine (49) through Sixty (60), Seventeen Thousand Nine Hundred Ninety Six and 51/100ths Dollars ($17,996.51) per month for months Sixty One (61) through Seventy Two (72), Eighteen Thousand Five Hundred Thirty Six and 41/100 ths Dollars ($18,536.41) per month for months Seventy Three (73) through Eighty Four (84), Nineteen Thousand Ninety Two and 50/100ths Dollars ($19,092.50) per month for months Eighty Five (85) through Ninety Six (96), Nineteen Thousand Six Hundred Sixty Five and 28/100ths Dollars ($19,665.28) per month for months Ninety Seven (97) through One Hundred Eight (108) and Twenty Thousand Two Hundred Fifty Five and 23/100ths Dollars ($20,255.23) per month for months One Hundred Nine (109) through One Hundred Twenty (120), of the initial Lease term. 1.08 TENANT'S PERCENTAGE SHARE. Tenant's share shall be 1.9220 % with respect In increases in Property Taxes and Operating Expenses (as such terms are hereinafter defined). Landlord may reasonably redetermine Tenant's Percentage Share from time to time to reflect reconfigurations, additions or modifications to the Building. 1.09 SECURITY DEPOSIT. The term "Security Deposit" shall mean None. 1.10 TENANT'S PERMITTED USE. The term "Tenant's Permitted Use" shall mean Banking and office use and no other use or purpose without the written consent of Landlord, which consent shall not be unreasonably withheld. It is agreed by Landlord that no other space in said building may be leased for or used by others for a similar business. Tenant will comply with the rules and regulations now or hereafter adopted by Landlord for the building as a whole; it being agreed that a copy of such rules and regulations will be supplied to Tenant, and that same will be reasonable and will not conflict with the normal operation of Landlord. Tenant Landlord /s/ [ILLEGIBLE] /s/ [ILLEGIBLE] 1 1.11 BUSINESS HOURS. The term "Business Hours" shall mean the hours of 8:30 A.M. to 6:00 P.M., Monday through Friday (federal and state holidays excepted). Holidays are defined as the following: New Years Day, President's Day, Memorial Day. Independence Day, Labor Day. Thanksgiving Day and Christmas Day, and to the extent of utilities or services provided by union members engaged at the Building, such other holidays observed by such unions. 1.12 LANDLORD'S ADDRESS FOR NOTICES. The term "Landlord's Address for Notices" shall mean 3600 Wilshire Boulevard, Suite 800, Los Angeles, California 90010, Attn: Property Manager. 1.13 TENANT'S ADDRESS FOR NOTICES. The term "Tenant's Address for Notices" shall mean 3600 Wilshire Boulevard, Suite 100A, Los Angeles, California 90010. 1.14 BROKER. The term "Broker" shall mean Jamison Properties Inc., as Landlord's Broker, and Julien J. Studley, Inc., as Tenant's Broker. 1.15 GUARANTER. The term "Guarantor" shall mean None. 1.16 Tenant's Parking Stalls: The term "Tenant's Parking Stalls" shall mean FIFTY (50) PARKING SPACES, in Landlord's parking structure at building's prevailing rates generally posted or quoted to the general public for available parking spaces, in common with other tenants on a non exclusive right to park, as provided in Article 27. ARTICLE II - PREMISES 2.01 LEASE OF PREMISES. Landlord hereby leases the Premises to Tenant, and Tenant hereby leases the Premises from Landlord, upon all of the terms, covenants and conditions contained in this Lease. On the Commencement Date described herein, Landlord shall deliver the Premises to Tenant in substantial conformance with the Work Letter Agreement attached hereto as Exhibit B. 2.02 ACCEPTANCE OF PREMISES. Tenant acknowledges that Landlord has not made any representation or warranty with respect to the condition of the Premises or the Building or with respect to the suitability or fitness of either for the conduct of Tenant's Permitted Use or for any other purpose. Tenant's taking possession of the Premises, Landlord or its designee and Tenant will walk the Premises for the purpose of reviewing the condition of the Premises shall be deemed conclusive evidence that as of the date of taking possession of the Premises are in good order and satisfactory condition. No promise of Landlord to alter, remodel, repair or improve the Premises, the Building or the Project and no representation, express or implied, respecting any matter or thing relating to the Premises, Building, Project or this Lease (including, without limitation, the condition of the Premises, the Building or the Project) have been made to Tenant by Landlord or Landlord"s Broker, or any agents thereof. Tenant shall execute a Suite Acceptance Letter, in the form of Exhibit E attached hereto, accepting the Premises. ARTICLE III - TERM 3.01 Except as otherwise provided in this Lease, the Lease Term shall be for the period described in Section 1.04 of this Lease, commencing on the Commencement Date described in Section 1.05 of this Lease and ending on the Expiration Date described in Section 1.06 of this Lease; provided, however, that, if, for any reason, Landlord is unable to deliver possession of the Premises on the date described in Section 1.05 of this Lease, Landlord shall not be liable for any damage caused thereby, nor shall the Lease be void or voidable, but, rather, the Lease Term shall commence upon, and the Commencement Date shall be the date that possession of the Premises is so tendered to Tenant (except for Tenant-caused delays which shall not be deemed to delay commencement of the Lease Term), and, unless Landlord elects otherwise, the Expiration Date described in Section 1.06 of this Lease shall be extended by an equal number of days. ARTICLE IV - RENTAL 4.01 DEFINITIONS. AS USED HEREIN, (A) "Base Year" shall mean calendar year 2003. (B) "Property Taxes" shall mean the aggregate amount of all real estate taxes, assessments (whether they be general or special), sewer rents and charges, transit taxes, taxes based upon the receipt of rent and any other federal, state or local governmental charge, general, special, ordinary or extraordinary (but not including income or franchise taxes, capital stock, inheritance, estate, gift, or any other taxes imposed upon or measured by Landlord's gross income or profits, unless the same shall be imposed in lieu of real estate taxes or other ad valorem taxes), which Landlord shall pay or become obligated to pay in connection with the Building, or any part thereof. Property Taxes shall also include all fees and costs, including attorneys' fees, appraisals and consultants' fees, incurred by Landlord in seeking to obtain a reassessment, reduction of, or a limit on the increase in, any Property Taxes, regardless of whether any reduction or limitation is obtained. Property Taxes for any calendar year shall be Tenant Landlord -s- [ILLEGIBLE] -s- [ILLEGIBLE] 2 Property Taxes which are due for payment or paid in such year, rather than Property Taxes which are assessed or become a lien during such year. Property Taxes shall include any tax, assessment, levy, imposition or charge imposed upon Landlord and measured by or based in whole or in part upon the Building or the rents or other income from the Building, to the extent that such items would be payable if the Building was the only property of Landlord subject to same and the income received by Landlord from the Building was the only income of Landlord. Property Taxes shall also include any personal property taxes imposed upon the furniture, fixtures, machinery, equipment, apparatus, systems and appurtenances of Landlord used in connection with the Building. (C) "Operating Expenses" shall mean all costs, fees, disbursements and expenses paid or incurred by or on behalf of Landlord in the operation, ownership, maintenance, insurance, management, replacement and repair of the Building (excluding Property Taxes) including without limitation: (i) Premiums for property, earthquake, casualty, liability, rent interruption or other types of insurance carried by Landlord. (ii) Salaries, wages and other amounts paid or payable for personnel including the Building manager, superintendent, operation and maintenance staff, and other employees of Landlord involved in the maintenance and operation of the Building, including contributions and premiums towards fringe benefits, unemployment, disability and worker's compensation insurance, pension plan contributions and similar premiums and contributions and the total charges of any independent contractors or property managers engaged in the operation, repair, care, maintenance and cleaning of any portion of the Building. (iii) Cleaning expenses, including without limitation janitorial services, window cleaning, and garbage and refuse removal. (iv) Landscaping expenses, including without limitation irrigating, trimming, mowing, fertilizing, seeding, and replacing plants. (v) Heating, ventilating, air conditioning and steam/utilities expenses, including fuel, gas, electricity, water, sewer, telephone, and other services. (vi) Subject to the provisions of Section 4.01 (C)(xii) below, the cost of maintaining, operating, repairing and replacing components of equipment or machinery, including without limitation heating, refrigeration, ventilation, electrical, plumbing, mechanical, elevator, escalator, sprinklers, fire/life safety, security and energy management systems, including service contracts, maintenance contracts, supplies and parts. (vii) Other items of repair or maintenance of elements of the Building. (viii) The costs of policing, security and supervision of the Building. (ix) Fair market rental and other costs with respect to the management office for the Building. (x) The cost of the rental of any machinery or equipment and the cost of supplies used in the maintenance and operation of the Building. (xi) Audit fees and the cost of accounting services incurred in the preparation of statements referred to in this Lease and financial statements, and in the computation of the rents and charges payable by tenants of the Building. (xii) Capital expenditures (a) made primarily to reduce Operating Expenses, or to comply with any laws or other governmental requirements, or (b) for replacements (as opposed to additions or new improvements) of non-structural items located in the common areas of the property required to keep such areas in good condition; provided, all such permitted capital expenditures (together with reasonable financing charges) shall be amortized for purposes of this Lease over the shorter of (i) their useful lives, (ii) the period during which the reasonably estimated savings in Operating Expenses equals the expenditures, or (iii) three (3) years. (xiii) Legal fees and expenses. (xiv) Payments under any easement, operating agreement, declaration, restrictive covenant, or instrument pertaining to the sharing of costs in any planned development. (xv) A fee for the administration and management of the Building as reasonably determined by Landlord from time to time. Operating Expenses shall not include costs of alteration of the premises of tenants of the Building, depreciation charges, interest and principal payments on mortgages, ground rental payments, real estate brokerage and leasing commissions, expenses incurred in enforcing obligations of tenants of the Building, salaries and other compensation of executive officers of the managing agent of the Building senior to the Building manager, costs of any special service provided to any one tenant of the Building but not to tenants of the Building generally, and costs of marketing or advertising the Building. Tenant Landlord /s/ [ILLEGIBLE] /s/ [ILLEGIBLE] 3 (D) If the Building does not have ninety five percent (95%) occupancy during an entire calendar year, including the Base Year, then the variable cost component of "Property Taxes" and "Operating Expenses" shall he equitably adjusted so that the total amount of Property Taxes and Operating Expenses equals the total amount which would have been paid or incurred by Landlord had the Building been ninety five percent (95%) occupied for the entire calendar year. In no event shall Landlord be entitled to receive from Tenant and any other tenants in the Building an aggregate amount in excess of actual Property Taxes and Operating Expenses as a result of the foregoing provision. 4.02 BASE RENT. (A) During the Lease Term, Tenant shall pay to Landlord as rental for the Premises the Base Rent described in Section 1.07 above, subject to the following annual adjustments (herein called the "Rent Adjustments"): (B) Annual Adjustments of Base Rent. (a) Tax and Operating Expense Adjustment. During each calendar year, the Base Rent payable by Tenant to Landlord, shall be increased by (collectively, the "Tax and Operating Expense Adjustment"): (i) Tenant's Percentage Share of the dollar increase, if any, in Property Taxes for such year over Property Taxes for the Base Year; and (ii) Tenant's Percentage Share of the dollar increase, if any, in any category of Operating Expenses paid or incurred by Landlord during such year over the respective category of Operating Expenses paid or incurred by Landlord during the Base Year. A decrease in Property Taxes or any category of Operating Expenses below the Base Year amounts shall not decrease the amount of the Base Rent due hereunder or give rise to a credit in favor of Tenant. (b) CPI Adjustment. During each calendar year, the Base Rent payable by Tenant to Landlord, shall be adjusted to reflect increases in the Consumer Price Index as follows: (i) Definitions. The following terms shall have the following meanings: (1) "Index" means the "Consumer Price Index - All Urban Consumers - Los Angeles/Long Beach/Anaheim Metropolitan Area" compiled by the U.S. Department of Labor, Bureau of Labor Statistics, (1967 = 100). If a substantial change is made in the Index, the revised Index shall be used, subject to such adjustments as Landlord may reasonably deem appropriate in order to make the revised Index comparable to the prior Index. If the Bureau of Labor Statistics ceases to publish the Index, then the successor or most nearly comparable index, as reasonably determined by Landlord, shall be used, subject to such adjustments as landlord may reasonably deem appropriate in order to make the new index comparable to the Index. (2) "CPI Adjustment Date" means January 1 of the year in which the anniversary of the Commencement Date falls, and January 1 of every year thereafter. (3) "CPI Base" means the initial Base Rent amount set forth in Section 4.02(A). (ii) Computation of Adjustment. Effective as of each CPI Adjustment Date, the Base Rent shall be adjusted to an amount to be determined by multiplying the CPI Base by a fraction, the numerator of which shall be the Index for the calendar month immediately preceding the CPI Adjustment Date and the denominator of which shall be the Index for the calendar month immediately preceding the month in which the Commencement Date occurs. Such fraction shall not exceed, for any CPI Adjustment Date, an amount in excess of one hundred percent, multiplied by the number of CPI Adjustment Dates that have then occurred (including the present one). The Base Rent shall never be reduced as a result of an adjustment pursuant to this paragraph. Landlord shall give Tenant written notice indicating the adjusted Base Rent and the method of computation, and, on or before the first day of the first calendar month following Tenant's receipt of such written notice, Tenant shall pay to Landlord an amount equal to the underpayment of Base Rent by Tenant for the period from the CPI Adjustment Date until such date. 4.03 TAX AND OPERATING EXPENSE ADJUSTMENT PROCEDURE; ESTIMATES. The Tax and Operating Expense Adjustment specified in Section 4.02(B)(a) shall be determined and paid as follows: (A) During each calendar year subsequent to the Base Year, Landlord shall give Tenant written notice of its estimate of any increased amounts payable under Section 4,02(B)(a) for that calendar year. On or before the first day of each calendar month during the calendar year, Tenant shall pay to Landlord one-twelfth (l/12th) of such estimated amounts; provided, however, that, not more often than quarterly, Landlord may, by written notice to Tenant, revise its estimate for such year, and subsequent payments by Tenant for such year shall be based upon such revised estimate. (B) Within one hundred twenty (120) days after the close of each calendar year or as soon thereafter as is practicable, Landlord shall deliver to Tenant a statement of that year's Property Taxes and Operating Expenses, and the actual Tax and Operating Expense Adjustment to be made pursuant to Section 4.02(B)(a) for such calendar year, as determined by Landlord (the "Landlord's Statement") and such Landlord's Statement shall be binding upon Tenant, except as provided in Section 4.04 below. If the amount of the actual Tax and Operating Tenant Landlord -s- [ILLEGIBLE] -s- [ILLEGIBLE] 4 Expense Adjustment is more than the estimated payments for such calendar year made by Tenant, Tenant shall pay the deficiency to Landlord upon receipt of Landlord's Statement. If the amount of the actual Tax and Operating Expense Adjustment is less than the estimated payments for such calendar year made by Tenant, any excess shall be credited against Rent (as hereinafter defined) next payable by Tenant under this Lease or, if the Lease Term has expired, any excess shall be paid to Tenant. No delay in providing the statement described in this subparagraph (B) shall act as a waiver of Landlord's right to payment under Section 4.02(B)(a) above. (C) If this Lease shall terminate on a day other than the end of a calendar year, the amount of the Tax and Operating Expense Adjustment to be paid pursuant to Section 4,02(B)(a) that is applicable to the calendar year in which such termination occurs shall be prorated on the basis of the number of days from January 1 of the calendar year to the termination date bears to 365. The termination of this Lease shall not affect the obligations of Landlord and Tenant pursuant to Section 4.03(B) to be performed after such termination. 4.04 REVIEW OF LANDLORD'S STATEMENT. Provided that Tenant is not then in default beyond any applicable cure period of its obligations to pay Base rent, additional rent described in Section 4.02(B), or any other payments required to be made by it under this Lease and provided further that Tenant strictly complies with the provisions of this Section 4.04, Tenant shall have the right, once each calendar year, to reasonably review supporting data for any portion of a Landlord's Statement (provided, however, Tenant may not have an audit right to all documentation relating to Building operations as this would far exceed the relevant information necessary to properly document a pass-through billing statement, but real estate tax statements, and information on utilities, repairs, maintenance and insurance will be available), in accordance with the following procedure: (A) Tenant shall, within ten (10) business days after any such Landlord's Statement is delivered, deliver a written notice to Landlord specifying the portions of the Landlord's Statement that are claimed to be incorrect, and Tenant shall simultaneously pay to Landlord all amounts due from Tenant to Landlord as specified in the Landlord's Statement Except as expressly set forth in subsection (C) below, in no event shall Tenant be entitled to withhold, deduct, or offset any monetary obligation of Tenant to Landlord under the Lease (including, without limitation, Tenant's obligation to make all payments of Base Rent and all payments of Tenant's Tax and Operating Expense Adjustment) pending the completion of and regardless of the results of any review of records under this Section 4.04. The right of Tenant under this Section 4.04 may only be exercised once for any Landlord's Statement, and if Tenant fails to meet any of the above conditions as a prerequisite to the exercise of such right, the right of Tenant under this Section 4.04 for a particular Landlord's Statement shall be deemed waived. (B) Tenant acknowledges that Landlord maintains its records for the Building at Landlord's manager's corporate offices presently located at the address set forth in Section 1.12 and Tenant agrees that any review of records under this Section 4.04 shall be at the sole expense of Tenant and shall be conducted by an independent firm of certified public accountants of national standing. Tenant acknowledges and agrees that any records reviewed under this Section 4.04 constitute confidential information of Landlord, which shall not be disclosed to anyone other than the accountants performing the review and the principals of Tenant who receive the results of the review. The disclosure of such information to any other person, whether or not caused by the conduct of Tenant, shall constitute a material breach of this Lease. (C) Any errors disclosed by the review shall be promptly corrected by Landlord, provided, however, that if Landlord disagrees with any such claimed errors, Landlord shall have the right to cause another review to be made by an independent firm of certified public accountants of national standing. In the event of a disagreement between the two accounting firms, the review that discloses the least amount of deviation from the Landlord's Statement shall be deemed to be correct. In the event that the results of the review of records (taking into account, if applicable, the results of any additional review caused by Landlord) reveal that Tenant has overpaid obligations for a preceding period, the amount of such overpayment shall be credited against Tenant's subsequent installment obligations to pay the estimated Tax and Operating Expense Adjustment. In the event that such results show that Tenant has underpaid its obligations for a preceding period, Tenant shall be liable for Landlord's actual accounting fees, and the amount of such underpayment shall be paid by Tenant to Landlord with the next succeeding installment obligation of estimated Tax and Operating Expense Adjustment. 4.05 PAYMENT. Concurrently with the execution hereof, Tenant shall pay Landlord Base Rent for the first calendar month of the Lease Term. Thereafter the Base Rent described in Section 1.07, as adjusted in accordance with Section 4.02, shall be payable in advance on the first day of each calendar month. If the Commencement Date is other than the first day of a calendar month, the prepaid Base Rent for such partial month shall be prorated in the proportion that the number of days this Lease is in effect during such partial month bears to the total number of days in the calendar month. All Rent, and all other amounts payable to Landlord by Tenant pursuant to the provisions of this Lease, shall be paid to Landlord, without notice, demand, abatement, deduction or offset, in lawful money of the United States at Landlord's office in the Building or to such other person or at such other place as Landlord may designate from time to time by written notice given to Tenant. No payment by Tenant or receipt by Landlord of a lesser amount than the correct Rent due hereunder shall be deemed to be other than a payment on account; nor shall any endorsement or statement on any check or any letter accompanying any check or payment he deemed to effect or evidence an accord and satisfaction; and Landlord may accept such check or payment without prejudice to Landlord's right to recover the balance or pursue any other remedy in this Lease or at law or in equity provided. 4.06 LATE CHARGE; INTEREST. Tenant acknowledges that the late payment of Base Rent or any other amounts payable by Tenant to Landlord hereunder (all of which shall constitute additional rental to the same extent Tenant Landlord -s- [ILLEGIBLE] -s- [ILLEGIBLE] 5 as Base Rent) will cause Landlord to incur administrative costs and other damages, the exact amount of which would be impracticable or extremely difficult to ascertain. Landlord and Tenant agree that if Landlord does not receive any such payment on or before five (5) days after the date the payment is due, Tenant shall pay to Landlord, as additional rent, (a) a late charge equal to Ten PERCENT (10%) of the overdue amount to cover such additional administrative costs; and (b) interest on the delinquent amounts at the lesser of the maximum rate permitted by law if any or TWELVE PERCENT (12%) per annum from the date due to the date paid. 4.07 ADDITIONAL RENT. For purposes of this Lease, all amounts payable by Tenant to Landlord pursuant to this Lease, whether or nut denominated as such, shall constitute Base Rent. Any amounts due Landlord shall sometimes be referred to in this Lease as "Rent". 4.08 ADDITIONAL TAXES. Notwithstanding anything in Section 4.01(B) to the contrary, Tenant shall reimburse Landlord upon demand for any and all taxes payable by or imposed upon Landlord upon or with respect to: any fixtures or personal property located in the Premises; any leasehold improvements made in or to the Premises by or for Tenant; the Rent payable hereunder, including, without limitation, any gross receipts (tax, license fee or excise tax levied by any governmental authority; the possession, leasing, operation, management, maintenance, alteration, repair, use or occupancy of any portion of the Premises (including without limitation any applicable possessory interest taxes); or this transaction or any document to which Tenant is a party creating or transferring an interest or an estate in the Premises. ARTICLE V - SECURITY DEPOSIT 5.01 Upon the execution of this Lease, Tenant shall deposit with Landlord the Security Deposit described in Section 1.09 above. The Security Deposit is made by Tenant to secure the faithful performance of all the terms, covenants and conditions of this Lease to be performed by Tenant. If Tenant shall default with respect to any covenant or provision hereof, Landlord may use, apply or retain all or any portion of the Security Deposit to cure such default or to compensate Landlord for any loss or damage which Landlord may suffer thereby. If Landlord so uses or applies all or any portion of the Security Deposit, Tenant shall immediately upon written demand deposit cash with Landlord in an amount sufficient to restore the Security Deposit to the full amount hereinabove stated. Landlord shall not be required to keep the Security Deposit separate from its general accounts and Tenant shall not be entitled to interest on the Security Deposit. Within thirty (30) days after the expiration of the Lease Term and the vacation of the Premises by Tenant, the Security Deposit, or such part as has not been applied to cure the default, shall be returned to Tenant. ARTICLE VI - USE OF PREMISES 6.01 TENANTS PERMITTED Use. Tenant shall use the Premises only for Tenant's Permitted Use as set forth in Section 1.10 above and shall not use or permit the Premises to be used for any other purpose. Tenant shall, at its sole cost and expense, obtain all governmental licenses and permits required to allow Tenant to conduct Tenant's Permitted Use. Landlord disclaims any warranty that the Premises are suitable for Tenant's use and Tenant acknowledges that it has had a full opportunity to make its own determination in this regard. Tenant further specifically acknowledges that neither Landlord nor Landlord's Broker, or any agents thereof, has made any representation or warranty with respect to the suitability of the Premises for their intended Use, with respect to the ability of Tenant to conduct a, Cafe or restaurant business from the Premises at a profit or with respect to the occupancy or expected occupancy level of the Building. 6.02 COMPLIANCE WITH LAWS AND OTHER REQUIREMENTS. (A) Tenant shall cause the Premises to comply in all material respects with all laws, ordinances, regulations and directives of any governmental authority having jurisdiction including, without limitation, any certificate of occupancy and any law, ordinance, regulation, covenant, condition or restriction affecting the Building or the Premises which in the future may become applicable to the Premises (collectively "APPLICABLE LAWS"). (B) Tenant shall not use the Premises, or permit the Premises to be used, in any manner which: (a) violates any Applicable Law; (b) causes or is reasonably likely to cause damage to the Building or the Premises; (c) violates a requirement or condition of any fire and extended insurance policy covering the Building and/or the Premises, or increases the cost of such policy; (d) constitutes or is reasonably likely to constitute a nuisance, annoyance or inconvenience to other tenants or occupants of the Building or its equipment, facilities or systems; (e) interferes with, or is reasonably likely to interfere with, the transmission or reception of microwave, television, radio, telephone or other communication signals by antennae or other facilities located in the Building; or (f) violates the Rules and Regulations described in Article XIX. 6.03 HAZARDOUS MATERIALS. This paragraph is reciprocal from Landlord. (A) No Hazardous Materials, as defined herein, shall be Handled, as also defined herein, upon, about, above or beneath the Premises or any portion of the Building by or on behalf of Tenant, its subtenants or its assignees, or their respective contractors, officers, directors, employees, agents, or invitees. Any such Hazardous Materials so Handled shall be known as Tenant's Hazardous Materials. Notwithstanding the foregoing, normal Tenant Landlord -s- [ILLEGIBLE] -s- [ILLEGIBLE] 6 quantities of Tenant's Hazardous Materials customarily used in the conduct of general activities (e.g., copier fluids and cleaning supplies) may be Handled at the Premises without Landlord's prior written consent. Tenant's Hazardous Materials shall be Handled at all times in compliance with the manufacturer's instructions therefor and all applicable Environmental Laws, as defined herein. (B) Notwithstanding the obligation of Tenant to indemnify Landlord pursuant to this Lease, Tenant shall, at its sole cost and expense, promptly take all actions required by any Regulatory Authority, as defined herein, or necessary for Landlord to make full economic use of the Premises or any portion of the Building, which requirements or necessity arises from the Handling of Tenant's Hazardous Materials upon, about, above or beneath the Premises or any portion of the Building. Such actions shall include, but not be limited to, the investigation of the environmental condition of the Premises or any portion of the Building, the preparation of any feasibility studies or reports and the performance of any cleanup, remedial, removal or restoration work. Tenant shall take all actions necessary to restore the Premises or any portion of the Building to the condition existing prior to the introduction of Tenant's Hazardous Materials, notwithstanding any less stringent standards or remediation allowable under applicable Environmental Laws. Tenant shall nevertheless obtain Landlord's written approval prior to undertaking any actions required by this Section, which approval shall not be unreasonably withheld so long as such actions would not potentially have a material adverse long-term or short-term effect on the Premises or any portion of the Building. (C) Tenant agrees to execute affidavits, representations, and the like from time to time at Landlord's request stating Tenant's best knowledge and belief regarding the presence of Hazardous Materials on the Premises. (D) "Environmental Laws" means and includes all now and hereafter existing statutes, laws, ordinances, codes, regulations, rules, rulings, orders, decrees, directives, policies and requirements by any Regulatory Authority regulating, relating to, or imposing liability or standards of conduct concerning public health and safety or the environment. (E) "Hazardous Materials" means: (a) any material or substance: (i) which is defined or becomes defined as a "hazardous substance," "hazardous waste," "infectious waste," "chemical mixture or substance," or "air pollutant" under Environmental Laws; (ii) containing petroleum, crude oil or any fraction thereof; (iii) containing polychlorinated biphenyls (PCB's); (iv) containing asbestos; (v) which is radioactive; (vi) which is infectious; or (b) any other material or substance displaying toxic, reactive, ignitable or corrosive characteristics, as all such terms are used in their broadest sense, and are defined, or become defined by Environmental Laws; or (c) materials which cause a nuisance upon or waste to the Premises or any portion of the Building. (F) "Handle," "handle," "Handled," "handled," "Handling," or "handling" shall mean any installation, handling, generation, storage, treatment, use, disposal, discharge, release, manufacture, refinement, presence, migration, emission, abatement, removal, transportation, or any other activity of any type in connection with or involving Hazardous Materials. (G) "Regulatory Authority" shall mean any federal, state or local governmental agency, commission, board or political subdivision. ARTICLE VII - UTILITIES AND SERVICES 7.01 BUILDING SERVICES. As long as Tenant is not in monetary default under this Lease, Landlord agrees to furnish or cause to be furnished to the Premises the following utilities and services, subject to the conditions and standards set forth herein: (A) Non-attended automatic elevator service (if the Building has such equipment serving the Premises), in common with Landlord and other tenants and occupants and their agents and invitees. (B) Water for restroom purposes for the common Building restrooms only. Any amounts which Tenant is required to pay to Landlord pursuant to this Section 7.01 shall be payable upon demand by Landlord and shall constitute additional rent. 7.02 INTERRUPTION OF SERVICES. Landlord shall not be liable for any failure to furnish, stoppage of, or interruption in furnishing any of the services or utilities described in Section 7.01 when such failure is caused by accident, breakage, repairs, strikes, lockouts, labor disputes, labor disturbances, governmental regulation, civil disturbances, acts of war, moratorium or other governmental action, or any other cause beyond Landlord's reasonable control, and, in such event, Tenant shall not be entitled to any damages nor shall any failure or interruption abate or suspend Tenant's obligation to pay Base Rent and additional rent required under this Lease or constitute or be construed as a constructive or other eviction of Tenant. Further, in the event any governmental authority or public utility promulgates or revises any law, ordinance, rule or regulation, or issues mandatory controls or voluntary controls relating to the use or conservation of energy, water, gas, light or electricity, the reduction of automobile or other emissions, or the provision of any other utility or service, Landlord may take any reasonably appropriate action to comply with such law, ordinance, rule, regulation, mandatory control or voluntary guideline and Tenant's obligations hereunder shall not be affected by any such action of Landlord. The parties acknowledge Tenant Landlord -s- [ILLEGIBLE] -s- [ILLEGIBLE] 7 that safety and security devices, services and programs provided by Landlord, if any, while intended to deter crime and ensure safety, may not in given instances prevent theft or other criminal acts, or ensure safety of persons or property. The risk that any safety or security device, service or program may not be effective, or may malfunction, or be circumvented by a criminal, is assumed by Tenant with respect to Tenant's property and interests, and Tenant shall obtain insurance coverage to the extent Tenant desires protection against such criminal acts and other losses, as further described in this Lease. Tenant agrees to cooperate in any reasonable safety or security program developed by Landlord or required by Law. ARTICLE VIII - MAINTENANCE AND REPAIRS 8.01 LANDLORD'S OBLIGATIONS. Except as provided hi Sections 8.02 and 8.03 below, Landlord shall maintain the Building in resonable order and repair throughout the Lease Term; provided, however, that Landlord shall not be liable for any failure to make any repairs or to perform any maintenance unless such failure shall persist for more than fifteen days after written notice of the need for such repairs or maintenance is given to Landlord by Tenant, or such greater period provided Landlord has commenced to cure, and diligently pursues same to completion. Except as provided in Article XI, there shall be no abatement of Rent, nor shall there be any liability of Landlord, by reason of any injury or inconvenience to, or interference with, Tenant's business or operations arising from die making of, or failure to make, any maintenance or repairs in or to any portion of the Building. 8.02 TENANT'S OBLIGATIONS. During the Lease Term, Tenant shall, at its sole cost and expense, maintain the Premises in good order and repair (including, without limitation, the carpet, wall-covering, doors, plumbing and other fixtures, equipment, alterations and improvements, whether installed by Landlord or Tenant). Further, Tenant shall be responsible for, and upon demand by Landlord shall promptly reimburse Landlord for, any damage to any portion of the Building or the Premises caused by (a) Tenant's activities hi the Building or the Premises; (b) the performance or existence of any alterations, additions or improvements made by Tenant in or to the Premises; (c) the installation, use, operation or movement of Tenant's property in or about the Building or the Premises; or (d) any act or omission by Tenant or its officers, partners, employees, agents, contractors or invitees. 8.03 LANDLORD'S RIGHTS. Landlord and its contractors shall have the right, at all reasonable times and upon twenty-four (24) hours prior oral or telephonic notice to Tenant at the Premises, other than in the case of any emergency in which case no notice shall be required, to enter upon the Premises to make any repairs to the Premises or the Building reasonably required or deemed reasonably necessary by Landlord and to erect such equipment, including scaffolding, as is reasonably necessary to effect such repairs. ARTICLE IX - ALTERATIONS. ADDITIONS AND IMPROVEMENTS 9.01 LANDLORD'S CONSENT; CONDITIONS. Tenant shall not make or permit to be made any alterations, additions, or improvements in or to the Premises ("Alterations") without the prior written consent of Landlord, which consent, with respect to non-structural alterations, shall not be unreasonably withheld. Landlord may impose as a condition to making any Alterations such requirements as Landlord in its reasonable discretion deems necessary or desirable including without limitation: Tenant's submission to Landlord, for Landlord's prior written approval, of all plans and specifications relating to the Alterations; Landlord's prior written approval of the time or times when the Alterations are to be performed; Landlord's prior written approval of the contractors and subcontractors performing work in connection with the Alterations; employment of union contractors and subcontractors who shall not cause labor disharmony; Tenant's receipt of all necessary permits and approvals from all governmental authorities having jurisdiction over the Premises prior to the construction of the Alterations; Tenant's delivery to Landlord of such bond and insurance as Landlord shall reasonably require; and Tenant's payment to Landlord of reasonable costs and expenses incurred by Landlord because of Tenant's Alterations, including but not limited to costs incurred in reviewing the plans and specifications for, and the progress of, the Alterations. Tenant is required to provide Landlord written notice of whether the Alterations include the Handling of any Hazardous Materials and whether these materials are of a customary and typical nature for industry practices. Upon completion of the Alterations, Tenant shall provide Landlord with copies of as-built plans. Neither the approval by Landlord of plans and specifications relating to any Alterations nor Landlord's supervision or monitoring of any Alterations shall constitute any warranty by Landlord to Tenant of the adequacy of the design for Tenant's intended use or the proper performance of the Alterations. 9.02 PERFORMANCE OF ALTERATIONS WORK. All work relating to the Alterations shall be performed in compliance with the plans and specifications approved by Landlord, all applicable laws, ordinances, rules, regulations and directives of all governmental authorities having jurisdiction (including without limitation Title 24 of the California Administrative Code) and the requirements of all carriers of insurance on the Premises and the Building, the Board of Underwriters, Fire Rating Bureau, or similar organization. All work shall be performed in a diligent, first class manner and so as not to unreasonably interfere with any other tenants or occupants of the Building. All costs incurred by Landlord relating to the Alterations shall be payable to Landlord by Tenant as additional rent upon demand. No asbestos-containing materials shall be used or incorporated in the Alterations. No lead-containing surfacing material, solder, or other construction materials or fixtures where the presence of lead might create a condition of exposure not in compliance with Environmental Laws shall be incorporated in the Alterations. Tenant Landlord -s- [ILLEGIBLE] -s- [ILLEGIBLE] 8 9.03 LIENS. Tenant shall pay when due all costs for work performed and materials supplied to the Premises for the Alteration. Tenant shall keep Landlord, the Premises and the Building free from all liens, stop notices and violation notices relating to the Alterations or any other work performed for, materials furnished to or obligations incurred by or for Tenant and Tenant shall protect, indemnify, hold harmless and defend Landlord, the Premises and the Building of and from any and all loss, cost, damage, liability and expense, including attorneys' fees, arising out of or related to any such liens or notices. Further, Tenant shall give Landlord not less then seven (7) business days prior written notice before commencing any Alterations in or about the Premises to permit Landlord to post appropriate notices of non-responsibility. Tenant shall also secure, prior to commencing any Alterations, at Tenant's sole expense, a completion and lien indemnity bond satisfactory to Landlord for such work. During the progress of such work. Tenant shall, upon Landlord's request, furnish Landlord with sworn contractor's statements and lien waivers covering all work theretofore performed. Tenant shall satisfy or otherwise discharge all liens, stop notices, claims or encumbrances within ten (10) days after Landlord notifies Tenant in writing that any such lien, stop notice, claim or encumbrance has been filed. If Tenant fails to pay and remove such lien, claim or encumbrance within such ten (10) days, Landlord, at its election, may pay and satisfy the same and in such event the sums so paid by Landlord, with interest from the date of payment at the rate set forth in Section 4.06 hereof for amounts owed Landlord by Tenant shall be deemed to be additional rent due and payable by Tenant at once without notice or demand. 9.04 LEASE TERMINATION. Except as provided in this Section 9.04, upon expiration or earlier termination of this Lease Tenant shall surrender the Premises to Landlord in the same condition as existed on the date Tenant first occupied the Premises, (whether pursuant to this Lease or an earlier lease), subject to reasonable wear and tear. All Alterations shall become a part of the Premises and shall become the property of Landlord upon the expiration or earlier termination of this lease, unless Landlord shall, by written notice given to Tenant, require Tenant to remove some or all of Tenant's Alterations, in which event Tenant shall promptly remove the designated Alterations and shall promptly repair any resulting damage, all at Tenant's sole expense. Notwithstanding the foregoing to the contrary, in the event that Landlord gives its consent, pursuant to the provisions of Section 9.01 of this Lease, to allow Tenant to make an Alteration in the Premises, Landlord agrees, upon Tenant's written request, to notify Tenant in writing at the time of the giving of such consent whether Landlord will require Tenant, at Tenant's cost, to remove such Alteration at the end of the Lease Term. ARTICLE X - INDEMNIFICATION AND INSURANCE 10.01 INDEMNIFICATION. (A) Tenant agrees to protect, indemnify, hold harmless and defend Landlord and any Mortgagee, as defined herein, and each of their respective partners, directors, officers, agents and employees, successors and assigns, (except to the extent of the losses described below are caused by the gross negligence of Landlord, its agents and employees), from and against: (i) any and all loss, cost, damage, liability or expense as incurred (including but not limited to reasonable attorneys' fees and legal costs) arising out of or related to any claim, suit or judgment brought by or in favor of any person or persons for damage, loss or expense due to, but not limited to, bodily injury, including death, or property damage sustained by such person or persons which arises out of, is occasioned by or is in any way attributable to the use or occupancy of the Premises or any portion of the Building by Tenant or the acts or omission of Tenant or its agents, employees, contractors, clients, invitees or subtenants except that caused by the sole active negligence or willful misconduct of Landlord or its agents or employees. Such loss or damage shall include, but not be limited to, any injury or damage to, or death of, Landlord's employees or agents or damage to the Premises or any portion of the Building. (ii) any and all environmental damages which arise from: (i) the Handling of any Tenant's Hazardous Materials, as defined in Section 6.03 or (ii) the breach of any of the provisions of this Lease. For the purpose of this Lease, "environmental damages" shall mean (a) all claims, judgments, damages, penalties, fines, costs, liabilities, and losses (including without limitation, diminution in the value of the Premises or any portion of the Building, damages for the loss of or restriction on use of rentable or usable space or of any amenity of the Premises or any portion of the Building, and from any adverse impact on Landlord's marketing of space); (b) all reasonable sums paid for settlement of claims, attorneys' fees, consultants' fees and experts' fees; and (c) all costs incurred by Landlord in connection with investigation or remediation relating to the Handling of Tenant's Hazardous Materials, whether or not required by Environmental Laws, necessary for Landlord to make full economic use of the Premises or any portion of the Building, or otherwise required under this Lease. To the extent that Landlord is held strictly liable by a court or other governmental agency of competent jurisdiction under any Environmental Laws, Tenant's obligation to Landlord and the other indemnities under the foregoing indemnification shall likewise be without regard to fault on Tenant's part with respect to the violation of any Environmental Law which results in liability to the indemnitee. Tenant's obligations and liabilities pursuant to this Section 10.01 shall survive the expiration or earlier termination of this Lease. (B) Landlord agrees to protect, indemnify, hold harmless and defend Tenant from and against any and all loss, cost, damage, liability or expense, including reasonable attorneys' fees, with respect to any claim of damage or injury to persons or property at the Premises, caused by the gross negligence of Landlord or its authorized agents or employees. Tenant Landlord -s- [ILLEGIBLE] -s- [ILLEGIBLE] 9 (C) Notwithstanding anything to the contrary contained herein, nothing shall be interpreted or used to in any way affect, limit, reduce or abrogate any insurance coverage provided by any insurers to either Tenant or Landlord. (D) Notwithstanding anything to the contrary contained in this Lease, nothing herein shall be construed to infer or imply that Tenant is a partner, joint venturer, agent, employee, or otherwise acting by or at the direction of Landlord. 10.02 PROPERTY INSURANCE. (A) At all times during the Lease Term, Tenant shall procure and maintain, at its sole expense, "all-risk" property insurance, for damage or other loss caused by fire or other casualty or cause including, but not limited to, vandalism and malicious mischief, theft, water damage of any type, including sprinkler leakage, bursting of pipes, explosion,in an amount not less than one hundred percent (100%) of the replacement cost covering (a) all Alterations made by or for Tenant in the Premises; and (b) Tenant's trade fixtures, equipment and other personal property from time to time situated in the Premises. The proceeds of such insurance shall be used for the repair or replacement of the property so insured, except that if not so applied or if this Lease is terminated following a casualty, the proceeds applicable to the leasehold improvements shall be paid to Landlord and the proceeds applicable to Tenant's personal property shall be paid to Tenant. (B) At all times during the Lease Term, Tenant shall procure and maintain business interruption insurance in such amount as will reimburse Tenant for direct or indirect loss of earnings attributable to all perils insured against in Section 10.02(A). (C) Landlord shall, at all times during the Lease Term, procure and maintain "all-risk" property insurance in the amount not less than ninety percent (90%) of the insurable replacement cost covering the Building in which the Premises are located and such other insurance as may be required by a Mortgagee or otherwise desired by Landlord. 10.03 LIABILITY INSURANCE. (A) At all times during the Lease Term, Tenant shall procure and maintain, at its sole expense, commercial general liability insurance applying to the use and occupancy of the Premises and the business operated by Tenant. Such insurance shall have a minimum combined single limit of liability of at least Two Million Dollars ($2,000,000) per occurrence and a general aggregate limit of at least Two Million Dollars ($2,000,000). All such policies shall be written to apply to all bodily injury, property damage, personal injury losses and shall be endorsed to include Landlord and its agents, beneficiaries, partners, employees, and any deed of trust holder or mortgagee of Landlord or any ground lessor as additional insureds. Such liability insurance shall be written as primary policies, not excess or contributing with or secondary to any other insurance as may be available to the additional insureds. (B) Prior to the sale, storage, use or giving away of alcoholic beverages on or from the Premises by Tenant or another person. Tenant, at its own expense, shall obtain a policy or policies of insurance issued by a responsible insurance company and in a form acceptable to Landlord saving harmless and protecting Landlord and the Premises against any and all damages, claims, liens, judgments, expenses and costs, including actual attorneys' fees, arising under any present or future law, statute, or ordinance of the State of California or other governmental authority having jurisdiction of the Premises, by reason of any storage, sale, use or giving away of alcoholic beverages on or from the Premises. Such policy or policies of insurance shall have a minimum combined single limit of Two Million ($2,000,000) per occurrence and shall apply to bodily injury, fatal or nonfatal; injury to means of support; and injury to property of any person. Such policy or policies of insurance shall name Landlord and its agents, beneficiaries, partners, employees and any mortgagee of Landlord or any ground lessor of Landlord as additional insureds. (C) Landlord shall, at all times during the Lease Term, procure and maintain commercial general liability insurance for the Building in which the Premises are located. Such insurance shall have minimum combined single limit of liability of at least Two Million Dollars ($2,000,000) per occurrence, and a general aggregate limit of at least Two Million Dollars ($2,000,000). 10.04 WORKERS' COMPENSATION INSURANCE. At all times during the Lease Term, Tenant shall procure and maintain Workers' Compensation Insurance in accordance with the laws of the State of California, and Employer's Liability insurance with a limit not less than One Million Dollars ($2,000,000) Bodily Injury Each Accident; Two Million Dollars ($2,000,000) Bodily Injury By Disease - - Each Person; and One Million Dollars ($1,000,000) Bodily Injury to Disease - Policy Limit. 10.05 POLICY REQUIREMENTS. All insurance required to be maintained by Tenant and Landlord shall be issued by insurance companies authorized to do insurance business in the State of California and rated not less than B + in Best's Insurance Guide. A certificate of insurance (or, at Landlord's option, copies of the applicable policies) evidencing the insurance required under this Article X shall be delivered to Landlord not less than thirty (30) days prior to the Commencement Date. No such policy shall be subject to cancellation or modification without thirty (30) days prior written notice to Landlord and to any deed of trust holder, mortgagee or ground lessor designated by Landlord to Tenant. Tenant shall furnish Landlord with a replacement certificate with respect to any insurance not less than thirty (30) days prior to the expiration of the current policy. Tenant shall have the right to provide the Tenant Landlord -s- [ILLEGIBLE] -s- [ILLEGIBLE] 10 insurance required by this Article X pursuant to blanket policies, but only if such blanket policies expressly provide coverage of the Premises and Landlord as required by this Lease. 10.06 WAIVER OF SUBROGATION. Each party hereby waives any right of recovery against the other for injury or loss due to hazards covered by insurance or required to be covered, to the extent of the injury or loss covered thereby. Any policy of insurance to be provided by Tenant or Landlord pursuant to this Article X shall contain a clause denying the applicable insurer any right of subrogation against the other party. 10.07 FAILURE TO INSURE. If Tenant fails to maintain any insurance which Tenant is required to maintain pursuant to this Article X, Tenant shall be liable to Landlord for any loss or cost resulting from such failure to maintain. Tenant may not self-insure against any risks required to be covered by insurance without Landlord's prior written consent. ARTICLE XI - DAMAGE OR DESTRUCTION 11.01 TOTAL DESTRUCTION. Except as provided in Section 11.03 below, this Lease shall automatically terminate if the Building is totally destroyed. 11.02 PARTIAL DESTRUCTION OF PREMISES. If the Premises are damaged by any casualty and, in Landlord's opinion, the Premises (exclusive of any Alterations made to the Premises by Tenant) can be restored to its pre-existing condition within two hundred seventy (270) days after the date of the damage or destruction, Landlord shall, upon written notice from Tenant to Landlord of such damage, except as provided in Section 11.03, promptly and with due diligence repair any damage to the Premises (exclusive of any Alterations to the Premises made by Tenant, which shall be promptly repaired by Tenant at its sole expense) and, until such repairs are completed, the Rent shall be abated from the date of damage or destruction in the same proportion that the rentable area of the portion of the Premises which is unusable by Tenant in the conduct of its business bears to the total rentable area of the Premises. If such repairs cannot, in Landlord's opinion, be made within said two hundred seventy (270) day period, then Landlord may, at its option, exercisable by written notice given to the other within thirty (30) days after the date of the damage or destruction, elect to make the repairs within a reasonable time after the damage or destruction, in which event this Lease shall remain in full force and effect but the Rent shall be abated as provided in the preceding sentence; if Landlord does not so elect to make the repairs, then either Landlord or Tenant shall have the right, by written notice given to the other within sixty (60) days after the date of the damage or destruction, to terminate this Lease as of the date of the damage or destruction. 11.03 EXCEPTIONS TO LANDLORD'S OBLIGATIONS. Notwithstanding anything to the contrary contained in this Article XI, Landlord shall have no obligation to repair the Premises if either: (a) the Building in which the Premises are located is so damaged as to require repairs to the Building exceeding twenty percent (20%) of the full insurable value of the Building; or (b) Landlord elects to demolish the Building to which the Premises are located; or (c) the damage or destruction occurs less than one (1)) years prior to the Termination Date, exclusive of option periods; or (d) the damage or destruction is caused by an uninsured event. Further, Tenant's Rent shall not be abated if either (i) the damage or destruction is repaired within five (5) business days after Landlord receives written notice from Tenant of the casualty, or (ii) Tenant, or any officers, partners, employees, agents or invitees of Tenant, or any assignee or subtenant of Tenant, is, in whole or in part, responsible for the damage or destruction. 11.04 WAIVER. The provisions contained in this Lease shall supersede any contrary laws (whether statutory, common law or otherwise) now or hereafter in effect relating to damage, destruction, self-help or termination, including California Civil Code Sections 1932 and 1933. ARTICLE X - CONDEMNATION 12.01 TAKING. If the entire Premises or so much of the Premises as to render the balance unusable by Tenant shall be taken by condemnation, sale in lieu of condemnation or in any other manner for any public or quasi-public purpose (collectively "Condemnation"), and if Landlord, at its option, is unable or unwilling to provide substitute premises containing at least as much rentable area described in Section 1.02 above, then this Lease shall terminate on the date that title or possession to the Premises is taken by the condemning authority, whichever is earlier. 12.02 AWARD. In the event of any Condemnation, the entire award for such taking shall belong to Landlord. Tenant shall have no claim against Landlord or the award for the value of any unexpired term of this Lease or otherwise. Tenant shall be entitled to independently pursue a separate award in a separate proceeding for Tenant's relocation costs directly associated with the taking, provided such separate award does not diminish Landlord's award. 12.03 TEMPORARY TAKING. No temporary taking of the Premises shall terminate this Lease or entitle Tenant to any abatement of the Rent payable to Landlord under this Lease; provided, further, that any award for such temporary taking shall belong to Tenant to the extent that the award applies to any time period during the Lease Term and to Landlord to the extent that the award applies to any time period outside the Lease Term. Tenant Landlord -s- [ILLEGIBLE] -s- [ILLEGIBLE] 11 ARTICLE XIII - RELOCATION ARTICLE XTV - ASSIGNMENT AND SUBLETTING 14.01 RESTRICTION. Without the prior written consent of Landlord, Tenant shall not, either voluntarily or by operation of law, assign, encumber, or otherwise transfer this Lease or any interest herein, or sublet the Premises or any part thereof, or permit the Premises to be occupied by anyone other than Tenant or Tenant's employees (any such assignment, encumbrance, subletting, occupation or transfer is hereinafter referred to as a "Transfer"). For purpose of this Lease, the term "Transfer" shall also include (a) if Tenant is a partnership, the withdrawal or change, voluntary, involuntary or by operation of law, of a majority of the partners, or transfer of majority of partnership interest, within a twelve month period, or the dissolution of partnership, (b) if Tenant is a closely held corporation (i.e. whose stock is not publicly held and not traded through an exchange or over the counter) or a limited liability company, the dissolution, merger, consolidation, division, liquidation or other reorganization of Tenant, or with in a twelve month period: (i) the sale or other transfer of more than an aggregate of 50% of the voting securities of Tenant (other than to immediate family members by reason of gift or death) or (ii) the sale, mortgage, hypothecation or pledge of more than an aggregate of 50% of Tenant's net assets, and (c) any change by Tenant in the form of its legal organization under applicable state law (such as, for example, a change from a general partnership to a limited partnership or from a corporation to a limited liability company). An assignment, subletting or other action in violation of the foregoing shall be void and, at Landlord's option, shall constitute a material breach of this Lease. Notwithstanding anything contained in this Article XIV to the contrary, Tenant shall have the right to assign the Lease or sublease the Premises, or any part thereof, to an "Affiliate" without the prior written consent of Landlord, but upon at least twenty (20) days' prior written notice to Landlord, provided that said Affiliate is not in default under any other lease for space in a property that is managed by Landlord or its managing agent. For purposes of this provision, the term "Affiliate" shall mean any corporation or other entity controlling, controlled by, or under common control with (directly or indirectly) Tenant, including, without limitation, any parent corporation controlling Tenant or any subsidiary that Tenant controls. The term "control," as used herein, shall mean the power to direct or cause the direction of the management and policies of the controlled entity through the ownership of more than fifty percent (50%) of the voting securities in such controlled entity. Notwithstanding anything contained in this Article XIV to the contrary, Tenant expressly covenants and agrees not to enter into any lease, sublease, license, concession or other agreement for use, occupancy or utilization of the Premises which provides for rental or other payment for such use, occupancy or utilization based in whole or in part on the net income or profits derived by any person from the property leased, used, occupied or utilized (other than an amount based on a fixed percentage or percentages of receipts or sales), and that any such purported lease, sublease, license, concession or other agreement shall be absolutely void and ineffective as a conveyance of any right or interest in the possession, use, occupancy or utilization of any part of the Premises. 14.02 NOTICE TO LANDLORD. If Tenant desires to assign this Lease or any interest herein, or to sublet all or any part of the Premises, then at least thirty (30) days but not more than one hundred eighty (180) days prior to the effective date of the proposed assignment or subletting, Tenant shall submit to Landlord in connection with Tenant's request for Landlord's consent: (A) A statement containing (i) the name and address of the proposed assignee or subtenant; (ii) such financial information with respect to the proposed assignee or subtenant as Landlord shall reasonably require; (iii) the type of use proposed for the Premises; and (iv) all of the principal terms of the proposed assignment or subletting; and (B) Four (4) originals of the assignment or sublease on a form approved by Landlord and four (4) originals of the Landlord's Consent to Sublease or Assignment and Assumption of Lease and Consent. 14.03 LANDLORD'S RECAPTURE RIGHTS. At any time within twenty (20) business days after Landlord's receipt of all (but not less than all) of the information and documents described in Section 14.02 above, Landlord may, at its option by written notice to Tenant, elect to: (a) sublease the Premises or the portion thereof proposed to be sublet by Tenant upon the same terms as those offered to the proposed subtenant; (b) take an assignment of the Lease upon the same terms as those offered to the proposed assignee; or (c) terminate the Lease in its entirety or as to the portion of the Premises proposed to be assigned or sublet, with a proportionate adjustment in the Rent payable hereunder if the Lease is terminated as to less than all of the Premises. If Landlord does not exercise any of the options described in the preceding sentence, then, during the above-described twenty (20) business day period, Landlord shall either consent or deny its consent to the proposed assignment or subletting. 14.04 LANDLORD'S CONSENT; STANDARDS. Landlord's consent to a proposed assignment or subletting shall not be unreasonably withheld; but, in addition to any other grounds for denial, Landlord's consent shall be deemed reasonably withheld if, in Landlord's good faith judgment: (i) the proposed assignee or subtenant does not have the financial strength to perform its obligations under this Lease or any proposed sublease; (ii) the business and Tenant Landlord -s- [ILLEGIBLE] -s- [ILLEGIBLE] 12 operations of the proposed assignee or subtenant are not of comparable quality to the business and operations being conducted by other tenants in the Building; (iii) the proposed assignee or subtenant intends to use any part of the Premises for a purpose not permitted under this Lease; (iv) either the proposed assignee or subtenant, or any person which directly or indirectly controls, is controlled by, or is under common control with the proposed assignee or subtenant occupies space in the Building, or is negotiating with Landlord to lease space in the Building; (v) the proposed assignee or subtenant is disreputable; or (vi) the use of the Premises or the Building by the proposed assignee or subtenant would, in Landlord's reasonable judgment, impact the Building in a negative manner including but not limited to significantly increasing the pedestrian traffic in and out of the Building or requiring any alterations to the Building to comply with applicable laws; (vii) the subject space is not regular in shape with appropriate means of ingress and egress suitable for normal renting purposes; (viii) the transferee is a government (or agency or instrumentality thereof) or (ix) Tenant has failed to cure a default at the time Tenant requests consent to the proposed Transfer. 14.05 ADDITIONAL RENT. If Landlord consents to any such assignment or subletting, one-half (1/2) of the amount by which all sums or other economic consideration received by Tenant in connection with such assignment or subletting, whether denominated as rental, exceeds, in the aggregate, the total sum which Tenant is obligated to pay Landlord under this Lease (prorated to reflect obligations allocable to less than all of the Premises under a sublease) shall be paid to Landlord promptly after receipt as additional Rent under the Lease without affecting or reducing any other obligation of Tenant hereunder. 14.06 LANDLORD'S COSTS. If Tenant shall Transfer this Lease or all or any part of the Premises or shall request the consent of Landlord to any Transfer, Tenant shall pay to Landlord as additional rent Landlord's costs related therein, including Landlord's reasonable attorneys' fees and a minimum fee In Landlord of Five Hundred Dollars ($500.00). 14.07 CONTINUING LIABILITY OF TENANT. Notwithstanding any Transfer, including an assignment or sublease to an Affiliate, Tenant shall remain as fully and primarily liable for the payment of Rent and for the performance of all other obligations of Tenant contained in this Lease to the same extent as if the Transfer had not occurred; provided, however, that any act or omission of any transferee, other than Landlord, that violates the terms of this Lease shall be deemed a violation of this Lease by Tenant. 14.08 NON-WAIVER. The consent by Landlord to any Transfer shall not relieve Tenant, or any person claiming through or by Tenant, of the obligation to obtain the consent of Landlord, pursuant to this Article XIV, to any further Transfer. In the event of an assignment or subletting, Landlord may collect rent from the assignee or the subtenant without waiving any rights hereunder and collection of the rent from a person other than Tenant shall not be deemed a waiver of any of Landlord's rights under this Article XIV, an acceptance of assignee or subtenant as Tenant, or a release of Tenant from the performance of Tenant's obligations under this Lease. If Tenant shall default under this Lease and fail to cure within the time permitted, Landlord is irrevocably authorized, as Tenant's agent and attorney-in-fact, to direct any transferee to make all payments under or in connection with the Transfer directly to Landlord (which Landlord shall apply towards Tenant's obligations under this Lease) until such default is cured. ARTICLE XV- DEFAULT AND REMEDIES 15.01 EVENTS OF DEFAULT BY TENANT. The occurrence of any of the following shall constitute a material default and breach of this Lease by Tenant: (A) The failure by Tenant to pay Base Rent or make any other payment required to be made by Tenant hereunder as and when due. (B) The abandonment of the Premises by Tenant or the vacation of the Premises by Tenant for fourteen (14) consecutive days (without the payment of Rent). (C) The making by Tenant of any assignment of this Lease or any sublease of all or part of the Premises, except as expressly permitted under Article XIV of this Lease. (D) The failure by Tenant to observe or perform any other provision of this Lease to be observed or performed by Tenant, other than those described in Sections 15.01(A), 15.01(B) or 15.01 (C) above, if such failure continues for ten (10) days after written notice thereof by Landlord to Tenant; provided, however, that if the nature of the default is such that it cannot be cured within the ten (10) day period, no default shall exist if Tenant commences the curing of the default within the ten (10) day period and thereafter diligently prosecutes the same to completion. The ten (10) day notice described herein shall be in lieu of, and not in addition to, any notice required under Section 1161 of the California Civil Code of Procedure or any other law now or hereafter in effect requiring that notice of default be given prior to the commencement of an unlawful detainer or other legal proceeding. (E) The making by Tenant or its Guarantor of any general assignment for the benefit of creditors, the filing by or against Tenant or its Guarantor of a petition under any federal or state bankruptcy or insolvency laws (unless, in the case of a petition filed against Tenant or its Guarantor the same is dismissed within thirty (30) days after filing); the appointment of a trustee or receiver to take possession of substantially all of Tenant's assets at the Premises or Tenant's interest in this Lease or the Premises, when possession is not restored to Tenant within Tenant Landlord -s- [ILLEGIBLE] -s- [ILLEGIBLE] 13 thirty (30) days; or the attachment, execution or other seizure of substantially all of Tenant's assets located at the Premises or Tenant's interest in this Lease or the Premises, if such seizure is not discharged within thirty (30) days. (F) Any material misrepresentation herein, or material misrepresentation or omission in any financial statements or other materials provided by Tenant or any Guarantor in connection with negotiating or entering into this Lease or in connection with any Transfer under Section 14.01. 15.02 LANDLORD'S RIGHT TO TERMINATE UPON TENANT DEFAULT. In the event of any default by Tenant as provided in Section 15.01 above, Landlord shall have the right to terminate this Lease and recover possession of die Premises by giving written notice to Tenant of Landlord's election to terminate this Lease, in which event Landlord shall be entitled to receive from Tenant: (A) The worth at the time of award of any unpaid Rent which had been earned at the time of such termination; plus (B) The worth at the time of award of the amount by which the unpaid Rent which would have been earned after termination until the time of award exceeds the amount of such rental loss Tenant proves could reasonably avoided; plus (C) The worth at the time of award of the amount by which the unpaid Rent for the balance of the term after the time of award exceeds the amount of such rental loss that Tenant proves could be reasonably avoided; plus (D) Any other amount necessary to compensate Landlord for all the detriment proximately caused by Tenant's failure to perform its obligations under this Lease or which in the ordinary course of things would be likely to result therefrom; and (E) At Landlord's election, such other amounts in addition to or in lieu of the foregoing as may be permitted from time to time by applicable law. As used in subparagraphs (A) and (B) above, "worth at the time of award" shall be computed by allowing interest on such amounts at the then highest lawful rate of interest, but in no event to exceed one percent (1%) per annum plus the rate established by the Federal Reserve Bank of San Francisco on advances made to member banks under Sections of the Federal Reserve Act ("discount rate") prevailing at the time of the award. As used in paragraph (C) above, "worth at the time of award" shall be computed by discounting such amount by (i) the discount rate of the Federal Reserve Bank of San Francisco prevailing at the time of award plus (ii) one percent (1%). 15.03 MITIGATION OF DAMAGES. If Landlord terminates this Lease or Tenant's right to possession of the Premises, Landlord shall have no obligation to mitigate Landlord's damages except to the extent required by applicable law. If Landlord has not terminated this Lease or Tenant's right to possession of the Premises, Landlord shall have no obligation to mitigate under any circumstances and may permit the Premises to remain vacant or abandoned. If Landlord is required to mitigate damages as provided herein: (i) Landlord shall be required only to use reasonable efforts to mitigate, which shall not exceed such efforts as Landlord generally uses to lease other space in the Building, (ii) Landlord will not be deemed to have failed to mitigate if Landlord or its affiliates lease any other portions of the Building or other projects owned by Landlord or its affiliates in the same geographic area, before reletting all or any portion of the Premises, and (iii) any failure to mitigate as described herein with respect to any period of time shall only reduce the Rent and other amounts to which Landlord is entitled hereunder by the reasonable rental value of the Premises during such period. In recognition that the value of the Building depends on the rental rates and terms of leases therein, Landlord's rejection of a prospective replacement tenant based on an offer of rentals below Landlord's published rates for new leases of comparable space at the Building at the time in question, or at Landlord's option, below the rates provided in this Lease, or containing terms less favorable than those contained herein, shall not give rise to a claim by Tenant that Landlord failed to mitigate Landlord's damages. 15.04 LANDLORD'S RIGHT TO CONTINUE LEASE UPON TENANT DEFAULT. In the event of a default of this Lease and abandonment of the Premises by Tenant, if Landlord does not elect to terminate this Lease as provided in Section 15.02 above, Landlord may from time to time, without terminating this Lease, enforce all of its rights and remedies under this Lease. Without limiting the foregoing, Landlord has the remedy described in California Civil Code Section 1951.4 (Landlord may continue this Lease in effect after Tenant's default and abandonment and recover Rent as it becomes due, if Tenant has the right to Transfer, subject to reasonable limitations). In the event Landlord re-lets the Premises, to the fullest extent permitted by law, the proceeds of any reletting shall be applied first to pay to Landlord all costs and expenses of such reletting (including without limitation, costs and expenses of retaking or repossessing the Premises, removing persons and property therefrom, securing new tenants, including expenses for redecoration, alterations and other costs in connection with preparing the Premises for the new tenant, and if Landlord shall maintain and operate the Premises, the costs thereof) and receivers' fees incurred in connection with the appointment of and performance by a receiver to protect the Premises and Landlord's interest under this Lease and any necessary or reasonable alterations; second, to the payment of any indebtedness of Tenant to Landlord other than Rent due and unpaid hereunder; third, to the payment of Rent due and unpaid hereunder; and the residue, if any, shall be held by Landlord and applied in payment of other or future obligations of Tenant to Landlord as the same may become due and payable, and Tenant shall not be entitled to receive any portion of such revenue. Tenant Landlord -s- [ILLEGIBLE] -s- [ILLEGIBLE] 14 15.05 RIGHT OF LANDLORD TO PERFORM. All covenants and agreements to be performed by Tenant under this Lease shall be performed by Tenant at Tenant's sole cost and expense. If Tenant shall fail to pay any sum of money, other than Rent, required to be paid by it hereunder or shall fail to perform any other act on its part to be performed hereunder, Landlord may, but shall not be obligated to, make any payment or perform any such other act on Tenant's part to be made or performed, without waiving or releasing Tenant of its obligations under this Lease. Any sums so paid by Landlord and all necessary incidental costs, together with interest thereon at the lesser of the maximum rate permitted by law if any or twelve percent (12%) per annum from the date of such payment, shall be payable to Landlord as additional rent on demand and Landlord shall have the same rights and remedies in the event of nonpayment as in the case of default by Tenant in the payment of Rent. 15.06 DEFAULT UNDER OTHER LEASES. If the term of any lease, other than this Lease, heretofore or hereafter made by Tenant for any office space in the Building shall be terminated or terminable after the making of this Lease because of any default by Tenant under such other lease, such fact shall empower Landlord, at Landlord's sole option, to terminate this Lease by notice to Tenant or to exercise any of the rights or remedies set forth in Section 15.02. 15.07 NON-WAIVER. Nothing in this Article shall be deemed to affect Landlord's rights to indemnification for liability or liabilities arising prior to termination of this Lease or Tenant's right to possession of the Premises for personal injury or property damages under the indemnification clause or clauses contained in this Lease. No acceptance by Landlord of a lesser sum than the Rent then due shall be deemed to be other than on account of the earliest installment of such rent due, nor shall any endorsement or statement on any check or any letter accompanying any check or payment as rent be deemed an accord and satisfaction, and Landlord may accept such check or payment without prejudice to Landlord's right to recover the balance of such installment or pursue any other remedy in the Lease provided. The delivery of keys to any employee of Landlord or to Landlord's agent or any employee thereof shall not operate as a termination of this Lease or a surrender of the Premises. 15.08 CUMULATIVE REMEDIES. The specific remedies to which Landlord may resort under the terms of the Lease are cumulative and are not intended to be exclusive of any other remedies or means of redress to which it may be lawfully entitled in case of any breach or threatened breach by Tenant of any provisions of the Lease. In addition to the other remedies provided in the Lease, Landlord shall be entitled to a restraint by injunction of the violation or attempted or threatened violation of any of the covenants, conditions or provisions of the Lease or to a decree compelling specific performance of any such covenants, conditions or provisions. 15.09 DEFAULT BY LANDLORD. Landlord's failure to perform or observe any of its obligations under this Lease shall constitute a default by Landlord under this Lease only if such failure shall continue for a period of thirty (30) days (or the additional time, if any, that is reasonably necessary to promptly and diligently cure the failure) after Landlord receives written notice from Tenant specifying the default. The notice shall give in reasonable detail the nature and extent of the failure and shall identify the Lease provision(s) containing the obligation(s). If Landlord shall default in the performance of any of its obligations under this Lease (after notice and opportunity to cure as provided herein), Tenant may pursue any remedies available to it under the law and this Lease, except that, in no event, shall Landlord be liable for punitive damages, lost profits, business interruption, speculative, consequential or other such damages. In recognition that Landlord must receive timely payments of Rent and operate the Building, Tenant shall have no right of self-help to perform repairs or any other obligation of Landlord, and shall have no right to withhold, set-off, or abate Rent. ARTICLE XVI - ATTORNEYS' FEES: COSTS OF SUIT 16.01 INSTITUTED ATTORNEYS FEES. If either Landlord or Tenant shall commence any action or other proceeding against the other arising out of, or relating to, this Lease or the Premises, the prevailing party shall be entitled to recover from the losing party, in addition to any other relief, its actual attorneys' fees irrespective to whether or not the action or other proceeding is prosecuted to judgment and irrespective of any court schedule of reasonable attorneys' fees. In addition, Tenant shall reimburse Landlord, upon demand, for all reasonable attorneys' fees incurred in collecting Rent, resolving any actual default by Tenant, securing indemnification as provided in Article X and paragraphs, 16.02, 23.01 and 25.01 herein or otherwise seeking enforcement against Tenant, its sublessees and assigns, of Tenant's obligations under this Lease. 16.02 INDEMNIFICATION. Should Landlord be made a party to any litigation litigation by Tenant against a party other than Landlord, or by a third party against Tenant, Tenant shall indemnify, hold harmless and defend Landlord from any and all loss, cost, liability, damage or expense incurred by Landlord, including attorneys' fees, in connection with the litigation. ARTICLE XVII - SUBORDINATION AND ATTORNMENT 17.01 SUBORDINATION. This Lease, and the rights of Tenant hereunder, are and shall be subject and subordinate to the interest of (i) all present and future ground leases and master leases of all or any part of the Building; (ii) present and future mortgages and deeds of trust encumbering all or any part of the Building; (iii) all past and future advances made under any such mortgages or deeds of trust; and (iv) all renewals, modifications, replacements and extensions of any such ground leases, master leases, mortgages and deeds of trust; provided, Tenant Landlord -s- [ILLEGIBLE] -s- [ILLEGIBLE] 15 however, that any lessor under any such ground lease or master lease or any mortgagee or beneficiary under any such mortgage or deed of trust (any such lessor, mortgagee or beneficiary is hereinafter referred to as a "Mortgagee") shall have the right to elect, by written notice given to Tenant, to have this Lease made superior in whole or in part to any such ground lease, master lease, mortgage or deed of trust (or subject and subordinate to such ground lease, master lease, mortgage or deed of trust but superior to any junior mortgage or junior deed of trust). Upon demand, Tenant shall execute, acknowledge and deliver any instruments reasonably requested by Landlord or any such Mortgagee to effect the purposes of this Section 17.01. Such instruments may contain, among other things, provisions to the effect that such Mortgagee (hereafter, for the purposes of this Section 17.01, a "Successor Landlord") shall (i) not be liable for any act or omission of Landlord or its predecessors, if any, prior to the date of such Successor Landlord's succession to Landlord's interest under this Lease; (ii) not be subject to any offsets or defenses which Tenant might have been able to assert against Landlord or its predecessors, if any, prior to the date of such Successor Landlord's succession to Landlord's interest under this Lease; (iii) not be liable for the return of any security deposit under the Lease unless the same shall have actually been deposited with such Successor Landlord; (iv) be entitled to receive notice of any Landlord default under this Lease plus a reasonable opportunity to cure such default prior to Tenant having any right or ability to terminate this Lease as a result of such Landlord default; (v) not be bound by any rent or additional rent which Tenant might have paid for more than the current month to Landlord; (vi) not be bound by any amendment or modification of the Lease or any cancellation or surrender of the same made without Successor Landlord's prior written consent; (vii) not be bound by any obligation to make any payment to Tenant which was required to be made prior to the time such Successor Landlord succeeded to Landlord's interest and (viii) not be bound by any obligation under the Lease to perform any work or to make any improvements to the demised Premises. Any obligations of any Successor Landlord under its respective lease shall be non-recourse as to any assets of such Successor Landlord other than its interest in the Premises and improvements. 17.02 ATTORNMENT. If the interests of Landlord under the Lease shall be transferred to any superior Mortgagee or other purchaser or person taking title to the Building by reason of the termination of any superior lease or the foreclosure of any superior mortgage or deed of trust, Tenant shall be bound to such Successor Landlord under all of the terms, covenants and conditions of the Lease for the balance of the term thereof remaining and any extensions or renewals thereof which may be effected in accordance with any option therefor in the Lease, with the same force and effect as if Successor Landlord were the landlord under the Lease, and Tenant shall attorn to and recognize as Tenant's landlord under this Lease such Successor Landlord, as its landlord, said attornment to be effective and self-operative without the execution of any further instruments upon Successor Landlord's succeeding to the interest of Landlord under the Lease. Tenant shall, upon demand, execute any documents reasonably requested by any such person to evidence the attornment described in this Section 17.02. Concurrently, upon written request from Tenant, and provided Tenant is not in default under this Lease, Landlord agrees to use diligent, commercially reasonable efforts to obtain a Non-Disturbance Agreement from the Successor Landlord. Such Non-Disturbance Agreement may be embodied in the Mortgagee's customary form of Subordination and Non-Disturbance Agreement. If, after exerting diligent, commercially reasonable efforts, Landlord is unable to obtain a Non-Disturbance Agreement from any such Mortgagee, Landlord shall have no further obligation to Tenant with respect thereto. 17.03 MORTGAGEE PROTECTION. Tenant agrees to give any Mortgagee, by registered or certified mail, a copy of any notice of default served upon Landlord by Tenant, provided that prior to such notice Tenant has been notified in writing (by way of service on Tenant of a copy of Assignment of Rents and Leases, or otherwise) of the address of such Mortgagee (hereafter the "Notified Party"); Tenant further agrees that if Landlord shall have failed to cure such default within twenty (20) days after such notice to Landlord (or if such default cannot be cured or corrected within that time, then such additional time as may be necessary if Landlord has commenced within such twenty (20) days and is diligently pursuing the remedies or steps necessary to cure or correct such default), then the Notified Party shall have an additional thirty (30) days within which to cure or correct such default (or if such default cannot be cured or corrected within that time, then such additional time as may be necessary if the Notified Party has commenced within such thirty (30) days and is diligently pursuing the remedies or steps necessary to cure or correct such default). Until the time allowed, as aforesaid, for the Notified Party to cure such default has expired without cure, Tenant shall have no right to, and shall not, terminate this Lease on account of Landlord's default. ARTICLE XVIII - QUIET ENJOYMENT 18.01 Provided that Tenant is not in material default beyond any applicable cure period hereunder, Tenant shall have and peaceably enjoy the Premises during the Lease Term free of claims by or through Landlord, subject to all of the terms and conditions contained in this Lease. ARTICLE XIX - RULES AND REGULATIONS 19.01 The Rules and Regulations attached hereto as Exhibit C are hereby incorporated by reference herein and made a part hereof. Tenant shall abide by, and faithfully observe and comply with the Rules and Regulations and any reasonable and non-discriminatory amendments, modifications and/or additions thereto as may hereafter be adopted and published by written notice to tenants by Landlord for the safety, care, security, good order and/or cleanliness of the Premises and/or the Building. Landlord shall not be liable to Tenant for any violation of such rules and regulations by any other tenant or occupant of the Building. Tenant Landlord -s- [ILLEGIBLE] -s- [ILLEGIBLE] 16 ARTICLE XX - ESTOPPEL CERTIFICATES 20.01 Tenant agrees at any time and from time to time upon not less than ten (10) business days' prior written notice from Landlord to execute, acknowledge and deliver to Landlord a statement in writing addressed and certifying to Landlord, to any current or prospective Mortgagee or any assignee thereof, to any prospective purchaser of the land, improvements or both comprising the Building, and to any other party designated by Landlord, that this Lease is unmodified and in full force and effect (of if there have been modifications, that the same is in full force and effect as modified and stating the modifications); that Tenant has accepted possession of the Premises, which are acceptable in all respects, and that any improvements required by the terms of this Lease to be made by Landlord have been completed to the satisfaction of Tenant; that Tenant is in full occupancy of the Premises; that no rent has been paid more than thirty (30) days in advance; that the first month's Base Rent has been paid; that Tenant is entitled to no free rent or other concessions except as stated in this Lease; that Tenant has not been notified of any previous assignment of Landlord's or any predecessor landlord's interest under this Lease; the dates to which Base Rent, additional rental and other charges have been paid; that Tenant, as of the date of such certificate, has no charge, lien or claim of setoff under this Lease or otherwise against Base Rent, additional rental or other charges due or to become due under this Lease; that Landlord is not in default in performance of any covenant, agreement or condition contained in this Lease; or any other matter relating to this Lease or the Premises or, if so, specifying each such default. If there is a Guaranty under this Lease, said Guarantor shall confirm the validity of the Guaranty by joining in the execution of the Estoppel Certificate or other documents so requested by Landlord or Mortgagee. In addition, in the event that such certificate is being given to any Mortgagee, such statement may contain any other provisions customarily required by such Mortgagee including, without limitation, an agreement on the part of Tenant to furnish to such Mortgagee, written notice of any Landlord default and a reasonable opportunity for such Mortgagee to cure such default prior to Tenant being able to terminate this Lease Any such statement delivered pursuant to this Section may be relied upon by Landlord or any Mortgagee, or prospective purchaser to whom it is addressed and such statement, if required by its addressee, may so specifically state. If Tenant does not execute, acknowledge and deliver to Landlord the statement as and when required herein, Landlord is hereby granted an irrevocable power-of-attorney, coupled with on interest, to execute such statement on Tenant's behalf, which statement shall be binding on Tenant to the same extent as if executed by Tenant. ARTICLE XXI - ENTRY BY LANDLORD 21.01 Landlord may enter the Premises at all reasonable times to: inspect the same: exhibit the same to prospective purchasers, Mortgagees or tenants: determine whether Tenant is complying with all of its obligations under this Lease; supply janitorial and other services to be provided by Landlord to Tenant under this Lease; post notices of non-responsibility; and make repairs or improvements in or to the Building or the Premises; provided, however, that all such work shall be done as promptly as reasonably possible and so as to cause as little interference to Tenant as reasonably possible. Tenant hereby waives any claim for damages for any injury or inconvenience to, or interference with, Tenant's business, any loss of occupancy or quiet enjoyment of the Premises or any other loss on or about the Premises (excluding Tenant's vaults, safes and similar areas designated by Tenant in writing in advance), and Landlord shall have the right to use any and all means by which Landlord may deem proper to open such doors to obtain entry to the Premises, and any entry to the Premises obtained by Landlord by any such means, or otherwise, shall not under any circumstances be deemed or construed to be a forcible or unlawful entry into or a detainer of the Premises or an eviction, actual or constructive, of Tenant from any part of the Premises. Such entry by Landlord shall not act as a termination of Tenant's duties under this Lease. If Landlord shall be required to obtain entry by means other than a key provided by Tenant, the cost of such entry shall by payable by Tenant to Landlord as additional rent. ARTICLE XXII LANDLORD'S LEASE UNDERTAKINGS-EXCULPATION FROM PERSONAL LIABILITY; TRANSFER OF LANDLORD'S INTEREST 22.01 LANDLORD'S LEASE UNDERTAKINGS. Notwithstanding anything to the contrary contained in this Lease or in any exhibits, Riders or addenda hereto attached (collectively the "Lease Documents"), it is expressly understood and agreed by and between the parties hereto that: (a) the recourse of Tenant or its successors or assigns against Landlord with respect to the alleged breach by or on the part of Landlord of any representation, warranty, covenant, undertaking or agreement contained in any of the Lease Documents or otherwise arising out of Tenant's use of the Premises or the Building (collectively, "Landlord's Lease Undertakings") shall extend only to Landlord's interest in the real estate of which the Premises demised under the Lease Documents are a part ("Landlord's Real Estate") and not to any other assets of Landlord or its officers, directors or shareholders; and (b) except to the extent of Landlord's interest in Landlord's Real Estate, no personal liability or personal responsibility of any sort with respect to any of Landlord's Lease Undertakings or any alleged breach thereof is assumed by, or shall at any time be asserted or enforceable against, Landlord, or against any of their respective directors, officers, employees, agents, constituent partners, beneficiaries, trustees or representatives. 22.02 TRANSFER OF LANDLORD'S INTEREST. In the event of any transfer of Landlord's interest in the Building, Landlord shall be automatically freed and relieved from all applicable liability with respect to performance of any covenant or obligation on the part of Landlord, provided any deposits or advance rents held by Landlord are turned over to the grantee and said grantee expressly assumes, subject to the limitations of this Section Tenant Landlord -s- [ILLEGIBLE] -s- [ILLEGIBLE] 17 22, all the terms, covenants and conditions of this Lease to be performed on the part of Landlord, it being intended hereby that the covenants and obligations contained in this Lease on the part of Landlord shall, subject to all the provisions of this Section 22, be binding on Landlord, its successors and assigns, only during their respective periods of ownership. ARTICLE XXIII. HOLDOVER TENANCY 23.01 If Tenant holds possession of the Premises after the expiration or termination of the Lease Term, by lapse of time or otherwise, Tenant shall become a tenant at sufferance upon all of the terms contained herein, except as to Lease Term and Rent. During such holdover period, Tenant shall pay to Landlord a monthly rental equivalent to Two hundred percent (200%) of the Rent Payable by Tenant to Landlord with respect to the last month of the Lease Term. The monthly rent payable for such holdover period shall in no event be construed as a penalty or as liquidated damages for such retention of possession. Without limiting the foregoing, Tenant hereby agrees to indemnify, defend and hold harmless Landlord, its beneficiary, and their respective agents, contractors and employees, from and against any and all claims, liabilities, actions, losses, damages (including without limitation, direct, indirect, incidental and consequential) and expenses (including, without limitation, court costs and reasonable attorneys' fees) asserted against or sustained by any such party and arising from or by reason of such retention of possession, which obligations shall survive the expiration or termination of the Lease Term. ARTICLE XXIV - NOTICES 24.01 All notices which Landlord or Tenant may be required, or may desire, to serve on the other may be served, as an alternative to personal service, by mailing the same by registered or certified mail, postage prepaid, addressed to Landlord at the address for Landlord set forth in Section 1.12 above and to Tenant at the address for Tenant set forth in Section 1.13 above, or from and after the Commencement Date, to Tenant at the Premises wether or not Tenant has departed from, abandoned or vacated the Premises, or addressed to such other address or addresses as either Landlord or Tenant may from time to time designate to the other in writing. Any notice shall be deemed to have been served at the time the same was posted. ARTICLE XXV - BROKERS 25.01 The parties recognize as the brokers) who procured this Lease the firm(s) specified in Section 1.14 and agree that Landlord shall be solely responsible for the payment of any brokerage commissions to said broker(s), and that Tenant shall have no responsibility therefor unless written provision to the contrary has been made a part of this Lease. If Tenant has dealt with any other person or real estate broker in respect to leasing, subleasing or renting space in the Building, Tenant shall be solely responsible for the payment of any fee due said person or firm and Tenant shall protect, indemnify, hold harmless and defend Landlord from any liability in respect thereto. ARTICLE XXVI - ELECTRONIC SERVICES 26.01 TENANT'S LINES. Tenant may, in a manner consistent with the provisions and requirements of this Lease, install, maintain, replace, remove or use any communications or computer or other electronic service wires, cables and related devices (collectively the "Lines") at the Building in or serving the Premises, provided: (a) Tenant shall obtain Landlord's prior written consent, which consent may be conditioned as required by Landlord, (b) if Tenant at any time uses any equipment that may create an electromagnetic field exceeding the normal insulation ratings of ordinary twisted pair riser cable or cause radiation higher than normal background radiation, the Lines therefor (including riser cables) shall be appropriately insulated to prevent such excessive electromagnetic fields or radiation, and (c) Tenant shall pay all costs in connection therewith. Landlord reserves the right to require that Tenant remove any Lines which are installed in violation of these provisions. Tenant shall not, without the prior written consent of Landlord in each instance, grant to any third party a security interest or lien in or on the Lines, and any such security interest or lien granted without Landlord's written consent shall be null and void. 26.02 DEFINITION OF ELECTRONIC SERVICES. As used herein "Electronic Services Provider" means a business which provides telephone, telegraph, telex, video, other telecommunications or other services which permit Tenant to receive or transmit information by the use of electronics and which require the use of wires, cables, antennas or similar devices in or on the Building. The services of Electronic Services Providers are sometimes referred to herein as "Electronic Services." 26.03 NO RIGHT TO SPECIFIC SERVICES. Landlord shall have no obligation (i) to install any Electronic Services equipment or facilities, (ii) to make available to Tenant the services of any particular Electronic Services Provider, (iii) to allow any particular Electronic Services Provider access to the Building, (iv) to continue to grant access to an Electronic Services Provider once such provider has been given access to the Building. Landlord may (but shall not have the obligation to): (x) install new Lines at the property, (y) create additional space for Lines at the property, and (z) adopt reasonable and uniform rules and regulations with respect to Lines. Tenant Landlord -s- [ILLEGIBLE] -s- [ILLEGIBLE] 18 26.04 LIMITATION OF LANDLORD'S RESPONSIBILITY. Tenant acknowledges and agrees that all Electronic Services desired by Tenant shall be ordered and utilized at the sole expense of Tenant. Unless Landlord otherwise requests or consents in writing, all of Tenant's Electronic Services equipment shall be and remain solely in the Tenant's premises and the telephone closet(s) on the floor(s) on which the Tenant's premises is located, in accordance with rules and regulations adopted by Landlord from time to time. Unless otherwise specifically agreed to in writing, Landlord shall have no responsibility for the maintenance of Tenant's Electronic Services equipment, including Lines; nor for any Lines or other infrastructure to which Tenant's Electronic Services equipment may be connected. Tenant agrees that, to the extent any Electronic Services are interrupted, curtailed or discontinued, Landlord shall have no obligation or liability with respect thereto and it shall be the sole obligation of Tenant at its own expense to obtain substitute service. Except to the extent arising from the intentional or grossly negligent acts of Landlord or Landlord's agents or employees, Landlord shall have no liability for damages arising from, and Landlord does not warrant that Tenant's use of any Lines will be free from the following (collectively called "Line Problems"): (x) any eavesdropping or wire-tapping by unauthorized parties, (y) any failure of any Lines to satisfy Tenant's requirements, or (z) any shortages, failures, variations, interruptions, disconnection's, loss or damage caused by the installation, maintenance, replacement, use or removal of Lines by or for other tenants or occupants at the property. Under no circumstances shall any Line Problems be deemed an actual or constructive eviction of Tenant, render Landlord liable to Tenant for abatement of Rent, or relieve Tenant from performance of Tenant's obligations under this Lease. Landlord in no event shall be liable for damages by reason of loss of profits, business interruption or other consequential damage arising from any Line Problems. 26.05 NECESSARY SERVICE INTERRUPTIONS. Landlord shall have the right, upon reasonable prior notice to Tenant, to interrupt or turn off Electronic Services facilities in the event of emergency or as necessary in connection with maintenance, repairs or construction at the Building or installation of Electronic Services equipment for other Tenants of the Building or on account of violation by the Electronic Services Provider or owner of the Electronic Services equipment of any obligation to Landlord or in the event that Tenant's use of the Electronic Services infrastructure of the Building materially interferes with the Electronic Services of other tenants of the Building. 26.06 REMOVAL OF EQUIPMENT, WIRING AND OTHER FACILITIES. Any and all Electronic Services equipment installed in the Tenant's Premises or elsewhere in the Building by or on behalf of Tenant, including Lines, or other facilities for Electronic Services reception or transmittal, shall be removed prior to the expiration or earlier termination of the Lease term, by Tenant at its sole cost or, at Landlord's election, by Landlord at Tenant's sole cost, with the cost thereof to be paid as additional rent. Landlord shall have the right, however, upon written notice to Tenant given no later than thirty (30) days prior to the expiration or earlier termination of the Lease term (except that the notice period shall extend to thirty (30) days beyond the date of termination of the Lease if it is terminated by either party due to a default by the other), to require Tenant to abandon and leave in place, without additional payment to Tenant or credit against rent, any and all Electronic Services Lines and related infrastructure, or selected components thereof, whether located in the Tenant's premises or elsewhere in the Building. 26.07 NEW PROVIDER INSTALLATIONS. In the event that Tenant wishes at any time to utilize the services of an Electronic Services Provider whose equipment is not then servicing the Building, no such Electronic Services Provider shall be permitted to install its Lines or other equipment within the Building without first securing the prior written approval of the Landlord. Landlord's approval shall not be deemed any kind of warranty or representation by Landlord, including, without limitation, any warranty or representation as to the suitability, competence, or financial strength of the Electronic Services Provider. Without limitation of the foregoing standard, unless all of the following conditions are satisfied to Landlord's satisfaction, it shall be reasonable for Landlord to refuse to give its approval: (i) Landlord shall incur no current expense or risk or future expense whatsoever with respect to any aspect of the Electronic Services Provider's provision of its Electronic Services, including without limitation, the costs of installation, materials and services; (ii) prior to commencement of any work in or about the Building by the Electronic Services Provider, the Electronic Services Provider shall supply Landlord with such written indemnities, insurance, financial statements, and such other items as Landlord reasonably determines to be necessary to protect its financial interests and the interests of the Building relating to the proposed activities of the Electronic Services Provider; (iii) the Electronic Services Provider agrees to abide by such rules and regulations, Building and other codes, job site rules and such other requirements as are reasonably determined by Landlord to be necessary to protect the interests of the Building, the Tenants in the Building and Landlord, in the same or similar manner as Landlord has the right to protect itself and the Building with respect to proposed alterations as described in Article IX of this Lease; (iv) Landlord reasonably determines that, considering other potential uses for space in the Building, there is sufficient space in the Building for the placement of all of the provider's equipment, conduit, Lines and other materials; (v) the Electronic Services Provider agrees to abide by Landlord's requirements, if any, that provider use existing Building conduits and pipes or use Building contractors (or other contractors approved by Landlord); (vi) Landlord receives from the Electronic Services Provider such compensation as is reasonably determined by Landlord to compensate it for space used in the Building for the storage and maintenance of the Electronic Services Provider's equipment, for the fair market value of a Electronic Services Provider's access to the Building, for the use of common or core space within the Building and the costs which may reasonably be expected to be incurred by Landlord; (vii) the provider agrees to deliver to Landlord detailed "as built" plans immediately after the installation of the provider's equipment is complete; and (viii) all of the foregoing matters are documented in a written license agreement between Landlord and the provider, the form and content of which is reasonably satisfactory to Landlord." 26.08 LIMIT OF DEFAULT OR BREACH. Notwithstanding any provision of the proceeding paragraphs to the contrary, the refusal of Landlord to grant its approval to any prospective Electronic Services Provider shall not be deemed a default or breach by Landlord of its obligation under this Lease unless and until Landlord is adjudicated to Tenant Landlord -s- [ILLEGIBLE] -s- [ILLEGIBLE] 19 have acted recklessly or maliciously with respect to Tenant's request for approval, and in that event, Tenant shall still have no right to terminate the Lease or claim an entitlement to rent abatement, but may as Tenant's sole and exclusive recourse seek a judicial order of specific performance compelling Landlord to grant its approval as to the prospective provider in question. The provisions of this paragraph may be enforced solely by Tenant and Landlord, are not for the benefit of any other party, and specifically but without limitation, no telephone or other Electronic Services Provider shall be deemed a third party beneficiary of this Lease. 26.9 INSTALLATION AND USE OF WIRELESS TECHNOLOGIES. Tenant shall not utilize any wireless Electronic Services equipment (other than usual and customary cellular telephones), including antennae and satellite receiver dishes, within the Tenant's premises, within the Building or attached to the outside walls or roof of the Building, without Landlord's prior written consent. Such consent may be conditioned in such a manner so as to protect Landlord's financial interests and the interests of the Building, and the other tenants therein, in a manner similar to the arrangements described in the immediately preceding paragraphs. 26.10 LIMITATION OF LIABILITY FOR EQUIPMENT INTERFERENCE. In the event that Electronic Services equipment, Lines and facilities or satellite and antennae equipment of any type installed by or at the request of Tenant within the Tenant's premises, on the roof, or elsewhere within or on the Building causes interference to equipment used by another party. Tenant shall cease using such equipment, Lines and facilities or satellite and antennae equipment until the source of the interference is identified and eliminated and Tenant shall assume all liability related to such interference. Tenant shall cooperate with Landlord and other parties, to eliminate such interference promptly. In the event that Tenant is unable to do so, Tenant will substitute alternative equipment which remedies the situation. If such interference persists, Tenant shall, at Landlord's sole discretion, remove such equipment. ARTICLE XXVII - PARKING 27.01 During the term of this Lease, Tenant shall be entitled to rent the number of Tenant's Parking Stalls, if any, described in Section 1.16 of this Lease in the parking facilities located within the Building; provided, however, that if Tenant does not rent all of the Tenant's Parking Stalls allocated to Tenant pursuant to Section 1.16, any change in the number of parking stalls actually rented by Tenant shall require not less than thirty (30) days prior written notice to Landlord. Such parking shall be on a non-assigned basis, and shall be at such rates and upon such other terms and conditions as are published or posted from time to time by Landlord (or, at Landlord's option, the operator or lessee of the parking facilities). Tenant's visitors shall have the right to use the parking facilities, subject to availability and to the rates, rules and regulations governing visitor parking from time to time adopted by Landlord (or, at Landlord's option, the operator or master lessee of the parking facilities). ARTICLE XXVIII - MISCELLANEOUS 28.1 ENTIRE AGREEMENT. This Lease contains all of the agreements and understandings relating to the leasing of the Premises and the obligations of Landlord and Tenant in connection with such leasing. Landlord has not made, and Tenant is not relying upon, any warranties, or representations, promises or statements made by Landlord or any agent of Landlord, except as expressly set forth herein. This Lease supersedes any and all prior agreements and understandings between Landlord and Tenant and alone expresses the agreement of the parties. 28.2 AMENDMENTS. This Lease shall not be amended, changed or modified in any way unless in writing executed by Landlord and Tenant. Landlord and Tenant shall not have waived or released any of its rights hereunder unless in writing and executed by such party. 28.3 SUCCESSORS. Except as expressly provided herein, this Lease and the obligations of Landlord and Tenant contained herein shall bind and benefit the successors and assigns of the parties hereto. 28.01 FORCE MAJEURE. Landlord and Tenant shall incur no liability to each other with respect to, and shall not be responsible for any failure to perform, any of Landlord's obligations hereunder if such failure is caused by any reason beyond the control of Landlord including, but not limited to, strike, labor trouble, governmental rule, regulations, ordinance, statute or interpretation, or by fire, earthquake, civil commotion, or failure or disruption of utility services. The amount of time for Landlord to perform any of Landlord's obligations shall be extended by the amount of time Landlord is delayed in performing such obligation by reason of any force majeure occurrence whether similar to or different from the foregoing types of occurrences. 28.5 SURVIVAL OF OBLIGATIONS. Any obligations of Tenant or Landlord accruing prior to the expiration of the Lease shall survive the expiration or earlier termination of the Lease, and each party shall promptly perform all such obligations whether or not this Lease has expired or been terminated. 28.6 LIGHT AND AIR. No diminution or shutting off of any light, air or view by any structure now or hereafter erected shall in any manner affect this Lease or the obligations of Tenant hereunder, or increase any of the obligations of Landlord hereunder. 28.7 GOVERNING LAW. This Lease shall be governed by, and construed in accordance with, the laws of the State of California. Tenant Landlord -s- [ILLEGIBLE] -s- [ILLEGIBLE] 20 28.8 SEVERABILITY. In the event any provision of this Lease is found to be unenforceable, the remainder of this Lease shall not be affected, and any provision found to be invalid shall be enforceable to the extent permitted by law. The parties agree that in the event two different interpretations may be given to any provision hereunder, one of which will render the provision unenforceable, and one of which will render the provision enforceable, the interpretation rendering the provision enforceable shall be adopted. 28.9 CAPTIONS. All captions, headings, titles, numerical references and computer highlighting are for convenience only and shall have no effect on the interpretation of this Lease. 28.10 INTERPRETATION. Tenant acknowledges that it has read and reviewed this Lease and that it has had the opportunity to confer with counsel in the negotiation of this Lease. Accordingly, this Lease shall be construed neither for nor against Landlord or Tenant, but shall be given a fair and reasonable interpretation in accordance with the meaning of its terms and the intent of the parties. 28.11 INDEPENDENT COVENANTS. Each covenant, agreement, obligation or other provision of this Lease to be performed by Tenant or Landlord are separate and independent covenants of Tenant or Landlord, and not dependent on any other provision of the Lease. 28.12 NUMBER AND GENDER. All terms and words used in this Lease, regardless of the number or gender in which they are used, shall be deemed to include the appropriate number and gender, as the context may require. 28.13 TIME IS OF THE ESSENCE. Time is of the essence of this Lease and the performance of all obligations hereunder. 28.14 JOINT AND SEVERAL LIABILITY. If Tenant comprises more than one person or entity, or if this Lease is guaranteed by any party, all such persons shall be jointly and severally liable for payment of rents and the performance of Tenant's obligations hereunder. If Tenant comprises more than one person or entity and fewer than all of the persons or entities comprising Tenant abandon the Premises, Landlord, at its sole option, may treat the abandonment by such person or entities as an event of default and exercise with respect to such persons the rights and remedies provided in Article XV without affecting the right or obligations of the persons or entities comprising Tenant which have not abandoned the property. 28.15 EXHIBITS. Exhibits A (Outline of Premises), B (Work Letter Agreement), C (Rules and Regulations), D (Guaranty), E (Suite Acceptance Letter), and F (Asbestos Notification), G (Parking Agreement) and Addendum I are incorporated into this Lease by reference and made a part hereof. 28.16 OFFER TO LEASE. The submission of this Lease to Tenant or its broker or other agent, does not constitute an offer to Tenant to lease the Premises. This Lease shall have no force and effect until (a) it is executed and delivered by Tenant to Landlord and (b) it is fully reviewed and executed by Landlord; provided, however, that, upon execution of this Lease by Tenant and delivery to Landlord, such execution and delivery by Tenant, shall, in consideration of the time and expense incurred by Landlord in reviewing the Lease and Tenant's credit, constitute an offer by Tenant to lease the Premises upon the terms and conditions set forth herein (which offer to Lease shall be irrevocable for twenty (20) business days following the date of delivery). 28.17 NO COUNTERCLAIM; CHOICE OF LAWS. It is mutually agreed that in the event Landlord commences any summary proceeding for non-payment of Rent, Tenant will not interpose any counterclaim of whatever nature or description in any such proceeding. In addition, Tenant hereby submits to local jurisdiction in the State of California and agrees that any action by Tenant against Landlord shall be instituted in the State of California and that Landlord shall have personal jurisdiction over Tenant for any action brought by Landlord against Tenant in the State of California. 28.18 ELECTRICAL SERVICE TO THE PREMISES. Anything set forth in Section 7.01 or elsewhere in this Lease to the contrary notwithstanding, electricity to the Premises shall not be furnished by Landlord, but shall be furnished by the approved electric utility company serving the Building. Landlord shall permit Tenant to receive such service directly from such utility company at Tenant's cost (except as otherwise provided herein) and shall permit Landlord's wire and conduits, to the extent available, suitable and safely capable, to be used for such purposes. 28.19 RIGHTS RESERVED BY LANDLORD. Landlord reserves the following rights exercisable without notice (except as otherwise expressly provided to the contrary in this Lease) and without being deemed an eviction or disturbance of Tenant's use or possession of the Premises or giving rise to any claim for set-off or abatement of Rent: (i) to change the name or street address of the Building; (ii) to install, affix and maintain all signs on the exterior and/or interior of the Building; (iii) to designate and/or approve prior to installation, all types of signs, window shades, blinds, drapes, awnings or other similar items, and all internal lighting that may be visible from the exterior of the Premises and, notwithstanding the provisions of Article IX, the design, arrangement, style, color and general appearance of the portion of the Premises visible from the exterior, and contents thereof, including, without limitation, furniture, fixtures, signs, art work, wall coverings, carpet and decorations, and all changes, additions and removals thereto, shall, at all times have the appearance of premises having the same type of exposure and used for substantially the same purposes that are generally prevailing in comparable office buildings in the area. Any violation of this provision shall be deemed a material breach of this Lease; (iv) to change the arrangement of Tenant Landlord -s- [ILLEGIBLE] -s- [ILLEGIBLE] 21 entrances, doors, corridors, elevators and/or stairs in the Building, provided no such change shall materially adversely affect access to the Premises; (v) to grant any party the exclusive right to conduct any business or render any service in the Building, provided such exclusive right shall not operate to prohibit Tenant from using the Premises for the purposes permitted under this Lease; (vi) to prohibit the placement of vending or dispensing machines of any kind in or about the Premises other than for use by Tenant's employees; (vii) to prohibit the placement of video or other electronic games in the Premises; (viii) to have access for Landlord and other tenants of the Building to any mail chutes and boxes located in or on the Premises according to the rules of the United States Post Office and to discontinue any mail chute business in the Building; (ix) to close the Building after normal business hours, except that Tenant and its employees and invitees shall be entitled to admission at all times under such rules and regulations as Landlord prescribes for security purposes; (x) to install, operate and maintain security systems which monitor, by close circuit television or otherwise, all persons entering or leaving the Building; (xi) to install and maintain pipes, ducts, conduits, wires and structural elements located in the Premises which serve other parts or other tenants of the Building; and (xii) to retain at all times master to the Premises for emergency use only. IN WITNESS WHEREOF, the parties hereto have executed this lease as of the date first above, written. LANDLORD: TENANT: 3600 WILSHIRE, LLC, A California NARA BANK, National Association limited liability company By: JPB Partners, Inc., a California By: -s- Bon T. Goo corporation --------------------- Its: Manager Print Name: BON T. GOO By: -s- David Y. Lee, Its: CFO & EVP -------------------------- David Y. Lee, M.D. Date: 2/6/03 Its: President By: -s- Michel Urich Date: 2/7/03 --------------------- Print Name: MICHEL URICH Its: Directors of Legal Affairs Date: 2/6/03 Tenant Landlord -s- [ILLEGIBLE] -s- [ILLEGIBLE] 22 EXHIBIT A AS - BUILT PLAIN [BUILT PLAIN] Tenant Landlord -s- [ILLEGIBLE] -s- [ILLEGIBLE] 23 EXHIBIT A-1 PREMISES FLOOR PLAN [PREMISES FLOOR PLAN] Tenant Landlord -s- [ILLEGIBLE] -s- [ILLEGIBLE] 24 EXHIBIT A-2 PARKING PLAN [PARKING PLAN] Tenant Landlord -s- [ILLEGIBLE] -s- [ILLEGIBLE] EXHIBIT B WORK LETTER AGREEMENT [LANDLORD PERFORMS WORK] [MINOR WORK ONLY] THIS AGREEMENT made as of the 17th day of JANUARY, 2003, between 3600 WILSHIRE LLC, A California limited liability company, By JPB Partners, Inc., a California corporation as ("Landlord") and NARA BANK, NATIONAL ASSOCIATION, ("Tenant"). Reference is made to the Lease or tenant expansion agreement dated JANUARY 17, 2003, (the "Lease") for premises known 3600 Wilshire Boulevard, Suite 100A (the "Premises"), located in the property known as The Wilshire Financial Tower also known as 3600 Wilshire Boulevard, Los Angeles, CA 90010 (the "Property") Landlord agrees to perform the following items of work (the "Work") in the Premises 1. Tenant agrees to accept the Premises in "as is" condition except for demising walls. Landlord shall pay the full cost of the Work, except that Tenant shall reimburse Landlord in the amount of $ none, within 10 days after Landlord completes the Work. If Landlord requires further choices by Tenant respecting the above Work (e g, color choices respecting the above items), Tenant shall promptly choose the same from such choices, if any, that Landlord makes available to Tenant as "building standard." If any such further choices are required, the parties agree that Tenant has heretofore been provided an opportunity to view the available choices and Tenant agrees to make such choices by n/a , 20 If Tenant fails to do so by such date, Landlord may make such choices for Tenant Landlord will use reasonable efforts to complete the Work by the Commencement Date under the Lease or within 90 days thereafter, subject to further delays beyond Landlord's reasonable control (as may be further described in the Lease), provided, notwithstanding anything to the contrary contained in the Lease, delays in the Work hereunder shall not postpone the commencement of Rent under any circumstances whether the delay is caused by Tenant or Tenant's contractors, agents or employees, or the delay is otherwise beyond Landlord's reasonable control (as may be further described in the Lease), or for any other reason whatsoever Tenant acknowledges that the Work may occur during normal business hours while Tenant is in occupancy of the Premises and that no interference to Tenant's business operations in, or use of, the Premises shall entitle Tenant to any abatement of rent or any other concession, or give rise to any claim against, or liability of, Landlord Notwithstanding anything to the contrary contained in this Work Letter, it is expressly understood and agreed by and between the parties hereto that (a) The recourse of Tenant or its successors or assigns against Landlord with respect to the alleged breach by or on the part of Landlord of any representation, warranty, covenant, undertaking or agreement contained in this Work Letter (collectively, "Landlord's Work Letter Undertakings") shall extend only to Landlord's interest in the real estate of which the Premises demised under the Lease are a part (hereinafter, "Landlord's Real Estate") and not to any other assets of Landlord or its beneficiaries; and (b) Except to the extent of Landlord's interest in Landlord's Real Estate, no personal liability or personal responsibility of any sort with respect to any of Landlord's Work Letter Undertakings or any alleged breach thereof is assumed by, or shall at any time be asserted or enforceable against, Landlord, or against any of their respective directors, officers, shareholders, employees, agents, constituent partners, beneficiaries, trustees or representatives LANDLORD: TENANT: 3600 WILSHIRE, LLC, A California NARA BANK, National Association limited liability company By: JPB Partners, Inc., a California corporation Its: Manager By: -s- Bon T. Goo --------------------- By: -s- David Y. Lee, Print Name: Bon T. Goo -------------------------- David Y. Lee, M.D. Its: CFO & EVP Its: President Date: 2/6/03 Date: 2/7/03 By: -s- Michel Urich --------------------- Print Name: MICHEL URICH Its: Directors of Legal Affairs Date: 2/6/03 Tenant Landlord -s- [ILLEGIBLE] -s- [ILLEGIBLE] 25 EXHIBIT B WORK LETTER AGREEMENT [TENANT PERFORMS WORK] This Work Letter Agreement ("Work Letter") is executed simultaneously with that certain Lease dated JANUARY 17, 2003, (the "Lease") between 3600 WILSHIRE, LLC, a California limited liability company, c/o JPB PARTNERS, INC., a California corporation, as ("Landlord") and NARA BANK, NATIONAL ASSOCIATION, as ("Tenant"), relating to demised premises ("Premises") at the building commonly known as Wilshire Financial Tower or 3600 Wilshire Boulevard, Los Angeles, California 90010 (the "Building"), which Premises are more fully identified in the Lease. Capitalized terms used herein, unless otherwise defined in this Work Letter, shall have the respective meanings ascribed to them in the Lease. For and in consideration of the agreement to lease the Premises and the mutual covenants contained herein and in the Lease, Landlord and Tenant hereby agree as follows: 1. WORK. Tenant, at its sole cost and expense, shall perform, or cause to be performed, the work (the "Work") in the Premises provided for in the Approved Plans (as defined in Paragraph 2 hereof). 2. PRE-CONSTRUCTION ACTIVITIES. (a) On or before FEBRUARY 14, 2003, Tenant shall submit the following information and items to Landlord for Landlord's review and approval: (i) A detailed critical path construction schedule containing the major components of the Work and the time required for each, including the scheduled commencement date of construction of the Work, milestone dates and the estimated date of completion of construction. (ii) An itemized statement of estimated construction cost, including fees for permits and architectural and engineering fees. (iii) Evidence satisfactory to Landlord in all respects of Tenant's ability to pay the cost of the Work as and when payments become due. (iv) The names and addresses of Tenant's contractors (and said contractor's subcontractors) and material men to be engaged by Tenant for the Work (individually, a "Tenant Contractor," and collectively, "Tenant's Contractors"). Landlord has the right to approve or disapprove all or any one or more of Tenant's Contractors. Landlord may, at its election, designate a list of approved contractors for performance of those portions of work involving electrical, mechanical, plumbing, heating, air conditioning or life safety systems, from which Tenant must select its contractors for such designated portions of work. (v) Certified copies of Insurance policies or certificates of insurance as hereinafter described. Tenant shall not permit Tenant's Contractors to commence work until the required insurance has been obtained and certified copies of policies or certificates have been delivered to Landlord. (vi) Payment and performance bonds for all of Tenant's Contractors naming Landlord (or an agent, designee or representative appointed by Landlord's written notice to Tenant given prior to Tenant's procurement of paid bonds) as dual obligee. (vii) The Plans (as hereinafter defined) for the Work, which Plans shall be subject to Landlord's approval in accordance with Paragraph 2(b) below. Tenant will update such information and items by notice to Landlord of any changes. (b) As used herein the term "Approved Plans" shall mean the Plans (as hereinafter defined), as and when approved in writing by Landlord. As used herein, the term "Plans" shall mean the full and detailed architectural and engineering plans and specifications covering the Work (including, without limitation, architectural, mechanical and electrical working drawings for the Work). The Plans shall be subject to Landlord's approval and the approval of all local governmental authorities requiring approval of the work and/or the Approved Plan. Landlord shall give its approval or disapproval (giving general reasons in case of disapproval) of the Plans within Five (5) days after then delivery to Landlord. Landlord agrees not to unreasonably withhold its approval of said Plans; provided, however, that Landlord shall not be deemed to have acted unreasonably if it withholds its approval of the Plans because, in Landlord's reasonable opinion: the Work as shown in the Plans is likely to adversely affect Building systems, the structure of the Building or the safety of the Building and/or its occupants; the Work as shown on the Plans might impair Landlord's ability to furnish services to Tenant or other tenants; the Work would increase the cost of operating the Building; the Work would violate any governmental laws, rules or ordinances (or interpretations thereof); the Work contains or uses hazardous or toxic materials or substances; the Work would adversely affect the appearance of the Building; the Work might adversely affect another tenant's Tenant Landlord -s- [ILLEGIBLE] -s- [ILLEGIBLE] 26 premises; or the Work is prohibited by any mortgage or trust deed encumbering the Building. The foregoing reasons, however, shall not be exclusive of the reasons for which Landlord may withhold consent, whether or not such other reasons are similar or dissimilar to the foregoing. If Landlord notifies Tenant that changes are required to the final Plans submitted by Tenant, Tenant shall, within three (3) business days thereafter, submit to Landlord, for its approval, the Plans amended in accordance with the changes so required. The Plans shall also be revised, and the Work shall be changed, all at Tenant's cost and expense, to incorporate any work required in the Premises by any local governmental field inspector. Landlord's approval of the Plans shall in no way be deemed to be (i) an acceptance or approval of any element therein contained which is in violation of any applicable laws, ordinances, regulations or other governmental requirements, or (ii) an assurance that work done pursuant to the Approved Plans will comply with all applicable laws (or with the interpretations thereof) or satisfy Tenant's objectives and needs. (c) No Work shall be undertaken or commenced by Tenant in the Premises until (i) Tenant has delivered, and Landlord has approved, all items set forth in Paragraph 2(a) above, (ii) all necessary building permits have been applied for and obtained by tenant, and (iii) proper provision has been made by Tenant for payment in full of the cost of the Work, which is satisfactory to Landlord and which, if applicable, shall be in the form of the construction escrow referred to in Paragraph 9 hereof or an irrevocable and unconditional letter of credit issued by a bank acceptable to Landlord, which letter of credit shall be satisfactory in all respects by Landlord. 3. DELAYS. In the event Tenant fails to deliver or deliver in sufficient and accurate detail of the information required under Paragraph 2 above on or before the respective dates specified in said Paragraph 2, or in the event Tenant, for any reason, fails to complete the Work on or before the Commencement Date, Tenant shall be responsible for Rent and all other obligations set forth in the Lease from the Commencement Date regardless of the degree of completion of the Work on such date, and no such delay in completion of the Work shall relieve Tenant of any of its obligations under the Lease. 4. CHARGES AND FEES. Tenant shall pay Landlord a supervisory fee in an amount equal to Zero percent (0%) of the direct cost of the materials and labor for the Work (and all change orders with respect thereto) to defray Landlord's administrative and overhead expenses incurred to review the Plans and coordinate with Tenant's on-site project manager the staging and progress of the Work. 5. CHANGE ORDERS. All changes to the Approved Plans requested by Tenant must be approved by Landlord in advance of the implementation of such changes as part of the Work. All delays caused by Tenant-initiated change orders, including, without limitation, any stoppage of work during the change order review process, are solely the responsibility of Tenant and shall cause no delay in the commencement of the Lease or the Rent and other obligations therein set forth. All increases in the cost of the Work resulting from such change orders shall be borne by Tenant. 6. STANDARDS OF DESIGN AND CONSTRUCTION AND CONDITIONS OF TENANT'S PERFORMANCE. All work done in or upon the Premises by Tenant shall be done according to the standards set forth in this Paragraph 6, except as the same may be modified in the Approved Plans approved by or on behalf of Landlord and Tenant. (a) Tenant's Approved Plans and all design and construction of the Work shall comply with all applicable statutes, ordinances, regulations, laws, codes and industry standards, including, but not limited to, requirements of Landlord's fire insurance underwriters. (b) Tenant shall, at its own cost and expense, obtain all required building permits and occupancy permits. Tenant's failure to obtain such permits shall not cause a delay in the commencement of the Lease Term or the obligation to pay Rent or any other obligations set forth in the Lease. (c) Tenant's Contractors shall be licensed contractors, possessing good labor relations, capable of performing quality workmanship and working in harmony with Landlord's contractors and subcontractors and with other contractors and subcontractors in the Building. All work shall be coordinated with any other construction or other work in the Building in order not to adversely affect construction work being performed by or for Landlord or its tenants. (d) Landlord shall have the right, but not the obligation, to perform, on behalf of and for the account of Tenant, subject to reimbursement by Tenant, any work which pertains to patching of the Work and other work in the Building. (e) Tenant shall use only new, first-class materials in the Work, except where explicitly shown in the Approved Plans, All Work shall be done in a good and workmanlike manner. Tenant shall obtain contractors' warranties of at least one (1) year duration from the completion of the Work against defects in workmanship and materials on all work performed and equipment installed in the Premises as part of the Work. (f) Tenant and Tenant's Contractors shall make all efforts and take all steps appropriate to assure that all construction activities undertaken comport with the reasonable expectations of all tenants and other occupants of a fully-occupied (or substantially fully occupied) first-class office building and do not unreasonably interfere with Tenant Landlord -s- [ILLEGIBLE] -s- [ILLEGIBLE] 27 the operation of the Building or with other tenants and occupants of the Building. In any event, Tenant shall comply with all reasonable rules and regulations existing from time to time at the Building. Tenant and Tenant's Contractors shall take all precautionary steps to minimize dust, noise and construction traffic, and to protect their facilities and the facilities of others affected by the Work and to properly police same. Construction equipment and materials are to be kept within the Premises and delivery and loading of equipment and materials shall be done at such locations and at such time as Landlord shall direct so as not to burden the construction or operation of the Building. If and as required by Landlord, the Premises shall be sealed off from the balance of the office space on the floor(s) containing the Premises so as to minimize the disbursement of dirt, debris and noise. (g) Landlord shall have the right to order Tenant or any of Tenant's Contractors who violate the requirements imposed on Tenant or Tenant's Contractors in performing work to cease work and remove its equipment and employees from the Building. No such action by Landlord shall delay the commencement of the Lease or the obligation to pay Rent or any other obligations therein set forth. (h) Utility costs or charges for any service (including HVAC, hoisting or freight elevator and the like) to the Premises shall be the responsibility of Tenant from the date Tenant is obligated to commence or commences the Work and shall be paid for by Tenant at Landlord's standard rates then in effect. Tenant shall apply and pay for all utility meters required. Tenant shall pay for all support services provided by Landlord's contractors at Tenant's request or at Landlord's discretion resulting from breaches or defaults by Tenant under this Work Letter Agreement. All use of freight elevators is subject to scheduling by Landlord and the rules and regulations of the Building. Tenant shall arrange and pay for removal of construction debris and shall not place debris in the Building's waste containers. If required by Landlord, Tenant shall sort and separate its waste and debris for recycling and/or environmental law compliance purposes. (i) Tenant shall permit access to the Premises, and the Work shall be subject to inspection, by Landlord and Landlord's architects, engineers, contractors and other representatives, at all times during the period in which the Work is being constructed and installed and following completion of the Work. (j) Tenant shall proceed with its work expeditiously, continuously and efficiently, and shall use its best efforts to complete the same on or before Twenty One (21) days after the date Landlord tenders possession of the Premises to Tenant for the construction of the Work. Tenant shall notify Landlord upon completion of the Work and shall furnish Landlord and Landlord's title insurance company with such further documentation as may be necessary under Paragraphs 8 and 9 below. (k) Tenant shall have no authority to deviate from the Approved Plans in performance of the Work, except as authorized by Landlord and its designated representative in writing. Tenant shall furnish to Landlord "as-built" drawings of the Work within thirty (30) days after completion of the Work. (l) Landlord shall have the right to run utility lines, pipes, conduits, duct work and component parts of all mechanical and electrical systems where necessary or desirable through the Premises, to repair, alter, replace or remove the same, and to require Tenant to install and maintain proper access panels thereto. (m) Tenant shall impose on and enforce all applicable terms of this Work Letter Agreement against Tenant's architect and Tenant's Contractors. 7. INSURANCE AND INDEMNIFICATION. (a) In addition to any insurance which may be required under the Lease, Tenant shall secure, pay for and maintain or cause Tenant's Contractors to secure, pay for and maintain during the continuance of construction and fixturing work within the Building or Premises, insurance in the following minimum coverages and the following minimum limits of liability: (i) Worker's Compensation and Employer's Liability Insurance with limits of not less than $500,000.00, or such higher amounts as may be required from time to time by any Employee Benefit Acts or other statutes applicable where the work is to be performed, and in any event sufficient to protect Tenant's Contractors from liability under the aforementioned acts. (ii) Comprehensive General Liability Insurance (including Contractors' Protective Liability) in an amount not less than $1,000,000.00 per occurrence, whether involving bodily injury liability (or death resulting therefrom) or property damage liability or a combination thereof with a minimum aggregate limit of $2,000,000.00, and with umbrella coverage with limits not less than $5,000,000.00. Such insurance shall provide for explosion and collapse, completed operations coverage and broad form blanket contractual liability coverage and shall insure Tenant's Contractors against any and all claims for bodily injury, including death resulting therefrom, and damage to the property of others and arising from its operations under the contracts whether such operations are performed by Tenant's Contractors or by anyone directly or indirectly employed by any of them. (iii) Comprehensive Automobile Liability Insurance, including the ownership, maintenance and operation of any automotive equipment, owned, hired, or non-owned in an amount not less than $500,000.00 for each person in one accident, and $1,000,000.00 for injuries sustained by two or more persons in any one accident and property damage liability in an amount not less than $1,000,000.00 for each accident. Such insurance shall Tenant Landlord -s- [ILLEGIBLE] -s- [ILLEGIBLE] 28 insure Tenant's Contractors against any and all claims for bodily injury, including death resulting therefrom, and damage to the property of others arising from its operations under the contracts, whether such operations are performed by Tenant's Contractors, or by anyone directly or indirectly employed by any of them. (iv) "All-risk" builder's risk insurance upon the entire Work to the full insurable value thereof. This insurance shall include the interests of Landlord and Tenant (and their respective contractors and subcontractors of any tier to the extent of any insurable interest therein) in the Work and shall insure against the perils of fire and extended coverage and shall include "all-risk" builder's risk insurance for physical loss or damage including, without duplication of coverage, theft vandalism and malicious mischief. If portions of the Work are stored off the site of the Building or in transit to said site are not covered under said "all-risk" builder's risk insurance, then Tenant shall effect and maintain similar property insurance on such portions of the Work. Any loss insured under said "all-risk" builder's risk insurance is to be adjusted with Landlord and Tenant and made payable to Landlord, as trustee for the insured, as their interests may appear. All policies (except the worker's compensation policy) shall be endorsed to include as additional insured parties the parties listed on, or required by, the Lease, Landlord's contractors, Landlord's architects, and their respective beneficiaries, partners, directors, officers, employees and agents, and such additional persons as Landlord may designate. The waiver of subrogation provisions contained in the Lease shall apply to all insurance policies (except the workmen's compensation policy) to be obtained by Tenant pursuant to this paragraph. The insurance policy endorsements shall also provide that all additional insured parties shall be given thirty (30) days' prior written notice of any reduction, cancellation or non-renewal of coverage (except that ten (10) days' notice shall be sufficient in the case of cancellation for non-payment of premium) and shall provide that the insurance coverage afforded to the additional insured parties thereunder shall be primary to any insurance carried independently by said additional insured parties. Additionally, where applicable, each policy shall contain a cross-liability and severability of interest clause. (b) Without limitation of the indemnification provisions contained in the Lease, to the fullest extent permitted by law Tenant agrees to indemnify, protect, defend and hold harmless Landlord, the parties listed, or required by, the Lease to be named as additional insureds, Landlord's contractors, Landlord's architects, and their respective beneficiaries, partners, directors, officers, employees and agents, from and against all claims, liabilities, losses, damages and expenses of whatever nature arising out of or in connection with the Work or the entry of Tenant or Tenant's Contractors into the Building and the Premises, including, without limitation, mechanic's liens, the cost of any repairs to the Premises or Building necessitated by activities of Tenant or Tenant's Contractors, bodily injury to persons (including, to the maximum extent provided by law, claims arising under the California Structural Work Act) or damage to the property of Tenant, its employees, agents, invitees, licenses or others. It is understood and agreed that the foregoing indemnity shall be in addition to the insurance requirements set forth above and shall not be in discharge of or in substitution for same or any other indemnity or insurance provision of the Lease. 8. EXCESS AMOUNTS. (a) Upon completion of the Work, Tenant shall furnish Landlord with full and final waivers of liens and contractors' affidavits and statements, in such form as may be required by Landlord, Landlord's title insurance company and Landlord's construction or permanent lender, if any, from all parties performing labor or supplying materials or services in connection with the Work showing that all of said parties have been compensated in full and waiving all liens in connection with the Premises and Building. Tenant shall submit to Landlord a detailed breakdown of Tenant's total construction costs, together with such evidence of payment as is reasonably satisfactory to Landlord. (b) Upon completion of the Work and Tenant's satisfaction of all requirements set forth in this Work Letter Agreement. Prior to commencing the Work, Tenant shall submit to Landlord a written statement of the total Cost of the Work as then known by Tenant. Tenant shall submit to Landlord at the end of each thirty (30) days copies of invoices that indicate the work has been completed to Tenant's satisfaction and mechanic lien releases. Tenant shall have sole responsibility for the payment of such excess cost. Upon demand from Landlord, Tenant must show evidence of signed contracts and paid invoices. 9. CONSTRUCTION ESCROW. Prior to commencement of any construction or performance of any Work or payment to or by Tenant or to any of Tenant's Contractors, Tenant shall, at Landlord's option, establish a construction escrow or other payment procedure acceptable to Landlord and each holder of a mortgage on the Building at a title insurance company designated by Landlord providing for payment to Tenant's Contractors and payment of all other costs associated with the Work as the Work progresses, upon the title insurance company's satisfactory review of lien waivers and sworn statements from Tenant's Contractors and other applicable parties and upon the title insurance company's willingness to issue title insurance over mechanic's liens relating to Tenant's contracts and the Work to the date of each draw; in the alternative, Landlord may elect to have payments to Tenant's Contractors for the Work made through Landlord's construction lender's escrow. Tenant shall pay for the Work when required under its contracts for the Work and shall not permit the Premises or the Building to become subject to any lien or claim of lien on account of labor, material or services furnished to or for the benefit of Tenant. Tenant shall, from time to time, deposit funds into the construction escrow or Landlord's construction lender's escrow, as the case may be, in amounts sufficient to pay the costs of the Work. Tenant may not withdraw funds except to pay Tenant Landlord -s- [ILLEGIBLE] -s- [ILLEGIBLE] 29 Tenant's Contractors unless Landlord has consented to such withdrawal. The construction escrow agreement shall contain the foregoing restriction on withdrawal of funds by Tenant and shall also provide that if Tenant fails to pay for the Work when due or if any mechanic's lien is filed in connection with the Work, Landlord may use and withdraw the funds in the escrow to pay for the Work or remove the lien without Tenant's consent. Tenant shall provide such contractor's affidavits, tenant (owner) statements, partial and final waivers of lien, architect's certificates and any additional documentation (including, without limitation, Tenant or contractor personal undertakings) which may be requested by Landlord, such title insurance company or any holder of a mortgage on the Building in connection with said escrow or consistent with any other title insurance requirements concerning the Work. 10. Miscellaneous. (a) If the Plans for the Work require the construction and installation of more fire hose cabinets or telephone/electrical closets than the number regularly provided by Landlord in the core of the Building in which the Premises are located, Tenant agrees to pay all costs and expenses arising from the construction and installation of such additional fire hose cabinets or telephone/electrical closets. (b) Time is of the essence of this Work Letter Agreement. (c) Any person signing this Work Letter Agreement on behalf of Landlord and Tenant warrants and represents he has authority to sign and deliver this Work Letter Agreement and bind the party on behalf of which he has signed. (d) If Tenant fails to make any payment relating to the Work as required hereunder, Landlord, at its option, may complete the Work pursuant to the Approved Plans and continue to hold Tenant liable for the costs thereof and all other costs due to Landlord. Tenant's failure to pay any amounts owed by Tenant hereunder when due or Tenant's failure to perform its obligations hereunder shall also constitute a default under the Lease and Landlord shall have all the rights and remedies granted to Landlord under the Lease for nonpayment of any amounts owed thereunder or failure by Tenant to perform its obligations thereunder. (e) Notices under this Work Letter shall be given in the same manner as under the Lease. (f) The liability of Landlord hereunder or under any amendment hereto or any instrument or document executed in connection herewith (including, without limitation, the Lease) shall be limited to and enforceable solely against Landlord's interest in the Building. (g) The headings set forth herein are for convenience only. (h) This Work Letter sets forth the entire agreement of Tenant and Landlord regarding the Work. This Work Letter may only be amended if in writing, duly executed by both Landlord and Tenant. (i) All amounts due from Tenant hereunder shall be deemed to be Rent due under the Lease. 11. ON-SITE PROJECT MANAGER. As a condition of Tenant's right to commence and perform the Work, Tenant shall engage the services of an on-site project manager approved in advance by and reasonably acceptable to Landlord, who will be charged with the task of performing daily supervision of the Work. Such on-site manager shall be familiar with all rules and regulations and procedures of the Building and all personnel of the Building engaged directly or indirectly in the management, operation and construction of the Building. Such on-site project manager shall be accountable and responsible to Tenant and to Landlord and, where necessary, shall serve as a liaison between Landlord and Tenant with respect to the Work. The entire cost and expense of the on-site project manager shall be borne and paid for by Tenant (subject to Tenant's right to use all or any part of Landlord's Contribution to reimburse Tenant for the same.) 12. EXCULPATION OF LANDLORD. Notwithstanding anything to the contrary contained in this Work Letter Agreement, it is expressly understood and agreed by and between the parties hereto that: (a) The recourse of Tenant or its successors or assigns against Landlord with respect to the alleged breach by or on the part of Landlord of any representation, warranty, covenant, undertaking or agreement contained in this Work Letter Agreement (collectively, "Landlord's Work Letter Undertakings") shall extend only to Landlord's interest in the real estate of which the Premises demised under this Lease Documents are a part (hereinafter, "Landlord's Real Estate") and not to any other assets of Landlord or its beneficiaries; and (b) Except to the extent of Landlord's interest in Landlord's Real Estate, no personal liability or personal responsibility of any sort with respect to any of Landlord's Work Letter Undertakings or any alleged Tenant Landlord -s- [ILLEGIBLE] -s- [ILLEGIBLE] 30 breach thereof is assumed by, or shall at any time be asserted or enforceable against, Landlord, Jamison Properties, Inc., or against any of their respective directors, officers, employees, agents, constituent partners, beneficiaries, trustees or representatives. IN WITNESS WHEREOF, the parties hereto have executed this Work Letter as of the date first above written. LANDLORD: TENANT: 3600 WILSHIRE, LLC, A California NARA BANK, National Association limited liability company By: JPB Partners, Inc., a California corporation Its: Manager By: /s/ BON T. GOO --------------------- By: /s/ David Y. Lee Print Name: BON T. GOO -------------------------- David Y. Lee, M.D. Its: CFO & EVP Its: President Date: 2/6/03 Date: 2/7/03 By: /s/ [ILLEGIBLE] --------------------- Print Name: [ILLEGIBLE] Its: Directors of Legal Affairs Date: 2/6/03 Tenant Landlord -s- [ILLEGIBLE] -s- [ILLEGIBLE] 31 EXHIBIT C RULES AND REGULATIONS 1. The sidewalks, entrances, passages, courts, elevators, vestibules, stairways, corridors or halls shall not be obstructed or used for any purpose other than ingress and egress. The halls, passages, entrances, elevators, stairways, balconies and roof are not for the use of the general public, and Landlord shall in all cases retain the right to control or prevent access thereto by all persons whose presence in the judgment of Landlord shall be prejudicial to the safety, character, reputation or interests of Landlord and its tenants, provided that nothing herein contained shall be construed to prevent such access by persons with whom the tenant normally deals in the ordinary course of its business unless such persons are engaged in illegal activities No tenant and no employees of any tenant shall go upon the roof of the Building without the written consent of Landlord. 2. No awnings or other projections shall be attached to the outside walls or surfaces of the Building nor shall the interior or exterior of any windows be coated without the prior written consent of Landlord. Except as otherwise specifically approved by Landlord, all electrical ceiling fixtures hung in offices or spaces along the perimeter of the Building must be fluorescent and of a quality, type, design and bulb color approved by Landlord. Tenant shall not place anything or allow anything to be placed near the glass of any window, door, partition or wall which may appear unsightly from outside the Premises. 3. Interior signs on doors and the directory tablet shall be inscribed, painted or affixed for each tenant by Landlord at the expense of such tenant, and shall be of a size, color and style acceptable to Landlord. 4. The toilets and wash basins and other plumbing fixtures shall not be used for any purpose other than those for which they were constructed, and no sweepings, rubbish, rags or other substances shall be thrown therein. All damage resulting from any misuse of the fixtures shall be borne by tenant who, or whose servants, employees, agents, visitors or licensees, shall have caused the same. 5. No tenant or its officers, agents, employees or invitees shall mark, paint, drill into, or in any way deface any part of the Premises or the Building. No boring, cutting or stringing of wires or laying of linoleum or other similar floor coverings shall be permitted except with the prior written consent of Landlord and as Landlord may direct. 6. No bicycles, vehicles or animals of any kind shall be brought into or kept in or about the Premises and no cooking shall be done or permitted by any tenant on the Premises except that microwave cooking in a UL-approved microwave oven and the preparation of coffee, tea, hot chocolate and similar items for the tenant and its employees and business visitors shall be permitted. Tenant shall not cause or permit any unusual or objectionable odors to escape from the Premises. 7. The Premises shall not be used for manufacturing or for the storage of merchandise except as such storage may be incidental to the use of the Premises for general office purposes. No tenant shall engage or pay any employees on the Premises except those actually working for such tenant on the Premises nor advertise for laborers giving an address at the Premises. The Premises shall not be used for lodging or sleeping or for any immoral or illegal purposes. 8. No tenant or its officers, agents, employees or invitees shall make, or permit to be made any unseemly or disturbing noises, sounds or vibrations or disturb or interfere with occupants of this or neighboring buildings or Premises or those having business with them whether by the use of any musical instrument, radio, phonograph, unusual noise, or in any other way. 9. No tenant or its officers, agents, employees or invitees shall throw anything out of doors, balconies or down the passageways. 10. Tenant shall not maintain armed security in or about the Premises nor possess any weapons, explosives, combustibles or other hazardous devices in or about the Building and/or Premises. 11. No tenant or its officers, agents, employees or invitees shall at any time use, bring or keep upon the Premises any flammable, combustible, explosive, foul or noxious fluid, chemical or substance, or do or permit anything to be done in the leased Premises, or bring or keep anything therein, which shall in any way increase the rate of fire insurance on the Building, or on the property kept therein, or obstruct or interfere with the rights of other tenants, or in any way injure or annoy them, or conflict with the regulations of the Fire Department or the fire laws, or with any insurance policy upon the Building, or any part thereof, or with any rules and ordinances established by the Board of Health or other governmental authority. 12. Each tenant must, upon the termination of this tenancy, restore to Landlord all keys of stores, offices, and toilet rooms, either furnished to, or otherwise procured by, such tenant, and in the event of the loss of any keys so furnished, such tenant shall pay to Landlord the cost of replacing the same or of changing the lock or locks opened by such lost key if Landlord shall deem it necessary to make such change. 13. All removals, or the carrying in or out of any safes, freight, furniture, or bulky matter of any description must take place during the hours which Landlord may determine form time to time. The moving of Tenant Landlord -s- [ILLEGIBLE] -s- [ILLEGIBLE] 32 safes or other fixtures or bulky matter of any kind must be made upon previous notice to the manager of the Building and under his or her supervision, and the persons employed by any tenant for such work must be acceptable to Landlord. Landlord reserves the right to inspect all safes, freight or other bulky articles to be brought into the Building and to exclude from the Building all safes, freight or other bulky articles which violate any of these Rules and Regulations or the Lease of which these Rules and Regulations are a part. Landlord reserves the right to prohibit or impose conditions upon the installation in the Premises of heavy objects which might overload the building floors. Landlord will not be responsible for loss of or damage to any safes, freight, bulky articles or other property from any cause, and all damage done to the Building by moving or maintaining any such safe or other property shall be repaired at the expense of the tenant. 14 No tenant shall purchase or otherwise obtain for use in the Premises water, ice, towel, vending machine, janitorial, maintenance or other like services, or accept barbering or bootblacking services, except from persons authorized by Landlord, and at hours and under regulations fixed by Landlord. 15. Landlord shall have the right to prohibit any advertising by any tenant which, in Landlord's opinion, tends to impair the reputation of the Building or its desirability as an office building and upon written notice from Landlord any tenant shall refrain from or discontinue such advertising. No tenant shall use any graphic image of the Building or any part of the Building for advertising or public relations without Landlord's written permission. 16. Landlord reserves the right to exclude from the Building between the hours of 10:00 p.m. and 6:00 a.m. and at all hours of Saturdays, Sundays and legal holidays all persons who do not present a pass signed by Landlord. Landlord shall furnish passes to persons for whom any tenant requests the same in writing. Each tenant shall be responsible for all persons for whom he requests passes and shall be liable to Landlord for all acts of such persons. Landlord shall in no case be liable for damages for any error with regard to the admission to or exclusion from the Building of any person. In the case of invasion, mob, riot, public excitement or other commotion, Landlord reserves the right to prevent access to the Building during the continuance of the same, by closing of the gates and doors or otherwise, for the safety of the tenants and others and the protection of the Building and the property therein. 17. Any outside contractor employed by any tenant, shall, while in the Building, be subject to the Rules and Regulations of the Building. Tenant shall be responsible for all acts of such persons and Landlord shall not be responsible for any loss or damage to property in the Premises, however occurring. 18. All doors opening onto public corridors shall be kept closed, except when in use for ingress and egress, and left locked when not in use. 19. The requirements of tenants will be attended to only upon application to the Office of the Building. 20. Canvassing, soliciting and peddling in the Building are prohibited and each tenant shall cooperate to prevent the same. 21. All office equipment of any electrical or mechanical nature shall be placed by tenants in the Premises in setting approved by Landlord, to absorb or prevent any vibration, noise or annoyance. 22. No air conditioning unit or other similar apparatus shall be installed or used by any tenant without the written consent of Landlord. 23. There shall not be used in any space, or in the public halls of the Building either by any tenant or others, any hand trucks except those equipped with rubber tires and side guards. 24. Landlord will direct electricians as to where and how telephone and telegraph wires are to be introduced. No boring or cutting for wires or stringing of wires will be allowed without written consent of Landlord. The location of telephones, call boxes and other office equipment affixed to the Premises shall be subject to the approval of Landlord. All such work shall be effected pursuant to permits issued by all applicable governmental authorities having jurisdiction. 25. No vendor with the intent of selling such goods shall be allowed to transport or carry beverages, food, food containers, etc., on any passenger elevators. The transportation of such items shall be via the service elevators in such manner as prescribed by Landlord. 26. Tenants shall cooperate with Landlord in the conservation of energy used in or about the Building, including without limitation, cooperating with Landlord in obtaining maximum effectiveness of the cooling system by closing drapes or other window coverings when the sun's rays fall directly on windows of the Premises, and closing windows and doors to prevent heat loss. Tenant shall not obstruct, alter or in any way impair the efficient operation of Landlord's heating, lighting, ventilating and air conditioning system and shall not place bottles, machines, parcels or any other articles on the induction unit enclosure so as to interfere with air flow. Tenant shall not tamper with or change the setting of any thermostats or temperature control valves, and shall in general use heat, gas, electricity, air conditioning equipment and heating equipment in a manner compatible with sound energy conservation practices and standards. Tenant Landlord -s- [ILLEGIBLE] -s- [ILLEGIBLE] 33 27. All parking ramps and areas, pedestrian walkways, plazas, and other public areas forming a part of the Building shall be under the sole and absolute control of Landlord with the exclusive right to regulate and control these areas. Tenant agrees to conform to the rules and regulations that may be established by Landlord for these areas from time to time. 28. Landlord reserves the right to exclude or expel from the Building any person who, in the judgment of Landlord, is intoxicated or under the influence of liquor or drugs, or who shall in any manner do any act in violation of any of the rules and regulations of the Building. 29. Tenant and its employees, agents, subtenants, contractors and invitees shall comply with all applicable "no-smoking" ordinances and, irrespective of such ordinances, shall not smoke or permit smoking of cigarettes, cigars or pipes outside of Tenant's Premises (including plaza areas) in any portions of the Building except areas specifically designated as smoking areas by Landlord. If required by applicable ordinance, Tenant shall provide smoking areas within Tenant's Premises. Tenant Landlord -s- [ILLEGIBLE] -s- [ILLEGIBLE] 34 EXHIBIT D GUARANTY BY A CORPORATION INTENTIONALLY OMITTED Tenant Landlord -s- [ILLEGIBLE] -s- [ILLEGIBLE] 35 EXHIBIT E SUITE ACCEPTANCE AGREEMENT BUILDING NAME/ADDRESS: 3600 WILSHIRE BOULEVARD TENANT NAME: NARA BANK, NATIONAL ASSOCIATION TENANT CODE:_______________________________ SUITE NUMBER: 100A MANAGEMENT'S TENANT CONTACT:_________________________________PHONE: 213-385-1374 Gentlemen: As a representative of the above referenced tenant, I/we have physically inspected the suite noted above and its improvements with______________________, a representative of________________________. I/we accept the suite improvements as to compliance with all the requirements indicated in our lease, also including the following verified information below: Lease Commencement Date: July 1, 2003 Occupancy Date: Lease Rent Start Date*: July 1, 2003 Actual Rent Start*: Lease Expiration Date: June 30, 2013 Actual Expiration Date: Date Keys Delivered: Items requiring attention:______________________________________________________ ________________________________________________________________________________ ________________________________________________________________________________ ________________________________________________________________________________ * If these dates are not the same, attach documentation. NOTE: This inspection is to be made prior to tenant move-in. Very truly yours, _________________________________ By: ___________________________ Its: ___________________________ Date: ___________________________ Distribution Tenant Tenant Lease File Leasing Manager: ______________________ Document Control: ______________________ Regional Construction Manager: ______________________ Regional Engineering Manager: ______________________ Tenant Landlord -s- [ILLEGIBLE] -s- [ILLEGIBLE] 36 EXHIBIT F ASBESTOS NOTIFICATION Tenant Landlord -s- [ILLEGIBLE] -s- [ILLEGIBLE] 37 EXHIBIT F ASBESTOS NOTIFICATION NOTICE PURSUANT TO AB3713 CALIFORNIA HEALTH & SAFETY CODE 25915 ET SEQ. RE: 3600 WILSHIRE BOULEVARD, LOS ANGELES, CALIFORNIA (BUILDING) California legislation requires landlords and tenants of commercial buildings constructed prior to 1979 to notify each other and their respective employees working within such building of any knowledge they may have regarding any asbestos containing construction material in the building. This notice is to provide you with the information required under this legislation. Certain tests to determine the existence of asbestos containing construction materials have been conducted. The results of these tests, which arc summarized below, indicate that there are asbestos containing construction materials in the Buildings. Some of these materials in some locations have been abated (removed) by the prior owner of the Buildings. The specific locations within the Building where asbestos containing construction materials have been identified by the reports as being present in any quantities are as follows: 1. The fire proofing on the steel deck and structural beams between floors and above the ceiling line. 1. The thermal insulation on pipes and equipment on the roof and basement level equipment rooms. 2. The thermal insulation on pipes in the tenth (10th) floor equipment room. 3. The thermal insulation on pipes located inside the wet columns throughout the Building. 4. The adhesive mastic holding the corridor ceiling tiles substrate. 5. Some of the vinyl floor tiles located throughout the Buildings. The general procedures and handling restrictions necessary to minimize any disturbance to, release of and exposure to the asbestos are: 1. No work is to be performed above the suspended ceiling line of any floor without prior authorization from the Office of the Building. 2. Access to any and all equipment rooms (including electrical and telephone rooms) is strictly prohibited, except to personnel authorized by the Office of the Building. 3. No work is to be performed on vinyl floor tiles without prior authorization from the Office of the Building. We have no special knowledge concerning the potential health risks or impacts that may result from exposure to asbestos in the Buildings, but we understand that potential health risks may exist if asbestos fibers are released from asbestos containing construction materials. Those of your that may require additional information of potential health risks are encouraged to contact appropriate government agencies, including Federal and State OSHA, State Health & Welfare Agency, State Department of Health Services and the County Health Departments. If there are any questions regarding this notice, please contact the Property Manager at 3600 Wilshire Boulevard, Suite 800, Los Angeles, CA 90010. Tenant Landlord -s- [ILLEGIBLE] -s- [ILLEGIBLE] 38 EXHIBIT G PARKING AGREEMENT So long as the lease dated JANUARY 17, 2003, 3600 WILSHIRE, LLC, A California limited liability company, c/o JPB Partners, Inc., a California corporation, ("Landlord") and NARA BANK, NATIONAL ASSOCIATION, as ("Tenant") covering space at 3600 Wilshire Blvd., SUITE 100A, Los Angeles, CA 90010 property commonly known as Wilshire Financial Tower as (the "Property") remains in effect, and so long as the Rules and Regulations adopted by Landlord are not violated, Tenant or persons designated by Tenant, shall have the right to use on a month to month basis FIFTY (50) parking spaces for Tenant's employee use in the Parking Facilities associated with or forming a part of the Property. THREE (3) of above allotted parking spaces shall be on a reserved basis. Additionally, Landlord will provide TEN (10) reserved upper level parking spaces near the south entrance of the building project for Tenant's visitors. Said parking spaces shall be offered to Tenant at the building's prevailing parking rates subject to applicable city, state, and federal taxes and assessments, if any, which amount may be changed from time to time at Landlord's reasonable discretion. Tenant may validate visitor parking at Landlord's prevailing rate. However, should Tenant or Tenant's designee materially violate the Parking Rules and Regulations, the right to the parking spaces granted in this Parking Agreement shall be subject to cancellation by Landlord, in whole or in part, at any time upon not less than thirty (30) days prior written notice, except where the Parking Rules and Regulations provide for a shorter notice. A condition of any parking shall be compliance by the driver with Parking Rules and Regulations, including any sticker or other identification system established by the parking operator. The following Parking Rules and Regulations are currently in effect. Landlord reserves the right to modify and/or adopt such other reasonable and nondiscriminatory Rules and Regulations for the Parking Facilities as it deems necessary for the operation of the Parking Facilities. The parking operator may refuse to admit any person who violates the Parking Rules and Regulations ("Rules") to park in the Parking Facilities, and any violation of the Rules shall subject the driver's car to removal from the Parking Facilities. In either of said events the parking operator shall refund a prorata portion of the current parking rate and the sticker or any other form of identification shall be returned or caused to be returned by Tenant to the parking operator. Landlord expressly disclaims any responsibility for any theft of or vandalism or damage to any personal property, including without limitation, any motor vehicle, in, on, or about the Parking Facilities irrespective of cause, circumstance, or parties involved. As a material inducement to Landlord to allow Tenant the parking rights set forth herein, Tenant agrees to assume full responsibility for the foregoing to the extent such relates to Tenant and/or Tenant's employees, principals, agents, affiliates, and/or invitees, and Tenant agrees to indemnify, defend and hold harmless Landlord for all costs, liability and damages relating to or arising from the foregoing. The occurrence of the following shall constitute a material default and breach of the Lease to which this Parking Agreement is attached as Exhibit "F" and shall entitle Landlord to exercise such remedies as are therein provided, in addition to any other right or remedy which Landlord may have at law or in equity by reason of such default or breach: The failure of Tenant to make any payment required to be made by Tenant under this Parking Agreement, where such failure continues until the earlier of (I) five (5) days after the date on which such payment was due, or (II) three days after written notice thereof has been given by Landlord to Tenant; or The failure of Tenant to observe and perform any other provision of this Parking Agreement to be observed or performed by Tenant, where such failure continues for five (5) days after written notice thereof by Landlord to Tenant; provided, however, that any such notice referred to in part; (b) hereof shall be in lieu of and not in addition to any notice required under Section 1161 of the California Code of Civil Procedure. PARKING RULES AND REGULATIONS Parking Facilities hours shall be as posted by management. Cars must be parked entirely within the stall lines painted on the floor. All directional signs and arrows must be observed. The speed limit shall be 5 miles per hour. Parking is prohibited in areas: not striped for parking aisles where "no parking" signs are posted ramps in reserved spaces, except for the person for whom such space is reserved. Parking stickers or any other device or form of identification supplied by the parking operator shall remain the property of the parking operator. Such parking identification device must be displayed in the front area of the interior of the vehicle, or as requested, so that it may be readily observed by the parking operator's attendants at all times while the vehicle is in the Parking Facilities, and it may not be mutilated in any manner, and the serial number Tenant Landlord -s- [ILLEGIBLE] -s- [ILLEGIBLE] 39 of the parking identification device may not be obliterated. Devices are not transferable and any device in the possession of an unauthorized holder will be void. The monthly rent for parking space is payable one (1) month in advance and must be paid prior to the fifth day of each calendar month. Failure to do so will automatically cancel parking privileges and a charge at the prevailing daily parking rate plus a reinstatement fee of $25.00 will be due. No deductions or allowances from the monthly rate will be made for time the customer does not use Parking Facilities. Parking managers or attendants are not authorized to make or allow any exceptions to these Parking Rules and Regulations and these Parking Rules and Regulations may be from time to time modified or amended. Every driver is required to park his/her own car. If there are tandem spaces, the first car shall pull all the way to the front of the space leaving room for a second car to park behind the first car. The driver parking behind the first car must leave his key in the ignition and the door of his car unlocked. Failure to do so shall subject the driver of the second car to a $25.00 fine. Refusal of the driver to leave his key to the second car when parking tandem shall be cause for termination of the right to park in the Parking Facilities. The parking operator, or his employees or agents, shall be authorized to move cars that are parked in tandem should it be necessary for the operation of the Parking Facilities. Tenant agrees that all responsibility for damage to cars or the theft of or from cars is assumed by the driver, and further agrees that he/she will hold Landlord harmless for any such damages or theft. Loss or theft of parking identification stickers or devices from automobiles must be reported to the parking operator immediately, and a lost or stolen report must be filed by the customer at that time. Any parking identification stickers or devices reported lost or stolen, found on any unauthorized car will be confiscated and the illegal holder will be subject to prosecution Lost or stolen stickers or devices found by the purchaser must be reported to the parking operator immediately. Spaces rented are for the express purpose of parking automobiles and for no other purpose. Washing, waxing, cleaning or servicing of any vehicle by the customer and/or his agents is prohibited. The parking operator reserves the right to refuse the sale of monthly stickers to any tenant or person and/or his agents or representatives who willfully refuse to comply with these Parking Rules and Regulations and all unposted City, State or Federal ordinances, laws or agreements. By signing this Parking Agreement, Tenant agrees to inform all persons to whom tenant assigns parking space of the context of these Parking Rules and Regulations. LANDLORD: TENANT: 3600 WILSHIRE, LLC, A California NARA BANK, National Association limited liability company By: JPB Partners, Inc., a California corporation Its: Manager By: -s- BON T. GOO --------------------- By: -s- David Y. Lee, M.D. Print Name: BON T. GOO -------------------------- David Y. Lee, M.D. Its: CFO & EVP Its: President Date: 2/6/03 Date: 2/7/03 By: -s- MICHEL URICH --------------------- Print Name: MICHEL URICH Its: Directors of Legal Affairs Date: 2/6/03 Tenant Landlord -s- [ILLEGIBLE] -s- [ILLEGIBLE] 40 ADDENDUM I This Addendum I to Lease is made and entered into as of the JANUARY 17,2003 ("the Effective Date") by and between 3600 WILSHIRE, LLC A California limited liability company, its Manager By: c/o JPB Partners, Inc., a California corporation, ("Landlord") and NARA BANK, NATIONAL ASSOCIATION, as ("Tenant"). In the event of a conflict between the Lease and this Addendum 1 to Lease, this Addendum shall prevail. 1. TENANT'S DUTIES TO MAINTAIN THE PREMISES: During the Lease Term, Tenant agrees to maintain and keep clean at all times the interior and store front of the Premises (including repair of plate glass and cleaning and maintenance of the Plaza deck area where Tenant's enter and exit) at Tenant's sole cost and expense and with a degree of workmanship reasonably acceptable to Landlord. Such maintenance and cleaning of the store front glass shall be done by Tenant periodically and Tenant shall maintain the metal trim around and between the windows, doors and thresholds of the Premises at least once a month or as needed during the Lease Term. Notwithstanding anything to the contrary herein, Tenant agrees to repair or replace any damaged plate glass within Seven (7) business days of occurrence. Tenant shall be responsible for painting the entire interior of the premises every Five (5) years during the Lease term. Tenant agrees that it shall use a contractor or contractors acceptable to Landlord and approved in writing by Landlord for such maintenance and cleaning. 2. PRIOR OCCUPANCY: Tenant shall be permitted to enter the Premises during the Four (4) months period, from March 1, 2003 through June 30, 2003, prior to the Commencement Date, for the purpose of constructing its Premises, installing furniture, fixtures, equipment or other special leasehold improvements. Landlord shall deliver the Premises to Tenant no later than February 28,2003 ready for Tenant's construction. 3. JANITORIAL AND PEST CONTROL: During the Lease Term, Tenant shall keep and maintain the Premises in a clean and sanitary condition at all times as well as providing adequate pest control on a monthly basis, or more often, if necessary, at its sole cost and expense. 4. UTILITIES AND SERVICES: Tenant shall be responsible for and shall pay promptly all charges of water, gas, electricity, sewer, heat, light, power, telephone, refuse pickup, janitorial service and all other utilities, materials and services furnished directly or indirectly to the Premises during the term, and any option periods exercised by Tenant. Separate meters will measure Tenant's electrical and gas usage at the Premises. Tenant shall be responsible at its own cost for the maintenance and repair of said separate meters. Tenant shall at its own cost install or have installed on its behalf a separate meters which shall measure Tenant's electrical and gas consumption at the Premises and Tenant shall arrange with the local natural gas utility and electrical utility company for Tenant to be billed directly for its gas and electrical consumption at the Premises. Tenant shall be responsible for the maintenance and repair of said separate meters. Tenant shall be responsible fir maintaining the Premises in a clean and sanitary condition at all times, including but not limited to a drain maintenance program by a certified licensed plumber as well as maintaining a pest control system on a monthly basis, or more often, if required. The cost of such is to be paid for by Tenant. 5. TRASH DUMPSTER REMOVAL: Throughout the term of this Lease and any extension hereof, at Tenant's sole cost and expense, Tenant shall contract with an outside trash removal company to remove any and all trash generated by Tenant. This vendor must have it on file, with the Landlord a certificate of Insurance naming the Landlord and the Management Company as additional insured. The Tenant further agrees that it will dispose of all garbage and refuse at times and locations that Landlord specifies so as not to inconvenience or annoy the tenants or visitors in the building of which the Premises form a part. Tenant covenants and agrees that all garbage waiting collection shall be kept in an adequately contained space within the Premises until such time as it is actually disposed of. All trash must be kept in sealed, lockable containers so as not to emit any odors or leakage and must be removed from the Premises once a day. Tenant further covenants and agrees that it will wash and clean empty refuse can in an area designated by Landlord. 6. EXCLUSIVITY FOR GENERAL BANKING BUSINESS. Landlord hereby agrees that Tenant and its operations shall be the exclusive banking entity on-site at the Premises and/or project. 7. SIGNAGE: Tenant shall not affix, paint, erect or inscribe any sign, protection, awning, signal or advertisement of any kind to any part of the Premises, Building or Project, including without limitation, the inside or outside of windows or doors, without the prior written consent of Landlord. Tenant shall be permitted to install signage at Tenant's cost and subject to Landlord's consent, above its Premises along Wilshire Boulevard and any adjacent street to its Premises. Signage rights shall be at no cost to Tenant, with exception to cost of installation. Design shall be subject to Landlord and City of Los Angeles approval Landlord shall have the right to remove any signs or other matter installed without Landlord's permission, without being liable to Tenant by reason of such removal, and to charge the cost of removal to Tenant as additional Rent hereunder, payable within Ten (10) days of written demand by Landlord. Tenant may utilize, letter style and graphics on all interior and exterior (canopy) signage. Exterior signage shall be illuminated signage. Landlord shall not unreasonably withhold its consent to Tenant's signs, which conform, to Landlord's sign criteria and local sign ordinances. Said signage shall be at Tenant's sole cost and expense and Tenant shall maintain signage in good order and repair at all times at Tenant's sole cost and expense. 8. TELEPONE AND COMMUNICATIONS: All private telephone and communications systems must be installed in Tenant suite area. Special equipment shall not be maintained in telephone terminal rooms. Tenant Landlord -s- [ILLEGIBLE] -s- [ILLEGIBLE] 41 9. RISER CABLE: Landlord will maintain the telephone cable it has installed inside the Property. Landlord, however, shall not be responsible for interruption of service transmission, installation, and/or quality of intra- building network of cable. 10. PLUMBING REPAIRS: Landlord shall not be responsible for repair and maintenance of any plumbing in the Premises such as sinks or kitchen facilities in the suite. Tenant shall be responsible for cleaning, drain work that may be necessary, repair of garbage disposal, and any other related costs to the extent such costs are not covered by manufacturer or contractor warranties. Tenant shall reimburse any costs incurred by Landlord for these items to Landlord. 11. PLATE GLASS INSURANCE: During the entire term of the Lease, Tenant shall maintain, at its own expense, an insurance policy covering all plate glass and other glass in the premises which shall name Landlord as an additional insured, and Tenant will deliver to Landlord such policy of insurance or certificates therefore not less than Fifteen (15) days before the commencement of the term of the Lease or before Tenant shall enter the Premises, whichever is earlier, and will renew such policy and deliver such renewal policy to Landlord not less than Fifteen (15) days before the expiration of the policy so renewed. Should Tenant fail to deliver such insurance within the time aforesaid, Landlord shall notify Tenant of Landlord's intention to procure such insurance. If Tenant has not delivered evidence of such insurance within Ten (10) days following receipt of such notice, Landlord may procure such insurance and pay the premiums thereof, in which case, Tenant shall reimburse Landlord for the cost thereof as additional rent on the first day of the calendar month following the receipt of Landlord's evidence of payment thereof. Landlord shall have the same rights and remedies in endorsing the payment of any such additional rent as in the case of Tenant's failure to pay the rental herein reserved. Such plate glass insurance shall be in an amount sufficient to replace all plate glass of like quality in the Premises including the installation thereof. 12. HVAC: Tenant acknowledges that the Premises has a separate air conditioning system for after hours usage, which supplies the Premises exclusively, and is under the care, custody and control of Tenant. Landlord shall, prior to the Lease Commencement Date, service the HVAC units to make sure they are in good working condition. Thereafter, Tenant shall be responsible for all maintenance and repair costs or replacement relative to such systems throughout the term of the Lease. Tenant shall keep and maintain the system in good working order and repair throughout the term of the Lease, and Tenant shall use contractors acceptable to Landlord for said maintenance, repair and/or replacement. 13. RENEWAL OPTIONS: Provided that no event of default has ever occurred under any term or provision contained in this Lease and no condition exists which with the passage of time or the giving of notice or both would constitute an event of default pursuant to this lease and provided that Tenant has continuously occupied the Premises for the permitted use during the Lease Term, Tenant shall have the right and option (the "Renewal option") to renew this Lease by written notice delivered to Landlord no later than Nine (9) months prior to the expiration of the initial Lease Term, for Two (2) additional terms (the renewal term) of Sixty (60) months under the same terms, conditions and covenants contained in this Lease, except that: a) no abatements or other concessions if any applicable to the initial Lease Term shall apply to the Renewal Term: b) the Base Rental shall be equal to the Fair Market rate including all applicable concessions for comparable space located in the Building as of the end of the initial Lease Term or extended term: c) Tenant shall have no option to renew this Lease beyond the expiration of the Renewal Terms and the all leasehold improvements within the Premises shall be provided in their then existing condition (on an "as is" basis) at the time the Renewal Term commences. Failure by Tenant to notify Landlord in writing of Tenant's election to exercise any Renewal Option herein granted within the time limits set forth for such exercise shall constitute a waiver of such Renewal Option. In the event Tenant elects to exercise the Renewal Option as set forth above, Landlord shall within Thirty (30) days thereafter notify Tenant in writing of the Proposed Rental for the Renewal Term (the "Proposed Renewal Rental" ). Tenant shall within Thirty (30) days following delivery of the Proposed Renewal Rental by Landlord notify Landlord in writing of the acceptance or rejection of the Proposed Renewal Rental. If Tenant accepts Landlord's proposal, then the Proposed Renewal Rental shall be the rental rate in effect during the Renewal Term. Failure of Tenant to respond in writing during the aforementioned Thirty (30) day period shall be deemed an acceptance by Tenant of the Proposed Renewal Rental. Should Tenant reject Landlord's Proposed Renewal Rental during such Thirty (30) day period, then Landlord and Tenant shall negotiate during the Thirty (30) day period commencing upon Tenant's rejection of Landlord's Proposed Renewal Rental to determine the rental for the Renewal Term. 14. PRELIMINARY SPACE PLAN: Landlord to provide sixteen cents ($0.16) per usable square foot. Said allowance is to pay for Tenant's space planner to design a preliminary drawing of said space. 15. MOVE-IN: The demised premises shall be thoroughly cleaned, at Landlord's sole cost and expense, prior to the delivery of the Premises to Tenant for construction. 16. ABANDONMENT: Tenant shall not be in default for vacating the premises so long as Tenant pays its rent per the Lease agreement and is not in default on other provisions of this Lease. Upon exercise of Renewal Option by Tenant and subject to the conditions set forth hereinabove, the Lease shall be extended for the period of such Renewal Term without the necessity of the execution of any further instrument or document, although if requested by either party, Landlord and Tenant shall enter into a written agreement modifying and supplementing the Lease in accordance with the provisions hereof. Any termination of the Lease during the initial Lease Term shall terminate all renewal rights hereunder. The renewal rights of Tenant hereunder shall not be severable from the Lease, nor may such rights be assigned or otherwise conveyed in Tenant Landlord -s- [ILLEGIBLE] -s- [ILLEGIBLE] 42 connection with any permitted assignment of the Lease. Landlord's consent to any assignment of the Lease shall not be construed as allowing an assignment of such rights to any assignee. Except as amended herein, all other provisions of the Lease Agreement remain in full force and effect. This Addendum I shall control in the event of any inconsistency with the original lease. If Tenant shall be a corporation, the authorized officers must sign on behalf of the corporation and indicate the capacity in which they are signing. LANDLORD: TENANT: 3600 WILSHIRE, LLC, A California NARA BANK, National Association limited liability company By: JPB Partners, Inc., a California corporation Its: Manager By: -s- BON T. GOO --------------------- By: -s- David Y. Lee, M.D. Print Name: BON T. GOO -------------------------- David Y. Lee, M.D. Its: CFO & EVP Its: President Date: 2/6/03 Date: 2/7/03 By: -s- MICHEL URICH --------------------- Print Name: MICHEL URICH Its: Director of Legal Affairs Date: 2/6/03 Tenant Landlord -s- [ILLEGIBLE] -s- [ILLEGIBLE] 43 ADDENDUM TO LEASE This ADDENDUM TO LEASE (this "Addendum") is an addendum to and part of that certain Lease dated January 17, 2003 (the "Lease") by and between by and between 3600 Wilshire, LLC, a California limited liability company. ("Landlord") and Nara Bank, National Association ("Tenant"). 1. Unless otherwise defined herein, all capitalized terms in this Addendum shall have the meanings ascribed to them in the Lease. All references herein to sections are to sections in the Lease. 2. The fourth line of Section 1.03 is amended to insert the words "and Tenant's" after the word "Landlord's." 3. The first line of Section 1.10 is amended to delete "Banking and Office" and to insert in its place and stead "banking, financial services, insurance, general office or retail." 4. Section 1.10 is amended to add the following sentence at the end of such section: "In the event of a conflict between the provisions of any such rule or regulation and the provisions of this Lease (and all exhibits and addenda attached hereto), the provisions of this Lease shall prevail and control." 5. The third line of Section 1.11 is amended to insert the following after "Thanksgiving Day": ", Martin Luther King, Jr.'s Birthday (observed), Columbus Day, Veterans Day...." 6. Section 1.13 is amended to insert the following before the period at the end of such section: "Attention: Branch Manager, with a copy to 3701 Wilshire Blvd., Second Floor, Los Angeles, CA 90019, Attention: Chief Financial Officer." 7. A new Section 1.17 is inserted into the Lease, as follows: 1.17 BASE SHELL CONDITION. The term "Base Shell Condition" shall mean the Premises, as modified by Landlord upon the completion of the base building work to be performed by Landlord as described in the Landlord's Work in Exhibit A attached to the Addendum to Lease pursuasnt to which this section is inserted into the Lease. 8. The first line of Section 2.01 is amended to insert the following after "Lender hereby leases": "in Base Shell Condition, and inclusive of all standard landlord representations and warranties, and with structural integrity of the Building and the Premises". 9. Section 2.01 is amended to add the following at the end of such section: Tenant shall accept Landlord's tender of possession of the Premises provided there are no material violations of applicable laws (including, without limitation, hazardous substances laws) other than as disclosed in the Asbestos Notification attached hereto as Exhibit F and, Landlord shall, at its sole cost and expense, shall cure any undisclosed violations prior to delivering the Premises to Tenant for the purpose of Tenant's performance of its portion of the tenant improvement work. 1 10. A new Section 2.03 is inserted into the Lease, as follows: 2.03 THIRD PARTY AGREEMENTS. Landlord represents and warrants to Tenant that the leasing of the Premises and the execution of the Lease by Landlord and Tenant does not cause a default under any lease, mortgage or deed of trust affecting the Premises, or under any other agreement or document to which Landlord is a party that affects the Building or the Premises 11. Section 3.01 is amended and restated in its entirety as follows: 3.01 Except as otherwise provided in this Lease, the Lease Term shall be for the period described in Section 1.04 of this Lease, commencing on the Commencement Date described in Section 1.05 of this Lease and ending on the Expiration Date described in Section 1.06 of this Lease; provided, however, that, if, for any reason, Landlord is unable to deliver possession of the Premises to Tenant in Base Shell Condition on or before February 28, 2003, Landlord shall not be liable for any damage caused thereby, nor shall the Lease be void or voidable, but, rather, the Commencement Date shall be extended by the same number of days as the number of days between February 28, 2003 and the date that Landlord does tender possession to Tenant of the Premises in Base Shell Condition and, unless Landlord elects otherwise, the Expiration Date described in Section 1.06 of this Lease shall be extended by an equal number of days. NOTWITHSTANDING THE FOREGOING, IF THE PREMISES ARE NOT DELIVERED IN BASE SHELL CONDITION TO TENANT ON OR BEFORE APRIL 30,2003, TENANT MAY, WITHIN THE FOLLOWING FIFTEEN (15) BUSINESS DAYS, AT ITS SOLE OPTION, TERMINATE THIS LEASE AND HAVE NO LIABILITY TO LANDLORD HEREUNDER OR THEREFOR. 12. Landlord and Tenant agree that the Lease is a modified gross lease and that, accordingly, (a) Section 4.01(C) is hereby amended to delete in their entirety the following subsections: (ix) - (xv) and (b) subsection (iii) is amended and restated in its entirety as; follows: "(iii) Cleaning expenses, including without limitation janitorial services and window cleaning.". 13. Section 4.02(B)(b), including its subsections (i) and (ii), is deleted in its entirety. Landlord and Tenant agree that there shall be no adjustment to rent based upon a consumer price index. 14. The first line of Section 4.03(B) is amended to delete "one hundred twenty (120)" and to insert in its place and stead "ninety (90)". 15. The fourth line of the introductory paragraph of Section 4.04(A) is amended to delete "once" and to insert in its place and stead "twice". 16. The first line of Section 4.04(A) is amended to delete "ten (10)" and to insert in its place and stead "thirty (30)". 2 17. The eighth line of Section 4.04(A) is amended to delete "once" and to insert in its place and stead "twice". 18. The fourth line of Section 4.04(B) is amended to delete "of national standing". 19. The sixth line of Section 4.04(B) is amended to insert the following after "accountants": "legal counsel and real estate representatives ....." 20. The eighth line of Section 4.04(C) is amended to insert the following after "Adjustment" and before the period that ends the sentence: "; provided, however, that if the review occurs during the final year of the term (or any renewal term) of this Lease, Landlord shall provide the refund within sixty (60) days following the expiration of the term of this Lease". 21. Section 4.05 is amended to add the following sentence at the end of such section: Notwithstanding any of the provisions of this section or this Lease to the contrary, if a condition exists as a result of Landlord's gross negligence or willful misconduct that injures, inconveniences or interferes with Tenant's ability to conduct its business or that constitutes a default hereunder and such condition persists for more than five (5) consecutive business days or such other period as may be permitted by applicable law, Tenantshall have the right to damages for such default and such other remedies as may be permitted by this Lease and applicable law. 22. The seventh and eighth lines of Section 4.06 are amended to delete "twelve percent (12%)" and insert in its place and stead "ten percent (10%)". 23. A new Section 4.09 is added to the Lease, as follows: Section 4.09 EFFECT OF PROPOSITION 13 REASSESSMENT. Notwithstanding anything to the contrary herein, or any actions taken by Landlord relating the to the Premises, if any portion of the Premises is reassessed due to a "change in ownership," "new construction," or other reassessment within the meaning of Section XIIIA of the California Constitution (a "Reassessment"), Tenant shall bear taxes attributable to such Reassessment only to the extent such reassessment is due to a modification of the Premises by Tenant. Nothing in this section shall exempt Tenant from bearing its share of the annual increases provided by applicable laws attributable to the Premises which would be assessed regardless of the occurrence of such a Reassessment. 24. Section 5.01 is deleted in its entirety. 25. Section 6.02(A) is hereby amended to delete "Tenant shall" and insert in their place and stead: "Landlord and Tenant shall each have respective responsibilities (allocated to each based upon the portion of the improvements for which each is responsible to construct)". 26. THE LAST PARAGRAPH OF SECTION 7.01 IS DELETED IN ITS ENTIRETY. 27. The seventh line of Section 7.02 is amended to insert the following after "Tenant" and before the period mat ends the sentence: "; provided, however, if a condition exists as a result of 3 Landlord's gross negligence or willful misconduct that injures, inconveniences or interferes with Tenant's ability to conduct its business or that constitutes a default hereunder and such condition persists for more than five (5) consecutive business days or such other period as may be permitted by applicable law, Tenantshall have the right to damages for such default and such other remedies as may be permitted by this Lease and applicable law. 28. Section 8.01 is amended and restated, as follows: 8.01 LANDLORD'S OBLIGATIONS. Except as provided in Sections 8.02 and 8.03 below, Landlord shall maintain the Building in reasonable order and repair throughout the Lease Term; provided, however, that Landlord shall not be liable for any failure to make any repairs or to perform any maintenance unless such failure shall persist for more than five (5) business days after written notice of the need for such repairs or maintenance is given to Landlord by Tenant, or such greater period provided Landlord has commenced to cure, and diligently pursues same to completion; provided, however, that Tenant shall have the right to damages for such default and such other remedies as may be permitted by this Lease and applicable law. 29. The second line of Section 8.03 is amended to delete "twenty-four (24)" and insert in its place and stead "forty-eight (48)". 30. Section 8.03 is amended to add the following at the end of such section: Notwithstanding any other provisions hereof to the contrary, except in the case of emergency, Landlord shall enter the Premises only during normal business hours following the giving of forty-eight (48) hours notice (which shall be in writing, unless notice is given to Tenant's Chief Financial Officer or the branch manager on the Premises, either of whom may request that any oral notice be confirmed with a written notice) and Landlord shall be accompanied by a representative of Tenant (except that such restrictions shall not apply on such days as the Premises are not open for the conduct of Tenant's business or in the event of an emergency, in which cases Landlord shall make reasonable efforts to give oral notice to Tenant's Chief Financial Officer or the branch manager on the Premises). Furthermore, in the event of an emergency, Landlord's representative shall enter the Premises only with the accompaniment of the appropriate third-party emergency response official from the Los Angeles Fire Department, Los Angeles Police Department, or other appropriate governmental agency. All such entries shall be in conformance with all applicable federal and state laws and regulations. 31. Section 9.01 is amended to add the following at the end of such section: Landlord's approval shall not be required for any Alteration that costs Tenant $20,000.00 or less (but Tenant shall provide reasonable prior written notice of Tenant's intent to make or permit to be made any such Alteration) unless such Alteration causes or requires modification of any of Landlord's service systems or affects the structural integrity of the Premises. Further, if Landlord's approval is required by any provision of this section, such approval shall be provided within thirty (30) days after Tenant's request therefor, and such 4 approval shall not be unreasonably conditioned, withheld or delayed. 32. Section 9.02 is amended to add the following at the end of such section: If any Alteration requires Landlord to enter the Premises, such entry shall be subject to the requirements of the last sentence of Section 8.03. 33. A new Section 9.05 is added to the Lease, as follows: 9.05 Tenant shall be responsible for the installation of its vault and an automated teller machine (" ATM") within the [Building lobby or the Premises] in accordance with the provisions of this Article IX and such improvements shall be subject to the provisions of this Section 9; provided, however, that Tenant shall remove the ATM within thirty (30) days following the expiration of the Lease, subject to extension if necessary to satisfy all applicable laws. Reasonable security for the use and operation of the vault and the ATM shall be provided by Landlord throughout the term of the Lease. Landlord shall have no duties to increase spending on the security service as a result of the presence of the ATM and the vault in the Premises, but the security provided by Landlord for the Premises, as generally provided for herein, shall include the ATM and the vault area (but Tenant acknowledges that because the vault is within the Premises, the Building's security guard cannot enter the Premises). Landlord and Tenant shall use their best efforts to approve a commercially reasonable location for Tenant's ATM, which approval shall not be unreasonably conditioned, withheld or delayed. 34. Section 10.01(A) is amended and restated in its entirety as follows: (A) Tenant agrees to protect, indemnify, hold harmless and defend Landlord and any Successor Landlord (as defined below) from and against any and all loss, cost, damage, liability or expense, including reasonable attorneys' fees, with respect to any claim of damage or injury to persons or property at the Premises, caused by the gross negligence or willful misconduct of Tenant or its authorized agents or employees. 35. Section 10.01(B) is amended and restated in its entirety as follows: (A) Landlord agrees to protect, indemnify, hold harmless and defend Tenant from and against any and all loss, cost, damage, liability or expense, including reasonable attorneys' fees, with respect to any claim of damage or injury to persons or property at the Premises, caused by the gross negligence or willful misconduct of Landlord or its authorized agents or employees. 36. Section 10.06 is amended to add the following at the end of such section: The waivers contained in this Section 10.06 shall not apply to any injury or loss caused by Tenant's or Landlord's gross negligence or willful misconduct. 5 37. The first line of Section 11.02 is amended to insert the following after "If: "25% or more of. 38. The first line of Section 11.02 is amended 10 insert the following after "and": "Tenant elect not to repair". 39. The second line of Section 11.02 is amended to insert the following before "opinion": "reasonable". 40. Section 11.04 is deleted in its entirety. 41. The fourth line of Section 12.01 is amended to insert the following after "premises": "on the ground floor of the Building". 42. The first line of Section 12.02 is amended to insert the following after "award": ", unless otherwise specified that the amount awarded is to be shared between Tenant and Landlord for Tenant's relocation and improvement costs". 43. The eighteenth line of Section 14.01 is amended to delete "twenty (20) days" and insert in its place and stead "ten (10) business days". 44. Section 14.01 is amended to add the following at the end of such section: Notwithstanding any of the provisions of this section or this Lease to the contrary, any change of ownership of Tenant due to merger of Tenant into, or acquisition of Tenant by, another financial institution shall not be deemed an assignment or sublease for purposes of this Lease. Further, if Landlord's approval is required by any provision of this section, such approval shall not be unreasonably conditioned, withheld or delayed. 45. The third and fourth lines of Section 14.02 are amended to delete "in connection with Tenant's request for Landlord's consent" and insert in its place and stead "a notice containing". 46. The first line of Section 14.03 is amended to delete "twenty (20) business days" and to insert in its place and stead "fifteen (15) business days". 47. The eighth line of Section 14.03 is amended to delete "twenty (20) day period" and to insert in its place and stead "fifteen (15) business day period". 48. Section 14,03 is amended to add the following at the end of such section: Landlord acknowledges that notwithstanding any of the provisions of this section, (i) Landlord shall have no recapture rights in the event of any change of ownership of Tenant due to merger of Tenant into, or acquisition of Tenant by, another financial institution (and that any such event shall not be deemed an assignment or sublease, as provided in Section 14.01) and (ii) the recapture process, including, without limitation, timing requirements, shall be subject to all applicable federal and state regulatory 6 requirements. 50. The second line of Section 15.01(A) is hereby amended insert the following before the period at the end of such section: "or within five days following when such payment is due". 51. Section 15.01 (D) is amended and restated in its entirety as follows: (D) The failure by Tenant to observe or perform any other provision of this Lease to be observed or performed by Tenant, other than those described in Sections 15.01(A), 15.01(B) or 15.01 (C) above, shall constitute a default by Tenant under this Lease only if such failure shall continue for a period of thirty (30) days (or the additional time, if any, that is reasonably necessary to promptly and diligently cure the failure) after Tenant receives written notice from Landlord specifying the default. The notice shall give in reasonable detail the nature and extent of the failure and shall identify the Lease provision(s) containing the obligation(s). If Tenant shall default in the performance of any of its obligations under this Lease (after notice and opportunity to cure as provided herein), Landlord may pursue any remedies available to it under the law and this Lease, except that, in no event, shall Tenant be liable for punitive damages, lost profits, business interruption, speculative, consequential or other such damages. 52. Section 15.01(E) is hereby amended to delete each occurrence of the phrase "or its Guarantor". 53. The third, sixth, seventh and eighth lines of Section 15.01(E) are hereby amended to delete "thirty (30)" and to insert in its place and stead "ninety (90)". 54. The second line of Section 15.01 (F) is hereby amended to delete " or any Guarantor". 55. The introductory paragraph to Section 15.02 is amended and restated in its entirety as follows: 15.02 LANDLORD'S RIGHT TO TERMINATE UPON TENANT DEFAULT. In the event of any default by Tenant as provided in Section 15.01 above, Landlord shall have the right to terminate this Lease and recover possession of the Premises by giving written notice to Tenant of Landlord's election to terminate this Lease, in which event Landlord shall be entitled to receive from Tenant, as provided in California Civil Code Section 1951.2: 56. Section 15.04 is amended and restated in its entirety as follows: 15.04 LANDLORD'S RIGHT TO CONTINUE LEASE UPON TENANT DEFAULT. In the event of a default of this Lease and abandonment of the Premises by Tenant, if Landlord does not elect to terminate this Lease as provided in Section 15.02 above, (a) Landlord may from time to time, without terminating this Lease, enforce all of its rights and remedies under this Lease and (b) notwithstanding the timing requirements of Section 14.02 above (i) Tenant may assign or sublet its interest in the Premises by giving ten (10) days notice of the proposed assignment or sublease and submitting the information and 7 documents required by Section 14.02 above and (ii) Landlord shall, within twenty (20) business days after Landlord's receipt of all of the information and documents required by Section 14.02 above, approve or disapprove the proposed assignment or sublease (with approval by Landlord not being unreasonably withheld) or exercise its recapture rights under Section 14.03 above. Without limiting the foregoing, Landlord has the remedy described in California Civil Code Section 1951.4 (Landlord may continue this Lease in effect after Tenant's default and abandonment and recover Rent as it becomes due, if Tenant has the right to Transfer, subject to reasonable limitations). In the event Landlord re-lets the Premises, to the fullest extent permitted by law, the proceeds of any reletting shall be applied first to pay to Landlord all costs and expenses of such reletting (including without limitation, costs and expenses of retaking or repossessing the Premises, removing persons and property therefrom, securing new tenants, including expenses for redecoration, alterations and other costs in connection with preparing the Premises for the new tenant, and if Landlord shall maintain and operate the Premises, the costs thereof) and receivers' fees incurred in connection with the appointment of and performance by a receiver to protect the Premises and Landlord's interest under this Lease and any necessary or reasonable alterations; second, to the payment of any indebtedness of Tenant to Landlord other than Rent due and unpaid hereunder; third, to the payment of Rent due and unpaid hereunder; and the residue, if any, shall be held by Landlord and applied in payment of other or future obligations of Tenant to Landlord as the same may become due and payable, and Tenant shall not be entitled to receive any portion of such revenue. 57. Section 15.05 is amended and restated in its entirety as follows: 15.05 RIGHT OF LANDLORD TO PERFORM. All covenants and agreements to be performed by Tenant under this Lease shall be performed by Tenant at Tenant's sole cost and expense. If Tenant shall fail to pay any sum of money, other than Rent, required to be paid by it hereunder or shall fail to perform any other act on its part to be performed hereunder, Landlord may, but shall not be obligated to, make any payment or perform any such other act on Tenant's part to be made or performed, without waiving or releasing Tenant of its obligations under this Lease. Any sums so paid by Landlord and all necessary incidental costs (including, without limitation, reasonable attorneys fees), together with interest thereon at the lesser of the maximum rate permitted by law if any or eight percent (8%) per annum from the date of such payment, shall be payable to Landlord as additional rent on demand and Landlord shall have the same rights and remedies in the event of nonpayment as in the case of default by Tenant in the payment of Rent. If Tenant successfully disputes any sums paid by Landlord pursuant to this Section, Tenant shall be entitled to recover any and all such sums paid by Tenant to Landlord pursuant to this Section, including any and all interest, and shall be entitled to payment of its costs and attorneys fees and other amounts recoverable under this Lease by Tenant as the prevailing party in such dispute. 58. The first line of Section 15.02(D) is amended to insert the following after "other": "reasonable". 59. Section 15.06 is deleted in its entirety. 8 60. Section 17.01 and Section 17.02 are amended and restated in their entirety as follows: 17.01 SUBORDINATION. This Lease, and the rights of Tenant hereunder, are and shall be subject and subordinate to the interest of (i) all present and future ground leases and master leases of all or any part of the Building; (ii) present and future mortgages and deeds of trust encumbering all or any part of the Building; (iii) all past and future advances made under any such mortgages or deeds of trust; and (iv) all renewals, modifications, replacements and extensions of any such ground leases, master leases, mortgages and deeds of trust; provided, however, that as a condition precedent to Tenant's subordination of this Lease, Landlord shall obtain nondisturbance and attornment agreements in commercially reasonable form from the landlord under any such ground lease or master lease and from the holders of any such mortgages and deeds of trust, as applicable. Further, any lessor under any such ground lease or master lease or any mortgagee or beneficiary under any such mortgage or deed of trust (any such lessor, mortgagee or beneficiary is hereinafter referred to as a "Mortgagee") shall have the right to elect, by written notice given to Tenant, to have this Lease made superior in whole or in part to any such ground lease, master lease, mortgage or deed of trust (or subject and subordinate to such ground lease, master lease, mortgage or deed of trust but superior to any junior mortgage or junior deed of trust). Upon demand, Tenant shall execute, acknowledge and deliver any instruments reasonably requested by Landlord or any such Mortgagee to effect the purposes of this Section 17.01. Such instruments may contain, among other things, provisions to the effect that such Mortgagee (hereafter, for the purposes of this Section 17.01, a "Successor Landlord") shall (i) not be liable for any act or omission of Landlord or its predecessors, if any, prior to the date of such Successor Landlord's succession to Landlord's interest under this Lease;; and (ii) be entitled to receive notice of any Landlord default under this Lease plus a reasonable opportunity to cure such default prior to Tenant having any right or ability to terminate this Lease as a result of such Landlord default.. Any obligations of any Successor Landlord under its respective lease shall be non-recourse as 1o any assets of such Successor Landlord other than its interest in the Premises and improvements. 17.2 ATTORNMENT. If the interests of Landlord under the Lease shall be transferred to any superior Mortgagee or other purchaser or person taking title to the Building by reason of the termination of any superior lease or the foreclosure of any superior mortgage or deed of trust, and if such superior Mortgagee or other purchaser or person taking title to the Building shall not disturb Tenant, Tenant shall be bound to such Successor Landlord under all of the terms, covenants and conditions of the Lease for the balance of the term thereof remaining and any extensions or renewals thereof which may be effected in accordance with any option therefor in the Lease, with the same force and effect as if Successor Landlord were the landlord under the Lease, and Tenant shall attorn to and recognize as Tenant's landlord under this Lease such Successor Landlord, as its landlord, said attornment to be effective and self-operative without the execution of any further instruments upon Successor Landlord's succeeding to the interest of Landlord under the Lease. Tenant shall, upon demand, execute any documents reasonably requested by any such person to evidence the attornment described in this Section 17.02. 9 Concurrently, upon written request from Tenant, and provided Tenant is not in default under this Lease, Landlord agrees to use diligent, commercially reasonable efforts to obtain a commercially reasonable Non-Disturbance Agreement from the Successor Landlord. Such Non-Disturbance Agreement may be embodied in the Mortgagee's customary form of Subordination and Non-Disturbance Agreement if such form is commercially reasonable. If, after exerting diligent, commercially reasonable efforts, Landlord is unable to obtain a Non-Disturbance Agreement from any such Mortgagee, Landlord shall have no further obligation to Tenant with respect thereto. 61. The fifth and seventh lines of Section 17.03 are hereby amended to delete " twenty (20)" and to insert in its place and stead "thirty (30)". 62. Section 21.01 is amended and restated in its entirety as follows: 21.01 Landlord may enter the Premises during normal business hours following the giving of forty-eight (48) hours notice (which shall be in writing, unless notice is given to Tenant's Chief Financial Officer or the branch manager on the Premises, either of whom may request that any oral notice be confirmed with a written notice) and Landlord shall be accompanied by a representative of Tenant (except that such restrictions shall not apply on such days as the Premises are not open for the conduct of Tenant's business or in the event of an emergency) to: inspect the same; exhibit the same to prospective purchasers, Mortgagees or tenants; determine whether Tenant is complying with all of its obligations under this Lease; post notices of non-responsibility; and make repairs or improvements in or to the Building or the Premises; provided, however, that all such work shall be done as promptly as reasonably possible and so as to cause as little interference to Tenant as reasonably possible. Tenant hereby waives any claim for damages for any injury or inconvenience to, or interference with, Tenant's business, any loss of occupancy or quiet enjoyment of the Premises or any other loss on or about the Premises (excluding Tenant's vaults, safes and similar areas designated by Tenant in writing in advance) resulting from such entry (except if such damages are the result of Landlord's gross negligence or willful misconduct). In the event of an emergency, Landlord shall make reasonable efforts to give oral notice to Tenant's Chief Financial Officer or the branch manager on the Premises and Landlord shall have the right to use any and all means by which Landlord may deem proper to open such doors to obtain entry to the Premises, and any entry to the Premises obtained by Landlord by any such means, or otherwise, shall not under any circumstances be deemed or construed to be a forcible or unlawful entry into or a detainer of the Premises or an eviction, actual or constructive, of Tenant from any part of the Premises. Furthermore, in the event of an emergency, Landlord's representative shall enter the Premises only with the accompaniment of the appropriate third-party emergency response official from the Los Angeles Fire Department, Los Angeles Police Department, or other appropriate governmental agency. All such entries shall be in conformance with all applicable federal and state laws and regulations. An emergency entry by Landlord shall not act as a termination of Tenant's duties under this Lease. IF LANDLORD SHALL BE REQUIRED TO OBTAIN ENTRY BY MEANS OTHER THAN A KEY PROVIDED BY TENANT, THE COST OF SUCH ENTRY SHALL BY PAYABLE BY TENANT. 10 63. Section 22.01 and Section 22.02 are amended and restated in their entirety as follows: 22.1 LANDLORD'S LEASE UNDERTAKINGS. Notwithstanding anything to the contrary contained in this Lease or in any exhibits, Riders or addenda hereto attached (collectively the "Lease Documents'"), it is expressly understood and agreed by and between the parties hereto that: (a) the recourse of Tenant or its successors or assigns against Landlord with respect to the alleged breach by or on the part of Landlord of any representation, warranty, covenant, undertaking or agreement contained in any of the Lease Documents or otherwise arising out of Tenant's use of the Premises or the Building (collectively, "Landlord's Lease Undertakings") shall extend only to an amount equal to the value of Landlord's interest in the real estate of which the Premises demised under the Lease Documents are a part ("Landlord's Real Estate") and not to any other assets of Landlord or its officers, directors or shareholders; and (b) except for an amount equal to to the value of Landlord's interest in Landlord's Real Estate, no personal liability or personal responsibility of any sort with respect to any of Landlord's Lease Undertakings or any alleged breach thereof is assumed by, or shall at any time be asserted or enforceable against, Landlord, or against any of their respective directors, officers, employees, agents, constituent partners, beneficiaries, trustees or representatives. 22.2 TRANSFER OF LANDLORD'S INTEREST. In the event of any transfer of Landlord's interest in the Building, Landlord shall be automatically freed and relieved from all applicable liability (unless the occurrence upon which the claim of liability is based occurred prior to the transfer) with respect to performance of any covenant or obligation on the part of Landlord, provided any deposits or advance rents held by Landlord are turned over to the grantee and said grantee expressly assumes, subject to the limitations of this Section 22, all the terms, covenants and conditions of this Lease to be performed on the part of Landlord, including all liability for performance of any covenant or obligation from which Landlord is released pursuant to this Section. 64. The fourth line of Section 23.01 is hereby amended to delete " Two hundred percent (200%) and to insert in its place and stead One hundred fifty percent (150%)". 65. The fourth line of Section 26.01 is hereby amended to delete "may be conditioned as required by Landlord" and to insert the following in its place and stead: "shall not be unreasonably conditioned, delayed or withheld". 66. Section 26.01 is amended to add the following at the end of such section: In the event that Tenant requires access to or space on the top of the roof of the Building in connection with the activities contemplated in this section in connection with Lines, or elsewhere outside the Premises, then subject to availability and the rights of any tenants under leases executed before this Lease, Tenant shall provide plans or specifications, as applicable, for such activities and request Landlord's approval for such access, which 11 approval shall not be unreasonably conditioned, delayed or withheld. Such access shall not be denied if it will not be disruptive to the Building's communications systems or cause undue risk to Landlord or other Tenants of the Building. Tenant shall pay to Landlord such fees as are reasonable (which reasonableness shall be determined by comparison to the fees charged by comparable buildings in the area) for such access and use of the Building's rooftop and the Premises' rooftop. Tenant's right to access and use of the Building's rooftop and Premises' rooftop is subject to the rights of other tenants in the Building whose leases existed prior to the date of this Lease. 67. Section 26.04 is amended to add the following before the period at the end of such section: except to the extent that such Line Problems are caused by Landlord's gross negligence or willful misconduct 68. Section 26.05 is amended to add the following before the period at the end of such section: "Reasonable notice" of an interruption or turning off of the Electronic Services facilities shall be forty-eight (48) hours prior notice, except in the case of emergencies, in which event Landlord shall give to Tenant as much notice as is reasonably possible. In addition, Landlord shall use its best efforts to schedule any such interruptions for times other than Tenant's business hours. 69. Section 26.07 is amended to add the following at the end of such section: Notwithstanding any of the provisions of this section. Landlord agrees that Tenant will provide to Landlord a list of Electronic Service Providers customarily used by Tenant and that Landlord will not unreasonably condition, delay or withhold its approval thereof and that further, in the event that Landlord does withhold its approval, Landlord and Tenant will meet to discuss and resolve in good faith Landlord's objections. 70. Section 26.09 is amended and restated as follows: 26.09 INSTALLATION AND USE OF WIRELESS TECHNOLOGIES. Tenant may utilize any wireless Electronic Services equipment (including the usual and customary cellular telephones), including antennae and satellite receiver dishes, within the Tenant's premises, within the Building or attached to the outside walls or roof of the Building, without Landlord's prior written consent unless such equipment adversely affects the Building or the conduct of business by other tenants of the Building. 71. [INTENTIONALLY OMITTED.] 72. Section 28.04 is amended and restated in its entirety as follows: 28.04 FORCE MAJEURE. Landlord and Tenant shall incur no liability to each other with respect to, and shall not be responsible for any failure to perform, any of their obligations hereunder if such failure is caused by any reason beyond the control of the 12 party having the obligation, including, but not limited to, strike, labor trouble, governmental rule, regulations, ordinance, statute or interpretation, or by fire, earthquake, civil commotion, or failure or disruption of utility services. The amount of time for the party having such obligation to perform any such shall be extended by the amount of time such party is delayed in performing such obligation by reason of any force majeure occurrence whether similar to or different from the foregoing types of occurrences. 73. Section 28.06 is amended and restated in its entirety as follows: 28,06 Light AND AIR. No diminution or shutting off of any light, air or view by any structure erected or modified by a third party, whether now or hereafter erected shall in any manner affect this Lease or the obligations of Tenant hereunder, or increase any of the obligations of Landlord hereunder. Landlord shall not, however, by its acts or the acts of its employees, agents, contractors or representatives, cause any diminution or shutting off of any light, air or view of Tenant or the view of any persons outside the Building of the Building or any of Tenant's signs on the Building. 74. Section 28.07 is amended to add the following at the end of such section: LANDLORD AND TENANT EACH WAIVE ANY RIGHT TO A TRIAL BY JURY IN ANY ACTION OR PROCEEDING TO ENFORCE OR DEFEND ANY RIGHTS UNDER THIS LEASE OR UNDER ANY AMENDMENT, INSTRUMENT, DOCUMENT OR AGREEMENT DELIVERED OR WHICH MAY IN THE FUTURE BE DELIVERED IN CONNECTION HEREWITH AND AGREE THAT ANY SUCH ACTION OR PROCEEDING SHALL BE TRIED BEFORE A COURT AND NOT A JURY. 75. Section 28.19 is amended to add the following at the end of such section: Notwithstanding any of the provisions of this section, Tenant may, in its sole discretion, (a) install, affix and maintain signs pertaining to advertising or marketing campaigns of Tenant within the Premises without the consent of Landlord; (b) install signs on, and have exclusive signage rights to all sides of the exterior of the Premises, and (c) install, operate and maintain security systems within the Premises without the consent of Landlord; provided, however, that if any signs or security systems affect or require modification of any of the Building's systems, Landlord's prior consent shall be required, which consent shall not be unreasonably conditioned, withheld or delayed. 76. The first line of the fourth paragraph of Section 1 of the portion of the Work Letter Agreement attached to the Lease as Exhibit B [Landlord Performs Work] [Minor Work Only] is hereby amended (a) to delete "Work" and insert "the portion of the Work necessary to deliver the Premises to Tenant in Base Shell Condition" and (b) to delete "Commencement Date" and insert in its place and stead "February 28, 2003". 77. The first line of the subsection (a) of Section 2 of the portion of the Work Letter Agreement attached to the Lease as Exhibit B [Tenant Performs Work] is hereby amended to delete 13 "February 14, 2003" and insert in its place and stead "February 28, 2003". 78. Subsection (a)(iii) of Section 2 of the portion of the Work Letter Agreement attached to the Lease as Exhibit B [Tenant Performs Work] is hereby amended and restated in its entirety as follows: (iii) Tenant shall provide Landlord financial statements as proof of its ability to pay the cost of the Work as and when payments become due. 79. Subsection (a)(iv) of Section 2 of the portion of the Work Letter Agreement attached to the Lease as Exhibit B [Tenant Performs Work] is hereby amended to add the following at the end of such subsection: Tenant shall submit to Landlord a list of proposed vendors for Landlord's approval, which shall not be unreasonably withheld, conditioned or delayed. 80. The fifteenth and sixteenth lines of subsection (b) of Section 2 of the portion of the Work Letter Agreement attached to the Lease as Exhibit B [Tenant Performs Work] is hereby amended to delete therefrom "or the Work is prohibited by any mortgage or trust deed encumbering the Building". 81. The eighteenth line of subsection (b) of Section 2 of the portion of the Work Letter Agreement attached to the Lease as Exhibit B [Tenant Performs Work] is hereby amended to delete "three (3)" and insert in its place and stead "seven (7)". 82. Subsection (c)(iii) of Section 2 of the portion of the Work Letter Agreement attached to the Lease as Exhibit B [Tenant Performs Work] is hereby deleted in its entirety. 83. The first line of Section 5 of the portion of the Work Letter Agreement attached to the Lease as Exhibit B [Tenant Performs Work] is hereby amended to delete "All changes" and to insert in its place and stead "All material changes". 84. The second, third and fourth lines of Section 6(e) of the portion of the Work Letter Agreement attached to the Lease as Exhibit B [Tenant Performs Work] are hereby amended to delete "in a good and workmanlike manner" and the remainder of such section and to insert in its place and stead "in a good and workmanlike manner, using first class commercial materials". 85. The third line of Section 6(g) of the portion of the Work Letter Agreement attached to the Lease as Exhibit B [Tenant Performs Work] is hereby amended to delete "from the building" and to insert in its place and stead "from the building provided that Landlord has provided to Tenant written notice and the opportunity to cure within five (5) business days". 86. The third line of Section 6(h) of the portion of the Work Letter Agreement attached to the Lease as Exhibit B [Tenant Performs Work] is hereby amended to delete "standard rates then in effect" and to insert in its place and stead "actual cost plus an administrative fee of 7% of mat cost". 14 87. The fourth and fifth lines of Section 6(h) of the portion of the Work Letter Agreement attached to the Lease as Exhibit B [Tenant Performs Work] is hereby amended to delete in its entirety the sentence beginning with "Tenant shall pay". 88. Section 6(i) of the portion of the Work Letter Agreement attached to the Lease as Exhibit B [Tenant Performs Work] is hereby amended to add the following before the period at the end of such section: ", provided that Landlord's review dues not materially interfere or cause any delay of Tenant's work on the Premises." 89. The second line of Section 6(J) of the portion of the Work Letter Agreement attached to the Lease as Exhibit B [Tenant Performs Work] is hereby amended to delete "twenty-one (21) days" and to insert in its place and stead "four (4) months". 90. The first line of Section 6(k) of the portion of the Work Letter Agreement attached to the Lease as Exhibit B [Tenant Performs Work] is hereby amended to delete "have no authority to" and to insert in its place and stead "shall not materially". 91. The first line of Section 6(L) of the portion of the Work Letter Agreement attached to the Lease as Exhibit B [Tenant Performs Work] is hereby amended to insert "at it sole cost and expense" after "ran". 92. The ninth line of Section 7(b) is hereby amended to insert the following after "others" and before the period: ; provided, however, that Tenant shall have no obligation to indemnify, protect, defend or hold harmless Landlord, the parties listed, or required by, the Lease to be named as additionally-insured, Landlord's contractors, Landlord's architects, or their respective beneficiaries, partners, directors, officers, employees and agents, from and against any claims, liabilities, losses, damages and expenses of whatever nature arising out any of such parties' gross negligence or willful misconduct. 93. Section 9 of the portion of the Work Letter Agreement attached to the Lease as Exhibit B [Tenant Performs Work] is hereby deleted in its entirety. 94. The third line of subsection (f) of Section 10 of the portion of the Work Letter Agreement attached to the Lease as Exhibit B [Tenant Performs Work] is hereby amended to delete "and enforceable solely against" and insert the following in its place and stead "an amount equal to the value of". 95. The second sentence of Section 11 of the portion of the Work Letter Agreement attached to the Lease as Exhibit B [Tenant Performs Work] is deleted in its entirety. 96. [INTENTIONALLY OMITTED.] 15 97. Section 2 of the Rules and Regulations attached to the Lease as Exhibit C is amended to add the following at the end of such section: Notwithstanding the other provisions of this section, Tenant may attach promotional and marketing materials within the Premises and in the windows of the Premises provided that such materials do not damage the Premises or materially disrupt Landlord's operation and maintenance of the Building or the conduct of the business of other tenants of the Building. 98. The first line of Section 6 of the Rules and Regulations attached to the Lease as Exhibit C is amended to add the following after "Premises": "except as reasonably necessary to accommodate the special needs of customers of Tenant who or disabled or handicapped, which exceptions shall include permitting seeing eye dogs and wheelchairs to enter the Premises." 99. Section 10 of the Rules and Regulations attached to the Lease as Exhibit C is amended to add the following before the period at the end of such section: "provided, however, that Tenant may maintain armed security in or about the Premises if such armed security is properly licensed and if Tenant pays to Landlord an amount equal to any increase in Landlord's insurance premiums resulting from Tenant's maintaining such armed security." 100. Section 14 of the Rules and Regulations attached to the Lease as Exhibit C is amended to add the following at the end of such section: Notwithstanding the foregoing, Tenant shall provide to Landlord a list of approved providers of such services and Tenant shall request Landlord's approval to utilize the services of such providers, which approval shall not be unreasonably conditioned, delayed or withheld In the event that Landlord does withhold its approval, Landlord and Tenant will meet to discuss and resolve in good faith Landlord's objections. 101. The second line of Section 16 of the Rules and Regulations attached to the Lease as Exhibit C is amended to delete "Saturdays". 102. The second line of Section 18 of the Rules and Regulations attached to the Lease as Exhibit C is amended to delete "and left locked when not in use". 103. Section 19 of the Rules and Regulations attached to the Lease as Exhibit C is amended and restated in its entirety as follows: 19. Any special requirements of Tenant in connection with the Premises that are not expressly provided for in this Lease or that are not implied as a matter of law will be attended to only upon application to the Office of the Building. 104. Section 21 of the Rules and Regulations attached to the Lease as Exhibit C is amended and restated in its entirety as follows: 21. All office equipment of any electrical or mechanical nature which causes 16 noise or adversely affects other tenants of the Building shall be placed by Tenant in the Premises in settings approved by Landlord (which shall not be unreasonably conditioned, delayed or withheld) to absorb or prevent any vibration, noises or annoyance. 105. Section 26 of the Rules and Regulations attached to the Lease as Exhibit C is amended to end the first sentence thereof by inserting a period after "cooling system" in the second line of such section. 106. A new paragraph is added to the second page of the Asbestos Notification attached to the Lease as Exhibit F as follows: If Tenant desires to abate the presence of asbestos within the Premises, it may do so at its sole expense but it shall do so in compliance with all applicable laws and without material disruption of the business of the Building or any of the tenants of the Building. In addition, Tenant shall use contractors approved by Landlord, which approval shall not be unreasonably conditioned, delayed or withheld. 107. The fifth and sixth lines of the first paragraph of the Parking Agreement attached to the Lease as Exhibit G is amended to delete "on a month to month basis" and insert the following in its place and stead: "throughout the term of this Lease and any renewal period thereof. Tenant may purchase up to 50 passes per month at Tenant's sole option". 108. The eighth line of the first paragraph of the Parking Agreement attached to the Lease as Exhibit G is amended to add the following after "spaces": "as shown on the Parking Plan for the Building, a copy of which has been provided by Landlord to Tenant and attached hereto as Schedule 1 to Exhibit G." 109. The ninth line of the first paragraph of the Parking Agreement attached to the Lease as Exhibit G is amended to add the following after "visitors": "which shall be prominently marked as being Reserved for Nara Bank Customers Only". 110. The fourteenth line of the first paragraph of the Parking Agreement attached to the Lease as Exhibit G eventh paragraph below the caption PARKING RULES AND REGULATIONS is amended to insert the following after "notice": "and the passage of an additional fifteen (15) day period within which Tenant shall have the right to cure such violation." 111. The third line of the seventh paragraph below the caption PARKING RULES AND REGULATIONS of the Parking Agreement attached to the Lease as Exhibit G is hereby amended to delete "$25.00" and to insert in it place and stead "$10.00, except that such amount shall not be due and payable the first time that such a violation occurs." 112. Section 1 of Addendum I is hereby amended to add the following at the end of such section: Tenant shall have the option to use its own window cleaning vendor, subject to Landlord approval, which shall not be unreasonably conditioned, delayed or withheld. 17 113. The second line of Addendum I is hereby amended to delete "from March 1, 2003 through June 30, 2003" and to insert the following in its place and stead: "from the date that Landlord delivers possession of the Premises to Tenant in Base Shell Condition through the date that is four mouths later". 114. Section 4 of Addendum I is hereby amended to add the following at the end of such section: "Notwithstanding any of the provisions of this Section 4 and Section 3 above, Tenant's obligation to maintain the plumbing and pest control shall be on an annual basis or as otherwise reasonably needed." 115. Section 5 of Addendum I is hereby amended to add the following at the end of such section: Notwithstanding the foregoing, following the Commencement Date, Tenant shall pay no more than $100 per month for trash removal unless Landlord can provide to Tenant reasonable substantiation of a higher cost attributable to Tenant. 116. The tenth line of Section 7 of Addendum I is hereby amended to add the following after "illuminated": "or non-illuminated". 117. Section 9 of Addendum I is hereby amended to add the following before the period at the end of section: ", unless such interruption is the result of Landlord's gross negligence or willful misconduct". 118 Section 12 of Addendum I is hereby amended to add the following at the end of such section: The current HVAC system was installed in_____, and has been maintained as reasonably necessary for its usage and to the knowledge of Landlord, is appropriate for the Premise as the Premises will be used by Tenant 119. Section 13 of Addendum I is hereby amended to delete from the first sentence thereof the first three lines thereof and the portion of the fourth line thereof ending with ""Lease Term" and to insert the following in its place and stead: "Provided that Tenant is not in material breach of the Lease at the time for renewal thereof. 120. The ninth line of Section 13 of Addendum I is hereby amended to delete "located in the Building" and to insert in its place and stead: "competitive buildings within an [arm's length distance".] 121. Addendum I is hereby amended to delete therefrom all references to "Proposed Renewal Rental" and to insert in its place and stead "Proposed Rental Rate". 122. Section 16 of Addendum I is hereby deleted in its entirety, 123. The second paragraph of Section 16 of Addendum I is hereby amended to add the 18 following at the end of such section: "Tenant's Renewal Option shall extend to any entity or person acquiring Tenant or its holding company, as applicable, during the initial term of this Lease or during any extension thereof." 124. LANDLORD AND TENANT HEREBY AGREE THAT TENANT IS A BANK AND THAT NOTWITHSTANDING ANY OF THE OTHER PROVISIONS OF THE LEASE: (I) TENANT CANNOT CEASE TO OPERATE ITS BUSINESS ON THE PREMISES FOR MORE THAN 3 CONSECUTIVE DAYS AND LANDLORD SHALL TAKE ALL STEPS NECESSARY TO ASSURE THAT TENANT IS ABLE TO BE OPEN FOR BUSINESS IN COMPLIANCE WITH SUCH REQUIREMENT; (II) THE TERM HEREOF SHALL NOT COMMENCE UNTIL TENANT HAS RECEIVED ALL NECESSARY APPROVALS FROM APPLICABLE FEDERAL OR STATE BANKING AUTHORITIES TO OPERATE A BANK BRANCH WITHIN THE PREMISES AND TENANT SHALL HAVE THREE MONTHS' FREE RENT FROM LANDLORD'S TENDER OF POSSESSION OF THE PREMISES IN BASE SHELL CONDITION; AND (III) ANY ATTEMPTED TERMINATION OF THE LEASE BY LANDLORD SHALL NOT BE EFFECTIVE UNTIL SUCH TIME AS ALL FEDERAL AND STATE REGULATORY REQUIREMENTS FOR THE CLOSURE OF THE BRANCH TO BE OPERATED WITHIN THE PREMISES HAVE BEEN SATISFIED. [signatures follow] 19 Landlord: 3600 Wilshire, LLC By: /s/ [ILLEGIBLE] ------------------------ Its: [ILLEGIBLE] Tenant: Nara Bank, National Association By: /s/ [ILLEGIBLE] --------------------------- Its: [ILLEGIBLE] 2/6/03 /s/ [ILLEGIBLE] Director of Legal Affairs 2/6/03 20 EXHIBIT A SECTION I. BASE BUILDING CONSTRUCTION A. Concrete and Fire resistant or existing Steel non-combustible construction Construction (i.e., concrete slab with fire rated structural steel beam & column supports, etc.). B. Slab to underside Minimum 2'-6" to 3'0" clearance ,, of deck height to the underside of beams. C. Floor Load 50 lbs. per sq. ft. Live Load, ,, 20 lbs. per sq. ft. Dead Load D. Materials and Build using appropriate ,, warrantee materials of high quality and durability to provide a low-maintenance barrier to the elements. Landlord shall warrantee performance for the term of the lease against leakage and other failure. E. Codes and Designed in accordance with ,, compliance governing Codes, (i.e., municipal, state and/or federal, B.O.C.A., U.B.C , etc.), with respect to Live Loading, including loads due to hurricanes, earthquake, and the accumulation of snow, ice and water. F. Dunnage Include the installation of ,, dunnage of other supports required for roof-mounted Base Building HVAC, Tenant Supplemental AC, and other equipment as required. G. Satellite dish Allow access and support for in lease roof-mounted Tenant satellite dish and provide penetrations for connections to such devises from the Tenant Premises. H. Base building shell Base building shell must be existing fully insulated and weatherproofed in accordance with applicable Codes to avoid excessive transfer of heat, cold and moisture. I. Roof Roof must be designed to ,, provide for proper drainage and to prevent accumulation of runoff around the building. J. Concrete Slab Insulation as required for ,, or Metal Deck prevention of heat loss and heat gain. K. Slab Condition Smooth and level, pitch not ,, to exceed 1/2 inch for every 10 ft. in every direction. L. Slab Seal to avoid moisture ,, permeation from hydrostatic pressure if on grade. Insulation as required if open garage above or below. M. Exterior Fire resistant on ,, Wall Finishes non-combustible fire rated construction (i.e., glass, metal, stone or masonry facade). N. Windows Non-operable double glazed ,, E-reflective energy efficient units. O. Tint Contingent upon orientation ,, and/or applicability of National Energy Conservation Code. P. Window Module 5'-0" wide on center. ,, Size Q. Sill Height 30" -32" AFF. ,, R. Window Height To finished ceiling (8'-6" ,, minimum). 21 S. Window Treatment Mini-blinds or building standard blinds. T. Interior surfaces All interior surfaces (exterior walls, interior walls and columns) shall be insulated drywall, taped, spackled and primed, ready to receive Tenant's finishes. U. Doors Main entry doors and rear egress existing doors in place with lock sets (dead bolt) and/or panic hardware as required to meet applicable Building and Fire Codes. 22 SECTION II. BASE BUILDING HVAC A. Variable Air 1 .75 CFM per sq. ft. with air Landlord Volume Base temperature of 35-57 degrees Fahrenheit at main distribution points of delivery (shaft). Air distribution by V.A.V. system with a minimum of 20 CFM of outside air per person based upon a design of one person per 100 useable square feet. Main trunk live, in place for Tenant's distribution. B. Type of exterior The system shall produce ,, perimeter HVAC interior temperatures in the system Premises at-all times and in all weather conditions of 72 degrees Fahrenheit with a corresponding relative humidity of fifty (50%) percent plus or minus five (5%) percent. C. Return Air Plenum Included as part of the base ,, building HVAC system, (preferred system). Landlord shall provide a Base Building HVAC system designed where the return air is ducted, only if it is a non-return air plenum, from occupied space to the air handling unit. D. 24 Hour- Landlord shall provide a minimum Tenant Supplemental AC of 5 tons for Tenant's responsible Telecommunications Equipment Room 24 hours per day, seven days per week, 365 days per year. If roof or attic mounted, Landlord to design for adequate structural support, including dunnage, pads and penetrations in place as per Tenant Plans and Specifications. If mounted on grade, Landlord to provide supports including pad design. Landlord to furnish and install underground conduits for power, refrigerant and all other related services from pads into Tenant's demised Premises for Tenant connection as required. Equipment area shall be surrounded with enclosure that compliments architecture, site, landscape and design. E. Connection for In multi-tenant building, ,, Supplemental AC Landlord to provide condenser water or chilled water tap connection on floor of demised Premises for Tenant tie-in. F. Condenser Provided 24 hours per day, ,, Water/Chilled seven days per week, 365 days Water per year. 23 SECTION III. BASE BUILDING ELECTRICAL A. Wattage Six (6) watts per RSF (less base existing building and HVAC) available at panel on floor for distribution by Tenant in multi-tenant buildings. Eight (8) watts per RSF in sole occupancy buildings. B. Design Capacity Electrical service design Tenant capacity to be exclusive of responsible building HVAC Landlord to provide all disconnect switches, transformers, meters and distribution panels as required. Panels shall provide for one (1) branch circuit for every three (3) workstations. C. EMF Maximum ten (1 0) N/A milligauss, with five (5) milligauss average at any given point, within demised Premises. D. Telephone Service Available at designated Tenant location of floor for Tenant responsible distribution. E. Satellite Dish Landlord to provide roof space, in lease tower or facility to accommodate (six (6) feel maximum diameter of dish). F. Satellite Dish-- If satellite dish is roof ,, roof mounted mounted, Landlord shall provide location and pad with necessary structural support inclusive of pitch pockets, penetrations, etc., for complete installation of said satellite dish. Conduit connections from roof to Tenant's demised Premises shall also be provided. G. Satellite Dish-- If satellite dish is mounted on ,, tower or grade tower or grade, Landlord shall mounted provide the necessary pads, conduits, etc. for connection of dish to Tenant's Telecommunications Equipment room within the demised Premise. 24 SECTION IV. BASE BUILDING LINE SAFETY A. Sprinkler Loop & 100% wet pipe system. Main existing Branches loop in place for Tenant distribution. (S & Y Value) B. Standpipe As required by Codes & NFPA ,, requirements. C. Fire Extinguishers Semi-recessed type fire ,, extinguisher cabinets with ABC extinguisher on site for Tenant Contractor to install. The number of extinguishers & cabinets to be determined by local Fire Department, Building Department and NFPA requirements. D. ADA Strobe & Panel ports available for ,, Speaker tie-in of Tenant's fire protection and life safety systems into Base Building system. SECTION V. BASE BUILDING CEILING A. Ceiling Type 2x2 lay-ins (standard tile and ,, grid). B. Finish 8'-6" minimum. ,, Ceiling Height SECTION VI. BASE BUILDING PLUMBING A. Rest room Ceramic tile floors and walls ,, Condition with floor drain in each facility. B. Accessories Toilet paper, paper towel, ,, sanitary napkin, soap dispensers, trash receptacle, mirrors, etc. Commercial grade quality, Bobrick or equal. C. ADA Facilities Compliance with ADA laws. in lease D. Number of Fixtures Sufficient to meet Tenant's existing staff requirements for male to female ratio & governing Building Codes. E. Tap & Drain Plumbing Rough-in, in place ,, for Tenant's pantry sink. F. Hot Water Rest room and pantry to be ,, separate from main boiler. G. Drinking Fountains ADA compliant. ,, H. Exhaust Exhaust fans and ducted ,, exhaust for both rest room facilities as per governing Building Codes. I. Utility Room Door shall be 'B' labeled, ,, fire rated wood door to match Tenant's wood finishes. J. Janitor's Closet Janitor's closet shall be a N/A separate room and shall have a slop sink. SECTION VII. MISCELLANEOUS A. Building Access ADA compliant entries ,, including ramps, elevators, parking, etc. B. Freight Elevators Provide contact and Building ,, Rules & Regulations. 25 C. Building Standards All entry points to the N/A Vestibules building that lead directly from the exterior shall be protected by weather tight, air-conditioned , permanent enclosures The mode of conditioning the air shall be compatible with local climatic conditions and shall meet all governing federal, state and/or municipal Energy Conservation Codes. Finishes within vestibule shall be of durable, non-slip, weather-resistant materials coordinated with Tenant's interior finishes. D. Exterior Signage Tenant's signage (illuminated) in lease and logo on face of building and/or free-standing, illuminated, monument sign. Signage permits as required by local City Codes to be procured by Landlord. E. Interior Signage Tenant's signage and logo at ,, Tenant's entrance. F. Wood Finishes If Tenant is sole occupant N/A of building, all wood finishes on interior shall match wood finishes. G Parking spaces Designate a minimum of one (1 in lease ) parking space per 250 sq. ft. of building area, or compliance with governing Building and Zoning Regulations, whichever is more. H. Lighting and Site and Landscaping Plans N/A landscaping on to be submitted for Tenant site review and approval. I. As Built A&E Base Building As Built A&E Tenant Drawings Drawings to be submitted to Possession Tenant on Auto Cad #13 or #14. J. Milestone Schedule Landlord to provide Base N/A Building Milestone Schedule including weather-tight shell, permanent power, permanent Base Building HVAC, fully functional elevator service, etc. SECTION II. RENT/LEASE RECAP (CURRENT AND NEW LOCATION) A. FREE RENT in lease B. RENT START ,, DATE C PENALTIES DUE TO ,, LANDLORD'S DELAY D. HOLDOVER AT OUR N/A CURRENT LOCATION E. LL CONTRIBUTION RSF or USF $ 0 26 EX-31.1 5 v94422exv31w1.htm EXHIBIT 31.1

Exhibit 31.1

CERTIFICATION

I, Seong Hoon Hong, certify that:

1.	I have reviewed this quarterly report on Form 10-Q of Nara Bancorp, Inc. (“the Company”);
2.	Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report;
3.	Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and or, the period presented in this quarterly report;
4.	The Company’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13A-14 and 15d-14) for the registrant and we have:

a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made know to us by others within those entities, particularly during the period in which this quarterly report is being prepared;
b)	Evaluated the effectiveness of the Company’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation and
c)	Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonable likely to materially affect, the registrant’s internal control over financial reporting; and

5. The Company’s other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Company’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):

a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Company’s ability to record, process, summarize and report financial information; and
b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal controls over financial reporting

Dated: November 13, 2003	/s/ Seong Hoon Hong
	Seong Hoon Hong
	President and Chief Executive Officer

EX-31.2 6 v94422exv31w2.htm EXHIBIT 31.2

Exhibit 31.2

CERTIFICATION

I, Timothy Chang, certify that:

1.	I have reviewed this quarterly report on Form 10-Q of Nara Bancorp, Inc. (“the Company”);
2.	Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report;
3.	Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and or, the period presented in this quarterly report;
4.	The Company’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13A-14 and 15d-14) for the registrant and we have:

a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made know to us by others within those entities, particularly during the period in which this quarterly report is being prepared;
b)	Evaluated the effectiveness of the Company’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation and
c)	Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonable likely to materially affect, the registrant’s internal control over financial reporting; and

5. The Company’s other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Company’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):

a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Company’s ability to record, process, summarize and report financial information; and
b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal controls over financial reporting

Date: November 13, 2003
	/s/ Timothy Chang
	Timothy Chang
	Senior Vice President and
	Chief Financial Officer

EX-32.1 7 v94422exv32w1.txt EXHIBIT 32.1 EXHIBIT 32.1 Pursuant to Section 906 of the Public Company Accounting Reform and Investor Protection Act of 2002 (18 U.S.C 1350, as adopted), Seong Hoon Hong, Chief Executive Officer of Nara Bancorp, Inc. (the "Company") and Timothy Chang, Chief Financial Officer of the Company hereby certifies that, to the best of their knowledge: 1. The Company's Quarterly Report on Form 10-Q for the period ended September 30, 2003, and to which this Certification is attached as Exhibit 99.1 (the "Periodic Report"), fully complies with the requirements of section 13(a) or section 15(d) of the Securities Exchange Act of 1934, and 2. The information contained in the Periodic Report fairly presents, in all material respects, the financial condition and results of operations of the Company. IN WITNESS WHEREOF, the undersigned have set their hands hereto as of the 13th day of November 2003. /s/ Seong Hoon Hong -------------------------- Chief Executive Officer /s/ Timothy Chang --------------------------- Chief Financial Officer -----END PRIVACY-ENHANCED MESSAGE-----

EX-10.19

                                                                   EXHIBIT 10.19

                 DEPOSIT ASSUMPTION AND LOAN PURCHASE AGREEMENT

         THIS AGREEMENT ("Agreement") is made and entered into as of the 7th day
of August, 2003, by and between Korea Exchange Bank, Seoul, Republic of Korea
("Seller") and Nara Bank, N.A., Los Angeles, California ("Buyer").

         WHEREAS, Seller and Buyer have entered into a letter of intent dated as
of July 18, 2003;

         WHEREAS, Seller desires to divest itself of, and Buyer desires to
assume, the deposit liabilities of the Broadway Branch, located at 49-51 West
33rd Street, New York, New York (the "Branch Office") of Seller, including
personal checking and savings accounts, passbook savings accounts, business
checking accounts, club savings accounts, NOW accounts, money market accounts,
time deposits and IRA accounts (the "Accounts"), listed on Schedule A (which
list is subject to change between the date hereof and the Closing Date
consistent with the other terms and conditions of this Agreement);

         WHEREAS, Seller desires to sell, and Buyer desires to purchase, certain
loans (the "Loans") (including collateral relating thereto and including
overdraft lines of credit and letters of credit) listed on Schedule B and
Schedule C (which lists are subject to change between the date hereof and the
Closing Date consistent with the other terms and conditions of this Agreement);
and

         WHEREAS, subject to the receipt of regulatory approvals or exemptions
therefrom, Buyer proposes to assume the Accounts and purchase the Loans, all in
accordance with the terms and conditions hereinafter set forth.

         NOW, THEREFORE, for and in consideration of the mutual promises and
covenants contained herein, the parties hereby agree as follows:

1.       CLOSING.

         (a)  DATE. Subject to the satisfaction or waiver of the conditions set
forth in Sections 6, 7 and 8 of this Agreement, the purchase of assets and
assumption of liabilities provided for in this Agreement shall occur at a
closing (the "Closing") to be held at the offices of Seller on the first
Friday after thirty (30) calendar days following the date of all approvals by
regulatory agencies and after all statutory waiting periods have expired, , or
at such other place, time or date on which the parties mutually agree (the
"Closing Date"). The effective time (the "Effective Time") shall be as of the
close of business on the Closing Date.

         (b) DOCUMENTS, INSTRUMENTS, CERTIFICATES, ETC. TO BE DELIVERED BY THE
PARTIES AT THE CLOSING. At the Closing, the parties shall deliver the documents
required by Sections 6 and 7 hereof. In order to assign each Loan to Buyer, on
or prior to Closing Seller will endorse the promissory note associated with each
transferred Loan. On or prior to Closing, Seller will also prepare and execute
assignments of trust deeds and amendments of Uniform Commercial Code filings.
Buyer will be responsible for the filing of any such assignments and amendments
following the Closing. After delivery of all documents pursuant to the
foregoing, the Estimated



Payment Amount (defined in subsection 3(b) below) shall be made by wire transfer
on or before 4:00 p.m., pursuant to subsection 3(b) hereof. The calculation of
balances of the Accounts, the Loans and the Payment Amount (defined in
subsection 3(a) below) shall be as of the Effective Time.

2.       TRANSFER OF ASSETS AND LIABILITIES.

         (a)      ASSUMPTION OF ACCOUNTS.

         Buyer shall assume, as of and at the Effective Time and subject to the
terms and conditions set forth herein, liability for payment and performance of
all of Seller's duties, responsibilities, obligations and liabilities for the
Accounts (including accrued but unpaid or uncredited interest thereon). Seller
shall assign and transfer to Buyer all of its right, title and interest in the
records and relationships pertaining to the Accounts. Other than those
liabilities specifically assumed under this Section 2(a), Buyer is not assuming
any other liabilities or obligations of Seller, whether known or unknown,
disclosed or undisclosed, contingent or otherwise, which have arisen or may
arise or be established in connection with the conduct of business of Seller
prior to the Closing Date or thereafter (the "Excluded Liabilities"). Excluded
Liabilities includes, but is not limited to the following:

                           (i)      Seller's cashier checks, accounts which are
on overdraft status (other than those with overdraft lines of credit), money
orders, traveler's checks and any cash items paid by Seller and not cleared
prior to the Effective Time; and

                           (ii)     Liabilities or obligations with respect to
any litigation, suits, claims, demands or governmental proceedings related to
any fact, circumstance or event occurring prior to Closing and relating to the
Accounts or Loans;

                           (iii)    All liabilities and obligations of Seller
arising out of Seller's employment, or Seller's termination of employment, of
employees of the Branch Office including without limitation Seller's compliance
with all applicable laws relating to employment, payment of all compensation,
payroll taxes, and benefits, obligations for providing COBRA health plan
continuation coverage to former employees and their dependents, and giving any
required notices under the Worker Adjustment and Retraining Notification Act of
1988, as amended, including similar state or local laws with respect to mass
layoffs or similar events.

         (b)      PURCHASE OF LOANS.

                           (i)      Seller shall sell, assign, transfer, convey
and deliver to Buyer, and Buyer shall purchase and accept from Seller, as of and
at the Effective Time and subject to the terms and conditions set forth herein,
all of Seller's right, title and interest in the following loans, including any
collateral, deeds of trust and security agreements related thereto:

                                    a.       Those loans that are listed on
         Schedule B as of the date of this Agreement and that do not become
         Schedule C Loans or Excluded Loans between the date of this Agreement
         and the Closing Date;

                                       2



                                    b.       Those loans that Seller makes on or
         after the date of this Agreement and that Buyer agrees to list on
         Schedule B (collectively with the loans described in subsection (a),
         the "Schedule B Loans");

                                    c.       The Schedule C Loans, as defined in
         subsection (ii) below; and

                                    d.       Those letters of credit of Seller
         listed on Schedule B hereto (the "Letters of Credit").

                           (ii)     For a period of five (5) days commencing on
a date that is within one (1) week of the date of this Agreement, Buyer shall
have the opportunity to perform due diligence on the loans and the Letters of
Credit listed on Schedule B as of the date of this Agreement, to identify those
loans and Letters of Credit that Buyer determines in good faith do not meet
Buyer's credit or other standards ("Other Loans"), and to delete such Other
Loans or Letters of Credit from Schedule B. Other Loans also include (a) loans
30 calendar days or more past due; (b) loans that Seller has classified as
"substandard," "doubtful," or "loss," listed as "special mention," or otherwise
not graded as "pass"; (c) nonaccruals (which term shall include loans in which
the collateral securing the same has been repossessed or in which collection
efforts have been instituted or claim and delivery or foreclosure proceedings
have been filed); (d) loans upon which insurance has been force-placed; (e)
loans in connection with which the borrower has filed, or has been forced to
file, a petition or relief under the United States Bankruptcy Code prior to the
Effective Time; (f) loans which are overdrafts (other than overdraft lines of
credit) and that have been on overdraft status for 30 days or more; and (g) all
loans that Seller makes or renews on or after the date of this Agreement and
that Buyer does not agree to list on Schedule B. Buyer and Seller agree to
negotiate in good faith reasonable terms for Buyer to acquire the Other Loans at
the Closing. If prior to Closing, Buyer and Seller agree upon reasonable terms
for Buyer to acquire any of the Other Loans, Buyer shall list such Other Loans
on Schedule C (the "Schedule C Loans") along with the negotiated price
therefore, and Buyer and Seller shall duly execute Schedule C. Any Other Loans
not listed in Schedule C shall constitute "Excluded Loans" and Buyer shall not
have any responsibility whatsoever with respect thereto.

                           (iii)    Buyer shall become the beneficiary of credit
life insurance written on direct consumer installment loans and coverage will
continue to be the obligation of the current insurer after the Effective Time
and for the duration of such insurance as provided under the terms of the policy
or certificate. If Buyer becomes the beneficiary of credit life insurance
written on direct consumer installment loans, Seller and Buyer shall cooperate
in good faith to develop a mutually satisfactory method by which the current
insurer will make rebate payments to and satisfy claims of the holders of such
certificates of insurance after the Effective Time. The parties' obligations in
this section are subject to restrictions contained in existing insurance
contracts as well as applicable laws and regulations.

                           (iv)     As of the Effective Time, Seller shall
transfer and assign all files, documents and records related to the Loans (and
collateral related thereto) to Buyer.

                                       3



                           (v)      Buyer shall after the Effective Time make
trade receipt loans and/or acceptances under the Letters of Credit in accordance
with the terms of such Letters of Credit which are listed on Schedule B on the
Effective Time.

         (c)      BOOKS AND RECORDS. From and after the Closing, Buyer will have
the right to possession of any and all files, books of account and records
directly relating to the Loans and the Accounts which are ordinarily maintained
at the Branch Office. All books and records relating to the Loans or Accounts
will be maintained for a period at least equal to the longer of the period
required by law or the normal retention period under Seller's or Buyer's (as the
case may be) records management program, unless the parties agree to a shorter
period.

         (d)      IRA ACCOUNTS.

                           (i)      Included in the Accounts are IRA accounts
(which the parties acknowledge includes SEP IRA accounts, SIMPLE IRA accounts
and any other type of retirement account reflected on the general ledgers of the
Branch Office) pursuant to which Seller is currently acting as trustee or
custodian.

                           (ii)     On or before the Closing Date, Seller shall
resign as of the close of business on the Closing Date as the trustee or
custodian, as applicable, of each IRA account and to the extent permitted by the
documentation governing each such IRA account and applicable law, appoint Buyer
as successor trustee or custodian, as applicable. Buyer hereby accepts each such
trusteeship or custodianship under the terms and conditions of Buyer's plan
documents for its IRA accounts and assumes all fiduciary and custodial
obligations with respect thereto as of the close of business on the Closing
Date. Within such period prior to the Closing Date as is required by applicable
law or regulation, Seller will, at its sole cost and expense, notify the
depositors who maintain such IRA accounts of Seller's intent to resign as
custodian as of Closing and to appoint Buyer as successor custodian and the
discharge and release of Seller from all liabilities as custodian from and after
the effective time of its resignation. Such notification shall include such
information as is required by the documentation governing each such IRA account
and be accompanied by all such documents necessary to effect such replacement
and release and to Buyer's master agreement. If, pursuant to the terms of the
documentation governing any such IRA account or applicable law, Seller is not
permitted to appoint Buyer as successor trustee or custodian, or the grantor
objects in writing to such designation, or is entitled to, and does, in fact,
name a successor trustee or custodian other than Buyer, all deposit liabilities
of Seller held under such IRA accounts shall be excluded from the Accounts and
deemed an Excluded Liability.

         (e)      EMPLOYEES.

                           (i)      Employment by Buyer. Buyer shall have the
right to make offers of employment to any employees of Seller, such employment
to be effective no earlier than the Closing Date, and shall make offers to at
least one-half of Seller's employees as of the date of this Agreement.
Notwithstanding anything in this Agreement to the contrary, Buyer shall have
complete discretion in determining which employees to hire and will hire such
employees at will subject to Buyer's current employment policies and practices,
provided however, that Buyer agrees not to terminate any of Seller's employees
that accept Buyer's offer of employment for a

                                       4



period of one year after the Closing Date, unless terminated for cause, as
reasonably determined by Buyer.

                           (ii)     Obligations of Seller. Seller shall,
effective as of the Closing Date, terminate the employment of all employees who
have been offered and have accepted employment with Buyer. Seller shall perform
and discharge all liabilities and obligations in connection with such employees
through the Closing Date, including giving any required notices, paying all
compensation or other amount owed to such employee through the Closing Date,
including wages, bonuses, commissions, severance benefits, vacation pay, paid
time off, sick leave, holiday pay, or other accrued and vested paid time off as
of the Closing Date, employee benefit plan contributions, payroll taxes and any
other form of compensation or benefits of any type or nature on account of such
employees' employment through the Closing Date and their termination by Seller.
Seller shall remain responsible and shall perform and discharge all liabilities
and obligations of any type or nature in connection with all other employees of
Seller that are not employed by Buyer and Buyer shall have no liability or
obligations with respect thereto.

3.       PRICE AND PAYMENT.

         (a)      PAYMENT AMOUNT.

                           (i)      The price to be paid by Seller in
consideration of the assumption of the Accounts by Buyer in accordance with this
Agreement (the "Account Payment Amount") shall be an amount equal to one hundred
percent (100%) of the net book value of the Accounts assumed by Buyer at the
Effective Time, which book value shall include the total principal balance of
the Accounts at the Effective Time plus accrued but uncredited or unpaid
interest thereon, minus accrued but uncredited debits thereon, minus a premium
("Premium") paid by Buyer calculated pursuant to the formula set forth in
Appendix I hereto.

                           (ii)     The price to be paid by the Buyer in
consideration of the transfer of the Loans to the Buyer in accordance with this
Agreement (the "Loan Payment Amount") shall be the sum of the following, without
duplication: (a) an amount equal to one hundred percent (100%) of the net book
value of the Schedule B Loans (excluding Letters of Credit), as recorded on the
books and records of the Seller, which books and records shall reflect any
write-downs or write-offs, and as adjusted by all earned interest as of the
Effective Time and otherwise as required by generally accepted accounting
principles consistently applied ("GAAP"), plus (b) the negotiated price for the
Schedule C Loans as shown in Schedule C.

                           (iii)    The net amount to be paid by Seller
("Payment Amount") shall be the net of the Account Payment Amount and the Loan
Payment Amount.

         (b)      PAYMENT PROCEDURE. The Payment Amount shall be paid by Seller
as follows:

                           (i)      Attached hereto as Schedule 3(b) is a trial
settlement statement prepared for the transaction as if the Closing Date had
occurred on June 30, 2003. At the Closing, the same calculations shall be made
subject to adjustments in amounts reflecting transactions made between June 30,
2003 and the Closing Date and for any other adjustments

                                       5



made in the ordinary course of business or in accordance with this Agreement.
Not less than two (2) business days prior to the Closing Date, Seller shall
deliver to Buyer its good faith estimate of the Payment Amount (the "Estimated
Payment Amount").

                           (ii)     At the Closing, Seller shall pay to Buyer by
wire transfer to an account designated in writing by Buyer of immediately
available funds an amount equal to the Estimated Payment Amount.

                           (iii)    As soon as practicable after the Closing but
in no event later than thirty (30) business days after the Closing Date, Buyer
and Seller shall, in good faith, make a final determination of the Payment
Amount after the receipt by Seller of Buyer's statement setting forth the amount
of the Payment Amount as determined in accordance with the provisions of this
Agreement, including work papers, schedules and other supporting data as may be
reasonably requested by Seller to enable it to verify such determination. If the
Estimated Payment Amount paid at the Closing exceeds the Payment Amount, Buyer
shall refund the excess to Seller, and, if the Payment Amount exceeds the
Estimated Payment Amount paid at the Closing, Seller shall pay to Buyer the
excess.

                           (iv)     Notwithstanding the provisions of subsection
3(b)(iii) hereof, and subject to the following sentence, Buyer shall reimburse
Seller or Seller shall reimburse Buyer, as the case may be, for any amount by
which the balance of any Account used in determining the Payment Amount did not
accurately reflect the balance of such Account as of the close of Seller's books
on the day before the Closing Date as a result of any error or inaccuracy in the
books and records of Seller as of the close of business on such date (other than
as a result of items in transit, which are to be handled as set forth in Section
10 hereof). Such reimbursement shall be made to the party entitled thereto
promptly following the discovery of such error or inaccuracy; provided, however,
that no reimbursement for any discrepancy shall be made after (i) the date that
is ninety (90) days after the Closing Date or (ii) in the case of Accounts with
maturities or withdrawal notice periods of fifteen (15) days or more, the date
that is (A) one year after the Closing Date or (B) thirty (30) days after the
maturity of such Accounts, whichever is earlier, provided, further, that the
foregoing time limitations shall not apply if Buyer is entitled to
indemnification from Seller because of the error or inaccuracy, in which case
subsection 12(b) shall apply.

4.       REPRESENTATIONS AND WARRANTIES OF SELLER.

         Seller hereby represents and warrants to Buyer as follows:

         (a)      ORGANIZATION; GOOD STANDING; CORPORATE AUTHORITY. Seller is a
banking corporation headquartered in Seoul, Republic of Korea duly licensed,
validly existing and in good standing under the laws of the Republic of Korea
and has the requisite corporate power and authority to execute, deliver and
perform this Agreement The Branch Office is a New York State licensed branch
duly licensed, validly existing and in good standing under the laws of the State
of New York.

         (b)      FDIC INSURANCE. The Branch Office is an insured depository
institution within the meaning of the Federal Deposit Insurance Act, as amended
(the "FDI Act"), and, to the

                                       6



knowledge of Seller, other than in connection with Seller's proposed voluntary
termination of the FDIC insurance upon consummation of the transactions
contemplated hereby, there is no action pending or threatened to terminate its
status as an insured depository institution. The Accounts are insured by the
FDIC to the fullest extent permitted by the FDI Act and the rules and
regulations of the FDIC thereunder.

         (c)      DUE AUTHORIZATION. The execution, delivery and performance of
this Agreement by Seller and the consummation of the transaction contemplated
hereby by Seller have been duly and validly authorized and approved by Seller in
accordance with its charter, bylaws or similar organizational documents and
internal policies and procedures and all requisite corporate actions have been
taken so that this Agreement is a valid and binding obligation of Seller,
enforceable against Seller in accordance with its terms, except (i) as such
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws now or hereafter in effect
affecting the enforcement of creditors' rights in general, and (ii) as such
enforceability may be limited by general principles of equity (whether
considered in a suit at law or in equity). The execution, delivery and
performance of this Agreement does not and will not conflict with any law,
regulation or order applicable to Seller and will not result in a breach of
Seller's charter, bylaws or similar organizational document or any license or of
any agreement or instrument to which Seller is a party or by which Seller or the
Accounts are bound.

         (d)      NO VIOLATION. The execution and delivery of this Agreement and
the consummation of the transactions contemplated hereby by Seller do not
conflict with or result in any breach, violation of or default under (with or
without notice or lapse of time, or both) or give rise to a right of
termination, cancellation, modification or acceleration of any obligation or
loss of any benefit under (a) any provision of the charter, bylaws or similar
organizational documents of Seller, (b) any material contract to which Seller is
a party or bound or by which any of its properties is bound, or (c) any
judgment, order, decree, statute, law, ordinance, rule, regulation, writ or
injunction applicable to Seller.

         (e)      CONSENTS. No consent, waiver, approval, order or authorization
of, or registration, declaration or filing with any Federal, state or local
government or any foreign, national, provincial or local government, or any
governmental, regulatory, legislative, executive or administrative authority,
agency or commission, or any court, tribunal, or judicial body or any other
person, including a party to any material contract with Seller, is required by
or with respect to Seller in connection with the execution and delivery of this
Agreement or the consummation of the transactions contemplated hereby other than
any filings with or approval or waiver of approval by the Office of the
Controller of the Currency, the Federal Deposit Insurance Corporation, the Board
of Governors of the Federal Reserve System, the banking department of the State
of New York, the Korean Ministry of Finance and Economy and the Korean Financial
Supervisory Service.

         (f)      PERMITS. Seller has all licenses, franchises, permits,
certificates, approvals or other similar authorizations affecting, or relating
in any way to, the assets or business of Seller required in connection with the
operation of the Branch Office, and all such licenses, franchises, permits,
certificates, approvals or other similar authorizations are valid and in full
force and effect, except where failure to do so would not have a material
adverse effect on the Branch Office.

                                       7



         (g)      ACCOUNTS, LOANS AND LISTS.

                           (i)      Seller has delivered to Buyer a true and
complete list of each Account as of the date of this Agreement (it being
acknowledged by Buyer that such list is subject to change between the date
hereof and the Closing Date), listing the balance of each Account as of the most
recent practicable date, the interest rate, the accrued interest thereon, and
the type of Account (the "Account List," attached as Schedule A hereto). Seller
also has delivered to Buyer a true and complete copy of the account forms for
all Accounts.

                           (ii)     Seller has delivered to Buyer a true and
complete list of each Loan as of the date of this Agreement (it being
acknowledged by Buyer and Seller that such list is subject to change between the
date hereof and the Closing Date), listing the principal balance of each Loan as
of the most recent practicable date, the interest rate, the earned interest
thereon, the Account or other collateral which secures each Loan, and the type
of Loan (the "Loan List," attached as Schedule B hereto and as of Closing,
Schedules B and C). Seller also represents that Seller has timely booked any
write-downs and write-offs as required by GAAP and any applicable rules or
regulations.

         (h)      NO BROKER. No agent, broker, investment banker, person or firm
retained or allegedly retained by Seller is or will be entitled to any broker's
or finder's fee or any other commission or similar fee, directly or indirectly,
in connection with any of the transactions contemplated herein.

         (i)      VALIDITY OF LOANS.

                           (i)      Seller has provided to Buyer true, complete
and accurate information concerning the Loans, and no material information with
respect to the Loans has been withheld from Buyer.

                           (ii)     (A) Each Loan and related security
instruments are a legal, valid and binding obligation of the obligor named
therein, are in full force and effect and are enforceable against the obligor
named therein in accordance with their terms (except as may be limited by
bankruptcy, insolvency, moratorium, reorganization or similar laws affecting the
rights of creditors generally or equitable principles limiting the right to
obtain specific performance or other similar relief); (B) Seller has good title
to and is the sole owner of record of each Loan as of the date of this Agreement
and of the indebtedness represented by the notes evidencing such Loans, and each
is free of any lien, encumbrance or claim by any other person; (C) Seller has
duly performed in all material respects all of its obligations thereunder to the
extent that such obligations to perform have accrued; (D) all documents and
agreements necessary for Seller to enforce such Loan and security instruments
are in existence and in Seller's possession; (E) no claims, counterclaims,
set-off rights or other rights exist, nor do the grounds for any such claim,
counterclaim, set-off rights or other rights exist, with respect to any Loan
which could impair the collectibility thereof; (F) each Loan has been, in all
material respects, originated and serviced in accordance with Seller's then
applicable underwriting guidelines, the terms of the relevant credit documents
and agreements; (G) all Loans are in compliance with all applicable laws, orders
and regulations and have been documented in such a manner so as to render the
rights and remedies of the secured parties named in the security

                                       8



instruments related thereto adequate for the realization against the collateral,
if any, securing the obligations of such Loan (except as may be limited by
bankruptcy, insolvency, moratorium, reorganization or similar laws affecting the
rights of creditors generally or equitable principles limiting the right to
obtain specific performance or other similar relief); and (H) to the knowledge
of Seller, no approval or consent of the borrower is required with respect to
the transfer to Buyer of any Loan.

         (j)      ACCOUNTS. Seller has properly accrued interest on the Accounts
and its records respecting the Accounts accurately reflect such accruals of
interest except where failure to do so would not have a material adverse effect
on the Branch Office. Seller has delivered to Buyer a true and correct copy of
the current account forms for each of the types of Accounts offered by Seller
out of the Branch Office.

         (k)      LITIGATION. There are no actions, suits or proceedings pending
or, to the knowledge of Seller, threatened against or affecting the Accounts or
Loans. Seller has not received notice from any governmental agency,
instrumentality or department of the United States, the State of New York or any
other state indicating that it would oppose or not grant or issue its consent or
approval, if required, with respect to the transactions contemplated by this
Agreement.

         (l)      COMPLIANCE WITH APPLICABLE LAW. The origination and
administration of the Accounts and the Loans have been and are being conducted
in compliance with all applicable laws, rules, regulations and authorities,
except where failure to do so would not have and would not be reasonably
expected to have in the aggregate a material adverse affect on the Accounts or
the Loans.

         (m)      EMPLOYEES. None of Seller's employees at the Branch Office are
party to any written employment or deferred compensation agreement with Seller
or any affiliate. Seller has no union contracts or collective bargaining
agreements with, or any other obligations to, employee organizations or groups.

         (n)      BRANCHES. Seller has no other branches or loan production
offices within a twenty mile radius of the Branch Office except a wholesale
branch located on the 14th floor at 460 Park Avenue, New York, New York (the
"Park Avenue Wholesale Branch") nor does Seller currently contemplate opening a
branch or loan production office within a twenty mile radius of the Branch
Office.

         (o)      REPRESENTATIONS COMPLETE. No representation or warranty by
Seller in this Agreement or any certificate delivered pursuant hereto contains
any untrue statement of a material fact or omits to state any material fact
necessary to make such representation or warranty not misleading.

5.       REPRESENTATIONS AND WARRANTIES OF BUYER.

         Buyer hereby represents and warrants to Seller as follows:

                                       9



         (a)      ORGANIZATION; GOOD STANDING; CORPORATE AUTHORITY. Buyer is a
national bank, duly organized, validly existing and in good standing under the
laws of the United States and has the requisite corporate power and authority to
execute, deliver and perform this Agreement.

         (b)      FDIC INSURANCE, ETC. Buyer is an insured depository
institution within the meaning of the FDI Act. There is no action, suit,
proceeding, inquiry or investigation, at law or equity, or before or by any
court, regulatory agency, public board or body pending or, to the best of
Buyer's knowledge, threatened, which would either prevent or materially delay
the consummation of the transactions contemplated hereby.

         (c)      DUE AUTHORIZATION. The execution, delivery and performance of
this Agreement by Buyer and the consummation of the transactions contemplated
hereby by Buyer have been duly and validly authorized and approved and all
requisite corporate actions have been taken so that this Agreement is a valid
and binding obligation of Buyer, enforceable against Buyer in accordance with
its terms, except (i) as such enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or other similar laws now or
hereafter in effect affecting the enforcement of creditors' rights in general,
(ii) as such enforceability may be limited by general principles of equity
(whether considered in a suit at law or in equity), and (iii) as to the approval
of the Board of Directors of Buyer, which is a condition to closing in Section
6(e). The execution, delivery and performance of this Agreement does not and
will not conflict with any law, regulation or order applicable to Buyer and will
not result in a breach of Buyer's charter, bylaws or of any agreement or
instrument to which Buyer is a party or by which Buyer is bound.

         (d)      NO BROKER. No agent, broker, investment banker, person or firm
retained or allegedly retained by Buyer is or will be entitled to any broker's
or finder's fee or any other commission or similar fee, directly or indirectly,
in connection with any of the transactions contemplated herein.

         (e)      LEGAL PROCEEDINGS. There are no actions, suits or proceedings
pending or, to the knowledge of Buyer, threatened against or affecting Buyer
which would have or be reasonably expected to have a material adverse effect on
Buyer's ability to consummate the transactions contemplated by this Agreement.
Buyer has not received notice from any governmental agency, instrumentality or
department of the United States or any state indicating that it would oppose or
not grant or issue its consent or approval, if required, with respect to the
transactions contemplated by this Agreement.

         (f)      REPRESENTATIONS COMPLETE. No representation or warranty made
or given by Buyer in this Agreement or any certificate delivered pursuant hereto
contains any untrue statement of a material fact or omits to state any material
fact necessary to make such representation or warranty not misleading.

6.       CONDITIONS TO OBLIGATIONS OF BUYER.

         The obligations of Buyer hereunder are subject to the satisfaction or
waiver, on or before the Closing, of the following conditions:

                                       10



         (a)      PERFORMANCE. Each of the acts and undertakings of Seller to be
performed at or before the Closing pursuant to this Agreement shall have been
duly performed in all material respects.

         (b)      REPRESENTATIONS. All of the representations and warranties
made by Seller herein shall be true and correct in all material respects as of
the Closing Date with the same force and effect as though such representations
and warranties had been made as of such date.

         (c)      ABSENCE OF PROCEEDINGS AND LITIGATION. No order shall have
been entered and remain in force at the Closing Date restraining or prohibiting
the transactions contemplated by this Agreement in any legal, administrative or
other proceeding and no action or proceeding shall have been instituted or
threatened on or before the Closing Date pertaining to the transactions
contemplated by this Agreement which, in the reasonable judgment of Buyer, could
be materially adverse to Buyer or Buyer's assumption of the Accounts.

         (d)      DOCUMENTS. Buyer shall have received at the Closing on the
Closing Date the following documents from Seller:

                           (i)      Written approval by Seller's head office
certified by an officer of Seller, authorizing the signing and delivery of this
Agreement and the other agreements and instruments referred to herein and the
consummation of the transactions contemplated hereby and thereby;

                           (ii)     A certificate signed by a duly authorized
officer of Seller stating that the conditions set forth in subsections 6(a) and
6(b) have been fulfilled;

                           (iii)    An Assignment and Assumption Agreement
substantially in the form of Exhibit A hereto.

                           (iv)     A Bill of Sale substantially in the form of
Exhibit B hereto.

                           (v)      Such other documents and instruments as
Buyer or its counsel may reasonably request to consummate the transaction
contemplated herein.

         (e)      BOARD APPROVAL. Buyer's Board of Directors shall have approved
this Agreement.

7.       CONDITIONS TO OBLIGATIONS OF SELLER.

         The obligations of Seller hereunder are subject to the satisfaction or
waiver, on or before the Closing, of the following conditions:

                                       11



         (a)      PERFORMANCE. Each of the acts and undertakings of Buyer to be
performed at or before the Closing pursuant to this Agreement shall have been
duly performed in all material respects.

         (b)      REPRESENTATIONS. All of the representations and warranties
made by Buyer herein shall be true and correct in all material respects as of
the Closing Date with the same force and effect as though such representations
and warranties had been made as of such date.

         (c)      ABSENCE OF PROCEEDINGS AND LITIGATION. No order shall have
been entered and remain in force at the Closing Date restraining or prohibiting
the transactions contemplated by this Agreement in any legal, administrative or
other proceeding and no action or proceeding shall have been instituted or
threatened on or before the Closing Date pertaining to the transactions
contemplated by this Agreement which, in the reasonable judgment of Seller,
could be materially adverse to Seller.

         (d)      DOCUMENTS. Seller shall have received at the Closing Date the
following documents from Buyer:

                           (i)      Resolutions of Buyer's Board of Directors
certified by Buyer's Secretary or an Assistant Secretary, authorizing the
signing and delivery of this Agreement and the other agreements and instruments
referred to herein and the consummation of the transactions contemplated hereby
and thereby;

                           (ii)     A certificate signed by a duly authorized
officer of Buyer stating that the conditions set forth in subsections 7(a) and
7(b) have been fulfilled;

                           (iii)    The Assignment and Assumption Agreement; and

                           (iv)     Such other documents and instruments as
Seller or its counsel may reasonably request to consummate the transaction
contemplated herein.

8.       CONDITIONS TO OBLIGATIONS OF BOTH PARTIES.

         The obligations of both parties to this Agreement are subject to the
condition that all filings and registrations with, and notifications to all
federal and state authorities (including any notifications to Korean
authorities) required for consummation of the transactions contemplated by this
Agreement, shall have been made, all regulatory approvals shall have been
received and shall be in full force and effect, and all applicable waiting
periods shall have passed.

9.       COVENANTS AND AGREEMENTS OF THE PARTIES.

         (a)      COOPERATION. Seller and Buyer each agree to cooperate with the
other and to use their commercially reasonable efforts to consummate the
transactions contemplated by this Agreement.

         (b)      CONDUCT OF BUSINESS PRIOR TO CLOSING. Except as provided
herein and as may be otherwise required by any regulatory authority, between the
date of this Agreement and the Closing Date, Seller will conduct its deposit
business in the ordinary course and substantially in

                                       12



the same manner as heretofore conducted. Buyer and Seller will work together to
define and implement the operational procedures necessary to transfer the
Accounts and Loans to Buyer. Within two (2) days after the execution of this
Agreement, Buyer and Seller will each designate an individual to serve as
liaison concerning operational matters. Seller will use its commercially
reasonable efforts in good faith to provide Buyer, on a monthly basis, Seller's
internal loan classifications for the Loans. From and after the date hereof
through the Closing Date, except as may be required by a regulatory authority,
Seller will not, without the prior written consent of Buyer:

                           (i)      Cause or permit the Branch Office to engage
or participate in any material transaction or incur or sustain any material
obligation except in the ordinary course of business consistent with past
practice;

                           (ii)     Cause or encourage any customer of the
Branch Office to transfer such customers Accounts or Loans to any office of
Seller or withdraw from such Accounts or pay down such Loans (except upon the
unsolicited request of a customer in the ordinary course of business);

                           (iii)    Effect any changes to the terms of any
Account, including in the interest rate applicable thereto, except for changes
in the ordinary course of business;

                           (iv)     Cause or permit the Branch Office to
transfer to Seller's other operations any Loans or Accounts (except pursuant to
an unsolicited customer request in the ordinary course of business);

                           (v)      Take any action that would cause the
termination of or reduction in coverage of any insurance policy currently in
effect on or relating to the Loans or Accounts; and

                           (vi)     Increase the number of personnel at the
Branch Office.

         (c)      ACCESS TO RECORDS AND INFORMATION. Between the date of this
Agreement and the Closing Date, Seller will afford Buyer and its authorized
agents and representatives reasonable access during normal business hours, upon
reasonable notice to Seller, to records and other information within Seller's
possession relating to the Accounts and the Loans. Seller shall provide to Buyer
assistance in Buyer's investigation of matters relating to the Accounts and the
Loans; provided, however, Buyer's investigations shall be conducted in a manner
which does not unreasonably interfere with Seller's normal operations, customers
and employee relations. Seller shall provide to Buyer information requested by
Buyer sufficient to prepare and deliver necessary change of terms notices in
sufficient time to allow for changes to the terms of the Accounts effective upon
transfer to Buyer. Seller shall provide full access to the books and records
necessary for servicing of the Accounts and the Loans commencing immediately
after close of business on the business day immediately preceding the Closing
Date for transfer to Buyer's premises. Buyer and Seller will provide each other
promptly with information as to any significant developments in the performance
of this Agreement and will promptly notify the other if either discovers that
any of its representations or warranties contained in this Agreement was not
true and correct in all material respects or becomes untrue or incorrect in any
material respect.

                                       13



         (d)      REGULATORY APPLICATIONS AND APPROVALS. Buyer and Seller shall
file initial regulatory applications and notices required to consummate the
transactions contemplated hereby as soon as reasonably practicable, but no later
than five (5) business days from the date hereof. Buyer and Seller agree to use
their commercially reasonable efforts to obtain and, where necessary, to assist
the other party in obtaining as promptly as practicable such regulatory approval
and other approvals or consents, if any, as may be necessary to consummate the
transactions contemplated hereby. The parties shall promptly notify the other
upon receipt of any regulatory approval or consent. Immediately following the
Closing Date, Seller shall request that the FDIC terminate its FDIC insurance of
the Branch Office.

         (e)      COMPUTER SERVICES: TRIAL BALANCES. Buyer and Seller shall
cooperate with each other and any applicable service bureau and shall use their
commercially reasonable efforts to cause the transfer on the Closing Date of all
information and records relating to the Accounts and the Loans from Seller's
computer system to Buyer's computer system. Seller agrees to deliver to Buyer
within one week of executing this Agreement a preliminary draft of certain data
processing information (the "DP Information") then in existence on Seller's data
processing system that relates to the Accounts and Loans. Additionally, Seller
agrees to deliver to Buyer within 30 days prior to and at the Closing Date all
DP Information on Seller's data processing system that relates to the Accounts
and Loans.

         (f)      DELINQUENT LOAN REPORT. At Closing, Seller will deliver to
Buyer a report listing each transferred Loan that, as of such date, is 60 days
delinquent and each transferred Loan that, as of such date, is 30 days
delinquent.

         (g)      FURTHER ASSURANCES. On and after the Closing Date, upon
Buyer's request, Seller shall execute, acknowledge and deliver such assurances
as may be reasonably necessary and appropriate to transfer all of the Accounts
in full to Buyer and to vest in Buyer full, legal and equitable title to all of
the Loans, including without limitation providing Buyer with access to any
documents, records and other information in Seller's possession that are not
already provided to Buyer and reasonably related to the Accounts or Loans. From
the date hereof through Closing, Seller will provide Buyer all reasonable
assistance requested by Buyer in order to effect as of Closing the orderly
transfer of the Accounts and Loans, including providing information reasonably
requested by Buyer to enable Buyer to provide the notifications and documents
necessary hereunder or to effect the transfer, and except as otherwise provided
in this Agreement, for a period of three (3) months after the Closing Date,
Seller will provide such similar reasonable assistance to Buyer to effect the
orderly transfer of the Accounts and Loans.

         (h)      CONSENTS. Except as otherwise provided by this Agreement,
Seller will use its commercially reasonable efforts to obtain and deliver to
Buyer prior to Closing all consents reasonably necessary, if any, to authorize
the transfer and assignment to Buyer of, or the substitution of Buyer for Seller
under, all Account agreements, Loans and related documents.

         (i)      TAX INFORMATION AND WITHHOLDING. All tax information reporting
and filing requirements and all tax withholding requirements with respect to the
Accounts and Loans are the responsibility of Seller up to and through the
Closing Date and the responsibility of Buyer thereafter.

                                       14



         (j)      EXCLUSIVITY. Neither Seller, nor any of its directors,
executive officers, lawyers or accountants or other representatives will,
directly or indirectly, encourage or solicit proposals or discussions with, or
enter into negotiations with, or provide any information to, any person, entity
or group other than Buyer concerning any sale or assumption of the Loans or
Accounts or concerning any other possible transaction which would preclude or
materially adversely affect the ability of Seller or Buyer to consummate the
purchase and assumption of the Loans and Accounts contemplated by this
Agreement. Neither Seller, nor any of its directors, executive officers, lawyers
or accountants or other representatives have taken since July 18, 2003, any of
the actions described in this section.

10.      ITEMS IN TRANSIT; TRANSITIONAL MATTERS.

         (a)      RETURNED ITEMS. Except as provided in this subsection, Buyer
shall obtain the benefit of and shall bear the risk of all checks, drafts,
withdrawal orders, and items of any kind which are deposited and credited to an
Account by Seller prior to Closing ("Deposit Items") relating to or originating
from the Accounts which are in transit as of the Effective Time. Any Deposit
Items that were credited for deposit to an Account prior to the Effective Time
and are returned unpaid ("Returned Item") on or after the Effective Time will be
handled in following manner.

                           (i)      If there are sufficient funds in the Account
to which such Returned Item was credited, and Buyer has a right of charge-back
against such Account, Buyer will debit any or all of such Account an amount
equal in the aggregate to such Returned Item and shall repay that amount to
Seller, reduced however, by the amount of the Premium, if any, attributable to
such Returned Item; or

                           (ii)     If there are not sufficient funds in the
Account, Buyer will use its commercially reasonable efforts to obtain
reimbursement from the party to whom the Returned Item was credited, but Buyer
will have no obligation to repay Seller an amount in excess of what is in the
Account unless and until Buyer obtains reimbursement from the party liable for
such Returned Item.

                           (iii)    Any repayment obligation of the Buyer to the
Seller for Returned Items shall be conditional upon such Returned Items being
debited from the Seller's account with the Federal Reserve Bank after the
Closing Date. To the extent that the processing of any item or transaction
pursuant to this Section 10 requires the cooperation of the other party, that
party will provide such cooperation.

         (b)      ACH TRANSACTIONS. Seller agrees that for a period of three (3)
months following the Closing Date it will effectuate direct pay and automated
clearinghouse transactions in the same manner and with the same diligence as it
would have prior to the Closing Date. Seller agrees timely to provide Buyer with
the daily electronic detail necessary for Buyer to timely credit or debit the
customer's account and to allow Buyer to send notifications of changes. Seller
and Buyer agree to a timely net daily settlement of these transactions. At the
end of such four month period, Seller will discontinue accepting and forwarding
ACH entries and funds and will return them to the originators marked "Account
Closed." Buyer agrees to reimburse Seller for any reasonable out of pocket
expenses incurred by Seller in complying with this Section.

                                       15



         (c)      OTHER TRANSITIONAL MATTERS. For a period of three (3) months
beginning on the Closing Date, Seller shall timely provide Buyer with checks,
deposits and payments it receives on the Accounts and Loans, including
documentation for ACH transactions, to enable Buyer to timely pay checks drawn
on the Accounts and process deposits to the Accounts and process payments on the
Loans.

11.      PRESS RELEASES; CONTACT WITH DEPOSITORS.

         (a)      PRESS RELEASE. Unless otherwise required by law, the parties
agree that, to the extent practicable, they will cooperate on any public
announcements, communications or other publicity concerning the transactions
contemplated by this Agreement.

         (b)      NOTIFICATION OF CUSTOMERS.

                           (i)      Seller shall promptly but no later than one
(1) business day following receipt by the parties of all required regulatory
approvals, deliver to Buyer the names and addresses of the holders of the
Accounts and of the borrowers on the Loans that are to be purchased by Buyer.
Buyer may use the address list to send change of terms notices within sufficient
time to permit change of terms of the Accounts on the Closing Date. Buyer shall
give Seller a reasonable opportunity to review and comment upon Buyer's written
communications (other than portions of said communications which set forth the
specific changes proposed to the terms and rates of the Accounts) to the holders
of the Accounts and to the borrowers on the Loans prior to the Closing.
Commencing not earlier than two (2) weeks prior to the estimated Closing Date,
Buyer may commence telephone and further written communications with holders of
Accounts to be assumed under this Agreement and with borrowers on the Loans to
be purchased under this Agreement for the purpose of assisting such Account
holders in the transition of the Accounts to Buyer. Buyer shall give Seller a
reasonable opportunity to review and comment on such written communications and
Buyer's script, fact sheet or any other document used in connection with such
telephonic communications (other than portions of said communications which set
forth the specific changes proposed to the terms and rates of the Accounts).

                           (ii)     At least two (2) weeks prior to the
estimated Closing Date, Seller will at its expense prepare and deliver a letter,
in form and substance reasonably satisfactory to Buyer, informing customers and
depositors of the Branch Office of the transfer of Accounts and Loans to Buyer.
With respect to any customer notice which is required by applicable law or
regulation to be mailed by Seller, Seller will, no later than the applicable
deadline mail a letter prepared by Seller in form and substance reasonably
satisfactory to Buyer to each customer.

                           (iii)    Within such period as may be required by
applicable law and regulations but no later than five (5) business days
following the Closing Date, Buyer will mail to each account holder of a
checking, money market deposit or NOW account: (a) a letter prepared by Buyer,
in form and substance reasonably satisfactory to Seller, notifying such
depositor of the transfer of his or her account to Buyer, requesting that such
account holder cease writing checks or drafts against his or her Seller's
account immediately following receipt of such letter (or such other period as
may be required by applicable law or regulation) and (b) check

                                       16



order forms, replacement checks bearing Buyer's transit and routing number and
any other documents to be signed by the account holder to establish a similar
account with Buyer.

                           (iv)     Within five (5) business days after the
Closing Date, Buyer will mail a letter prepared by Buyer, in form and substance
reasonably satisfactory to Seller, to each customer whose Loan was transferred
to Buyer and requesting that such customer remit all payments on such Loan to
Buyer.

                           (v)      At Buyer's option, Seller agrees to do the
mailings prior to Closing on Buyer's behalf provided that the costs of the
mailings will remain the liability of Buyer.

12.      INDEMNIFICATION.

         (a)      INDEMNIFICATION BY SELLER. Seller shall indemnify and hold
harmless Buyer and its directors, officers, employees and affiliates from, and
shall reimburse Buyer and its directors, officers, employees and affiliates for,
any loss, fee, cost, expense, damage, liability or claim (including, without
limitation, any and all fees, costs and expenses whatsoever, reasonably incurred
by Buyer or such other persons in investigating, preparing for, defending
against, or providing evidence, producing documents or taking any other action
in respect of any threatened or asserted claim) (hereinafter referred to as
"Losses") arising out of, based upon, resulting from or relating to (i) the
inaccuracy of any representation or warranty of Seller contained in Section 4 of
this Agreement; (ii) Seller's breach of or failure to perform in any material
respect any of its covenants or agreements contained in this Agreement; (iii)
any obligation or liability of Seller arising out of the Accounts and Loans
before the Effective Time which is not expressly assumed by Buyer pursuant to
this Agreement, including, but not limited to, Seller's management or
administration of the Accounts and Loans prior to the Effective Time (including
without limitation any claims asserted after the Effective Time and attributable
to the period before the Effective Time); (iv) any liability for payroll,
withholding, property, excise, sales, use and transfer taxes imposed by the
United States or by any other taxing authority relating to the Accounts which
are due and payable by Seller for the period prior to the Effective Time; (v)
any Excluded Liabilities; or (vi) any Excluded Loans.

         (b)      INDEMNIFICATION BY BUYER. Buyer shall indemnify and hold
harmless Seller and its respective directors, officers, employees and affiliates
from, and shall reimburse Seller and its respective directors, officers,
employees and affiliates for, any loss, fee, cost, expense, damage, liability or
claim (including, without limitation, any and all fees, costs and expenses
whatsoever, reasonably incurred by Seller or such other persons in
investigating, preparing for, defending against, or providing evidence,
producing documents or taking any other action in respect of any threatened or
asserted claim) (hereinafter referred to as "Losses") arising out of, based upon
or resulting from (i) the inaccuracy of any representation or warranty of Buyer
which is contained in Section 5 of this Agreement; (ii) Buyer's breach of or
failure to perform in any material respect any of its covenants or agreements
contained in this Agreement, including, but not limited to, Buyer's assumption
of the Accounts; (iii) any obligation or liability of Buyer arising out of the
Accounts and Loans after the Effective Time, including, but not limited to,
Buyer's management or administration of the Accounts and Loans after the
Effective Time; or (iv) any liability for payroll, withholding, property,
excise, sales, use or transfer taxes imposed by the

                                       17



United States or by any other taxing authority relating to the Accounts which
are due and payable by Buyer for the period after the Effective Time.

         (c)      PROCEDURE. In the event of the occurrence of any event which
any party asserts is an indemnifiable event pursuant to this Section 12, such
party shall notify the indemnifying party promptly and, if such event involves
the claim of any third party, the indemnifying party shall be entitled to assume
the defense of any claim as to which this Section 12 requires it to indemnify
the other party, provided that (i) the indemnified party may, if it so desires,
employ counsel at its own expense to assist in the handling of such claim, and
(ii) the indemnifying party shall obtain the prior written approval of the
indemnified party, which approval shall not be unreasonable withheld, before
entering into any settlement, adjustment or compromise of such claim or ceasing
to defend against such claim.

         (d)      SURVIVAL OF REPRESENTATIONS.

         All of the representations and warranties in this Agreement shall
survive the Closing (even if the damaged party knew or had reason to know of any
misrepresentation or breach of warranty at the time of Closing) and shall
continue in full force and effect until the first anniversary of the Closing
Date, except that all representations and warranties relating only to the
Accounts in Section 4(b), 4(g)(i), and 4(j) shall survive the Closing and
continue in full force and effect until the end of the sixth full month after
the Closing Date. After the applicable survival period, all such representations
and warranties shall terminate and be of no further force and effect, other than
claims for indemnification with respect to which notice has been given to the
indemnifying party prior to the end of the applicable survival period.

         (e)      SURVIVAL OF INDEMNIFICATION OBLIGATIONS. After the first
anniversary of the Closing Date, all indemnification obligations hereunder shall
terminate and be of no further force and effect, other than (i) claims for
indemnification with respect to which notice has been given to the indemnifying
party prior to such anniversary (or prior to the time provided in Section 12(d),
as applicable) and (ii) claims for indemnification arising from or relating to
any claim or claims asserted by a third party (i.e., asserted against Buyer by a
party other than Seller, or asserted against Seller by a party other than Buyer)
which shall survive until expiration of the applicable statute of limitations.

13.      TERMINATION.

         (a)      TERMINATION EVENTS. This Agreement shall terminate and be of
no further force or effect, upon the occurrence of any of the following:

                           (i)      Any regulatory authority whose consent or
approval is necessary for consummation of the transactions contemplated hereby
shall have issued a final order denying or refusing to grant any such approval
or consent or shall have granted such approval but shall have imposed conditions
that are or would become applicable to either Seller or Buyer that either Seller
or Buyer reasonably and in good faith deems to be materially burdensome to it;
or

                           (ii)     Mutual agreement of the parties evidenced in
writing; or

                                       18



                           (iii)    Immediately upon the expiration of thirty
(30) days from the date that either party hereto has given notice to the other
party hereto of such other party's material breach or misrepresentation of any
condition, warranty, representation or covenant herein; provided, however, that
no such termination shall take effect if within said thirty (30) day period the
party so notified shall have corrected in all material respects the grounds for
termination as specified in the aforementioned notice; or

                           (iv)     Written notice by Buyer or Seller to the
other party if the Closing shall not have taken place on or before ninety (90)
days from the date of this Agreement, other than by reason of a matter within
the control of the person asserting such termination provided that if, as of
such date, all regulatory approvals necessary for the consummation of the
transactions contemplated hereunder have been received but the Closing cannot
take place because any applicable waiting period has not expired, the parties
agree that this Agreement shall be extended for such period as shall be required
for the expiration of such waiting period and, within a reasonable time
thereafter, the Closing; or

                           (v)      Written notice by Buyer or Seller given to
the other party after entry of a final, restraining order or injunction
prohibiting the assumption of the Accounts.

         (b)      NO TERMINATION FOR OWN BREACH. Notwithstanding anything to the
contrary herein contained, neither party hereto shall have the right to
terminate this Agreement on account of its own breach or any non-material breach
by the other party hereto.

14.      NOTICES.

         Any notice or other communications required or permitted hereunder
shall be sufficiently given if sent by registered or certified mail, postage
prepaid, or sent by facsimile transmission or otherwise actually delivered,
addressed as follows:

                  To Seller:              Oh Kyung Kwon
                                          Regional Director
                                          Regional Headquarters for the Americas
                                          Korea Exchange Bank
                                          460 Park Avenue
                                          15th Floor
                                          New York, NY 10022
                                          Telephone: (212) 350-7404
                                          Facsimile: (212) 752-3964

                  Copy to:                Kathleen E. Topelius, Esq.
                                          Bryan Cave LLP
                                          700 13th Street, N.W.
                                          Washington, DC 20005
                                          Telephone: (202) 508-6140
                                          Facsimile: (202) 508-6200

                                       19



                  To Buyer:               Jungho Kim
                                          Senior Vice President
                                          Nara Bank, NA
                                          29 W. 30th Street
                                          New York, NY 10001
                                          Telephone: (212) 563-9130
                                          Facsimile: (212) 279-0728

                  Copy to:                Michel Urich, Esq.
                                          Director of Legal Affairs
                                          Nara Bank, NA
                                          3701 Wilshire Blvd., Suite 220
                                          Los Angeles, CA 90010
                                          Telephone: (213) 235-3250
                                          Facsimile: (213) 235-3257

or such other address as shall be furnished in writing by either party.

15.      EXPENSES.

         Except as otherwise provided in this Agreement, each party hereto shall
pay its own expenses.

16.      CONFIDENTIALITY.

         Except to the extent disclosure is required by law, Buyer will maintain
the confidentiality of all information obtained from Seller which is not
publicly available (the "Information"), and will use the Information only for
purposes reasonably related to this Agreement and the transactions contemplated
herein. Buyer shall guard and protect the Information with the highest degree of
care. In the event of termination of this Agreement, Buyer shall promptly
deliver to Seller the Information, and all copies thereof which are in the
possession or under the control of Buyer or its officers, directors, employees
or agents, or (in the case of copies) certified to Seller that all such copies
have been destroyed. That portion of Buyer's summaries, analysis, memoranda,
correspondence, notes and other writings containing Information shall be
modified to delete, destroy or render illegible material based in whole or in
part on such Information and the deletion, destruction and/or rendering of
portions of said material illegible shall be certified to Seller. The mutual
covenants contained in this Section shall survive termination of this Agreement.

17.      ENTIRE AGREEMENT, MODIFICATIONS, WAIVERS, HEADINGS.

         This Agreement constitutes the entire agreement between the parties
hereto pertaining to the subject matter hereof, supersedes all prior and
contemporaneous agreements and understandings of the parties in connection
therewith, and confers no rights or benefits upon any person not a party hereto.
No modification or termination of this Agreement shall be binding unless
executed in writing by the parties hereto. No waiver of any provision of this
Agreement shall be deemed or shall constitute a waiver of any other provision
hereof (whether or not

                                       20



similar) nor shall such waiver constitute a continuing waiver. Section and
subsection headings are not to be considered part of this Agreement, are solely
for convenience of reference, are not intended to be full or accurate
descriptions of the contents of any section or subsection.

18.      SUCCESSORS AND ASSIGNS.

         All of the terms and provisions of this Agreement shall be binding upon
and inure to the benefit of the parties hereto and their respective transferees,
successors and assigns, but rights under this Agreement may not be assigned and
duties hereunder may not be delegated by either party without the written
consent of the other. Nothing herein, express or implied, is intended to or
shall confer upon any other person any right, benefit or remedy of any nature
whatsoever under or by reason of this Agreement.

19.      COUNTERPARTS.

         This Agreement may be executed in one or more counterparts, all of
which taken together shall constitute one instrument.

20.      NO SOLICITATION OF CUSTOMERS.

         (a)      BY SELLER. Prior to the Closing, Seller will not knowingly
solicit any of its customers, either directly or indirectly, to reduce, transfer
or close any of the Accounts, or open deposit accounts or conduct any type of
business at other branches of the Seller that are not the subject of this
Agreement. For a period of twelve (12) months following the Closing Date, Seller
will not, directly or indirectly, knowingly solicit deposits or loans, whether
by the use of direct mail, telemarketing programs or other marketing methods,
specifically directed at former customers whose Accounts and Loans were
transferred to Buyer. For a period of twelve (12) months following the Closing
Date, Seller will not open a branch or loan production office located within the
State of New York and within a twenty (20) mile radius of the Branch Office.
Notwithstanding the previous sentence, nothing herein will prohibit Seller from
soliciting customers who are also customers of other operations of Seller or
other products offered by Seller and through general marketing campaigns not
directed at persons whose Accounts or Loans were transferred to Buyer. The
parties agree that the covenants in this Section 20 are reasonable in scope,
territory, and duration. If any court of competent jurisdiction shall at any
time deem any covenant herein too broad or lengthy, the duration or scope of
such covenant shall be deemed to be the longest and broadest permissible by law
under the circumstances.

         (b)      BY BUYER. From and after the date hereof and up to the Closing
Date, Buyer will not cause or encourage any customer of the Branch Office to
transfer such customer's Accounts or Loans to any office of Buyer.

21.      GOVERNING LAW.

         This Agreement shall be construed and enforced in accordance with the
laws of the State of New York without giving effect to the principles of the
conflicts of laws, except to the extent matters may be governed as a matter of
law by federal law. FURTHERMORE, THE PARTIES EACH WAIVE THEIR RESPECTIVE RIGHTS
TO A TRIAL BY JURY OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF
OR RELATED TO THIS

                                       21



AGREEMENT, IN ANY ACTION, PROCEEDING OR OTHER LITIGATION OF ANY TYPE BROUGHT BY
A PARTY AGAINST THE OTHER PARTY, WHETHER WITH RESPECT TO CONTRACT CLAIMS, TORT
CLAIMS, OR OTHERWISE. THE PARTIES AGREE THAT ANY SUCH ACTION OR CAUSE OF ACTION
SHALL BE TRIED BY A COURT TRIAL WITHOUT A JURY. THIS WAIVER SHALL APPLY TO ANY
SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT.

22.      CONSENT TO JURISDICTION; WAIVER OF IMMUNITIES.

         Each party hereby irrevocably submits to the nonexclusive jurisdiction
of any state or federal court sitting in the City of New York, borough of
Manhattan, U.S.A., in any action or proceeding brought to enforce or otherwise
arising out of or relating to this Agreement. Seller irrevocably appoints CT
Corporation System, with an office on the date hereof at 111 Eighth Avenue, New
York, NY 10011, U.S.A., as its agent for service of process to receive on behalf
of Seller and its property service of copies of the summons and complaint and
any other process which may be served in any such action or proceeding. Such
service may be made by mailing or delivering a copy of such process to Seller in
care of such process agent, at the address of such process agent stated above,
and Seller hereby irrevocably authorizes and directs such process agent to
accept such service on its behalf. Each party also irrevocably consents to the
service of any and all process in any such action or proceeding by the mailing
of copies of such process to such party by registered or certified mail at its
address in accordance with Section 14 hereof. Nothing contained herein shall be
deemed to limit in any way any right to serve process in any manner permitted by
law. In addition, each party hereby irrevocably waives to the fullest extent
permitted by law any objection which it may now or hereafter have to the laying
of venue in any such action or proceeding in any state or federal court sitting
in the City of New York, borough of Manhattan, U.S.A., and hereby further
irrevocably waives any claim that any such forum is an inconvenient forum. Each
party agrees that a final judgment in any such action or proceeding that is no
longer subject to appeal shall be conclusive and may be enforced in any other
jurisdiction by suit on the judgment or in any other manner provided by law.

         Nothing in this section shall impair the right of any party to bring
any action or proceeding against the other or its property in the courts of any
other jurisdiction, and each party irrevocably submits to the nonexclusive
jurisdiction of the appropriate courts of the jurisdiction sitting in any place
where the property or an office of such party is located.

         To the extent that any party or any of its property has or may
hereafter acquire any immunity from jurisdiction of any court or from any legal
process (whether through service or notice, attachment prior to judgment,
attachment in aid of execution, execution, or otherwise) under the laws of any
jurisdiction, such party hereby irrevocably waives such immunity in respect of
its obligations under this Agreement and agrees that it shall be subject to
civil and commercial law with respect to such obligations.

23.      SEVERABILITY.

         Any provision of this Agreement which is prohibited or unenforceable in
any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of
such prohibition or unenforceability

                                       22



without invalidating the remaining provisions hereof or affecting the validity
or enforceability of such provision in any other jurisdiction.

24.      ATTORNEYS' FEES.

         If any litigation with respect to the obligations of the parties under
this Agreement results in a final nonappealable order of a court of competent
jurisdiction that results in a final disposition of such litigation, the
prevailing party, as determined by the court ordering such disposition, shall be
entitled to reasonable attorneys' fees and costs of suit, including appeal, as
shall be determined by such court.

                   [Rest of the page left intentionally blank]

                                       23



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

                              SELLER:

                              KOREA EXCHANGE BANK

                              By:___________________________________________
                              Name:_________________________________________
                              Title:________________________________________

                              BUYER:

                              NARA BANK, NATIONAL ASSOCIATION

                              By:___________________________________________
                              Name:_________________________________________
                              Title:________________________________________

                                       24



                                   SCHEDULE A

                                  ACCOUNT LIST

                                      A-1



                                   SCHEDULE B

                                    LOAN LIST

                                      B-1



                                   SCHEDULE C

                                    LOAN LIST

(To be prepared after due diligence)

                                      C-1



                                   APPENDIX I

1.       Eight percent (8%) of the Average Balance of all Accounts listed on
         Schedule A on the Closing Date which balance shall exclude: (i) the
         Average Balance of the business checking account and money market
         account of Seller or any of Seller's affiliates; and (ii) the accounts
         listed in item 2 below. The "Average Balance" as used herein shall mean
         the average amount calculated using the average of the daily closing
         balances over the period from the date of the Agreement to the Closing
         Date.

2.       Zero percent (0%) of all certificates of deposit and club savings
         accounts listed on Schedule A on the Closing Date.

                                      I-1



                                    EXHIBIT A

                 DEPOSIT ASSUMPTION AND LOAN PURCHASE AGREEMENT

                                     BETWEEN

                              KOREA EXCHANGE BANK

                                      AND

                                 NARA BANK, N.A.

                       ASSIGNMENT AND ASSUMPTION AGREEMENT

THIS ASSIGNMENT AND ASSUMPTION AGREEMENT is entered into this ____ day of
____________, 2003, by and between Korea Exchange Bank, Seoul, Republic of Korea
("Seller"), and Nara Bank, N.A., a national bank ("Buyer").

                              W I T N E S S E T H:

WHEREAS, Seller and Buyer have entered into a Deposit Assumption and Loan
Purchase Agreement dated as of _____________, 2003 (the "Agreement"), which
provides for the assignment by Seller of all of its rights and interests in and
to certain deposit liabilities related to Seller's office located at 49-51 West
33rd Street, New York, New York, and the assumption by Buyer of all of Seller's
liabilities thereunder, all as set forth in the Agreement;

NOW, THEREFORE, in consideration of the foregoing, and for other good and
valuable consideration, receipt of which is hereby acknowledged by Seller and
Buyer, Seller hereby assigns, transfers and sets over to Buyer all of Seller's
rights and interest to, and Buyer does hereby assume all of Seller's liabilities
and obligations in connection with, all Accounts set forth on Schedule A
attached hereto on the Closing Date.

Nothing contained herein shall require Buyer to pay or discharge any debts or
obligations expressly assumed hereby so long as Buyer shall in good faith
contest or cause to be contested the amount or validity thereof.

Other than as specifically stated above or in the Agreement, Buyer assumes no
debt, liability or obligation of Seller by this Assignment and Assumption
Agreement, and it is expressly understood and agreed that all debts, liabilities
and obligations not assumed hereby by Buyer shall remain the sole obligation of
Seller, its successors and assigns.

No person other than Seller, its successors and assigns shall have any rights
under this Assignment and Assumption Agreement or the provisions contained
herein.

                                      AA-1



This Assignment and Assumption Agreement is intended to evidence the
consummation of the transactions contemplated by the Agreement and is made
without representation or warranty except as provided in and by the Agreement.
This Assignment and Assumption Agreement is in all respects subject to the
provisions of the Agreement and is not intended in any way to supersede, limit,
expand or qualify any provision of the Agreement.

Capitalized terms used herein and not defined herein shall have the meanings
assigned to them in the Agreement.

This Assumption Agreement may be executed in any number of counterparts, each of
which will be deemed an original, but all of which together will constitute one
and the same instrument.

This Assignment and Assumption Agreement shall be governed by and construed in
accordance with the laws of the State of New York applicable to a contract
executed and performed in such State without giving effect to the conflicts of
law principles thereof. Section 22 of the Agreement on consent to jurisdiction
and waiver of immunities is incorporated herein by reference and made a part
hereof as if fully set forth herein.

IN WITNESS WHEREOF, the undersigned have caused their duly authorized officers
to execute this Assignment and Assumption Agreement on the day and year first
above written.

                                                BUYER:

                                                NARA BANK NATIONAL ASSOCIATION

                                                By: ___________________________
                                                Name: Benjamin Hong
                                                Title: President

                                                SELLER:

                                                KOREA EXCHANGE BANK

                                                By:_____________________________
                                                Name:___________________________
                                                Title:__________________________

                                      AA-2



                                    EXHIBIT B

                 DEPOSIT ASSUMPTION AND LOAN PURCHASE AGREEMENT

                                     BETWEEN

                               KOREA EXCHANGE BANK

                                       AND

                                 NARA BANK, N.A.

                                  BILL OF SALE

THIS BILL OF SALE is dated this ____ day of _____________, 2003, by Korea
Exchange Bank, Seoul, Republic of Korea ("Seller").

                              W I T N E S S E T H:

WHEREAS, Seller and Nara Bank, N.A., a national bank ("Buyer"), have entered
into a Deposit Assumption and Loan Purchase Agreement dated as of August __,
2003 (the "Agreement"), which provides for the sale by Seller to Buyer of
certain loans related to Seller's Broadway Branch located at 49-51 West 33rd
Street, New York, New York, all as set forth in the Agreement;

NOW, THEREFORE, Seller, for good and valuable consideration, receipt of which is
hereby acknowledged, does hereby grant, bargain, sell, assign, set over, convey
and transfer to Buyer all of its right, title and interest in and to the
following assets (the "Assets"):

(a)      All of the Loans (including the Letters of Credit but excluding the
         Excluded Loans under Section 2(b) of the Agreement) set forth on
         Schedule B and Schedule C attached hereto on the Closing Date; and

(b)      All of Seller's files and records related to the Loans.

Seller, for itself and its successors and assigns, does hereby covenant and
agree to and with Buyer and its successors and assigns that it (i) is seized of,
and has the right to convey to Buyer, such title to the Assets as is provided in
the Agreement, (ii) shall warrant and defend said title to the Assets in the
manner provided in the Agreement, and (iii) shall, from time to time at the
request of Buyer, provide Buyer with such information and assistance as may be
necessary to give full force and effect to the intent and purposes of this Bill
of Sale.

This Bill of Sale is intended to evidence the consummation of the transactions
contemplated by the Agreement and is made without representation or warranty
except as provided in and by the

                                      BB-1



Agreement. This Bill of Sale is in all respects subject to the provisions of the
Agreement and is not intended in any way to supersede, limit, expand or qualify
any provision of the Agreement.

Capitalized terms not defined herein shall have the meaning assigned to them in
the Agreement.

IN WITNESS WHEREOF, Seller has caused this Bill of Sale to be duly executed by
its duly authorized officer, all as of the day and year first above written.

                                                   KOREA EXCHANGE BANK

                                                   By:__________________________
                                                   Name:________________________
                                                   Title:_______________________

                                      BB-2

EX-10.20

                                  RETAIL LEASE
                                     BETWEEN

                               3600 WILS HIRE,LLC,
                     A CALIFORNIA LIMITED LIABILITY COMPANY
                                   (LANDLORD)

                                       AND

                         NARA BANK, NATIONAL ASSOCIATION

                                    (TENANT)

                                   SUITE 100A
                             3600 WILSHIRE BOULEVARD
                         LOS ANGELES, CALIFORNIA, 90010

                                 JANUARY 17,2003



                                TABLE OF CONTENTS

                                  RETAIL LEASE



Article                             Title                                                     Page
- -------                             -----                                                     ----
                                                                                        
 1          Definitions                                                                         1

 2          Premises                                                                            2

 3          Term                                                                                2

 4          Rental                                                                              2

 5          Security Deposit                                                                    6

 6          Use of Premises                                                                     6

 7          Utilities and Services                                                              7

 8          Maintenance and Repairs                                                             8

 9          Alterations, Additions and Improvements                                             8

10          Indemnification and Insurance                                                       9

11          Damage or Destruction                                                              11

12          Condemnation                                                                       11

13          Relocation                                                                         12

14          Assignment and Subletting                                                          12

15          Default and Remedies                                                               13

16          Attorneys' Fees; Costs of Suits                                                    15

17          Subordination and Attornment                                                       15

18          Quiet Enjoyment                                                                    16

19          Rules and Regulations                                                              16

20          Estoppel Certificates                                                              16

21          Entry by Landlord                                                                  17

22          Landlord's Lease Undertakings-Exculpation from
            Personal Liability; Transfer of Landlord's Interest                                17

23          Holdover Tenancy                                                                   17

24          Notices                                                                            18

25          Brokers                                                                            18

26          Electronic Services                                                                18

27          Parking                                                                            20

28          Miscellaneous                                                                      20


                                    EXHIBITS

Exhibit A    As - Built Plan

Exhibit A-1  Premises Floor Plan

Exhibit A-2  Parking Plan

Exhibit B    Work Letter Agreement

Exhibit C    Agreement Rules and Regulations

Exhibit D    Personal Guaranty

Exhibit E    Suite Acceptance Agreement

Exhibit F    Asbestos Notification

Exhibit G    Parking Agreement

Addendum


                                  RETAIL LEASE

         THIS RETAIL LEASE ("Lease"), dated JANUARY 17,2003, is made and entered
into by and between 3600 Wilshire, LLC, a California limited liability company,
c/o JPB Partners, Inc., a California corporation, ("Landlord") NARA BANK,
NATIONAL ASSOCIATION, ("Tenant") upon the following terms and conditions:

                             ARTICLE I - DEFINITIONS

         Unless the context otherwise specifies or requires, the following terms
shall have the meanings specified herein;

         1.01     BUILDING. The term "Building" shall mean that certain office
building located at 3600 Wilshire Boulevard, Los Angeles, California 90010
commonly known as The Wilshire Financial Tower together with any related land,
improvements, parking facilities, common areas, driveways, sidewalks and
landscaping.

         1.02     PREMISES. The term "Premises" shall mean SUITE 100A in the
3600 Building, as more particularly outlined on the drawing attached hereto as
Exhibit A and incorporated herein by reference. As used herein, "Premises" shall
not include any storage area in the Building, which shall be leased or rented
pursuant to separate agreement.

         1.03     RENTABLE AREA OF THE PREMISES. The term "Rentable Area of the
Premises" shall mean approximately 7,961 rentable square feet, more or less,
which Landlord and Tenant have stipulated as the Rentable Area of the Premises,
the exact size and location shall be further determined upon final acceptance of
a mutually approved space plan by Landlord's architect using Building Owners and
Managers Association International ("BOMA") Standards for the measurement of
commercial office space (ANSIZ65-1-1996). Tenant acknowledges that (he Rentable
Area of the Premises include the usable area, without deduction for columns or
projections, multiplied by a load factor to reflect a share of certain areas,
which may include common or shared areas such as lobbies, corridors, mechanical,
utility, janitorial, boiler and service rooms and closets, restrooms and other
public, common and service areas of the Building.

         1.04     LEASE TERM. The term "Lease Term" shall mean the period
between the Commencement Date and the Expiration Date (as such terms are
hereinafter defined), unless sooner terminated as otherwise provided in this
Lease. The term of the Lease shall be for TEN (10) YEARS.

         1.05     COMMENCEMENT DATE. Subject to adjustment as provided in
Article 3, the term "Commencement Date" shall mean JULY 1,2003.

         1.06     EXPIRATION DATE. Subject to adjustment as provided in Article
3, the term "Expiration Date" shall mean JUNE 30,2013.

         1.07     BASE RENT. Subject to adjustment as provided in Article 4, the
term "Base Rent" shall mean Fifteen Thousand Five Hundred Twenty Three and
95/100ths Dollars ($15,523.95) per month for months One (1) through Twelve (12),
Fifteen Thousand Nine Hundred Eighty Nine and 67/100ths Dollars ($15,989.67) per
month for months TWELVE (12) through Twenty Four (24), Sixteen Thousand Four
Hundred Sixty Nine and 36/100ths Dollars ($16,469.36) per month for months
Twenty Five (25) through Thirty Six (36), Sixteen Thousand Nine Hundred Sixty
Three and 44/100ths Dollars ($16,963.44) per month for months Thirty Seven (37)
through Forty Eight (48), Seventeen Thousand Four Seventy Two Hundred and
34/100ths Dollars ($17,472.34) per month for months Forty Nine (49) through
Sixty (60), Seventeen Thousand Nine Hundred Ninety Six and 51/100ths Dollars
($17,996.51) per month for months Sixty One (61) through Seventy Two (72),
Eighteen Thousand Five Hundred Thirty Six and 41/100 ths Dollars ($18,536.41)
per month for months Seventy Three (73) through Eighty Four (84), Nineteen
Thousand Ninety Two and 50/100ths Dollars ($19,092.50) per month for months
Eighty Five (85) through Ninety Six (96), Nineteen Thousand Six Hundred Sixty
Five and 28/100ths Dollars ($19,665.28) per month for months Ninety Seven (97)
through One Hundred Eight (108) and Twenty Thousand Two Hundred Fifty Five and
23/100ths Dollars ($20,255.23) per month for months One Hundred Nine (109)
through One Hundred Twenty (120), of the initial Lease term.

         1.08     TENANT'S PERCENTAGE SHARE. Tenant's share shall be 1.9220 %
with respect In increases in Property Taxes and Operating Expenses (as such
terms are hereinafter defined). Landlord may reasonably redetermine Tenant's
Percentage Share from time to time to reflect reconfigurations, additions or
modifications to the Building.

         1.09     SECURITY DEPOSIT. The term "Security Deposit" shall mean None.

         1.10     TENANT'S PERMITTED USE. The term "Tenant's Permitted Use"
shall mean Banking and office use and no other use or purpose without the
written consent of Landlord, which consent shall not be unreasonably withheld.
It is agreed by Landlord that no other space in said building may be leased for
or used by others for a similar business. Tenant will comply with the rules and
regulations now or hereafter adopted by Landlord for the building as a whole; it
being agreed that a copy of such rules and regulations will be supplied to
Tenant, and that same will be reasonable and will not conflict with the normal
operation of Landlord.

                                                     Tenant          Landlord
                                                /s/ [ILLEGIBLE]  /s/ [ILLEGIBLE]

                                       1



         1.11     BUSINESS HOURS. The term "Business Hours" shall mean the hours
of 8:30 A.M. to 6:00 P.M., Monday through Friday (federal and state holidays
excepted). Holidays are defined as the following: New Years Day, President's
Day, Memorial Day. Independence Day, Labor Day. Thanksgiving Day and Christmas
Day, and to the extent of utilities or services provided by union members
engaged at the Building, such other holidays observed by such unions.

         1.12     LANDLORD'S ADDRESS FOR NOTICES. The term "Landlord's Address
for Notices" shall mean 3600 Wilshire Boulevard, Suite 800, Los Angeles,
California 90010, Attn: Property Manager.

         1.13     TENANT'S ADDRESS FOR NOTICES. The term "Tenant's Address for
Notices" shall mean 3600 Wilshire Boulevard, Suite 100A, Los Angeles, California
90010.

         1.14     BROKER. The term "Broker" shall mean Jamison Properties Inc.,
as Landlord's Broker, and Julien J. Studley, Inc., as Tenant's Broker.

         1.15     GUARANTER. The term "Guarantor" shall mean None.

         1.16     Tenant's Parking Stalls: The term "Tenant's Parking Stalls"
shall mean FIFTY (50) PARKING SPACES, in Landlord's parking structure at
building's prevailing rates generally posted or quoted to the general public for
available parking spaces, in common with other tenants on a non exclusive right
to park, as provided in Article 27.

                              ARTICLE II - PREMISES

         2.01     LEASE OF PREMISES. Landlord hereby leases the Premises to
Tenant, and Tenant hereby leases the Premises from Landlord, upon all of the
terms, covenants and conditions contained in this Lease. On the Commencement
Date described herein, Landlord shall deliver the Premises to Tenant in
substantial conformance with the Work Letter Agreement attached hereto as
Exhibit B.

         2.02     ACCEPTANCE OF PREMISES. Tenant acknowledges that Landlord has
not made any representation or warranty with respect to the condition of the
Premises or the Building or with respect to the suitability or fitness of either
for the conduct of Tenant's Permitted Use or for any other purpose. Tenant's
taking possession of the Premises, Landlord or its designee and Tenant will walk
the Premises for the purpose of reviewing the condition of the Premises shall be
deemed conclusive evidence that as of the date of taking possession of the
Premises are in good order and satisfactory condition. No promise of Landlord to
alter, remodel, repair or improve the Premises, the Building or the Project and
no representation, express or implied, respecting any matter or thing relating
to the Premises, Building, Project or this Lease (including, without limitation,
the condition of the Premises, the Building or the Project) have been made to
Tenant by Landlord or Landlord"s Broker, or any agents thereof. Tenant shall
execute a Suite Acceptance Letter, in the form of Exhibit E attached hereto,
accepting the Premises.

                                ARTICLE III - TERM

         3.01     Except as otherwise provided in this Lease, the Lease Term
shall be for the period described in Section 1.04 of this Lease, commencing on
the Commencement Date described in Section 1.05 of this Lease and ending on the
Expiration Date described in Section 1.06 of this Lease; provided, however,
that, if, for any reason, Landlord is unable to deliver possession of the
Premises on the date described in Section 1.05 of this Lease, Landlord shall not
be liable for any damage caused thereby, nor shall the Lease be void or
voidable, but, rather, the Lease Term shall commence upon, and the Commencement
Date shall be the date that possession of the Premises is so tendered to Tenant
(except for Tenant-caused delays which shall not be deemed to delay commencement
of the Lease Term), and, unless Landlord elects otherwise, the Expiration Date
described in Section 1.06 of this Lease shall be extended by an equal number of
days.

                               ARTICLE IV - RENTAL

         4.01     DEFINITIONS. AS USED HEREIN,

                  (A)      "Base Year" shall mean calendar year 2003.

                  (B)      "Property Taxes" shall mean the aggregate amount of
all real estate taxes, assessments (whether they be general or special), sewer
rents and charges, transit taxes, taxes based upon the receipt of rent and any
other federal, state or local governmental charge, general, special, ordinary or
extraordinary (but not including income or franchise taxes, capital stock,
inheritance, estate, gift, or any other taxes imposed upon or measured by
Landlord's gross income or profits, unless the same shall be imposed in lieu of
real estate taxes or other ad valorem taxes), which Landlord shall pay or become
obligated to pay in connection with the Building, or any part thereof.
Property Taxes shall also include all fees and costs, including attorneys' fees,
appraisals and consultants' fees, incurred by Landlord in seeking to obtain a
reassessment, reduction of, or a limit on the increase in, any Property Taxes,
regardless of whether any reduction or limitation is obtained. Property Taxes
for any calendar year shall be


                                                     Tenant            Landlord
                                                -s- [ILLEGIBLE]  -s- [ILLEGIBLE]

                                       2



Property Taxes which are due for payment or paid in such year, rather than
Property Taxes which are assessed or become a lien during such year. Property
Taxes shall include any tax, assessment, levy, imposition or charge imposed upon
Landlord and measured by or based in whole or in part upon the Building or the
rents or other income from the Building, to the extent that such items would be
payable if the Building was the only property of Landlord subject to same and
the income received by Landlord from the Building was the only income of
Landlord. Property Taxes shall also include any personal property taxes imposed
upon the furniture, fixtures, machinery, equipment, apparatus, systems and
appurtenances of Landlord used in connection with the Building.

                  (C)      "Operating Expenses" shall mean all costs, fees,
disbursements and expenses paid or incurred by or on behalf of Landlord in the
operation, ownership, maintenance, insurance, management, replacement and repair
of the Building (excluding Property Taxes) including without limitation:

                           (i)      Premiums for property, earthquake, casualty,
liability, rent interruption or other types of insurance carried by Landlord.

                           (ii)     Salaries, wages and other amounts paid or
payable for personnel including the Building manager, superintendent, operation
and maintenance staff, and other employees of Landlord involved in the
maintenance and operation of the Building, including contributions and premiums
towards fringe benefits, unemployment, disability and worker's compensation
insurance, pension plan contributions and similar premiums and contributions and
the total charges of any independent contractors or property managers engaged in
the operation, repair, care, maintenance and cleaning of any portion of the
Building.

                           (iii)    Cleaning expenses, including without
limitation janitorial services, window cleaning, and garbage and refuse removal.

                           (iv)     Landscaping expenses, including without
limitation irrigating, trimming, mowing, fertilizing, seeding, and replacing
plants.

                           (v)      Heating, ventilating, air conditioning and
steam/utilities expenses, including fuel, gas, electricity, water, sewer,
telephone, and other services.

                           (vi)     Subject to the provisions of Section 4.01
(C)(xii) below, the cost of maintaining, operating, repairing and replacing
components of equipment or machinery, including without limitation heating,
refrigeration, ventilation, electrical, plumbing, mechanical, elevator,
escalator, sprinklers, fire/life safety, security and energy management systems,
including service contracts, maintenance contracts, supplies and parts.

                           (vii)    Other items of repair or maintenance of
elements of the Building.

                           (viii)   The costs of policing, security and
supervision of the Building.

                           (ix)     Fair market rental and other costs with
respect to the management office for the Building.

                           (x)      The cost of the rental of any machinery or
equipment and the cost of supplies used in the maintenance and operation of the
Building.

                           (xi)     Audit fees and the cost of accounting
services incurred in the preparation of statements referred to in this Lease and
financial statements, and in the computation of the rents and charges payable by
tenants of the Building.

                           (xii)    Capital expenditures (a) made primarily to
reduce Operating Expenses, or to comply with any laws or other governmental
requirements, or (b) for replacements (as opposed to additions or new
improvements) of non-structural items located in the common areas of the
property required to keep such areas in good condition; provided, all such
permitted capital expenditures (together with reasonable financing charges)
shall be amortized for purposes of this Lease over the shorter of (i) their
useful lives, (ii) the period during which the reasonably estimated savings in
Operating Expenses equals the expenditures, or (iii) three (3) years.

                           (xiii)   Legal fees and expenses.

                           (xiv)    Payments under any easement, operating
agreement, declaration, restrictive covenant, or instrument pertaining to the
sharing of costs in any planned development.

                           (xv)     A fee for the administration and management
of the Building as reasonably determined by Landlord from time to time.

         Operating Expenses shall not include costs of alteration of the
premises of tenants of the Building, depreciation charges, interest and
principal payments on mortgages, ground rental payments, real estate brokerage
and leasing commissions, expenses incurred in enforcing obligations of tenants
of the Building, salaries and other compensation of executive officers of the
managing agent of the Building senior to the Building manager, costs of any
special service provided to any one tenant of the Building but not to tenants of
the Building generally, and costs of marketing or advertising the Building.

                                                      Tenant         Landlord
                                                /s/ [ILLEGIBLE]  /s/ [ILLEGIBLE]

                                       3



                  (D)      If the Building does not have ninety five percent
(95%) occupancy during an entire calendar year, including the Base Year, then
the variable cost component of "Property Taxes" and "Operating Expenses" shall
he equitably adjusted so that the total amount of Property Taxes and Operating
Expenses equals the total amount which would have been paid or incurred by
Landlord had the Building been ninety five percent (95%) occupied for the entire
calendar year. In no event shall Landlord be entitled to receive from Tenant and
any other tenants in the Building an aggregate amount in excess of actual
Property Taxes and Operating Expenses as a result of the foregoing provision.

         4.02     BASE RENT.

                  (A)      During the Lease Term, Tenant shall pay to Landlord
as rental for the Premises the Base Rent described in Section 1.07 above,
subject to the following annual adjustments (herein called the "Rent
Adjustments"):

                  (B)      Annual Adjustments of Base Rent.

                           (a)      Tax and Operating Expense Adjustment. During
each calendar year, the Base Rent payable by Tenant to Landlord, shall be
increased by (collectively, the "Tax and Operating Expense Adjustment"): (i)
Tenant's Percentage Share of the dollar increase, if any, in Property Taxes for
such year over Property Taxes for the Base Year; and (ii) Tenant's Percentage
Share of the dollar increase, if any, in any category of Operating Expenses paid
or incurred by Landlord during such year over the respective category of
Operating Expenses paid or incurred by Landlord during the Base Year. A decrease
in Property Taxes or any category of Operating Expenses below the Base Year
amounts shall not decrease the amount of the Base Rent due hereunder or give
rise to a credit in favor of Tenant.

                           (b)      CPI Adjustment. During each calendar year,
the Base Rent payable by Tenant to Landlord, shall be adjusted to reflect
increases in the Consumer Price Index as follows:

                  (i)      Definitions. The following terms shall have the
following meanings:

                           (1)      "Index" means the "Consumer Price Index -
All Urban Consumers - Los Angeles/Long Beach/Anaheim Metropolitan Area" compiled
by the U.S. Department of Labor, Bureau of Labor Statistics, (1967 = 100). If a
substantial change is made in the Index, the revised Index shall be used,
subject to such adjustments as Landlord may reasonably deem appropriate in order
to make the revised Index comparable to the prior Index. If the Bureau of Labor
Statistics ceases to publish the Index, then the successor or most nearly
comparable index, as reasonably determined by Landlord, shall be used, subject
to such adjustments as landlord may reasonably deem appropriate in order to make
the new index comparable to the Index.

                           (2)      "CPI Adjustment Date" means January 1 of the
year in which the anniversary of the Commencement Date falls, and January 1 of
every year thereafter.

                           (3)      "CPI Base" means the initial Base Rent
amount set forth in Section 4.02(A).

                  (ii)     Computation of Adjustment. Effective as of each CPI
Adjustment Date, the Base Rent shall be adjusted to an amount to be determined
by multiplying the CPI Base by a fraction, the numerator of which shall be the
Index for the calendar month immediately preceding the CPI Adjustment Date and
the denominator of which shall be the Index for the calendar month immediately
preceding the month in which the Commencement Date occurs. Such fraction shall
not exceed, for any CPI Adjustment Date, an amount in excess of one hundred
percent, multiplied by the number of CPI Adjustment Dates that have then
occurred (including the present one). The Base Rent shall never be reduced as a
result of an adjustment pursuant to this paragraph. Landlord shall give Tenant
written notice indicating the adjusted Base Rent and the method of computation,
and, on or before the first day of the first calendar month following Tenant's
receipt of such written notice, Tenant shall pay to Landlord an amount equal to
the underpayment of Base Rent by Tenant for the period from the CPI Adjustment
Date until such date.

         4.03     TAX AND OPERATING EXPENSE ADJUSTMENT PROCEDURE; ESTIMATES. The
Tax and Operating Expense Adjustment specified in Section 4.02(B)(a) shall be
determined and paid as follows:

                  (A)      During each calendar year subsequent to the Base
Year, Landlord shall give Tenant written notice of its estimate of any increased
amounts payable under Section 4,02(B)(a) for that calendar year. On or before
the first day of each calendar month during the calendar year, Tenant shall pay
to Landlord one-twelfth (l/12th) of such estimated amounts; provided, however,
that, not more often than quarterly, Landlord may, by written notice to Tenant,
revise its estimate for such year, and subsequent payments by Tenant for such
year shall be based upon such revised estimate.

                  (B)      Within one hundred twenty (120) days after the close
of each calendar year or as soon thereafter as is practicable, Landlord shall
deliver to Tenant a statement of that year's Property Taxes and Operating
Expenses, and the actual Tax and Operating Expense Adjustment to be made
pursuant to Section 4.02(B)(a) for such calendar year, as determined by Landlord
(the "Landlord's Statement") and such Landlord's Statement shall be binding upon
Tenant, except as provided in Section 4.04 below. If the amount of the actual
Tax and Operating

                                                      Tenant          Landlord
                                                -s- [ILLEGIBLE]  -s- [ILLEGIBLE]

                                       4



Expense Adjustment is more than the estimated payments for such calendar year
made by Tenant, Tenant shall pay the deficiency to Landlord upon receipt of
Landlord's Statement. If the amount of the actual Tax and Operating Expense
Adjustment is less than the estimated payments for such calendar year made by
Tenant, any excess shall be credited against Rent (as hereinafter defined) next
payable by Tenant under this Lease or, if the Lease Term has expired, any excess
shall be paid to Tenant. No delay in providing the statement described in this
subparagraph (B) shall act as a waiver of Landlord's right to payment under
Section 4.02(B)(a) above.

                  (C)      If this Lease shall terminate on a day other than the
end of a calendar year, the amount of the Tax and Operating Expense Adjustment
to be paid pursuant to Section 4,02(B)(a) that is applicable to the calendar
year in which such termination occurs shall be prorated on the basis of the
number of days from January 1 of the calendar year to the termination date bears
to 365. The termination of this Lease shall not affect the obligations of
Landlord and Tenant pursuant to Section 4.03(B) to be performed after such
termination.

         4.04     REVIEW OF LANDLORD'S STATEMENT. Provided that Tenant is not
then in default beyond any applicable cure period of its obligations to pay Base
rent, additional rent described in Section 4.02(B), or any other payments
required to be made by it under this Lease and provided further that Tenant
strictly complies with the provisions of this Section 4.04, Tenant shall have
the right, once each calendar year, to reasonably review supporting data for any
portion of a Landlord's Statement (provided, however, Tenant may not have an
audit right to all documentation relating to Building operations as this would
far exceed the relevant information necessary to properly document a
pass-through billing statement, but real estate tax statements, and information
on utilities, repairs, maintenance and insurance will be available), in
accordance with the following procedure:

                  (A)      Tenant shall, within ten (10) business days after any
such Landlord's Statement is delivered, deliver a written notice to Landlord
specifying the portions of the Landlord's Statement that are claimed to be
incorrect, and Tenant shall simultaneously pay to Landlord all amounts due from
Tenant to Landlord as specified in the Landlord's Statement Except as expressly
set forth in subsection (C) below, in no event shall Tenant be entitled to
withhold, deduct, or offset any monetary obligation of Tenant to Landlord under
the Lease (including, without limitation, Tenant's obligation to make all
payments of Base Rent and all payments of Tenant's Tax and Operating Expense
Adjustment) pending the completion of and regardless of the results of any
review of records under this Section 4.04. The right of Tenant under this
Section 4.04 may only be exercised once for any Landlord's Statement, and if
Tenant fails to meet any of the above conditions as a prerequisite to the
exercise of such right, the right of Tenant under this Section 4.04 for a
particular Landlord's Statement shall be deemed waived.

                  (B)      Tenant acknowledges that Landlord maintains its
records for the Building at Landlord's manager's corporate offices presently
located at the address set forth in Section 1.12 and Tenant agrees that any
review of records under this Section 4.04 shall be at the sole expense of Tenant
and shall be conducted by an independent firm of certified public accountants of
national standing. Tenant acknowledges and agrees that any records reviewed
under this Section 4.04 constitute confidential information of Landlord, which
shall not be disclosed to anyone other than the accountants performing the
review and the principals of Tenant who receive the results of the review. The
disclosure of such information to any other person, whether or not caused by the
conduct of Tenant, shall constitute a material breach of this Lease.

                  (C)      Any errors disclosed by the review shall be promptly
corrected by Landlord, provided, however, that if Landlord disagrees with any
such claimed errors, Landlord shall have the right to cause another review to be
made by an independent firm of certified public accountants of national
standing. In the event of a disagreement between the two accounting firms, the
review that discloses the least amount of deviation from the Landlord's
Statement shall be deemed to be correct. In the event that the results of the
review of records (taking into account, if applicable, the results of any
additional review caused by Landlord) reveal that Tenant has overpaid
obligations for a preceding period, the amount of such overpayment shall be
credited against Tenant's subsequent installment obligations to pay the
estimated Tax and Operating Expense Adjustment. In the event that such results
show that Tenant has underpaid its obligations for a preceding period, Tenant
shall be liable for Landlord's actual accounting fees, and the amount of such
underpayment shall be paid by Tenant to Landlord with the next succeeding
installment obligation of estimated Tax and Operating Expense Adjustment.

         4.05     PAYMENT. Concurrently with the execution hereof, Tenant shall
pay Landlord Base Rent for the first calendar month of the Lease Term.
Thereafter the Base Rent described in Section 1.07, as adjusted in accordance
with Section 4.02, shall be payable in advance on the first day of each calendar
month. If the Commencement Date is other than the first day of a calendar month,
the prepaid Base Rent for such partial month shall be prorated in the proportion
that the number of days this Lease is in effect during such partial month bears
to the total number of days in the calendar month. All Rent, and all other
amounts payable to Landlord by Tenant pursuant to the provisions of this Lease,
shall be paid to Landlord, without notice, demand, abatement, deduction or
offset, in lawful money of the United States at Landlord's office in the
Building or to such other person or at such other place as Landlord may
designate from time to time by written notice given to Tenant. No payment by
Tenant or receipt by Landlord of a lesser amount than the correct Rent due
hereunder shall be deemed to be other than a payment on account; nor shall any
endorsement or statement on any check or any letter accompanying any check or
payment he deemed to effect or evidence an accord and satisfaction; and Landlord
may accept such check or payment without prejudice to Landlord's right to
recover the balance or pursue any other remedy in this Lease or at law or in
equity provided.

         4.06     LATE CHARGE; INTEREST. Tenant acknowledges that the late
payment of Base Rent or any other amounts payable by Tenant to Landlord
hereunder (all of which shall constitute additional rental to the same extent

                                                     Tenant          Landlord
                                                -s- [ILLEGIBLE]  -s- [ILLEGIBLE]

                                       5



as Base Rent) will cause Landlord to incur administrative costs and other
damages, the exact amount of which would be impracticable or extremely difficult
to ascertain. Landlord and Tenant agree that if Landlord does not receive any
such payment on or before five (5) days after the date the payment is due,
Tenant shall pay to Landlord, as additional rent, (a) a late charge equal to Ten
PERCENT (10%) of the overdue amount to cover such additional administrative
costs; and (b) interest on the delinquent amounts at the lesser of the maximum
rate permitted by law if any or TWELVE PERCENT (12%) per annum from the date due
to the date paid.

         4.07     ADDITIONAL RENT. For purposes of this Lease, all amounts
payable by Tenant to Landlord pursuant to this Lease, whether or nut denominated
as such, shall constitute Base Rent. Any amounts due Landlord shall sometimes be
referred to in this Lease as "Rent".

         4.08     ADDITIONAL TAXES. Notwithstanding anything in Section 4.01(B)
to the contrary, Tenant shall reimburse Landlord upon demand for any and all
taxes payable by or imposed upon Landlord upon or with respect to: any fixtures
or personal property located in the Premises; any leasehold improvements made in
or to the Premises by or for Tenant; the Rent payable hereunder, including,
without limitation, any gross receipts (tax, license fee or excise tax levied by
any governmental authority; the possession, leasing, operation, management,
maintenance, alteration, repair, use or occupancy of any portion of the Premises
(including without limitation any applicable possessory interest taxes); or this
transaction or any document to which Tenant is a party creating or transferring
an interest or an estate in the Premises.

                          ARTICLE V - SECURITY DEPOSIT

         5.01     Upon the execution of this Lease, Tenant shall deposit with
Landlord the Security Deposit described in Section 1.09 above. The Security
Deposit is made by Tenant to secure the faithful performance of all the terms,
covenants and conditions of this Lease to be performed by Tenant. If Tenant
shall default with respect to any covenant or provision hereof, Landlord may
use, apply or retain all or any portion of the Security Deposit to cure such
default or to compensate Landlord for any loss or damage which Landlord may
suffer thereby. If Landlord so uses or applies all or any portion of the
Security Deposit, Tenant shall immediately upon written demand deposit cash with
Landlord in an amount sufficient to restore the Security Deposit to the full
amount hereinabove stated. Landlord shall not be required to keep the Security
Deposit separate from its general accounts and Tenant shall not be entitled to
interest on the Security Deposit. Within thirty (30) days after the expiration
of the Lease Term and the vacation of the Premises by Tenant, the Security
Deposit, or such part as has not been applied to cure the default, shall be
returned to Tenant.

                          ARTICLE VI - USE OF PREMISES

         6.01     TENANTS PERMITTED Use. Tenant shall use the Premises only for
Tenant's Permitted Use as set forth in Section 1.10 above and shall not use or
permit the Premises to be used for any other purpose. Tenant shall, at its sole
cost and expense, obtain all governmental licenses and permits required to allow
Tenant to conduct Tenant's Permitted Use. Landlord disclaims any warranty that
the Premises are suitable for Tenant's use and Tenant acknowledges that it has
had a full opportunity to make its own determination in this regard.

Tenant further specifically acknowledges that neither Landlord nor Landlord's
Broker, or any agents thereof, has made any representation or warranty with
respect to the suitability of the Premises for their intended Use, with respect
to the ability of Tenant to conduct a, Cafe or restaurant business from the
Premises at a profit or with respect to the occupancy or expected occupancy
level of the Building.

         6.02     COMPLIANCE WITH LAWS AND OTHER REQUIREMENTS.

                  (A)      Tenant shall cause the Premises to comply in all
material respects with all laws, ordinances, regulations and directives of any
governmental authority having jurisdiction including, without limitation, any
certificate of occupancy and any law, ordinance, regulation, covenant, condition
or restriction affecting the Building or the Premises which in the future may
become applicable to the Premises (collectively "APPLICABLE LAWS").

                  (B)      Tenant shall not use the Premises, or permit the
Premises to be used, in any manner which: (a) violates any Applicable Law; (b)
causes or is reasonably likely to cause damage to the Building or the Premises;
(c) violates a requirement or condition of any fire and extended insurance
policy covering the Building and/or the Premises, or increases the cost of such
policy; (d) constitutes or is reasonably likely to constitute a nuisance,
annoyance or inconvenience to other tenants or occupants of the Building or its
equipment, facilities or systems; (e) interferes with, or is reasonably likely
to interfere with, the transmission or reception of microwave, television,
radio, telephone or other communication signals by antennae or other facilities
located in the Building; or (f) violates the Rules and Regulations described in
Article XIX.

         6.03     HAZARDOUS MATERIALS. This paragraph is reciprocal from
Landlord.

                  (A)      No Hazardous Materials, as defined herein, shall be
Handled, as also defined herein, upon, about, above or beneath the Premises or
any portion of the Building by or on behalf of Tenant, its subtenants or its
assignees, or their respective contractors, officers, directors, employees,
agents, or invitees. Any such Hazardous Materials so Handled shall be known as
Tenant's Hazardous Materials. Notwithstanding the foregoing, normal

                                                     Tenant           Landlord
                                                -s- [ILLEGIBLE]  -s- [ILLEGIBLE]

                                       6



quantities of Tenant's Hazardous Materials customarily used in the conduct of
general activities (e.g., copier fluids and cleaning supplies) may be Handled at
the Premises without Landlord's prior written consent. Tenant's Hazardous
Materials shall be Handled at all times in compliance with the manufacturer's
instructions therefor and all applicable Environmental Laws, as defined herein.

                  (B)      Notwithstanding the obligation of Tenant to indemnify
Landlord pursuant to this Lease, Tenant shall, at its sole cost and expense,
promptly take all actions required by any Regulatory Authority, as defined
herein, or necessary for Landlord to make full economic use of the Premises or
any portion of the Building, which requirements or necessity arises from the
Handling of Tenant's Hazardous Materials upon, about, above or beneath the
Premises or any portion of the Building. Such actions shall include, but not be
limited to, the investigation of the environmental condition of the Premises or
any portion of the Building, the preparation of any feasibility studies or
reports and the performance of any cleanup, remedial, removal or restoration
work. Tenant shall take all actions necessary to restore the Premises or any
portion of the Building to the condition existing prior to the introduction of
Tenant's Hazardous Materials, notwithstanding any less stringent standards or
remediation allowable under applicable Environmental Laws. Tenant shall
nevertheless obtain Landlord's written approval prior to undertaking any actions
required by this Section, which approval shall not be unreasonably withheld so
long as such actions would not potentially have a material adverse long-term or
short-term effect on the Premises or any portion of the Building.

                  (C)      Tenant agrees to execute affidavits, representations,
and the like from time to time at Landlord's request stating Tenant's best
knowledge and belief regarding the presence of Hazardous Materials on the
Premises.

                  (D)      "Environmental Laws" means and includes all now and
hereafter existing statutes, laws, ordinances, codes, regulations, rules,
rulings, orders, decrees, directives, policies and requirements by any
Regulatory Authority regulating, relating to, or imposing liability or standards
of conduct concerning public health and safety or the environment.

                  (E)      "Hazardous Materials" means: (a) any material or
substance: (i) which is defined or becomes defined as a "hazardous substance,"
"hazardous waste," "infectious waste," "chemical mixture or substance," or "air
pollutant" under Environmental Laws; (ii) containing petroleum, crude oil or any
fraction thereof; (iii) containing polychlorinated biphenyls (PCB's); (iv)
containing asbestos; (v) which is radioactive; (vi) which is infectious; or (b)
any other material or substance displaying toxic, reactive, ignitable or
corrosive characteristics, as all such terms are used in their broadest sense,
and are defined, or become defined by Environmental Laws; or (c) materials which
cause a nuisance upon or waste to the Premises or any portion of the Building.

                  (F)      "Handle," "handle," "Handled," "handled," "Handling,"
or "handling" shall mean any installation, handling, generation, storage,
treatment, use, disposal, discharge, release, manufacture, refinement, presence,
migration, emission, abatement, removal, transportation, or any other activity
of any type in connection with or involving Hazardous Materials.

                  (G)      "Regulatory Authority" shall mean any federal, state
or local governmental agency, commission, board or political subdivision.

                      ARTICLE VII - UTILITIES AND SERVICES

         7.01     BUILDING SERVICES. As long as Tenant is not in monetary
default under this Lease, Landlord agrees to furnish or cause to be furnished to
the Premises the following utilities and services, subject to the conditions and
standards set forth herein:

                  (A)      Non-attended automatic elevator service (if the
Building has such equipment serving the Premises), in common with Landlord and
other tenants and occupants and their agents and invitees.

                  (B)      Water for restroom purposes for the common Building
restrooms only.

                  Any amounts which Tenant is required to pay to Landlord
pursuant to this Section 7.01 shall be payable upon demand by Landlord and shall
constitute additional rent.

         7.02     INTERRUPTION OF SERVICES. Landlord shall not be liable for any
failure to furnish, stoppage of, or interruption in furnishing any of the
services or utilities described in Section 7.01 when such failure is caused by
accident, breakage, repairs, strikes, lockouts, labor disputes, labor
disturbances, governmental regulation, civil disturbances, acts of war,
moratorium or other governmental action, or any other cause beyond Landlord's
reasonable control, and, in such event, Tenant shall not be entitled to any
damages nor shall any failure or interruption abate or suspend Tenant's
obligation to pay Base Rent and additional rent required under this Lease or
constitute or be construed as a constructive or other eviction of Tenant.
Further, in the event any governmental authority or public utility promulgates
or revises any law, ordinance, rule or regulation, or issues mandatory controls
or voluntary controls relating to the use or conservation of energy, water, gas,
light or electricity, the reduction of automobile or other emissions, or the
provision of any other utility or service, Landlord may take any reasonably
appropriate action to comply with such law, ordinance, rule, regulation,
mandatory control or voluntary guideline and Tenant's obligations hereunder
shall not be affected by any such action of Landlord. The parties acknowledge

                                                     Tenant           Landlord
                                                -s- [ILLEGIBLE]  -s- [ILLEGIBLE]

                                       7



that safety and security devices, services and programs provided by Landlord, if
any, while intended to deter crime and ensure safety, may not in given instances
prevent theft or other criminal acts, or ensure safety of persons or property.
The risk that any safety or security device, service or program may not be
effective, or may malfunction, or be circumvented by a criminal, is assumed by
Tenant with respect to Tenant's property and interests, and Tenant shall obtain
insurance coverage to the extent Tenant desires protection against such criminal
acts and other losses, as further described in this Lease. Tenant agrees to
cooperate in any reasonable safety or security program developed by Landlord or
required by Law.

                     ARTICLE VIII - MAINTENANCE AND REPAIRS

         8.01     LANDLORD'S OBLIGATIONS. Except as provided hi Sections 8.02
and 8.03 below, Landlord shall maintain the Building in resonable order and
repair throughout the Lease Term; provided, however, that Landlord shall not be
liable for any failure to make any repairs or to perform any maintenance unless
such failure shall persist for more than fifteen days after written notice of
the need for such repairs or maintenance is given to Landlord by Tenant, or such
greater period provided Landlord has commenced to cure, and diligently pursues
same to completion. Except as provided in Article XI, there shall be no
abatement of Rent, nor shall there be any liability of Landlord, by reason of
any injury or inconvenience to, or interference with, Tenant's business or
operations arising from die making of, or failure to make, any maintenance or
repairs in or to any portion of the Building.

         8.02     TENANT'S OBLIGATIONS. During the Lease Term, Tenant shall, at
its sole cost and expense, maintain the Premises in good order and repair
(including, without limitation, the carpet, wall-covering, doors, plumbing and
other fixtures, equipment, alterations and improvements, whether installed by
Landlord or Tenant). Further, Tenant shall be responsible for, and upon demand
by Landlord shall promptly reimburse Landlord for, any damage to any portion of
the Building or the Premises caused by (a) Tenant's activities hi the Building
or the Premises; (b) the performance or existence of any alterations, additions
or improvements made by Tenant in or to the Premises; (c) the installation, use,
operation or movement of Tenant's property in or about the Building or the
Premises; or (d) any act or omission by Tenant or its officers, partners,
employees, agents, contractors or invitees.

         8.03     LANDLORD'S RIGHTS. Landlord and its contractors shall have the
right, at all reasonable times and upon twenty-four (24) hours prior oral or
telephonic notice to Tenant at the Premises, other than in the case of any
emergency in which case no notice shall be required, to enter upon the Premises
to make any repairs to the Premises or the Building reasonably required or
deemed reasonably necessary by Landlord and to erect such equipment, including
scaffolding, as is reasonably necessary to effect such repairs.

              ARTICLE IX - ALTERATIONS. ADDITIONS AND IMPROVEMENTS

         9.01     LANDLORD'S CONSENT; CONDITIONS. Tenant shall not make or
permit to be made any alterations, additions, or improvements in or to the
Premises ("Alterations") without the prior written consent of Landlord, which
consent, with respect to non-structural alterations, shall not be unreasonably
withheld. Landlord may impose as a condition to making any Alterations such
requirements as Landlord in its reasonable discretion deems necessary or
desirable including without limitation: Tenant's submission to Landlord, for
Landlord's prior written approval, of all plans and specifications relating to
the Alterations; Landlord's prior written approval of the time or times when the
Alterations are to be performed; Landlord's prior written approval of the
contractors and subcontractors performing work in connection with the
Alterations; employment of union contractors and subcontractors who shall not
cause labor disharmony; Tenant's receipt of all necessary permits and approvals
from all governmental authorities having jurisdiction over the Premises prior to
the construction of the Alterations; Tenant's delivery to Landlord of such bond
and insurance as Landlord shall reasonably require; and Tenant's payment to
Landlord of reasonable costs and expenses incurred by Landlord because of
Tenant's Alterations, including but not limited to costs incurred in reviewing
the plans and specifications for, and the progress of, the Alterations. Tenant
is required to provide Landlord written notice of whether the Alterations
include the Handling of any Hazardous Materials and whether these materials are
of a customary and typical nature for industry practices. Upon completion of the
Alterations, Tenant shall provide Landlord with copies of as-built plans.
Neither the approval by Landlord of plans and specifications relating to any
Alterations nor Landlord's supervision or monitoring of any Alterations shall
constitute any warranty by Landlord to Tenant of the adequacy of the design for
Tenant's intended use or the proper performance of the Alterations.

         9.02     PERFORMANCE OF ALTERATIONS WORK. All work relating to the
Alterations shall be performed in compliance with the plans and specifications
approved by Landlord, all applicable laws, ordinances, rules, regulations and
directives of all governmental authorities having jurisdiction (including
without limitation Title 24 of the California Administrative Code) and the
requirements of all carriers of insurance on the Premises and the Building, the
Board of Underwriters, Fire Rating Bureau, or similar organization. All work
shall be performed in a diligent, first class manner and so as not to
unreasonably interfere with any other tenants or occupants of the Building. All
costs incurred by Landlord relating to the Alterations shall be payable to
Landlord by Tenant as additional rent upon demand. No asbestos-containing
materials shall be used or incorporated in the Alterations. No lead-containing
surfacing material, solder, or other construction materials or fixtures where
the presence of lead might create a condition of exposure not in compliance with
Environmental Laws shall be incorporated in the Alterations.

                                                       Tenant          Landlord
                                                -s- [ILLEGIBLE]  -s- [ILLEGIBLE]

                                       8




         9.03     LIENS. Tenant shall pay when due all costs for work performed
and materials supplied to the Premises for the Alteration. Tenant shall keep
Landlord, the Premises and the Building free from all liens, stop notices and
violation notices relating to the Alterations or any other work performed for,
materials furnished to or obligations incurred by or for Tenant and Tenant shall
protect, indemnify, hold harmless and defend Landlord, the Premises and the
Building of and from any and all loss, cost, damage, liability and expense,
including attorneys' fees, arising out of or related to any such liens or
notices. Further, Tenant shall give Landlord not less then seven (7) business
days prior written notice before commencing any Alterations in or about the
Premises to permit Landlord to post appropriate notices of non-responsibility.
Tenant shall also secure, prior to commencing any Alterations, at Tenant's sole
expense, a completion and lien indemnity bond satisfactory to Landlord for such
work. During the progress of such work. Tenant shall, upon Landlord's request,
furnish Landlord with sworn contractor's statements and lien waivers covering
all work theretofore performed. Tenant shall satisfy or otherwise discharge all
liens, stop notices, claims or encumbrances within ten (10) days after Landlord
notifies Tenant in writing that any such lien, stop notice, claim or encumbrance
has been filed. If Tenant fails to pay and remove such lien, claim or
encumbrance within such ten (10) days, Landlord, at its election, may pay and
satisfy the same and in such event the sums so paid by Landlord, with interest
from the date of payment at the rate set forth in Section 4.06 hereof for
amounts owed Landlord by Tenant shall be deemed to be additional rent due and
payable by Tenant at once without notice or demand.

         9.04     LEASE TERMINATION. Except as provided in this Section 9.04,
upon expiration or earlier termination of this Lease Tenant shall surrender the
Premises to Landlord in the same condition as existed on the date Tenant first
occupied the Premises, (whether pursuant to this Lease or an earlier lease),
subject to reasonable wear and tear. All Alterations shall become a part of the
Premises and shall become the property of Landlord upon the expiration or
earlier termination of this lease, unless Landlord shall, by written notice
given to Tenant, require Tenant to remove some or all of Tenant's Alterations,
in which event Tenant shall promptly remove the designated Alterations and shall
promptly repair any resulting damage, all at Tenant's sole expense.
Notwithstanding the foregoing to the contrary, in the event that Landlord gives
its consent, pursuant to the provisions of Section 9.01 of this Lease, to allow
Tenant to make an Alteration in the Premises, Landlord agrees, upon Tenant's
written request, to notify Tenant in writing at the time of the giving of such
consent whether Landlord will require Tenant, at Tenant's cost, to remove such
Alteration at the end of the Lease Term.

                    ARTICLE X - INDEMNIFICATION AND INSURANCE

         10.01    INDEMNIFICATION.

                  (A)      Tenant agrees to protect, indemnify, hold harmless
and defend Landlord and any Mortgagee, as defined herein, and each of their
respective partners, directors, officers, agents and employees, successors and
assigns, (except to the extent of the losses described below are caused by the
gross negligence of Landlord, its agents and employees), from and against:

                           (i)      any and all loss, cost, damage, liability or
expense as incurred (including but not limited to reasonable attorneys' fees and
legal costs) arising out of or related to any claim, suit or judgment brought by
or in favor of any person or persons for damage, loss or expense due to, but not
limited to, bodily injury, including death, or property damage sustained by such
person or persons which arises out of, is occasioned by or is in any way
attributable to the use or occupancy of the Premises or any portion of the
Building by Tenant or the acts or omission of Tenant or its agents, employees,
contractors, clients, invitees or subtenants except that caused by the sole
active negligence or willful misconduct of Landlord or its agents or employees.
Such loss or damage shall include, but not be limited to, any injury or damage
to, or death of, Landlord's employees or agents or damage to the Premises or any
portion of the Building.

                           (ii)     any and all environmental damages which
arise from: (i) the Handling of any Tenant's Hazardous Materials, as defined in
Section 6.03 or (ii) the breach of any of the provisions of this Lease. For the
purpose of this Lease, "environmental damages" shall mean (a) all claims,
judgments, damages, penalties, fines, costs, liabilities, and losses (including
without limitation, diminution in the value of the Premises or any portion of
the Building, damages for the loss of or restriction on use of rentable or
usable space or of any amenity of the Premises or any portion of the Building,
and from any adverse impact on Landlord's marketing of space); (b) all
reasonable sums paid for settlement of claims, attorneys' fees, consultants'
fees and experts' fees; and (c) all costs incurred by Landlord in connection
with investigation or remediation relating to the Handling of Tenant's Hazardous
Materials, whether or not required by Environmental Laws, necessary for Landlord
to make full economic use of the Premises or any portion of the Building, or
otherwise required under this Lease. To the extent that Landlord is held
strictly liable by a court or other governmental agency of competent
jurisdiction under any Environmental Laws, Tenant's obligation to Landlord and
the other indemnities under the foregoing indemnification shall likewise be
without regard to fault on Tenant's part with respect to the violation of any
Environmental Law which results in liability to the indemnitee. Tenant's
obligations and liabilities pursuant to this Section 10.01 shall survive the
expiration or earlier termination of this Lease.

                  (B)      Landlord agrees to protect, indemnify, hold harmless
and defend Tenant from and against any and all loss, cost, damage, liability or
expense, including reasonable attorneys' fees, with respect to any claim of
damage or injury to persons or property at the Premises, caused by the gross
negligence of Landlord or its authorized agents or employees.

                                                     Tenant          Landlord
                                                -s- [ILLEGIBLE]  -s- [ILLEGIBLE]

                                       9



                  (C)      Notwithstanding anything to the contrary contained
herein, nothing shall be interpreted or used to in any way affect, limit, reduce
or abrogate any insurance coverage provided by any insurers to either Tenant or
Landlord.

                  (D)      Notwithstanding anything to the contrary contained in
this Lease, nothing herein shall be construed to infer or imply that Tenant is a
partner, joint venturer, agent, employee, or otherwise acting by or at the
direction of Landlord.

         10.02    PROPERTY INSURANCE.

                  (A)      At all times during the Lease Term, Tenant shall
procure and maintain, at its sole expense, "all-risk" property insurance, for
damage or other loss caused by fire or other casualty or cause including, but
not limited to, vandalism and malicious mischief, theft, water damage of any
type, including sprinkler leakage, bursting of pipes, explosion,in an amount not
less than one hundred percent (100%) of the replacement cost covering (a) all
Alterations made by or for Tenant in the Premises; and (b) Tenant's trade
fixtures, equipment and other personal property from time to time situated in
the Premises. The proceeds of such insurance shall be used for the repair or
replacement of the property so insured, except that if not so applied or if this
Lease is terminated following a casualty, the proceeds applicable to the
leasehold improvements shall be paid to Landlord and the proceeds applicable to
Tenant's personal property shall be paid to Tenant.

                  (B)      At all times during the Lease Term, Tenant shall
procure and maintain business interruption insurance in such amount as will
reimburse Tenant for direct or indirect loss of earnings attributable to all
perils insured against in Section 10.02(A).

                  (C)      Landlord shall, at all times during the Lease Term,
procure and maintain "all-risk" property insurance in the amount not less than
ninety percent (90%) of the insurable replacement cost covering the Building in
which the Premises are located and such other insurance as may be required by a
Mortgagee or otherwise desired by Landlord.

         10.03    LIABILITY INSURANCE.

                  (A)      At all times during the Lease Term, Tenant shall
procure and maintain, at its sole expense, commercial general liability
insurance applying to the use and occupancy of the Premises and the business
operated by Tenant. Such insurance shall have a minimum combined single limit of
liability of at least Two Million Dollars ($2,000,000) per occurrence and a
general aggregate limit of at least Two Million Dollars ($2,000,000). All such
policies shall be written to apply to all bodily injury, property damage,
personal injury losses and shall be endorsed to include Landlord and its agents,
beneficiaries, partners, employees, and any deed of trust holder or mortgagee of
Landlord or any ground lessor as additional insureds. Such liability insurance
shall be written as primary policies, not excess or contributing with or
secondary to any other insurance as may be available to the additional insureds.

                  (B)      Prior to the sale, storage, use or giving away of
alcoholic beverages on or from the Premises by Tenant or another person. Tenant,
at its own expense, shall obtain a policy or policies of insurance issued by a
responsible insurance company and in a form acceptable to Landlord saving
harmless and protecting Landlord and the Premises against any and all damages,
claims, liens, judgments, expenses and costs, including actual attorneys' fees,
arising under any present or future law, statute, or ordinance of the State of
California or other governmental authority having jurisdiction of the Premises,
by reason of any storage, sale, use or giving away of alcoholic beverages on or
from the Premises. Such policy or policies of insurance shall have a minimum
combined single limit of Two Million ($2,000,000) per occurrence and shall apply
to bodily injury, fatal or nonfatal; injury to means of support; and injury to
property of any person. Such policy or policies of insurance shall name Landlord
and its agents, beneficiaries, partners, employees and any mortgagee of Landlord
or any ground lessor of Landlord as additional insureds.

                  (C)      Landlord shall, at all times during the Lease Term,
procure and maintain commercial general liability insurance for the Building in
which the Premises are located. Such insurance shall have minimum combined
single limit of liability of at least Two Million Dollars ($2,000,000) per
occurrence, and a general aggregate limit of at least Two Million Dollars
($2,000,000).

         10.04    WORKERS' COMPENSATION INSURANCE. At all times during the Lease
Term, Tenant shall procure and maintain Workers' Compensation Insurance in
accordance with the laws of the State of California, and Employer's Liability
insurance with a limit not less than One Million Dollars ($2,000,000) Bodily
Injury Each Accident; Two Million Dollars ($2,000,000) Bodily Injury By Disease
- - Each Person; and One Million Dollars ($1,000,000) Bodily Injury to Disease -
Policy Limit.

         10.05    POLICY REQUIREMENTS. All insurance required to be maintained
by Tenant and Landlord shall be issued by insurance companies authorized to do
insurance business in the State of California and rated not less than B + in
Best's Insurance Guide. A certificate of insurance (or, at Landlord's option,
copies of the applicable policies) evidencing the insurance required under this
Article X shall be delivered to Landlord not less than thirty (30) days prior to
the Commencement Date. No such policy shall be subject to cancellation or
modification without thirty (30) days prior written notice to Landlord and to
any deed of trust holder, mortgagee or ground lessor designated by Landlord to
Tenant. Tenant shall furnish Landlord with a replacement certificate with
respect to any insurance not less than thirty (30) days prior to the expiration
of the current policy. Tenant shall have the right to provide the

                                                     Tenant          Landlord
                                                -s- [ILLEGIBLE]  -s- [ILLEGIBLE]

                                       10



insurance required by this Article X pursuant to blanket policies, but only if
such blanket policies expressly provide coverage of the Premises and Landlord as
required by this Lease.

         10.06    WAIVER OF SUBROGATION. Each party hereby waives any right of
recovery against the other for injury or loss due to hazards covered by
insurance or required to be covered, to the extent of the injury or loss covered
thereby. Any policy of insurance to be provided by Tenant or Landlord pursuant
to this Article X shall contain a clause denying the applicable insurer any
right of subrogation against the other party.

         10.07    FAILURE TO INSURE. If Tenant fails to maintain any insurance
which Tenant is required to maintain pursuant to this Article X, Tenant shall be
liable to Landlord for any loss or cost resulting from such failure to maintain.
Tenant may not self-insure against any risks required to be covered by insurance
without Landlord's prior written consent.

                       ARTICLE XI - DAMAGE OR DESTRUCTION

         11.01    TOTAL DESTRUCTION. Except as provided in Section 11.03 below,
this Lease shall automatically terminate if the Building is totally destroyed.

         11.02    PARTIAL DESTRUCTION OF PREMISES. If the Premises are damaged
by any casualty and, in Landlord's opinion, the Premises (exclusive of any
Alterations made to the Premises by Tenant) can be restored to its pre-existing
condition within two hundred seventy (270) days after the date of the damage or
destruction, Landlord shall, upon written notice from Tenant to Landlord of such
damage, except as provided in Section 11.03, promptly and with due diligence
repair any damage to the Premises (exclusive of any Alterations to the Premises
made by Tenant, which shall be promptly repaired by Tenant at its sole expense)
and, until such repairs are completed, the Rent shall be abated from the date of
damage or destruction in the same proportion that the rentable area of the
portion of the Premises which is unusable by Tenant in the conduct of its
business bears to the total rentable area of the Premises. If such repairs
cannot, in Landlord's opinion, be made within said two hundred seventy (270)
day period, then Landlord may, at its option, exercisable by written notice
given to the other within thirty (30) days after the date of the damage or
destruction, elect to make the repairs within a reasonable time after the damage
or destruction, in which event this Lease shall remain in full force and effect
but the Rent shall be abated as provided in the preceding sentence; if Landlord
does not so elect to make the repairs, then either Landlord or Tenant shall have
the right, by written notice given to the other within sixty (60) days after the
date of the damage or destruction, to terminate this Lease as of the date of the
damage or destruction.

         11.03    EXCEPTIONS TO LANDLORD'S OBLIGATIONS. Notwithstanding anything
to the contrary contained in this Article XI, Landlord shall have no obligation
to repair the Premises if either: (a) the Building in which the Premises are
located is so damaged as to require repairs to the Building exceeding twenty
percent (20%) of the full insurable value of the Building; or (b) Landlord
elects to demolish the Building to which the Premises are located; or (c) the
damage or destruction occurs less than one (1)) years prior to the Termination
Date, exclusive of option periods; or (d) the damage or destruction is caused by
an uninsured event. Further, Tenant's Rent shall not be abated if either (i) the
damage or destruction is repaired within five (5) business days after Landlord
receives written notice from Tenant of the casualty, or (ii) Tenant, or any
officers, partners, employees, agents or invitees of Tenant, or any assignee or
subtenant of Tenant, is, in whole or in part, responsible for the damage or
destruction.

         11.04    WAIVER. The provisions contained in this Lease shall supersede
any contrary laws (whether statutory, common law or otherwise) now or hereafter
in effect relating to damage, destruction, self-help or termination, including
California Civil Code Sections 1932 and 1933.

                            ARTICLE X - CONDEMNATION

         12.01    TAKING. If the entire Premises or so much of the Premises as
to render the balance unusable by Tenant shall be taken by condemnation, sale in
lieu of condemnation or in any other manner for any public or quasi-public
purpose (collectively "Condemnation"), and if Landlord, at its option, is unable
or unwilling to provide substitute premises containing at least as much rentable
area described in Section 1.02 above, then this Lease shall terminate on the
date that title or possession to the Premises is taken by the condemning
authority, whichever is earlier.

         12.02    AWARD. In the event of any Condemnation, the entire award for
such taking shall belong to Landlord. Tenant shall have no claim against
Landlord or the award for the value of any unexpired term of this Lease or
otherwise. Tenant shall be entitled to independently pursue a separate award in
a separate proceeding for Tenant's relocation costs directly associated with the
taking, provided such separate award does not diminish Landlord's award.

         12.03    TEMPORARY TAKING. No temporary taking of the Premises shall
terminate this Lease or entitle Tenant to any abatement of the Rent payable to
Landlord under this Lease; provided, further, that any award for such temporary
taking shall belong to Tenant to the extent that the award applies to any time
period during the Lease Term and to Landlord to the extent that the award
applies to any time period outside the Lease Term.

                                                     Tenant         Landlord
                                                -s- [ILLEGIBLE]  -s- [ILLEGIBLE]

                                       11




                            ARTICLE XIII - RELOCATION




                     ARTICLE XTV - ASSIGNMENT AND SUBLETTING

         14.01    RESTRICTION. Without the prior written consent of Landlord,
Tenant shall not, either voluntarily or by operation of law, assign, encumber,
or otherwise transfer this Lease or any interest herein, or sublet the Premises
or any part thereof, or permit the Premises to be occupied by anyone other than
Tenant or Tenant's employees (any such assignment, encumbrance, subletting,
occupation or transfer is hereinafter referred to as a "Transfer"). For purpose
of this Lease, the term "Transfer" shall also include (a) if Tenant is a
partnership, the withdrawal or change, voluntary, involuntary or by operation of
law, of a majority of the partners, or transfer of majority of partnership
interest, within a twelve month period, or the dissolution of partnership, (b)
if Tenant is a closely held corporation (i.e. whose stock is not publicly held
and not traded through an exchange or over the counter) or a limited liability
company, the dissolution, merger, consolidation, division, liquidation or other
reorganization of Tenant, or with in a twelve month period: (i) the sale or
other transfer of more than an aggregate of 50% of the voting securities of
Tenant (other than to immediate family members by reason of gift or death) or
(ii) the sale, mortgage, hypothecation or pledge of more than an aggregate of
50% of Tenant's net assets, and (c) any change by Tenant in the form of its
legal organization under applicable state law (such as, for example, a change
from a general partnership to a limited partnership or from a corporation to a
limited liability company). An assignment, subletting or other action in
violation of the foregoing shall be void and, at Landlord's option, shall
constitute a material breach of this Lease. Notwithstanding anything contained
in this Article XIV to the contrary, Tenant shall have the right to assign the
Lease or sublease the Premises, or any part thereof, to an "Affiliate" without
the prior written consent of Landlord, but upon at least twenty (20) days' prior
written notice to Landlord, provided that said Affiliate is not in default under
any other lease for space in a property that is managed by Landlord or its
managing agent. For purposes of this provision, the term "Affiliate" shall mean
any corporation or other entity controlling, controlled by, or under common
control with (directly or indirectly) Tenant, including, without limitation, any
parent corporation controlling Tenant or any subsidiary that Tenant controls.
The term "control," as used herein, shall mean the power to direct or cause the
direction of the management and policies of the controlled entity through the
ownership of more than fifty percent (50%) of the voting securities in such
controlled entity. Notwithstanding anything contained in this Article XIV to the
contrary, Tenant expressly covenants and agrees not to enter into any lease,
sublease, license, concession or other agreement for use, occupancy or
utilization of the Premises which provides for rental or other payment for such
use, occupancy or utilization based in whole or in part on the net income or
profits derived by any person from the property leased, used, occupied or
utilized (other than an amount based on a fixed percentage or percentages of
receipts or sales), and that any such purported lease, sublease, license,
concession or other agreement shall be absolutely void and ineffective as a
conveyance of any right or interest in the possession, use, occupancy or
utilization of any part of the Premises.

         14.02    NOTICE TO LANDLORD. If Tenant desires to assign this Lease or
any interest herein, or to sublet all or any part of the Premises, then at least
thirty (30) days but not more than one hundred eighty (180) days prior to the
effective date of the proposed assignment or subletting, Tenant shall submit to
Landlord in connection with Tenant's request for Landlord's consent:

                  (A)      A statement containing (i) the name and address of
the proposed assignee or subtenant; (ii) such financial information with respect
to the proposed assignee or subtenant as Landlord shall reasonably require;
(iii) the type of use proposed for the Premises; and (iv) all of the principal
terms of the proposed assignment or subletting; and

                  (B)      Four (4) originals of the assignment or sublease on a
form approved by Landlord and four (4) originals of the Landlord's Consent to
Sublease or Assignment and Assumption of Lease and Consent.

         14.03    LANDLORD'S RECAPTURE RIGHTS. At any time within twenty (20)
business days after Landlord's receipt of all (but not less than all) of the
information and documents described in Section 14.02 above, Landlord may, at its
option by written notice to Tenant, elect to: (a) sublease the Premises or the
portion thereof proposed to be sublet by Tenant upon the same terms as those
offered to the proposed subtenant; (b) take an assignment of the Lease upon the
same terms as those offered to the proposed assignee; or (c) terminate the Lease
in its entirety or as to the portion of the Premises proposed to be assigned or
sublet, with a proportionate adjustment in the Rent payable hereunder if the
Lease is terminated as to less than all of the Premises. If Landlord does not
exercise any of the options described in the preceding sentence, then, during
the above-described twenty (20) business day period, Landlord shall either
consent or deny its consent to the proposed assignment or subletting.

         14.04    LANDLORD'S CONSENT; STANDARDS. Landlord's consent to a
proposed assignment or subletting shall not be unreasonably withheld; but, in
addition to any other grounds for denial, Landlord's consent shall be deemed
reasonably withheld if, in Landlord's good faith judgment: (i) the proposed
assignee or subtenant does not have the financial strength to perform its
obligations under this Lease or any proposed sublease; (ii) the business and

                                                     Tenant          Landlord
                                                -s- [ILLEGIBLE]  -s- [ILLEGIBLE]

                                       12



operations of the proposed assignee or subtenant are not of comparable quality
to the business and operations being conducted by other tenants in the Building;
(iii) the proposed assignee or subtenant intends to use any part of the Premises
for a purpose not permitted under this Lease; (iv) either the proposed assignee
or subtenant, or any person which directly or indirectly controls, is controlled
by, or is under common control with the proposed assignee or subtenant occupies
space in the Building, or is negotiating with Landlord to lease space in the
Building; (v) the proposed assignee or subtenant is disreputable; or (vi) the
use of the Premises or the Building by the proposed assignee or subtenant would,
in Landlord's reasonable judgment, impact the Building in a negative manner
including but not limited to significantly increasing the pedestrian traffic in
and out of the Building or requiring any alterations to the Building to comply
with applicable laws; (vii) the subject space is not regular in shape with
appropriate means of ingress and egress suitable for normal renting purposes;
(viii) the transferee is a government (or agency or instrumentality thereof) or
(ix) Tenant has failed to cure a default at the time Tenant requests consent to
the proposed Transfer.

         14.05    ADDITIONAL RENT. If Landlord consents to any such assignment
or subletting, one-half (1/2) of the amount by which all sums or other economic
consideration received by Tenant in connection with such assignment or
subletting, whether denominated as rental, exceeds, in the aggregate, the total
sum which Tenant is obligated to pay Landlord under this Lease (prorated to
reflect obligations allocable to less than all of the Premises under a sublease)
shall be paid to Landlord promptly after receipt as additional Rent under the
Lease without affecting or reducing any other obligation of Tenant hereunder.

         14.06    LANDLORD'S COSTS. If Tenant shall Transfer this Lease or all
or any part of the Premises or shall request the consent of Landlord to any
Transfer, Tenant shall pay to Landlord as additional rent Landlord's costs
related therein, including Landlord's reasonable attorneys' fees and a minimum
fee In Landlord of Five Hundred Dollars ($500.00).

         14.07    CONTINUING LIABILITY OF TENANT. Notwithstanding any Transfer,
including an assignment or sublease to an Affiliate, Tenant shall remain as
fully and primarily liable for the payment of Rent and for the performance of
all other obligations of Tenant contained in this Lease to the same extent as if
the Transfer had not occurred; provided, however, that any act or omission of
any transferee, other than Landlord, that violates the terms of this Lease shall
be deemed a violation of this Lease by Tenant.

         14.08    NON-WAIVER. The consent by Landlord to any Transfer shall not
relieve Tenant, or any person claiming through or by Tenant, of the obligation
to obtain the consent of Landlord, pursuant to this Article XIV, to any further
Transfer. In the event of an assignment or subletting, Landlord may collect rent
from the assignee or the subtenant without waiving any rights hereunder and
collection of the rent from a person other than Tenant shall not be deemed a
waiver of any of Landlord's rights under this Article XIV, an acceptance of
assignee or subtenant as Tenant, or a release of Tenant from the performance of
Tenant's obligations under this Lease. If Tenant shall default under this Lease
and fail to cure within the time permitted, Landlord is irrevocably authorized,
as Tenant's agent and attorney-in-fact, to direct any transferee to make all
payments under or in connection with the Transfer directly to Landlord (which
Landlord shall apply towards Tenant's obligations under this Lease) until such
default is cured.

                        ARTICLE XV- DEFAULT AND REMEDIES

         15.01    EVENTS OF DEFAULT BY TENANT. The occurrence of any of the
following shall constitute a material default and breach of this Lease by
Tenant:

                  (A)      The failure by Tenant to pay Base Rent or make any
other payment required to be made by Tenant hereunder as and when due.

                  (B)      The abandonment of the Premises by Tenant or the
vacation of the Premises by Tenant for fourteen (14) consecutive days (without
the payment of Rent).

                  (C)      The making by Tenant of any assignment of this Lease
or any sublease of all or part of the Premises, except as expressly permitted
under Article XIV of this Lease.

                  (D)      The failure by Tenant to observe or perform any other
provision of this Lease to be observed or performed by Tenant, other than those
described in Sections 15.01(A), 15.01(B) or 15.01 (C) above, if such failure
continues for ten (10) days after written notice thereof by Landlord to Tenant;
provided, however, that if the nature of the default is such that it cannot be
cured within the ten (10) day period, no default shall exist if Tenant commences
the curing of the default within the ten (10) day period and thereafter
diligently prosecutes the same to completion. The ten (10) day notice described
herein shall be in lieu of, and not in addition to, any notice required under
Section 1161 of the California Civil Code of Procedure or any other law now or
hereafter in effect requiring that notice of default be given prior to the
commencement of an unlawful detainer or other legal proceeding.

                  (E)      The making by Tenant or its Guarantor of any general
assignment for the benefit of creditors, the filing by or against Tenant or its
Guarantor of a petition under any federal or state bankruptcy or insolvency laws
(unless, in the case of a petition filed against Tenant or its Guarantor the
same is dismissed within thirty (30) days after filing); the appointment of a
trustee or receiver to take possession of substantially all of Tenant's assets
at the Premises or Tenant's interest in this Lease or the Premises, when
possession is not restored to Tenant within

                                                     Tenant          Landlord
                                                -s- [ILLEGIBLE]  -s- [ILLEGIBLE]

                                       13



thirty (30) days; or the attachment, execution or other seizure of substantially
all of Tenant's assets located at the Premises or Tenant's interest in this
Lease or the Premises, if such seizure is not discharged within thirty (30)
days.

                  (F)      Any material misrepresentation herein, or material
misrepresentation or omission in any financial statements or other materials
provided by Tenant or any Guarantor in connection with negotiating or entering
into this Lease or in connection with any Transfer under Section 14.01.

         15.02    LANDLORD'S RIGHT TO TERMINATE UPON TENANT DEFAULT. In the
event of any default by Tenant as provided in Section 15.01 above, Landlord
shall have the right to terminate this Lease and recover possession of die
Premises by giving written notice to Tenant of Landlord's election to terminate
this Lease, in which event Landlord shall be entitled to receive from Tenant:

                  (A)      The worth at the time of award of any unpaid Rent
which had been earned at the time of such termination; plus

                  (B)      The worth at the time of award of the amount by which
the unpaid Rent which would have been earned after termination until the time of
award exceeds the amount of such rental loss Tenant proves could reasonably
avoided; plus

                  (C)      The worth at the time of award of the amount by which
the unpaid Rent for the balance of the term after the time of award exceeds the
amount of such rental loss that Tenant proves could be reasonably avoided; plus

                  (D)      Any other amount necessary to compensate Landlord for
all the detriment proximately caused by Tenant's failure to perform its
obligations under this Lease or which in the ordinary course of things would be
likely to result therefrom; and

                  (E)      At Landlord's election, such other amounts in
addition to or in lieu of the foregoing as may be permitted from time to time by
applicable law.

         As used in subparagraphs (A) and (B) above, "worth at the time of
award" shall be computed by allowing interest on such amounts at the then
highest lawful rate of interest, but in no event to exceed one percent (1%) per
annum plus the rate established by the Federal Reserve Bank of San Francisco on
advances made to member banks under Sections of the Federal Reserve Act
("discount rate") prevailing at the time of the award. As used in paragraph (C)
above, "worth at the time of award" shall be computed by discounting such amount
by (i) the discount rate of the Federal Reserve Bank of San Francisco prevailing
at the time of award plus (ii) one percent (1%).

         15.03    MITIGATION OF DAMAGES. If Landlord terminates this Lease or
Tenant's right to possession of the Premises, Landlord shall have no obligation
to mitigate Landlord's damages except to the extent required by applicable law.
If Landlord has not terminated this Lease or Tenant's right to possession of the
Premises, Landlord shall have no obligation to mitigate under any circumstances
and may permit the Premises to remain vacant or abandoned. If Landlord is
required to mitigate damages as provided herein: (i) Landlord shall be required
only to use reasonable efforts to mitigate, which shall not exceed such efforts
as Landlord generally uses to lease other space in the Building, (ii) Landlord
will not be deemed to have failed to mitigate if Landlord or its affiliates
lease any other portions of the Building or other projects owned by Landlord or
its affiliates in the same geographic area, before reletting all or any portion
of the Premises, and (iii) any failure to mitigate as described herein with
respect to any period of time shall only reduce the Rent and other amounts to
which Landlord is entitled hereunder by the reasonable rental value of the
Premises during such period. In recognition that the value of the Building
depends on the rental rates and terms of leases therein, Landlord's rejection of
a prospective replacement tenant based on an offer of rentals below Landlord's
published rates for new leases of comparable space at the Building at the time
in question, or at Landlord's option, below the rates provided in this Lease, or
containing terms less favorable than those contained herein, shall not give rise
to a claim by Tenant that Landlord failed to mitigate Landlord's damages.

         15.04    LANDLORD'S RIGHT TO CONTINUE LEASE UPON TENANT DEFAULT. In the
event of a default of this Lease and abandonment of the Premises by Tenant, if
Landlord does not elect to terminate this Lease as provided in Section 15.02
above, Landlord may from time to time, without terminating this Lease, enforce
all of its rights and remedies under this Lease. Without limiting the foregoing,
Landlord has the remedy described in California Civil Code Section 1951.4
(Landlord may continue this Lease in effect after Tenant's default and
abandonment and recover Rent as it becomes due, if Tenant has the right to
Transfer, subject to reasonable limitations). In the event Landlord re-lets the
Premises, to the fullest extent permitted by law, the proceeds of any reletting
shall be applied first to pay to Landlord all costs and expenses of such
reletting (including without limitation, costs and expenses of retaking or
repossessing the Premises, removing persons and property therefrom, securing new
tenants, including expenses for redecoration, alterations and other costs in
connection with preparing the Premises for the new tenant, and if Landlord shall
maintain and operate the Premises, the costs thereof) and receivers' fees
incurred in connection with the appointment of and performance by a receiver to
protect the Premises and Landlord's interest under this Lease and any necessary
or reasonable alterations; second, to the payment of any indebtedness of Tenant
to Landlord other than Rent due and unpaid hereunder; third, to the payment of
Rent due and unpaid hereunder; and the residue, if any, shall be held by
Landlord and applied in payment of other or future obligations of Tenant to
Landlord as the same may become due and payable, and Tenant shall not be
entitled to receive any portion of such revenue.

                                                     Tenant          Landlord
                                                -s- [ILLEGIBLE]  -s- [ILLEGIBLE]

                                       14



         15.05    RIGHT OF LANDLORD TO PERFORM. All covenants and agreements to
be performed by Tenant under this Lease shall be performed by Tenant at
Tenant's sole cost and expense. If Tenant shall fail to pay any sum of money,
other than Rent, required to be paid by it hereunder or shall fail to perform
any other act on its part to be performed hereunder, Landlord may, but shall not
be obligated to, make any payment or perform any such other act on Tenant's part
to be made or performed, without waiving or releasing Tenant of its obligations
under this Lease. Any sums so paid by Landlord and all necessary incidental
costs, together with interest thereon at the lesser of the maximum rate
permitted by law if any or twelve percent (12%) per annum from the date of such
payment, shall be payable to Landlord as additional rent on demand and Landlord
shall have the same rights and remedies in the event of nonpayment as in the
case of default by Tenant in the payment of Rent.

         15.06    DEFAULT UNDER OTHER LEASES. If the term of any lease, other
than this Lease, heretofore or hereafter made by Tenant for any office space in
the Building shall be terminated or terminable after the making of this Lease
because of any default by Tenant under such other lease, such fact shall empower
Landlord, at Landlord's sole option, to terminate this Lease by notice to Tenant
or to exercise any of the rights or remedies set forth in Section 15.02.

         15.07    NON-WAIVER. Nothing in this Article shall be deemed to affect
Landlord's rights to indemnification for liability or liabilities arising prior
to termination of this Lease or Tenant's right to possession of the Premises for
personal injury or property damages under the indemnification clause or clauses
contained in this Lease. No acceptance by Landlord of a lesser sum than the Rent
then due shall be deemed to be other than on account of the earliest installment
of such rent due, nor shall any endorsement or statement on any check or any
letter accompanying any check or payment as rent be deemed an accord and
satisfaction, and Landlord may accept such check or payment without prejudice to
Landlord's right to recover the balance of such installment or pursue any other
remedy in the Lease provided. The delivery of keys to any employee of Landlord
or to Landlord's agent or any employee thereof shall not operate as a
termination of this Lease or a surrender of the Premises.

         15.08    CUMULATIVE REMEDIES. The specific remedies to which Landlord
may resort under the terms of the Lease are cumulative and are not intended to
be exclusive of any other remedies or means of redress to which it may be
lawfully entitled in case of any breach or threatened breach by Tenant of any
provisions of the Lease. In addition to the other remedies provided in the
Lease, Landlord shall be entitled to a restraint by injunction of the violation
or attempted or threatened violation of any of the covenants, conditions or
provisions of the Lease or to a decree compelling specific performance of any
such covenants, conditions or provisions.

         15.09    DEFAULT BY LANDLORD. Landlord's failure to perform or observe
any of its obligations under this Lease shall constitute a default by Landlord
under this Lease only if such failure shall continue for a period of thirty (30)
days (or the additional time, if any, that is reasonably necessary to promptly
and diligently cure the failure) after Landlord receives written notice from
Tenant specifying the default. The notice shall give in reasonable detail the
nature and extent of the failure and shall identify the Lease provision(s)
containing the obligation(s). If Landlord shall default in the performance of
any of its obligations under this Lease (after notice and opportunity to cure as
provided herein), Tenant may pursue any remedies available to it under the law
and this Lease, except that, in no event, shall Landlord be liable for punitive
damages, lost profits, business interruption, speculative, consequential or
other such damages. In recognition that Landlord must receive timely payments of
Rent and operate the Building, Tenant shall have no right of self-help to
perform repairs or any other obligation of Landlord, and shall have no right to
withhold, set-off, or abate Rent.

                  ARTICLE XVI - ATTORNEYS' FEES: COSTS OF SUIT

         16.01    INSTITUTED ATTORNEYS FEES. If either Landlord or Tenant shall
commence any action or other proceeding against the other arising out of, or
relating to, this Lease or the Premises, the prevailing party shall be entitled
to recover from the losing party, in addition to any other relief, its actual
attorneys' fees irrespective to whether or not the action or other proceeding is
prosecuted to judgment and irrespective of any court schedule of reasonable
attorneys' fees. In addition, Tenant shall reimburse Landlord, upon demand, for
all reasonable attorneys' fees incurred in collecting Rent, resolving any actual
default by Tenant, securing indemnification as provided in Article X and
paragraphs, 16.02, 23.01 and 25.01 herein or otherwise seeking enforcement
against Tenant, its sublessees and assigns, of Tenant's obligations under this
Lease.

         16.02    INDEMNIFICATION. Should Landlord be made a party to any
litigation litigation by Tenant against a party other than Landlord, or by a
third party against Tenant, Tenant shall indemnify, hold harmless and defend
Landlord from any and all loss, cost, liability, damage or expense incurred by
Landlord, including attorneys' fees, in connection with the litigation.

                   ARTICLE XVII - SUBORDINATION AND ATTORNMENT

         17.01    SUBORDINATION. This Lease, and the rights of Tenant hereunder,
are and shall be subject and subordinate to the interest of (i) all present and
future ground leases and master leases of all or any part of the Building; (ii)
present and future mortgages and deeds of trust encumbering all or any part of
the Building; (iii) all past and future advances made under any such mortgages
or deeds of trust; and (iv) all renewals, modifications, replacements and
extensions of any such ground leases, master leases, mortgages and deeds of
trust; provided,

                                                      Tenant         Landlord
                                                -s- [ILLEGIBLE]  -s- [ILLEGIBLE]

                                       15



however, that any lessor under any such ground lease or master lease or any
mortgagee or beneficiary under any such mortgage or deed of trust (any such
lessor, mortgagee or beneficiary is hereinafter referred to as a "Mortgagee")
shall have the right to elect, by written notice given to Tenant, to have this
Lease made superior in whole or in part to any such ground lease, master lease,
mortgage or deed of trust (or subject and subordinate to such ground lease,
master lease, mortgage or deed of trust but superior to any junior mortgage or
junior deed of trust). Upon demand, Tenant shall execute, acknowledge and
deliver any instruments reasonably requested by Landlord or any such Mortgagee
to effect the purposes of this Section 17.01. Such instruments may contain,
among other things, provisions to the effect that such Mortgagee (hereafter, for
the purposes of this Section 17.01, a "Successor Landlord") shall (i) not be
liable for any act or omission of Landlord or its predecessors, if any, prior to
the date of such Successor Landlord's succession to Landlord's interest under
this Lease; (ii) not be subject to any offsets or defenses which Tenant might
have been able to assert against Landlord or its predecessors, if any, prior to
the date of such Successor Landlord's succession to Landlord's interest under
this Lease; (iii) not be liable for the return of any security deposit under the
Lease unless the same shall have actually been deposited with such Successor
Landlord; (iv) be entitled to receive notice of any Landlord default under this
Lease plus a reasonable opportunity to cure such default prior to Tenant having
any right or ability to terminate this Lease as a result of such Landlord
default; (v) not be bound by any rent or additional rent which Tenant might have
paid for more than the current month to Landlord; (vi) not be bound by any
amendment or modification of the Lease or any cancellation or surrender of the
same made without Successor Landlord's prior written consent; (vii) not be bound
by any obligation to make any payment to Tenant which was required to be made
prior to the time such Successor Landlord succeeded to Landlord's interest and
(viii) not be bound by any obligation under the Lease to perform any work or to
make any improvements to the demised Premises. Any obligations of any Successor
Landlord under its respective lease shall be non-recourse as to any assets of
such Successor Landlord other than its interest in the Premises and
improvements.

         17.02    ATTORNMENT. If the interests of Landlord under the Lease shall
be transferred to any superior Mortgagee or other purchaser or person taking
title to the Building by reason of the termination of any superior lease or the
foreclosure of any superior mortgage or deed of trust, Tenant shall be bound to
such Successor Landlord under all of the terms, covenants and conditions of the
Lease for the balance of the term thereof remaining and any extensions or
renewals thereof which may be effected in accordance with any option therefor in
the Lease, with the same force and effect as if Successor Landlord were the
landlord under the Lease, and Tenant shall attorn to and recognize as Tenant's
landlord under this Lease such Successor Landlord, as its landlord, said
attornment to be effective and self-operative without the execution of any
further instruments upon Successor Landlord's succeeding to the interest of
Landlord under the Lease. Tenant shall, upon demand, execute any documents
reasonably requested by any such person to evidence the attornment described in
this Section 17.02. Concurrently, upon written request from Tenant, and provided
Tenant is not in default under this Lease, Landlord agrees to use diligent,
commercially reasonable efforts to obtain a Non-Disturbance Agreement from the
Successor Landlord. Such Non-Disturbance Agreement may be embodied in the
Mortgagee's customary form of Subordination and Non-Disturbance Agreement. If,
after exerting diligent, commercially reasonable efforts, Landlord is unable to
obtain a Non-Disturbance Agreement from any such Mortgagee, Landlord shall have
no further obligation to Tenant with respect thereto.

         17.03    MORTGAGEE PROTECTION. Tenant agrees to give any Mortgagee, by
registered or certified mail, a copy of any notice of default served upon
Landlord by Tenant, provided that prior to such notice Tenant has been notified
in writing (by way of service on Tenant of a copy of Assignment of Rents and
Leases, or otherwise) of the address of such Mortgagee (hereafter the "Notified
Party"); Tenant further agrees that if Landlord shall have failed to cure such
default within twenty (20) days after such notice to Landlord (or if such
default cannot be cured or corrected within that time, then such additional time
as may be necessary if Landlord has commenced within such twenty (20) days and
is diligently pursuing the remedies or steps necessary to cure or correct such
default), then the Notified Party shall have an additional thirty (30) days
within which to cure or correct such default (or if such default cannot be cured
or corrected within that time, then such additional time as may be necessary if
the Notified Party has commenced within such thirty (30) days and is diligently
pursuing the remedies or steps necessary to cure or correct such default). Until
the time allowed, as aforesaid, for the Notified Party to cure such default has
expired without cure, Tenant shall have no right to, and shall not, terminate
this Lease on account of Landlord's default.

                          ARTICLE XVIII - QUIET ENJOYMENT

         18.01    Provided that Tenant is not in material default beyond any
applicable cure period hereunder, Tenant shall have and peaceably enjoy the
Premises during the Lease Term free of claims by or through Landlord, subject to
all of the terms and conditions contained in this Lease.

                       ARTICLE XIX - RULES AND REGULATIONS

         19.01    The Rules and Regulations attached hereto as Exhibit C are
hereby incorporated by reference herein and made a part hereof. Tenant shall
abide by, and faithfully observe and comply with the Rules and Regulations and
any reasonable and non-discriminatory amendments, modifications and/or additions
thereto as may hereafter be adopted and published by written notice to tenants
by Landlord for the safety, care, security, good order and/or cleanliness of the
Premises and/or the Building. Landlord shall not be liable to Tenant for any
violation of such rules and regulations by any other tenant or occupant of the
Building.

                                                     Tenant          Landlord
                                                -s- [ILLEGIBLE]  -s- [ILLEGIBLE]

                                       16



                       ARTICLE XX - ESTOPPEL CERTIFICATES

         20.01    Tenant agrees at any time and from time to time upon not less
than ten (10) business days' prior written notice from Landlord to execute,
acknowledge and deliver to Landlord a statement in writing addressed and
certifying to Landlord, to any current or prospective Mortgagee or any assignee
thereof, to any prospective purchaser of the land, improvements or both
comprising the Building, and to any other party designated by Landlord, that
this Lease is unmodified and in full force and effect (of if there have been
modifications, that the same is in full force and effect as modified and stating
the modifications); that Tenant has accepted possession of the Premises, which
are acceptable in all respects, and that any improvements required by the terms
of this Lease to be made by Landlord have been completed to the satisfaction of
Tenant; that Tenant is in full occupancy of the Premises; that no rent has been
paid more than thirty (30) days in advance; that the first month's Base Rent has
been paid; that Tenant is entitled to no free rent or other concessions except
as stated in this Lease; that Tenant has not been notified of any previous
assignment of Landlord's or any predecessor landlord's interest under this
Lease; the dates to which Base Rent, additional rental and other charges have
been paid; that Tenant, as of the date of such certificate, has no charge, lien
or claim of setoff under this Lease or otherwise against Base Rent, additional
rental or other charges due or to become due under this Lease; that Landlord is
not in default in performance of any covenant, agreement or condition contained
in this Lease; or any other matter relating to this Lease or the Premises or, if
so, specifying each such default. If there is a Guaranty under this Lease, said
Guarantor shall confirm the validity of the Guaranty by joining in the execution
of the Estoppel Certificate or other documents so requested by Landlord or
Mortgagee. In addition, in the event that such certificate is being given to any
Mortgagee, such statement may contain any other provisions customarily required
by such Mortgagee including, without limitation, an agreement on the part of
Tenant to furnish to such Mortgagee, written notice of any Landlord default and
a reasonable opportunity for such Mortgagee to cure such default prior to Tenant
being able to terminate this Lease Any such statement delivered pursuant to
this Section may be relied upon by Landlord or any Mortgagee, or prospective
purchaser to whom it is addressed and such statement, if required by its
addressee, may so specifically state. If Tenant does not execute, acknowledge
and deliver to Landlord the statement as and when required herein, Landlord is
hereby granted an irrevocable power-of-attorney, coupled with on interest, to
execute such statement on Tenant's behalf, which statement shall be binding on
Tenant to the same extent as if executed by Tenant.

                         ARTICLE XXI - ENTRY BY LANDLORD

         21.01    Landlord may enter the Premises at all reasonable times to:
inspect the same: exhibit the same to prospective purchasers, Mortgagees or
tenants: determine whether Tenant is complying with all of its obligations under
this Lease; supply janitorial and other services to be provided by Landlord to
Tenant under this Lease; post notices of non-responsibility; and make repairs or
improvements in or to the Building or the Premises; provided, however, that all
such work shall be done as promptly as reasonably possible and so as to cause as
little interference to Tenant as reasonably possible. Tenant hereby waives any
claim for damages for any injury or inconvenience to, or interference with,
Tenant's business, any loss of occupancy or quiet enjoyment of the Premises or
any other loss on or about the Premises (excluding Tenant's vaults, safes and
similar areas designated by Tenant in writing in advance), and Landlord shall
have the right to use any and all means by which Landlord may deem proper to
open such doors to obtain entry to the Premises, and any entry to the Premises
obtained by Landlord by any such means, or otherwise, shall not under any
circumstances be deemed or construed to be a forcible or unlawful entry into or
a detainer of the Premises or an eviction, actual or constructive, of Tenant
from any part of the Premises. Such entry by Landlord shall not act as a
termination of Tenant's duties under this Lease. If Landlord shall be required
to obtain entry by means other than a key provided by Tenant, the cost of such
entry shall by payable by Tenant to Landlord as additional rent.

                                   ARTICLE XXII
 LANDLORD'S LEASE UNDERTAKINGS-EXCULPATION FROM PERSONAL LIABILITY; TRANSFER OF
                               LANDLORD'S INTEREST

         22.01    LANDLORD'S LEASE UNDERTAKINGS. Notwithstanding anything to the
contrary contained in this Lease or in any exhibits, Riders or addenda hereto
attached (collectively the "Lease Documents"), it is expressly understood and
agreed by and between the parties hereto that: (a) the recourse of Tenant or its
successors or assigns against Landlord with respect to the alleged breach by or
on the part of Landlord of any representation, warranty, covenant, undertaking
or agreement contained in any of the Lease Documents or otherwise arising out of
Tenant's use of the Premises or the Building (collectively, "Landlord's Lease
Undertakings") shall extend only to Landlord's interest in the real estate of
which the Premises demised under the Lease Documents are a part ("Landlord's
Real Estate") and not to any other assets of Landlord or its officers, directors
or shareholders; and (b) except to the extent of Landlord's interest in
Landlord's Real Estate, no personal liability or personal responsibility of any
sort with respect to any of Landlord's Lease Undertakings or any alleged breach
thereof is assumed by, or shall at any time be asserted or enforceable against,
Landlord, or against any of their respective directors, officers, employees,
agents, constituent partners, beneficiaries, trustees or representatives.

         22.02    TRANSFER OF LANDLORD'S INTEREST. In the event of any transfer
of Landlord's interest in the Building, Landlord shall be automatically freed
and relieved from all applicable liability with respect to performance of any
covenant or obligation on the part of Landlord, provided any deposits or advance
rents held by Landlord are turned over to the grantee and said grantee expressly
assumes, subject to the limitations of this Section

                                                     Tenant          Landlord
                                                -s- [ILLEGIBLE]  -s- [ILLEGIBLE]

                                       17



22, all the terms, covenants and conditions of this Lease to be performed on the
part of Landlord, it being intended hereby that the covenants and obligations
contained in this Lease on the part of Landlord shall, subject to all the
provisions of this Section 22, be binding on Landlord, its successors and
assigns, only during their respective periods of ownership.

                         ARTICLE XXIII. HOLDOVER TENANCY

         23.01    If Tenant holds possession of the Premises after the
expiration or termination of the Lease Term, by lapse of time or otherwise,
Tenant shall become a tenant at sufferance upon all of the terms contained
herein, except as to Lease Term and Rent. During such holdover period, Tenant
shall pay to Landlord a monthly rental equivalent to Two hundred percent (200%)
of the Rent Payable by Tenant to Landlord with respect to the last month of the
Lease Term. The monthly rent payable for such holdover period shall in no event
be construed as a penalty or as liquidated damages for such retention of
possession. Without limiting the foregoing, Tenant hereby agrees to indemnify,
defend and hold harmless Landlord, its beneficiary, and their respective agents,
contractors and employees, from and against any and all claims, liabilities,
actions, losses, damages (including without limitation, direct, indirect,
incidental and consequential) and expenses (including, without limitation, court
costs and reasonable attorneys' fees) asserted against or sustained by any such
party and arising from or by reason of such retention of possession, which
obligations shall survive the expiration or termination of the Lease Term.

                             ARTICLE XXIV - NOTICES

         24.01    All notices which Landlord or Tenant may be required, or may
desire, to serve on the other may be served, as an alternative to personal
service, by mailing the same by registered or certified mail, postage prepaid,
addressed to Landlord at the address for Landlord set forth in Section 1.12
above and to Tenant at the address for Tenant set forth in Section 1.13 above,
or from and after the Commencement Date, to Tenant at the Premises wether or not
Tenant has departed from, abandoned or vacated the Premises, or addressed to
such other address or addresses as either Landlord or Tenant may from time to
time designate to the other in writing. Any notice shall be deemed to have been
served at the time the same was posted.

                              ARTICLE XXV - BROKERS

         25.01    The parties recognize as the brokers) who procured this Lease
the firm(s) specified in Section 1.14 and agree that Landlord shall be solely
responsible for the payment of any brokerage commissions to said broker(s), and
that Tenant shall have no responsibility therefor unless written provision to
the contrary has been made a part of this Lease. If Tenant has dealt with any
other person or real estate broker in respect to leasing, subleasing or renting
space in the Building, Tenant shall be solely responsible for the payment of any
fee due said person or firm and Tenant shall protect, indemnify, hold harmless
and defend Landlord from any liability in respect thereto.

                       ARTICLE XXVI - ELECTRONIC SERVICES

         26.01    TENANT'S LINES. Tenant may, in a manner consistent with the
provisions and requirements of this Lease, install, maintain, replace, remove or
use any communications or computer or other electronic service wires, cables and
related devices (collectively the "Lines") at the Building in or serving the
Premises, provided: (a) Tenant shall obtain Landlord's prior written consent,
which consent may be conditioned as required by Landlord, (b) if Tenant at any
time uses any equipment that may create an electromagnetic field exceeding the
normal insulation ratings of ordinary twisted pair riser cable or cause
radiation higher than normal background radiation, the Lines therefor (including
riser cables) shall be appropriately insulated to prevent such excessive
electromagnetic fields or radiation, and (c) Tenant shall pay all costs in
connection therewith. Landlord reserves the right to require that Tenant remove
any Lines which are installed in violation of these provisions. Tenant shall
not, without the prior written consent of Landlord in each instance, grant to
any third party a security interest or lien in or on the Lines, and any such
security interest or lien granted without Landlord's written consent shall be
null and void.

         26.02    DEFINITION OF ELECTRONIC SERVICES. As used herein "Electronic
Services Provider" means a business which provides telephone, telegraph, telex,
video, other telecommunications or other services which permit Tenant to receive
or transmit information by the use of electronics and which require the use of
wires, cables, antennas or similar devices in or on the Building. The services
of Electronic Services Providers are sometimes referred to herein as "Electronic
Services."

         26.03    NO RIGHT TO SPECIFIC SERVICES. Landlord shall have no
obligation (i) to install any Electronic Services equipment or facilities, (ii)
to make available to Tenant the services of any particular Electronic Services
Provider, (iii) to allow any particular Electronic Services Provider access to
the Building, (iv) to continue to grant access to an Electronic Services
Provider once such provider has been given access to the Building. Landlord may
(but shall not have the obligation to): (x) install new Lines at the property,
(y) create additional space for Lines at the property, and (z) adopt reasonable
and uniform rules and regulations with respect to Lines.

                                                     Tenant         Landlord
                                                -s- [ILLEGIBLE]  -s- [ILLEGIBLE]

                                       18


         26.04    LIMITATION OF LANDLORD'S RESPONSIBILITY. Tenant acknowledges
and agrees that all Electronic Services desired by Tenant shall be ordered and
utilized at the sole expense of Tenant. Unless Landlord otherwise requests or
consents in writing, all of Tenant's Electronic Services equipment shall be and
remain solely in the Tenant's premises and the telephone closet(s) on the
floor(s) on which the Tenant's premises is located, in accordance with rules and
regulations adopted by Landlord from time to time. Unless otherwise specifically
agreed to in writing, Landlord shall have no responsibility for the maintenance
of Tenant's Electronic Services equipment, including Lines; nor for any Lines or
other infrastructure to which Tenant's Electronic Services equipment may be
connected. Tenant agrees that, to the extent any Electronic Services are
interrupted, curtailed or discontinued, Landlord shall have no obligation or
liability with respect thereto and it shall be the sole obligation of Tenant at
its own expense to obtain substitute service. Except to the extent arising from
the intentional or grossly negligent acts of Landlord or Landlord's agents or
employees, Landlord shall have no liability for damages arising from, and
Landlord does not warrant that Tenant's use of any Lines will be free from the
following (collectively called "Line Problems"): (x) any eavesdropping or
wire-tapping by unauthorized parties, (y) any failure of any Lines to satisfy
Tenant's requirements, or (z) any shortages, failures, variations,
interruptions, disconnection's, loss or damage caused by the installation,
maintenance, replacement, use or removal of Lines by or for other tenants or
occupants at the property. Under no circumstances shall any Line Problems be
deemed an actual or constructive eviction of Tenant, render Landlord liable to
Tenant for abatement of Rent, or relieve Tenant from performance of Tenant's
obligations under this Lease. Landlord in no event shall be liable for damages
by reason of loss of profits, business interruption or other consequential
damage arising from any Line Problems.

         26.05    NECESSARY SERVICE INTERRUPTIONS. Landlord shall have the
right, upon reasonable prior notice to Tenant, to interrupt or turn off
Electronic Services facilities in the event of emergency or as necessary in
connection with maintenance, repairs or construction at the Building or
installation of Electronic Services equipment for other Tenants of the Building
or on account of violation by the Electronic Services Provider or owner of the
Electronic Services equipment of any obligation to Landlord or in the event that
Tenant's use of the Electronic Services infrastructure of the Building
materially interferes with the Electronic Services of other tenants of the
Building.

         26.06    REMOVAL OF EQUIPMENT, WIRING AND OTHER FACILITIES. Any and all
Electronic Services equipment installed in the Tenant's Premises or elsewhere in
the Building by or on behalf of Tenant, including Lines, or other facilities for
Electronic Services reception or transmittal, shall be removed prior to the
expiration or earlier termination of the Lease term, by Tenant at its sole cost
or, at Landlord's election, by Landlord at Tenant's sole cost, with the cost
thereof to be paid as additional rent. Landlord shall have the right, however,
upon written notice to Tenant given no later than thirty (30) days prior to the
expiration or earlier termination of the Lease term (except that the notice
period shall extend to thirty (30) days beyond the date of termination of the
Lease if it is terminated by either party due to a default by the other), to
require Tenant to abandon and leave in place, without additional payment to
Tenant or credit against rent, any and all Electronic Services Lines and related
infrastructure, or selected components thereof, whether located in the Tenant's
premises or elsewhere in the Building.

         26.07    NEW PROVIDER INSTALLATIONS. In the event that Tenant wishes at
any time to utilize the services of an Electronic Services Provider whose
equipment is not then servicing the Building, no such Electronic Services
Provider shall be permitted to install its Lines or other equipment within the
Building without first securing the prior written approval of the Landlord.
Landlord's approval shall not be deemed any kind of warranty or representation
by Landlord, including, without limitation, any warranty or representation as to
the suitability, competence, or financial strength of the Electronic Services
Provider. Without limitation of the foregoing standard, unless all of the
following conditions are satisfied to Landlord's satisfaction, it shall be
reasonable for Landlord to refuse to give its approval: (i) Landlord shall incur
no current expense or risk or future expense whatsoever with respect to any
aspect of the Electronic Services Provider's provision of its Electronic
Services, including without limitation, the costs of installation, materials and
services; (ii) prior to commencement of any work in or about the Building by the
Electronic Services Provider, the Electronic Services Provider shall supply
Landlord with such written indemnities, insurance, financial statements, and
such other items as Landlord reasonably determines to be necessary to protect
its financial interests and the interests of the Building relating to the
proposed activities of the Electronic Services Provider; (iii) the Electronic
Services Provider agrees to abide by such rules and regulations, Building and
other codes, job site rules and such other requirements as are reasonably
determined by Landlord to be necessary to protect the interests of the Building,
the Tenants in the Building and Landlord, in the same or similar manner as
Landlord has the right to protect itself and the Building with respect to
proposed alterations as described in Article IX of this Lease; (iv) Landlord
reasonably determines that, considering other potential uses for space in the
Building, there is sufficient space in the Building for the placement of all of
the provider's equipment, conduit, Lines and other materials; (v) the Electronic
Services Provider agrees to abide by Landlord's requirements, if any, that
provider use existing Building conduits and pipes or use Building contractors
(or other contractors approved by Landlord); (vi) Landlord receives from the
Electronic Services Provider such compensation as is reasonably determined by
Landlord to compensate it for space used in the Building for the storage and
maintenance of the Electronic Services Provider's equipment, for the fair market
value of a Electronic Services Provider's access to the Building, for the use of
common or core space within the Building and the costs which may reasonably be
expected to be incurred by Landlord; (vii) the provider agrees to deliver to
Landlord detailed "as built" plans immediately after the installation of the
provider's equipment is complete; and (viii) all of the foregoing matters are
documented in a written license agreement between Landlord and the provider, the
form and content of which is reasonably satisfactory to Landlord."

         26.08    LIMIT OF DEFAULT OR BREACH. Notwithstanding any provision of
the proceeding paragraphs to the contrary, the refusal of Landlord to grant its
approval to any prospective Electronic Services Provider shall not be deemed a
default or breach by Landlord of its obligation under this Lease unless and
until Landlord is adjudicated to

                                                      Tenant         Landlord
                                                -s- [ILLEGIBLE]  -s- [ILLEGIBLE]

                                       19


have acted recklessly or maliciously with respect to Tenant's request for
approval, and in that event, Tenant shall still have no right to terminate the
Lease or claim an entitlement to rent abatement, but may as Tenant's sole and
exclusive recourse seek a judicial order of specific performance compelling
Landlord to grant its approval as to the prospective provider in question. The
provisions of this paragraph may be enforced solely by Tenant and Landlord, are
not for the benefit of any other party, and specifically but without limitation,
no telephone or other Electronic Services Provider shall be deemed a third party
beneficiary of this Lease.

         26.9 INSTALLATION AND USE OF WIRELESS TECHNOLOGIES. Tenant shall not
utilize any wireless Electronic Services equipment (other than usual and
customary cellular telephones), including antennae and satellite receiver
dishes, within the Tenant's premises, within the Building or attached to the
outside walls or roof of the Building, without Landlord's prior written consent.
Such consent may be conditioned in such a manner so as to protect Landlord's
financial interests and the interests of the Building, and the other tenants
therein, in a manner similar to the arrangements described in the immediately
preceding paragraphs.

         26.10 LIMITATION OF LIABILITY FOR EQUIPMENT INTERFERENCE. In the event
that Electronic Services equipment, Lines and facilities or satellite and
antennae equipment of any type installed by or at the request of Tenant within
the Tenant's premises, on the roof, or elsewhere within or on the Building
causes interference to equipment used by another party. Tenant shall cease using
such equipment, Lines and facilities or satellite and antennae equipment until
the source of the interference is identified and eliminated and Tenant shall
assume all liability related to such interference. Tenant shall cooperate with
Landlord and other parties, to eliminate such interference promptly. In the
event that Tenant is unable to do so, Tenant will substitute alternative
equipment which remedies the situation. If such interference persists, Tenant
shall, at Landlord's sole discretion, remove such equipment.

                             ARTICLE XXVII - PARKING

         27.01 During the term of this Lease, Tenant shall be entitled to rent
the number of Tenant's Parking Stalls, if any, described in Section 1.16 of this
Lease in the parking facilities located within the Building; provided, however,
that if Tenant does not rent all of the Tenant's Parking Stalls allocated to
Tenant pursuant to Section 1.16, any change in the number of parking stalls
actually rented by Tenant shall require not less than thirty (30) days prior
written notice to Landlord. Such parking shall be on a non-assigned basis, and
shall be at such rates and upon such other terms and conditions as are published
or posted from time to time by Landlord (or, at Landlord's option, the operator
or lessee of the parking facilities). Tenant's visitors shall have the right to
use the parking facilities, subject to availability and to the rates, rules and
regulations governing visitor parking from time to time adopted by Landlord (or,
at Landlord's option, the operator or master lessee of the parking facilities).

                         ARTICLE XXVIII - MISCELLANEOUS

         28.1 ENTIRE AGREEMENT. This Lease contains all of the agreements and
understandings relating to the leasing of the Premises and the obligations of
Landlord and Tenant in connection with such leasing. Landlord has not made, and
Tenant is not relying upon, any warranties, or representations, promises or
statements made by Landlord or any agent of Landlord, except as expressly set
forth herein. This Lease supersedes any and all prior agreements and
understandings between Landlord and Tenant and alone expresses the agreement of
the parties.

         28.2 AMENDMENTS. This Lease shall not be amended, changed or modified
in any way unless in writing executed by Landlord and Tenant. Landlord and
Tenant shall not have waived or released any of its rights hereunder unless in
writing and executed by such party.

         28.3 SUCCESSORS. Except as expressly provided herein, this Lease and
the obligations of Landlord and Tenant contained herein shall bind and benefit
the successors and assigns of the parties hereto.

         28.01 FORCE MAJEURE. Landlord and Tenant shall incur no liability to
each other with respect to, and shall not be responsible for any failure to
perform, any of Landlord's obligations hereunder if such failure is caused by
any reason beyond the control of Landlord including, but not limited to, strike,
labor trouble, governmental rule, regulations, ordinance, statute or
interpretation, or by fire, earthquake, civil commotion, or failure or
disruption of utility services. The amount of time for Landlord to perform any
of Landlord's obligations shall be extended by the amount of time Landlord is
delayed in performing such obligation by reason of any force majeure occurrence
whether similar to or different from the foregoing types of occurrences.

         28.5 SURVIVAL OF OBLIGATIONS. Any obligations of Tenant or Landlord
accruing prior to the expiration of the Lease shall survive the expiration or
earlier termination of the Lease, and each party shall promptly perform all such
obligations whether or not this Lease has expired or been terminated.

         28.6 LIGHT AND AIR. No diminution or shutting off of any light, air or
view by any structure now or hereafter erected shall in any manner affect this
Lease or the obligations of Tenant hereunder, or increase any of the obligations
of Landlord hereunder.

         28.7 GOVERNING LAW. This Lease shall be governed by, and construed in
accordance with, the laws of the State of California.

                                                   Tenant           Landlord
                                              -s- [ILLEGIBLE]    -s- [ILLEGIBLE]

                                       20


         28.8 SEVERABILITY. In the event any provision of this Lease is found to
be unenforceable, the remainder of this Lease shall not be affected, and any
provision found to be invalid shall be enforceable to the extent permitted by
law. The parties agree that in the event two different interpretations may be
given to any provision hereunder, one of which will render the provision
unenforceable, and one of which will render the provision enforceable, the
interpretation rendering the provision enforceable shall be adopted.

         28.9 CAPTIONS. All captions, headings, titles, numerical references and
computer highlighting are for convenience only and shall have no effect on the
interpretation of this Lease.

         28.10 INTERPRETATION. Tenant acknowledges that it has read and reviewed
this Lease and that it has had the opportunity to confer with counsel in the
negotiation of this Lease. Accordingly, this Lease shall be construed neither
for nor against Landlord or Tenant, but shall be given a fair and reasonable
interpretation in accordance with the meaning of its terms and the intent of the
parties.

         28.11 INDEPENDENT COVENANTS. Each covenant, agreement, obligation or
other provision of this Lease to be performed by Tenant or Landlord are separate
and independent covenants of Tenant or Landlord, and not dependent on any other
provision of the Lease.

         28.12 NUMBER AND GENDER. All terms and words used in this Lease,
regardless of the number or gender in which they are used, shall be deemed to
include the appropriate number and gender, as the context may require.

         28.13 TIME IS OF THE ESSENCE. Time is of the essence of this Lease and
the performance of all obligations hereunder.

         28.14 JOINT AND SEVERAL LIABILITY. If Tenant comprises more than one
person or entity, or if this Lease is guaranteed by any party, all such persons
shall be jointly and severally liable for payment of rents and the performance
of Tenant's obligations hereunder. If Tenant comprises more than one person or
entity and fewer than all of the persons or entities comprising Tenant abandon
the Premises, Landlord, at its sole option, may treat the abandonment by such
person or entities as an event of default and exercise with respect to such
persons the rights and remedies provided in Article XV without affecting the
right or obligations of the persons or entities comprising Tenant which have not
abandoned the property.

         28.15 EXHIBITS. Exhibits A (Outline of Premises), B (Work Letter
Agreement), C (Rules and Regulations), D (Guaranty), E (Suite Acceptance
Letter), and F (Asbestos Notification), G (Parking Agreement) and Addendum I are
incorporated into this Lease by reference and made a part hereof.

         28.16 OFFER TO LEASE. The submission of this Lease to Tenant or its
broker or other agent, does not constitute an offer to Tenant to lease the
Premises. This Lease shall have no force and effect until (a) it is executed and
delivered by Tenant to Landlord and (b) it is fully reviewed and executed by
Landlord; provided, however, that, upon execution of this Lease by Tenant and
delivery to Landlord, such execution and delivery by Tenant, shall, in
consideration of the time and expense incurred by Landlord in reviewing the
Lease and Tenant's credit, constitute an offer by Tenant to lease the Premises
upon the terms and conditions set forth herein (which offer to Lease shall be
irrevocable for twenty (20) business days following the date of delivery).

         28.17 NO COUNTERCLAIM; CHOICE OF LAWS. It is mutually agreed that in
the event Landlord commences any summary proceeding for non-payment of Rent,
Tenant will not interpose any counterclaim of whatever nature or description in
any such proceeding. In addition, Tenant hereby submits to local jurisdiction in
the State of California and agrees that any action by Tenant against Landlord
shall be instituted in the State of California and that Landlord shall have
personal jurisdiction over Tenant for any action brought by Landlord against
Tenant in the State of California.

         28.18 ELECTRICAL SERVICE TO THE PREMISES. Anything set forth in Section
7.01 or elsewhere in this Lease to the contrary notwithstanding, electricity to
the Premises shall not be furnished by Landlord, but shall be furnished by the
approved electric utility company serving the Building. Landlord shall permit
Tenant to receive such service directly from such utility company at Tenant's
cost (except as otherwise provided herein) and shall permit Landlord's wire and
conduits, to the extent available, suitable and safely capable, to be used for
such purposes.

         28.19 RIGHTS RESERVED BY LANDLORD. Landlord reserves the following
rights exercisable without notice (except as otherwise expressly provided to the
contrary in this Lease) and without being deemed an eviction or disturbance of
Tenant's use or possession of the Premises or giving rise to any claim for
set-off or abatement of Rent: (i) to change the name or street address of the
Building; (ii) to install, affix and maintain all signs on the exterior and/or
interior of the Building; (iii) to designate and/or approve prior to
installation, all types of signs, window shades, blinds, drapes, awnings or
other similar items, and all internal lighting that may be visible from the
exterior of the Premises and, notwithstanding the provisions of Article IX, the
design, arrangement, style, color and general appearance of the portion of the
Premises visible from the exterior, and contents thereof, including, without
limitation, furniture, fixtures, signs, art work, wall coverings, carpet and
decorations, and all changes, additions and removals thereto, shall, at all
times have the appearance of premises having the same type of exposure and used
for substantially the same purposes that are generally prevailing in comparable
office buildings in the area. Any violation of this provision shall be deemed a
material breach of this Lease; (iv) to change the arrangement of

                                                   Tenant           Landlord
                                              -s- [ILLEGIBLE]    -s- [ILLEGIBLE]

                                       21


entrances, doors, corridors, elevators and/or stairs in the Building, provided
no such change shall materially adversely affect access to the Premises; (v) to
grant any party the exclusive right to conduct any business or render any
service in the Building, provided such exclusive right shall not operate to
prohibit Tenant from using the Premises for the purposes permitted under this
Lease; (vi) to prohibit the placement of vending or dispensing machines of any
kind in or about the Premises other than for use by Tenant's employees; (vii) to
prohibit the placement of video or other electronic games in the Premises;
(viii) to have access for Landlord and other tenants of the Building to any mail
chutes and boxes located in or on the Premises according to the rules of the
United States Post Office and to discontinue any mail chute business in the
Building; (ix) to close the Building after normal business hours, except that
Tenant and its employees and invitees shall be entitled to admission at all
times under such rules and regulations as Landlord prescribes for security
purposes; (x) to install, operate and maintain security systems which monitor,
by close circuit television or otherwise, all persons entering or leaving the
Building; (xi) to install and maintain pipes, ducts, conduits, wires and
structural elements located in the Premises which serve other parts or other
tenants of the Building; and (xii) to retain at all times master to the Premises
for emergency use only.

         IN WITNESS WHEREOF, the parties hereto have executed this lease as of
the date first above, written.

LANDLORD:                                        TENANT:

3600 WILSHIRE, LLC, A California                 NARA BANK, National Association
limited liability company
By: JPB Partners, Inc., a California             By: -s-  Bon T. Goo
corporation                                          ---------------------
Its: Manager
                                                 Print Name: BON T. GOO

By: -s- David Y. Lee,                            Its: CFO & EVP
    --------------------------
    David Y. Lee, M.D.                           Date: 2/6/03
Its: President
                                                 By: -s-  Michel Urich
Date: 2/7/03                                         ---------------------

                                                 Print Name: MICHEL URICH

                                                 Its: Directors of Legal Affairs

                                                 Date: 2/6/03

                                                   Tenant           Landlord
                                              -s- [ILLEGIBLE]    -s- [ILLEGIBLE]

                                       22


                                    EXHIBIT A
                                AS - BUILT PLAIN

                                 [BUILT PLAIN]

                                                   Tenant           Landlord
                                              -s- [ILLEGIBLE]    -s- [ILLEGIBLE]

                                       23


                                   EXHIBIT A-1
                               PREMISES FLOOR PLAN

                             [PREMISES FLOOR PLAN]

                                                   Tenant           Landlord
                                              -s- [ILLEGIBLE]    -s- [ILLEGIBLE]

                                       24


                                   EXHIBIT A-2
                                  PARKING PLAN

                                 [PARKING PLAN]

                                                   Tenant           Landlord
                                              -s- [ILLEGIBLE]    -s- [ILLEGIBLE]



                                    EXHIBIT B
                             WORK LETTER AGREEMENT

                            [LANDLORD PERFORMS WORK]
                                [MINOR WORK ONLY]

         THIS AGREEMENT made as of the 17th day of JANUARY, 2003, between 3600
WILSHIRE LLC, A California limited liability company, By JPB Partners, Inc., a
California corporation as ("Landlord") and NARA BANK, NATIONAL ASSOCIATION,
("Tenant").

         Reference is made to the Lease or tenant expansion agreement dated
JANUARY 17, 2003, (the "Lease") for premises known 3600 Wilshire Boulevard,
Suite 100A (the "Premises"), located in the property known as The Wilshire
Financial Tower also known as 3600 Wilshire Boulevard, Los Angeles, CA 90010
(the "Property")

         Landlord agrees to perform the following items of work (the "Work") in
the Premises

         1.       Tenant agrees to accept the Premises in "as is" condition
except for demising walls.

         Landlord shall pay the full cost of the Work, except that Tenant shall
reimburse Landlord in the amount of $ none, within 10 days after Landlord
completes the Work.

         If Landlord requires further choices by Tenant respecting the above
Work (e g, color choices respecting the above items), Tenant shall promptly
choose the same from such choices, if any, that Landlord makes available to
Tenant as "building standard." If any such further choices are required, the
parties agree that Tenant has heretofore been provided an opportunity to view
the available choices and Tenant agrees to make such choices by       n/a
      , 20      If Tenant fails to do so by such date, Landlord may make such
choices for Tenant

         Landlord will use reasonable efforts to complete the Work by the
Commencement Date under the Lease or within 90 days thereafter, subject to
further delays beyond Landlord's reasonable control (as may be further described
in the Lease), provided, notwithstanding anything to the contrary contained in
the Lease, delays in the Work hereunder shall not postpone the commencement of
Rent under any circumstances whether the delay is caused by Tenant or Tenant's
contractors, agents or employees, or the delay is otherwise beyond Landlord's
reasonable control (as may be further described in the Lease), or for any other
reason whatsoever Tenant acknowledges that the Work may occur during normal
business hours while Tenant is in occupancy of the Premises and that no
interference to Tenant's business operations in, or use of, the Premises shall
entitle Tenant to any abatement of rent or any other concession, or give rise to
any claim against, or liability of, Landlord

         Notwithstanding anything to the contrary contained in this Work Letter,
it is expressly understood and agreed by and between the parties hereto that (a)
The recourse of Tenant or its successors or assigns against Landlord with
respect to the alleged breach by or on the part of Landlord of any
representation, warranty, covenant, undertaking or agreement contained in this
Work Letter (collectively, "Landlord's Work Letter Undertakings") shall extend
only to Landlord's interest in the real estate of which the Premises demised
under the Lease are a part (hereinafter, "Landlord's Real Estate") and not to
any other assets of Landlord or its beneficiaries; and (b) Except to the extent
of Landlord's interest in Landlord's Real Estate, no personal liability or
personal responsibility of any sort with respect to any of Landlord's Work
Letter Undertakings or any alleged breach thereof is assumed by, or shall at any
time be asserted or enforceable against, Landlord, or against any of their
respective directors, officers, shareholders, employees, agents, constituent
partners, beneficiaries, trustees or representatives

LANDLORD:                                        TENANT:

3600 WILSHIRE, LLC, A California                 NARA BANK, National Association
limited liability company
By: JPB Partners, Inc., a California
corporation
Its: Manager                                     By: -s-  Bon T. Goo
                                                     ---------------------

By: -s- David Y. Lee,                            Print Name: Bon T. Goo
    --------------------------
    David Y. Lee, M.D.                           Its: CFO & EVP
Its: President
                                                 Date: 2/6/03
Date: 2/7/03
                                                 By: -s-  Michel Urich
                                                     ---------------------

                                                 Print Name: MICHEL URICH

                                                 Its: Directors of Legal Affairs

                                                 Date: 2/6/03

                                                   Tenant           Landlord
                                              -s- [ILLEGIBLE]    -s- [ILLEGIBLE]

                                       25


                                    EXHIBIT B
                              WORK LETTER AGREEMENT

                             [TENANT PERFORMS WORK]

         This Work Letter Agreement ("Work Letter") is executed simultaneously
with that certain Lease dated JANUARY 17, 2003, (the "Lease") between 3600
WILSHIRE, LLC, a California limited liability company, c/o JPB PARTNERS, INC., a
California corporation, as ("Landlord") and NARA BANK, NATIONAL ASSOCIATION, as
("Tenant"), relating to demised premises ("Premises") at the building commonly
known as Wilshire Financial Tower or 3600 Wilshire Boulevard, Los Angeles,
California 90010 (the "Building"), which Premises are more fully identified in
the Lease. Capitalized terms used herein, unless otherwise defined in this Work
Letter, shall have the respective meanings ascribed to them in the Lease.

         For and in consideration of the agreement to lease the Premises and the
mutual covenants contained herein and in the Lease, Landlord and Tenant hereby
agree as follows:

1.       WORK. Tenant, at its sole cost and expense, shall perform, or cause to
be performed, the work (the "Work") in the Premises provided for in the Approved
Plans (as defined in Paragraph 2 hereof).

2.       PRE-CONSTRUCTION ACTIVITIES.

         (a)      On or before FEBRUARY 14, 2003, Tenant shall submit the
following information and items to Landlord for Landlord's review and approval:

                  (i)      A detailed critical path construction schedule
containing the major components of the Work and the time required for each,
including the scheduled commencement date of construction of the Work, milestone
dates and the estimated date of completion of construction.

                  (ii)     An itemized statement of estimated construction cost,
including fees for permits and architectural and engineering fees.

                  (iii)    Evidence satisfactory to Landlord in all respects of
Tenant's ability to pay the cost of the Work as and when payments become due.

                  (iv)     The names and addresses of Tenant's contractors (and
said contractor's subcontractors) and material men to be engaged by Tenant for
the Work (individually, a "Tenant Contractor," and collectively, "Tenant's
Contractors"). Landlord has the right to approve or disapprove all or any one or
more of Tenant's Contractors. Landlord may, at its election, designate a list of
approved contractors for performance of those portions of work involving
electrical, mechanical, plumbing, heating, air conditioning or life safety
systems, from which Tenant must select its contractors for such designated
portions of work.

                  (v)      Certified copies of Insurance policies or
certificates of insurance as hereinafter described. Tenant shall not permit
Tenant's Contractors to commence work until the required insurance has been
obtained and certified copies of policies or certificates have been delivered to
Landlord.

                  (vi)     Payment and performance bonds for all of Tenant's
Contractors naming Landlord (or an agent, designee or representative appointed
by Landlord's written notice to Tenant given prior to Tenant's procurement of
paid bonds) as dual obligee.

                  (vii)    The Plans (as hereinafter defined) for the Work,
which Plans shall be subject to Landlord's approval in accordance with Paragraph
2(b) below.

                  Tenant will update such information and items by notice to
Landlord of any changes.

         (b)      As used herein the term "Approved Plans" shall mean the Plans
(as hereinafter defined), as and when approved in writing by Landlord. As used
herein, the term "Plans" shall mean the full and detailed architectural and
engineering plans and specifications covering the Work (including, without
limitation, architectural, mechanical and electrical working drawings for the
Work). The Plans shall be subject to Landlord's approval and the approval of all
local governmental authorities requiring approval of the work and/or the
Approved Plan. Landlord shall give its approval or disapproval (giving general
reasons in case of disapproval) of the Plans within Five (5) days after then
delivery to Landlord. Landlord agrees not to unreasonably withhold its approval
of said Plans; provided, however, that Landlord shall not be deemed to have
acted unreasonably if it withholds its approval of the Plans because, in
Landlord's reasonable opinion: the Work as shown in the Plans is likely to
adversely affect Building systems, the structure of the Building or the safety
of the Building and/or its occupants; the Work as shown on the Plans might
impair Landlord's ability to furnish services to Tenant or other tenants; the
Work would increase the cost of operating the Building; the Work would violate
any governmental laws, rules or ordinances (or interpretations thereof); the
Work contains or uses hazardous or toxic materials or substances; the Work would
adversely affect the appearance of the Building; the Work might adversely affect
another tenant's

                                                   Tenant           Landlord
                                              -s- [ILLEGIBLE]    -s- [ILLEGIBLE]

                                       26


premises; or the Work is prohibited by any mortgage or trust deed encumbering
the Building. The foregoing reasons, however, shall not be exclusive of the
reasons for which Landlord may withhold consent, whether or not such other
reasons are similar or dissimilar to the foregoing. If Landlord notifies Tenant
that changes are required to the final Plans submitted by Tenant, Tenant shall,
within three (3) business days thereafter, submit to Landlord, for its approval,
the Plans amended in accordance with the changes so required. The Plans shall
also be revised, and the Work shall be changed, all at Tenant's cost and
expense, to incorporate any work required in the Premises by any local
governmental field inspector. Landlord's approval of the Plans shall in no way
be deemed to be (i) an acceptance or approval of any element therein contained
which is in violation of any applicable laws, ordinances, regulations or other
governmental requirements, or (ii) an assurance that work done pursuant to the
Approved Plans will comply with all applicable laws (or with the interpretations
thereof) or satisfy Tenant's objectives and needs.

         (c)      No Work shall be undertaken or commenced by Tenant in the
Premises until (i) Tenant has delivered, and Landlord has approved, all items
set forth in Paragraph 2(a) above, (ii) all necessary building permits have been
applied for and obtained by tenant, and (iii) proper provision has been made by
Tenant for payment in full of the cost of the Work, which is satisfactory to
Landlord and which, if applicable, shall be in the form of the construction
escrow referred to in Paragraph 9 hereof or an irrevocable and unconditional
letter of credit issued by a bank acceptable to Landlord, which letter of credit
shall be satisfactory in all respects by Landlord.

3.       DELAYS. In the event Tenant fails to deliver or deliver in sufficient
and accurate detail of the information required under Paragraph 2 above on or
before the respective dates specified in said Paragraph 2, or in the event
Tenant, for any reason, fails to complete the Work on or before the Commencement
Date, Tenant shall be responsible for Rent and all other obligations set forth
in the Lease from the Commencement Date regardless of the degree of completion
of the Work on such date, and no such delay in completion of the Work shall
relieve Tenant of any of its obligations under the Lease.

4.       CHARGES AND FEES. Tenant shall pay Landlord a supervisory fee in an
amount equal to Zero percent (0%) of the direct cost of the materials and labor
for the Work (and all change orders with respect thereto) to defray Landlord's
administrative and overhead expenses incurred to review the Plans and coordinate
with Tenant's on-site project manager the staging and progress of the Work.

5.       CHANGE ORDERS. All changes to the Approved Plans requested by Tenant
must be approved by Landlord in advance of the implementation of such changes as
part of the Work. All delays caused by Tenant-initiated change orders,
including, without limitation, any stoppage of work during the change order
review process, are solely the responsibility of Tenant and shall cause no delay
in the commencement of the Lease or the Rent and other obligations therein set
forth. All increases in the cost of the Work resulting from such change orders
shall be borne by Tenant.

6.       STANDARDS OF DESIGN AND CONSTRUCTION AND CONDITIONS OF TENANT'S
PERFORMANCE. All work done in or upon the Premises by Tenant shall be done
according to the standards set forth in this Paragraph 6, except as the same may
be modified in the Approved Plans approved by or on behalf of Landlord and
Tenant.

         (a)      Tenant's Approved Plans and all design and construction of the
Work shall comply with all applicable statutes, ordinances, regulations, laws,
codes and industry standards, including, but not limited to, requirements of
Landlord's fire insurance underwriters.

         (b)      Tenant shall, at its own cost and expense, obtain all required
building permits and occupancy permits. Tenant's failure to obtain such permits
shall not cause a delay in the commencement of the Lease Term or the obligation
to pay Rent or any other obligations set forth in the Lease.

         (c)      Tenant's Contractors shall be licensed contractors, possessing
good labor relations, capable of performing quality workmanship and working in
harmony with Landlord's contractors and subcontractors and with other
contractors and subcontractors in the Building. All work shall be coordinated
with any other construction or other work in the Building in order not to
adversely affect construction work being performed by or for Landlord or its
tenants.

         (d)      Landlord shall have the right, but not the obligation, to
perform, on behalf of and for the account of Tenant, subject to reimbursement by
Tenant, any work which pertains to patching of the Work and other work in the
Building.

         (e)      Tenant shall use only new, first-class materials in the Work,
except where explicitly shown in the Approved Plans, All Work shall be done in a
good and workmanlike manner. Tenant shall obtain contractors' warranties of at
least one (1) year duration from the completion of the Work against defects in
workmanship and materials on all work performed and equipment installed in the
Premises as part of the Work.

         (f)      Tenant and Tenant's Contractors shall make all efforts and
take all steps appropriate to assure that all construction activities undertaken
comport with the reasonable expectations of all tenants and other occupants of a
fully-occupied (or substantially fully occupied) first-class office building and
do not unreasonably interfere with

                                                   Tenant           Landlord
                                              -s- [ILLEGIBLE]    -s- [ILLEGIBLE]

                                       27


the operation of the Building or with other tenants and occupants of the
Building. In any event, Tenant shall comply with all reasonable rules and
regulations existing from time to time at the Building. Tenant and Tenant's
Contractors shall take all precautionary steps to minimize dust, noise and
construction traffic, and to protect their facilities and the facilities of
others affected by the Work and to properly police same. Construction equipment
and materials are to be kept within the Premises and delivery and loading of
equipment and materials shall be done at such locations and at such time as
Landlord shall direct so as not to burden the construction or operation of the
Building. If and as required by Landlord, the Premises shall be sealed off from
the balance of the office space on the floor(s) containing the Premises so as to
minimize the disbursement of dirt, debris and noise.

         (g)      Landlord shall have the right to order Tenant or any of
Tenant's Contractors who violate the requirements imposed on Tenant or Tenant's
Contractors in performing work to cease work and remove its equipment and
employees from the Building. No such action by Landlord shall delay the
commencement of the Lease or the obligation to pay Rent or any other obligations
therein set forth.

         (h)      Utility costs or charges for any service (including HVAC,
hoisting or freight elevator and the like) to the Premises shall be the
responsibility of Tenant from the date Tenant is obligated to commence or
commences the Work and shall be paid for by Tenant at Landlord's standard rates
then in effect. Tenant shall apply and pay for all utility meters required.
Tenant shall pay for all support services provided by Landlord's contractors at
Tenant's request or at Landlord's discretion resulting from breaches or defaults
by Tenant under this Work Letter Agreement. All use of freight elevators is
subject to scheduling by Landlord and the rules and regulations of the Building.
Tenant shall arrange and pay for removal of construction debris and shall not
place debris in the Building's waste containers. If required by Landlord, Tenant
shall sort and separate its waste and debris for recycling and/or environmental
law compliance purposes.

         (i)      Tenant shall permit access to the Premises, and the Work shall
be subject to inspection, by Landlord and Landlord's architects, engineers,
contractors and other representatives, at all times during the period in which
the Work is being constructed and installed and following completion of the
Work.

         (j)      Tenant shall proceed with its work expeditiously, continuously
and efficiently, and shall use its best efforts to complete the same on or
before Twenty One (21) days after the date Landlord tenders possession of the
Premises to Tenant for the construction of the Work. Tenant shall notify
Landlord upon completion of the Work and shall furnish Landlord and Landlord's
title insurance company with such further documentation as may be necessary
under Paragraphs 8 and 9 below.

         (k)      Tenant shall have no authority to deviate from the Approved
Plans in performance of the Work, except as authorized by Landlord and its
designated representative in writing. Tenant shall furnish to Landlord
"as-built" drawings of the Work within thirty (30) days after completion of the
Work.

         (l)      Landlord shall have the right to run utility lines, pipes,
conduits, duct work and component parts of all mechanical and electrical systems
where necessary or desirable through the Premises, to repair, alter, replace or
remove the same, and to require Tenant to install and maintain proper access
panels thereto.

         (m)      Tenant shall impose on and enforce all applicable terms of
this Work Letter Agreement against Tenant's architect and Tenant's Contractors.

7.       INSURANCE AND INDEMNIFICATION.

         (a)      In addition to any insurance which may be required under the
Lease, Tenant shall secure, pay for and maintain or cause Tenant's Contractors
to secure, pay for and maintain during the continuance of construction and
fixturing work within the Building or Premises, insurance in the following
minimum coverages and the following minimum limits of liability:

                  (i)      Worker's Compensation and Employer's Liability
Insurance with limits of not less than $500,000.00, or such higher amounts as
may be required from time to time by any Employee Benefit Acts or other statutes
applicable where the work is to be performed, and in any event sufficient to
protect Tenant's Contractors from liability under the aforementioned acts.

                  (ii)     Comprehensive General Liability Insurance (including
Contractors' Protective Liability) in an amount not less than $1,000,000.00 per
occurrence, whether involving bodily injury liability (or death resulting
therefrom) or property damage liability or a combination thereof with a minimum
aggregate limit of $2,000,000.00, and with umbrella coverage with limits not
less than $5,000,000.00. Such insurance shall provide for explosion and
collapse, completed operations coverage and broad form blanket contractual
liability coverage and shall insure Tenant's Contractors against any and all
claims for bodily injury, including death resulting therefrom, and damage to the
property of others and arising from its operations under the contracts whether
such operations are performed by Tenant's Contractors or by anyone directly or
indirectly employed by any of them.

                  (iii)    Comprehensive Automobile Liability Insurance,
including the ownership, maintenance and operation of any automotive equipment,
owned, hired, or non-owned in an amount not less than $500,000.00 for each
person in one accident, and $1,000,000.00 for injuries sustained by two or more
persons in any one accident and property damage liability in an amount not less
than $1,000,000.00 for each accident. Such insurance shall

                                                   Tenant           Landlord
                                              -s- [ILLEGIBLE]    -s- [ILLEGIBLE]

                                       28


insure Tenant's Contractors against any and all claims for bodily injury,
including death resulting therefrom, and damage to the property of others
arising from its operations under the contracts, whether such operations are
performed by Tenant's Contractors, or by anyone directly or indirectly employed
by any of them.

                  (iv)     "All-risk" builder's risk insurance upon the entire
Work to the full insurable value thereof. This insurance shall include the
interests of Landlord and Tenant (and their respective contractors and
subcontractors of any tier to the extent of any insurable interest therein) in
the Work and shall insure against the perils of fire and extended coverage and
shall include "all-risk" builder's risk insurance for physical loss or damage
including, without duplication of coverage, theft vandalism and malicious
mischief. If portions of the Work are stored off the site of the Building or in
transit to said site are not covered under said "all-risk" builder's risk
insurance, then Tenant shall effect and maintain similar property insurance on
such portions of the Work. Any loss insured under said "all-risk" builder's risk
insurance is to be adjusted with Landlord and Tenant and made payable to
Landlord, as trustee for the insured, as their interests may appear.

All policies (except the worker's compensation policy) shall be endorsed to
include as additional insured parties the parties listed on, or required by, the
Lease, Landlord's contractors, Landlord's architects, and their respective
beneficiaries, partners, directors, officers, employees and agents, and such
additional persons as Landlord may designate. The waiver of subrogation
provisions contained in the Lease shall apply to all insurance policies (except
the workmen's compensation policy) to be obtained by Tenant pursuant to this
paragraph. The insurance policy endorsements shall also provide that all
additional insured parties shall be given thirty (30) days' prior written notice
of any reduction, cancellation or non-renewal of coverage (except that ten (10)
days' notice shall be sufficient in the case of cancellation for non-payment of
premium) and shall provide that the insurance coverage afforded to the
additional insured parties thereunder shall be primary to any insurance carried
independently by said additional insured parties. Additionally, where
applicable, each policy shall contain a cross-liability and severability of
interest clause.

         (b)      Without limitation of the indemnification provisions contained
in the Lease, to the fullest extent permitted by law Tenant agrees to indemnify,
protect, defend and hold harmless Landlord, the parties listed, or required by,
the Lease to be named as additional insureds, Landlord's contractors, Landlord's
architects, and their respective beneficiaries, partners, directors, officers,
employees and agents, from and against all claims, liabilities, losses, damages
and expenses of whatever nature arising out of or in connection with the Work or
the entry of Tenant or Tenant's Contractors into the Building and the Premises,
including, without limitation, mechanic's liens, the cost of any repairs to the
Premises or Building necessitated by activities of Tenant or Tenant's
Contractors, bodily injury to persons (including, to the maximum extent provided
by law, claims arising under the California Structural Work Act) or damage to
the property of Tenant, its employees, agents, invitees, licenses or others. It
is understood and agreed that the foregoing indemnity shall be in addition to
the insurance requirements set forth above and shall not be in discharge of or
in substitution for same or any other indemnity or insurance provision of the
Lease.

8.      EXCESS AMOUNTS.

         (a)      Upon completion of the Work, Tenant shall furnish Landlord
with full and final waivers of liens and contractors' affidavits and statements,
in such form as may be required by Landlord, Landlord's title insurance company
and Landlord's construction or permanent lender, if any, from all parties
performing labor or supplying materials or services in connection with the Work
showing that all of said parties have been compensated in full and waiving all
liens in connection with the Premises and Building. Tenant shall submit to
Landlord a detailed breakdown of Tenant's total construction costs, together
with such evidence of payment as is reasonably satisfactory to Landlord.

         (b)      Upon completion of the Work and Tenant's satisfaction of all
requirements set forth in this Work Letter Agreement. Prior to commencing the
Work, Tenant shall submit to Landlord a written statement of the total Cost of
the Work as then known by Tenant. Tenant shall submit to Landlord at the end of
each thirty (30) days copies of invoices that indicate the work has been
completed to Tenant's satisfaction and mechanic lien releases. Tenant shall have
sole responsibility for the payment of such excess cost. Upon demand from
Landlord, Tenant must show evidence of signed contracts and paid invoices.

9.       CONSTRUCTION ESCROW. Prior to commencement of any construction or
performance of any Work or payment to or by Tenant or to any of Tenant's
Contractors, Tenant shall, at Landlord's option, establish a construction escrow
or other payment procedure acceptable to Landlord and each holder of a mortgage
on the Building at a title insurance company designated by Landlord providing
for payment to Tenant's Contractors and payment of all other costs associated
with the Work as the Work progresses, upon the title insurance company's
satisfactory review of lien waivers and sworn statements from Tenant's
Contractors and other applicable parties and upon the title insurance company's
willingness to issue title insurance over mechanic's liens relating to Tenant's
contracts and the Work to the date of each draw; in the alternative, Landlord
may elect to have payments to Tenant's Contractors for the Work made through
Landlord's construction lender's escrow. Tenant shall pay for the Work when
required under its contracts for the Work and shall not permit the Premises or
the Building to become subject to any lien or claim of lien on account of labor,
material or services furnished to or for the benefit of Tenant. Tenant shall,
from time to time, deposit funds into the construction escrow or Landlord's
construction lender's escrow, as the case may be, in amounts sufficient to pay
the costs of the Work. Tenant may not withdraw funds except to pay

                                                   Tenant           Landlord
                                              -s- [ILLEGIBLE]    -s- [ILLEGIBLE]

                                       29


Tenant's Contractors unless Landlord has consented to such withdrawal. The
construction escrow agreement shall contain the foregoing restriction on
withdrawal of funds by Tenant and shall also provide that if Tenant fails to pay
for the Work when due or if any mechanic's lien is filed in connection with the
Work, Landlord may use and withdraw the funds in the escrow to pay for the Work
or remove the lien without Tenant's consent. Tenant shall provide such
contractor's affidavits, tenant (owner) statements, partial and final waivers of
lien, architect's certificates and any additional documentation (including,
without limitation, Tenant or contractor personal undertakings) which may be
requested by Landlord, such title insurance company or any holder of a mortgage
on the Building in connection with said escrow or consistent with any other
title insurance requirements concerning the Work.

10.      Miscellaneous.

         (a)      If the Plans for the Work require the construction and
installation of more fire hose cabinets or telephone/electrical closets than the
number regularly provided by Landlord in the core of the Building in which the
Premises are located, Tenant agrees to pay all costs and expenses arising from
the construction and installation of such additional fire hose cabinets or
telephone/electrical closets.

         (b)      Time is of the essence of this Work Letter Agreement.

         (c)      Any person signing this Work Letter Agreement on behalf of
Landlord and Tenant warrants and represents he has authority to sign and deliver
this Work Letter Agreement and bind the party on behalf of which he has signed.

         (d)      If Tenant fails to make any payment relating to the Work as
required hereunder, Landlord, at its option, may complete the Work pursuant to
the Approved Plans and continue to hold Tenant liable for the costs thereof and
all other costs due to Landlord. Tenant's failure to pay any amounts owed by
Tenant hereunder when due or Tenant's failure to perform its obligations
hereunder shall also constitute a default under the Lease and Landlord shall
have all the rights and remedies granted to Landlord under the Lease for
nonpayment of any amounts owed thereunder or failure by Tenant to perform its
obligations thereunder.

         (e)      Notices under this Work Letter shall be given in the same
manner as under the Lease.

         (f)      The liability of Landlord hereunder or under any amendment
hereto or any instrument or document executed in connection herewith (including,
without limitation, the Lease) shall be limited to and enforceable solely
against Landlord's interest in the Building.

         (g)      The headings set forth herein are for convenience only.

         (h)      This Work Letter sets forth the entire agreement of Tenant and
Landlord regarding the Work. This Work Letter may only be amended if in writing,
duly executed by both Landlord and Tenant.

         (i)      All amounts due from Tenant hereunder shall be deemed to be
Rent due under the Lease.

11.      ON-SITE PROJECT MANAGER.

         As a condition of Tenant's right to commence and perform the Work,
Tenant shall engage the services of an on-site project manager approved in
advance by and reasonably acceptable to Landlord, who will be charged with the
task of performing daily supervision of the Work. Such on-site manager shall be
familiar with all rules and regulations and procedures of the Building and all
personnel of the Building engaged directly or indirectly in the management,
operation and construction of the Building. Such on-site project manager shall
be accountable and responsible to Tenant and to Landlord and, where necessary,
shall serve as a liaison between Landlord and Tenant with respect to the Work.
The entire cost and expense of the on-site project manager shall be borne and
paid for by Tenant (subject to Tenant's right to use all or any part of
Landlord's Contribution to reimburse Tenant for the same.)

12.      EXCULPATION OF LANDLORD.

         Notwithstanding anything to the contrary contained in this Work Letter
Agreement, it is expressly understood and agreed by and between the parties
hereto that:

         (a)      The recourse of Tenant or its successors or assigns against
Landlord with respect to the alleged breach by or on the part of Landlord of any
representation, warranty, covenant, undertaking or agreement contained in this
Work Letter Agreement (collectively, "Landlord's Work Letter Undertakings")
shall extend only to Landlord's interest in the real estate of which the
Premises demised under this Lease Documents are a part (hereinafter, "Landlord's
Real Estate") and not to any other assets of Landlord or its beneficiaries; and

         (b)      Except to the extent of Landlord's interest in Landlord's Real
Estate, no personal liability or personal responsibility of any sort with
respect to any of Landlord's Work Letter Undertakings or any alleged

                                                   Tenant           Landlord
                                              -s- [ILLEGIBLE]    -s- [ILLEGIBLE]

                                       30


breach thereof is assumed by, or shall at any time be asserted or enforceable
against, Landlord, Jamison Properties, Inc., or against any of their respective
directors, officers, employees, agents, constituent partners, beneficiaries,
trustees or representatives.

         IN WITNESS WHEREOF, the parties hereto have executed this Work Letter
as of the date first above written.

LANDLORD:                                        TENANT:

3600 WILSHIRE, LLC, A California                 NARA BANK, National Association
limited liability company
By: JPB Partners, Inc., a California
corporation
Its: Manager                                     By: /s/ BON T. GOO
                                                     ---------------------

By: /s/ David Y. Lee                             Print Name: BON T. GOO
    --------------------------
    David Y. Lee, M.D.                           Its: CFO & EVP
Its: President
                                                 Date: 2/6/03
Date: 2/7/03
                                                 By: /s/ [ILLEGIBLE]
                                                     ---------------------

                                                 Print Name: [ILLEGIBLE]

                                                 Its: Directors of Legal Affairs

                                                 Date: 2/6/03

                                                   Tenant           Landlord
                                              -s- [ILLEGIBLE]    -s- [ILLEGIBLE]

                                       31


                                    EXHIBIT C
                              RULES AND REGULATIONS

         1.       The sidewalks, entrances, passages, courts, elevators,
vestibules, stairways, corridors or halls shall not be obstructed or used for
any purpose other than ingress and egress. The halls, passages, entrances,
elevators, stairways, balconies and roof are not for the use of the general
public, and Landlord shall in all cases retain the right to control or prevent
access thereto by all persons whose presence in the judgment of Landlord shall
be prejudicial to the safety, character, reputation or interests of Landlord and
its tenants, provided that nothing herein contained shall be construed to
prevent such access by persons with whom the tenant normally deals in the
ordinary course of its business unless such persons are engaged in illegal
activities No tenant and no employees of any tenant shall go upon the roof of
the Building without the written consent of Landlord.

         2.       No awnings or other projections shall be attached to the
outside walls or surfaces of the Building nor shall the interior or exterior of
any windows be coated without the prior written consent of Landlord. Except as
otherwise specifically approved by Landlord, all electrical ceiling fixtures
hung in offices or spaces along the perimeter of the Building must be
fluorescent and of a quality, type, design and bulb color approved by Landlord.
Tenant shall not place anything or allow anything to be placed near the glass of
any window, door, partition or wall which may appear unsightly from outside the
Premises.

         3.       Interior signs on doors and the directory tablet shall be
inscribed, painted or affixed for each tenant by Landlord at the expense of such
tenant, and shall be of a size, color and style acceptable to Landlord.

         4.       The toilets and wash basins and other plumbing fixtures shall
not be used for any purpose other than those for which they were constructed,
and no sweepings, rubbish, rags or other substances shall be thrown therein. All
damage resulting from any misuse of the fixtures shall be borne by tenant who,
or whose servants, employees, agents, visitors or licensees, shall have caused
the same.

         5.       No tenant or its officers, agents, employees or invitees shall
mark, paint, drill into, or in any way deface any part of the Premises or the
Building. No boring, cutting or stringing of wires or laying of linoleum or
other similar floor coverings shall be permitted except with the prior written
consent of Landlord and as Landlord may direct.

         6.       No bicycles, vehicles or animals of any kind shall be brought
into or kept in or about the Premises and no cooking shall be done or permitted
by any tenant on the Premises except that microwave cooking in a UL-approved
microwave oven and the preparation of coffee, tea, hot chocolate and similar
items for the tenant and its employees and business visitors shall be permitted.
Tenant shall not cause or permit any unusual or objectionable odors to escape
from the Premises.

         7.       The Premises shall not be used for manufacturing or for the
storage of merchandise except as such storage may be incidental to the use of
the Premises for general office purposes. No tenant shall engage or pay any
employees on the Premises except those actually working for such tenant on the
Premises nor advertise for laborers giving an address at the Premises. The
Premises shall not be used for lodging or sleeping or for any immoral or illegal
purposes.

         8.       No tenant or its officers, agents, employees or invitees shall
make, or permit to be made any unseemly or disturbing noises, sounds or
vibrations or disturb or interfere with occupants of this or neighboring
buildings or Premises or those having business with them whether by the use of
any musical instrument, radio, phonograph, unusual noise, or in any other way.

         9.       No tenant or its officers, agents, employees or invitees shall
throw anything out of doors, balconies or down the passageways.

         10.      Tenant shall not maintain armed security in or about the
Premises nor possess any weapons, explosives, combustibles or other hazardous
devices in or about the Building and/or Premises.

         11.      No tenant or its officers, agents, employees or invitees shall
at any time use, bring or keep upon the Premises any flammable, combustible,
explosive, foul or noxious fluid, chemical or substance, or do or permit
anything to be done in the leased Premises, or bring or keep anything therein,
which shall in any way increase the rate of fire insurance on the Building, or
on the property kept therein, or obstruct or interfere with the rights of other
tenants, or in any way injure or annoy them, or conflict with the regulations of
the Fire Department or the fire laws, or with any insurance policy upon the
Building, or any part thereof, or with any rules and ordinances established by
the Board of Health or other governmental authority.

         12.      Each tenant must, upon the termination of this tenancy,
restore to Landlord all keys of stores, offices, and toilet rooms, either
furnished to, or otherwise procured by, such tenant, and in the event of the
loss of any keys so furnished, such tenant shall pay to Landlord the cost of
replacing the same or of changing the lock or locks opened by such lost key if
Landlord shall deem it necessary to make such change.

         13.      All removals, or the carrying in or out of any safes, freight,
furniture, or bulky matter of any description must take place during the hours
which Landlord may determine form time to time. The moving of

                                                   Tenant           Landlord
                                              -s- [ILLEGIBLE]    -s- [ILLEGIBLE]

                                       32


safes or other fixtures or bulky matter of any kind must be made upon previous
notice to the manager of the Building and under his or her supervision, and the
persons employed by any tenant for such work must be acceptable to Landlord.
Landlord reserves the right to inspect all safes, freight or other bulky
articles to be brought into the Building and to exclude from the Building all
safes, freight or other bulky articles which violate any of these Rules and
Regulations or the Lease of which these Rules and Regulations are a part.
Landlord reserves the right to prohibit or impose conditions upon the
installation in the Premises of heavy objects which might overload the building
floors. Landlord will not be responsible for loss of or damage to any safes,
freight, bulky articles or other property from any cause, and all damage done to
the Building by moving or maintaining any such safe or other property shall be
repaired at the expense of the tenant.

         14       No tenant shall purchase or otherwise obtain for use in the
Premises water, ice, towel, vending machine, janitorial, maintenance or other
like services, or accept barbering or bootblacking services, except from persons
authorized by Landlord, and at hours and under regulations fixed by Landlord.

         15.      Landlord shall have the right to prohibit any advertising by
any tenant which, in Landlord's opinion, tends to impair the reputation of the
Building or its desirability as an office building and upon written notice from
Landlord any tenant shall refrain from or discontinue such advertising. No
tenant shall use any graphic image of the Building or any part of the Building
for advertising or public relations without Landlord's written permission.

         16.      Landlord reserves the right to exclude from the Building
between the hours of 10:00 p.m. and 6:00 a.m. and at all hours of Saturdays,
Sundays and legal holidays all persons who do not present a pass signed by
Landlord. Landlord shall furnish passes to persons for whom any tenant requests
the same in writing. Each tenant shall be responsible for all persons for whom
he requests passes and shall be liable to Landlord for all acts of such persons.
Landlord shall in no case be liable for damages for any error with regard to the
admission to or exclusion from the Building of any person. In the case of
invasion, mob, riot, public excitement or other commotion, Landlord reserves the
right to prevent access to the Building during the continuance of the same, by
closing of the gates and doors or otherwise, for the safety of the tenants and
others and the protection of the Building and the property therein.

         17.      Any outside contractor employed by any tenant, shall, while in
the Building, be subject to the Rules and Regulations of the Building. Tenant
shall be responsible for all acts of such persons and Landlord shall not be
responsible for any loss or damage to property in the Premises, however
occurring.

         18.      All doors opening onto public corridors shall be kept closed,
except when in use for ingress and egress, and left locked when not in use.

         19.      The requirements of tenants will be attended to only upon
application to the Office of the Building.

         20.      Canvassing, soliciting and peddling in the Building are
prohibited and each tenant shall cooperate to prevent the same.

         21.      All office equipment of any electrical or mechanical nature
shall be placed by tenants in the Premises in setting approved by Landlord, to
absorb or prevent any vibration, noise or annoyance.

         22.      No air conditioning unit or other similar apparatus shall be
installed or used by any tenant without the written consent of Landlord.

         23.      There shall not be used in any space, or in the public halls
of the Building either by any tenant or others, any hand trucks except those
equipped with rubber tires and side guards.

         24.      Landlord will direct electricians as to where and how
telephone and telegraph wires are to be introduced. No boring or cutting for
wires or stringing of wires will be allowed without written consent of Landlord.
The location of telephones, call boxes and other office equipment affixed to the
Premises shall be subject to the approval of Landlord. All such work shall be
effected pursuant to permits issued by all applicable governmental authorities
having jurisdiction.

         25.      No vendor with the intent of selling such goods shall be
allowed to transport or carry beverages, food, food containers, etc., on any
passenger elevators. The transportation of such items shall be via the service
elevators in such manner as prescribed by Landlord.

         26.      Tenants shall cooperate with Landlord in the conservation of
energy used in or about the Building, including without limitation, cooperating
with Landlord in obtaining maximum effectiveness of the cooling system by
closing drapes or other window coverings when the sun's rays fall directly on
windows of the Premises, and closing windows and doors to prevent heat loss.
Tenant shall not obstruct, alter or in any way impair the efficient operation of
Landlord's heating, lighting, ventilating and air conditioning system and shall
not place bottles, machines, parcels or any other articles on the induction unit
enclosure so as to interfere with air flow. Tenant shall not tamper with or
change the setting of any thermostats or temperature control valves, and shall
in general use heat, gas, electricity, air conditioning equipment and heating
equipment in a manner compatible with sound energy conservation practices and
standards.

                                                   Tenant           Landlord
                                              -s- [ILLEGIBLE]    -s- [ILLEGIBLE]

                                       33


         27.      All parking ramps and areas, pedestrian walkways, plazas, and
other public areas forming a part of the Building shall be under the sole and
absolute control of Landlord with the exclusive right to regulate and control
these areas. Tenant agrees to conform to the rules and regulations that may be
established by Landlord for these areas from time to time.

         28.      Landlord reserves the right to exclude or expel from the
Building any person who, in the judgment of Landlord, is intoxicated or under
the influence of liquor or drugs, or who shall in any manner do any act in
violation of any of the rules and regulations of the Building.

         29.      Tenant and its employees, agents, subtenants, contractors and
invitees shall comply with all applicable "no-smoking" ordinances and,
irrespective of such ordinances, shall not smoke or permit smoking of
cigarettes, cigars or pipes outside of Tenant's Premises (including plaza areas)
in any portions of the Building except areas specifically designated as smoking
areas by Landlord. If required by applicable ordinance, Tenant shall provide
smoking areas within Tenant's Premises.

                                                   Tenant           Landlord
                                              -s- [ILLEGIBLE]    -s- [ILLEGIBLE]

                                       34


                                    EXHIBIT D

                            GUARANTY BY A CORPORATION

                              INTENTIONALLY OMITTED

                                                   Tenant           Landlord
                                              -s- [ILLEGIBLE]    -s- [ILLEGIBLE]

                                       35


                                    EXHIBIT E

                           SUITE ACCEPTANCE AGREEMENT

BUILDING NAME/ADDRESS: 3600 WILSHIRE BOULEVARD

TENANT NAME: NARA BANK, NATIONAL ASSOCIATION

TENANT CODE:_______________________________ SUITE NUMBER: 100A

MANAGEMENT'S TENANT CONTACT:_________________________________PHONE: 213-385-1374

Gentlemen:

As a representative of the above referenced tenant, I/we have physically
inspected the suite noted above and its improvements with______________________,
a representative of________________________. I/we accept the suite improvements
as to compliance with all the requirements indicated in our lease, also
including the following verified information below:

Lease Commencement Date:          July 1, 2003           Occupancy Date:

Lease Rent Start Date*:           July 1, 2003           Actual Rent Start*:

Lease Expiration Date:            June 30, 2013          Actual Expiration Date:

Date Keys Delivered:

Items requiring attention:______________________________________________________

________________________________________________________________________________

________________________________________________________________________________

________________________________________________________________________________

* If these dates are not the same, attach documentation.

NOTE: This inspection is to be made prior to tenant move-in.

Very truly yours,

_________________________________

By:   ___________________________

Its:  ___________________________

Date: ___________________________

Distribution

Tenant
Tenant Lease File
Leasing Manager:               ______________________
Document Control:              ______________________
Regional Construction Manager: ______________________
Regional Engineering Manager:  ______________________

                                                   Tenant           Landlord
                                              -s- [ILLEGIBLE]    -s- [ILLEGIBLE]

                                       36


                                    EXHIBIT F

                              ASBESTOS NOTIFICATION

                                                   Tenant           Landlord
                                              -s- [ILLEGIBLE]    -s- [ILLEGIBLE]

                                       37


                                    EXHIBIT F
                             ASBESTOS NOTIFICATION

                            NOTICE PURSUANT TO AB3713
                 CALIFORNIA HEALTH & SAFETY CODE 25915 ET SEQ.

         RE: 3600 WILSHIRE BOULEVARD, LOS ANGELES, CALIFORNIA (BUILDING)

California legislation requires landlords and tenants of commercial buildings
constructed prior to 1979 to notify each other and their respective employees
working within such building of any knowledge they may have regarding any
asbestos containing construction material in the building. This notice is to
provide you with the information required under this legislation.

Certain tests to determine the existence of asbestos containing construction
materials have been conducted. The results of these tests, which arc summarized
below, indicate that there are asbestos containing construction materials in the
Buildings. Some of these materials in some locations have been abated (removed)
by the prior owner of the Buildings.

The specific locations within the Building where asbestos containing
construction materials have been identified by the reports as being present in
any quantities are as follows:

1.       The fire proofing on the steel deck and structural beams between floors
         and above the ceiling line.

1.       The thermal insulation on pipes and equipment on the roof and basement
         level equipment rooms.

2.       The thermal insulation on pipes in the tenth (10th) floor equipment
         room.

3.       The thermal insulation on pipes located inside the wet columns
         throughout the Building.

4.       The adhesive mastic holding the corridor ceiling tiles substrate.

5.       Some of the vinyl floor tiles located throughout the Buildings.

The general procedures and handling restrictions necessary to minimize any
disturbance to, release of and exposure to the asbestos are:

1.       No work is to be performed above the suspended ceiling line of any
         floor without prior authorization from the Office of the Building.

2.       Access to any and all equipment rooms (including electrical and
         telephone rooms) is strictly prohibited, except to personnel authorized
         by the Office of the Building.

3.       No work is to be performed on vinyl floor tiles without prior
         authorization from the Office of the Building.

We have no special knowledge concerning the potential health risks or impacts
that may result from exposure to asbestos in the Buildings, but we understand
that potential health risks may exist if asbestos fibers are released from
asbestos containing construction materials. Those of your that may require
additional information of potential health risks are encouraged to contact
appropriate government agencies, including Federal and State OSHA, State Health
& Welfare Agency, State Department of Health Services and the County Health
Departments.

If there are any questions regarding this notice, please contact the Property
Manager at 3600 Wilshire Boulevard, Suite 800, Los Angeles, CA 90010.

                                                   Tenant           Landlord
                                              -s- [ILLEGIBLE]    -s- [ILLEGIBLE]

                                       38


                                    EXHIBIT G
                                PARKING AGREEMENT

So long as the lease dated JANUARY 17, 2003, 3600 WILSHIRE, LLC, A California
limited liability company, c/o JPB Partners, Inc., a California corporation,
("Landlord") and NARA BANK, NATIONAL ASSOCIATION, as ("Tenant") covering space
at 3600 Wilshire Blvd., SUITE 100A, Los Angeles, CA 90010 property commonly
known as Wilshire Financial Tower as (the "Property") remains in effect, and so
long as the Rules and Regulations adopted by Landlord are not violated, Tenant
or persons designated by Tenant, shall have the right to use on a month to month
basis FIFTY (50) parking spaces for Tenant's employee use in the Parking
Facilities associated with or forming a part of the Property. THREE (3) of above
allotted parking spaces shall be on a reserved basis. Additionally, Landlord
will provide TEN (10) reserved upper level parking spaces near the south
entrance of the building project for Tenant's visitors. Said parking spaces
shall be offered to Tenant at the building's prevailing parking rates subject to
applicable city, state, and federal taxes and assessments, if any, which amount
may be changed from time to time at Landlord's reasonable discretion. Tenant may
validate visitor parking at Landlord's prevailing rate. However, should Tenant
or Tenant's designee materially violate the Parking Rules and Regulations, the
right to the parking spaces granted in this Parking Agreement shall be subject
to cancellation by Landlord, in whole or in part, at any time upon not less than
thirty (30) days prior written notice, except where the Parking Rules and
Regulations provide for a shorter notice.

A condition of any parking shall be compliance by the driver with Parking Rules
and Regulations, including any sticker or other identification system
established by the parking operator. The following Parking Rules and Regulations
are currently in effect. Landlord reserves the right to modify and/or adopt such
other reasonable and nondiscriminatory Rules and Regulations for the Parking
Facilities as it deems necessary for the operation of the Parking Facilities.
The parking operator may refuse to admit any person who violates the Parking
Rules and Regulations ("Rules") to park in the Parking Facilities, and any
violation of the Rules shall subject the driver's car to removal from the
Parking Facilities. In either of said events the parking operator shall refund a
prorata portion of the current parking rate and the sticker or any other form of
identification shall be returned or caused to be returned by Tenant to the
parking operator.

Landlord expressly disclaims any responsibility for any theft of or vandalism or
damage to any personal property, including without limitation, any motor
vehicle, in, on, or about the Parking Facilities irrespective of cause,
circumstance, or parties involved. As a material inducement to Landlord to allow
Tenant the parking rights set forth herein, Tenant agrees to assume full
responsibility for the foregoing to the extent such relates to Tenant and/or
Tenant's employees, principals, agents, affiliates, and/or invitees, and Tenant
agrees to indemnify, defend and hold harmless Landlord for all costs, liability
and damages relating to or arising from the foregoing.

The occurrence of the following shall constitute a material default and breach
of the Lease to which this Parking Agreement is attached as Exhibit "F" and
shall entitle Landlord to exercise such remedies as are therein provided, in
addition to any other right or remedy which Landlord may have at law or in
equity by reason of such default or breach:

The failure of Tenant to make any payment required to be made by Tenant under
this Parking Agreement, where such failure continues until the earlier of (I)
five (5) days after the date on which such payment was due, or (II) three days
after written notice thereof has been given by Landlord to Tenant; or

The failure of Tenant to observe and perform any other provision of this Parking
Agreement to be observed or performed by Tenant, where such failure continues
for five (5) days after written notice thereof by Landlord to Tenant; provided,
however, that any such notice referred to in part; (b) hereof shall be in lieu
of and not in addition to any notice required under Section 1161 of the
California Code of Civil Procedure.

PARKING RULES AND REGULATIONS

Parking Facilities hours shall be as posted by management.

Cars must be parked entirely within the stall lines painted on the floor.

All directional signs and arrows must be observed.

The speed limit shall be 5 miles per hour.

Parking is prohibited in areas:
not striped for parking
aisles
where "no parking" signs are posted
ramps
in reserved spaces, except for the person for whom such space is reserved.

Parking stickers or any other device or form of identification supplied by the
parking operator shall remain the property of the parking operator. Such parking
identification device must be displayed in the front area of the interior of the
vehicle, or as requested, so that it may be readily observed by the parking
operator's attendants at all times while the vehicle is in the Parking
Facilities, and it may not be mutilated in any manner, and the serial number

                                                   Tenant           Landlord
                                              -s- [ILLEGIBLE]    -s- [ILLEGIBLE]

                                       39


of the parking identification device may not be obliterated. Devices are not
transferable and any device in the possession of an unauthorized holder will be
void.

The monthly rent for parking space is payable one (1) month in advance and must
be paid prior to the fifth day of each calendar month. Failure to do so will
automatically cancel parking privileges and a charge at the prevailing daily
parking rate plus a reinstatement fee of $25.00 will be due. No deductions or
allowances from the monthly rate will be made for time the customer does not use
Parking Facilities.

Parking managers or attendants are not authorized to make or allow any
exceptions to these Parking Rules and Regulations and these Parking Rules and
Regulations may be from time to time modified or amended.

Every driver is required to park his/her own car. If there are tandem spaces,
the first car shall pull all the way to the front of the space leaving room for
a second car to park behind the first car. The driver parking behind the first
car must leave his key in the ignition and the door of his car unlocked. Failure
to do so shall subject the driver of the second car to a $25.00 fine. Refusal of
the driver to leave his key to the second car when parking tandem shall be cause
for termination of the right to park in the Parking Facilities. The parking
operator, or his employees or agents, shall be authorized to move cars that are
parked in tandem should it be necessary for the operation of the Parking
Facilities. Tenant agrees that all responsibility for damage to cars or the
theft of or from cars is assumed by the driver, and further agrees that he/she
will hold Landlord harmless for any such damages or theft.

Loss or theft of parking identification stickers or devices from automobiles
must be reported to the parking operator immediately, and a lost or stolen
report must be filed by the customer at that time.

Any parking identification stickers or devices reported lost or stolen, found on
any unauthorized car will be confiscated and the illegal holder will be subject
to prosecution

Lost or stolen stickers or devices found by the purchaser must be reported to
the parking operator immediately.

Spaces rented are for the express purpose of parking automobiles and for no
other purpose. Washing, waxing, cleaning or servicing of any vehicle by the
customer and/or his agents is prohibited.

The parking operator reserves the right to refuse the sale of monthly stickers
to any tenant or person and/or his agents or representatives who willfully
refuse to comply with these Parking Rules and Regulations and all unposted City,
State or Federal ordinances, laws or agreements.

By signing this Parking Agreement, Tenant agrees to inform all persons to whom
tenant assigns parking space of the context of these Parking Rules and
Regulations.

LANDLORD:                                        TENANT:

3600 WILSHIRE, LLC, A California                 NARA BANK, National Association
limited liability company
By: JPB Partners, Inc., a California
corporation
Its: Manager                                     By: -s- BON T. GOO
                                                     ---------------------

By: -s- David Y. Lee, M.D.                       Print Name: BON T. GOO
    --------------------------
     David Y. Lee, M.D.                          Its: CFO & EVP
Its: President
                                                 Date: 2/6/03
Date: 2/7/03
                                                 By: -s-  MICHEL URICH
                                                     ---------------------

                                                 Print Name: MICHEL URICH

                                                 Its: Directors of Legal Affairs

                                                 Date: 2/6/03

                                                   Tenant           Landlord
                                              -s- [ILLEGIBLE]    -s- [ILLEGIBLE]

                                       40


                                   ADDENDUM I

         This Addendum I to Lease is made and entered into as of the JANUARY
17,2003 ("the Effective Date") by and between 3600 WILSHIRE, LLC A California
limited liability company, its Manager By: c/o JPB Partners, Inc., a California
corporation, ("Landlord") and NARA BANK, NATIONAL ASSOCIATION, as ("Tenant"). In
the event of a conflict between the Lease and this Addendum 1 to Lease, this
Addendum shall prevail.

1.       TENANT'S DUTIES TO MAINTAIN THE PREMISES: During the Lease Term, Tenant
agrees to maintain and keep clean at all times the interior and store front of
the Premises (including repair of plate glass and cleaning and maintenance of
the Plaza deck area where Tenant's enter and exit) at Tenant's sole cost and
expense and with a degree of workmanship reasonably acceptable to Landlord. Such
maintenance and cleaning of the store front glass shall be done by Tenant
periodically and Tenant shall maintain the metal trim around and between the
windows, doors and thresholds of the Premises at least once a month or as needed
during the Lease Term. Notwithstanding anything to the contrary herein, Tenant
agrees to repair or replace any damaged plate glass within Seven (7) business
days of occurrence. Tenant shall be responsible for painting the entire interior
of the premises every Five (5) years during the Lease term. Tenant agrees that
it shall use a contractor or contractors acceptable to Landlord and approved in
writing by Landlord for such maintenance and cleaning.

2.       PRIOR OCCUPANCY: Tenant shall be permitted to enter the Premises during
the Four (4) months period, from March 1, 2003 through June 30, 2003, prior to
the Commencement Date, for the purpose of constructing its Premises, installing
furniture, fixtures, equipment or other special leasehold improvements. Landlord
shall deliver the Premises to Tenant no later than February 28,2003 ready for
Tenant's construction.

3.       JANITORIAL AND PEST CONTROL: During the Lease Term, Tenant shall keep
and maintain the Premises in a clean and sanitary condition at all times as well
as providing adequate pest control on a monthly basis, or more often, if
necessary, at its sole cost and expense.

4.       UTILITIES AND SERVICES: Tenant shall be responsible for and shall pay
promptly all charges of water, gas, electricity, sewer, heat, light, power,
telephone, refuse pickup, janitorial service and all other utilities, materials
and services furnished directly or indirectly to the Premises during the term,
and any option periods exercised by Tenant. Separate meters will measure
Tenant's electrical and gas usage at the Premises. Tenant shall be responsible
at its own cost for the maintenance and repair of said separate meters. Tenant
shall at its own cost install or have installed on its behalf a separate meters
which shall measure Tenant's electrical and gas consumption at the Premises and
Tenant shall arrange with the local natural gas utility and electrical utility
company for Tenant to be billed directly for its gas and electrical consumption
at the Premises. Tenant shall be responsible for the maintenance and repair of
said separate meters. Tenant shall be responsible fir maintaining the Premises
in a clean and sanitary condition at all times, including but not limited to a
drain maintenance program by a certified licensed plumber as well as maintaining
a pest control system on a monthly basis, or more often, if required. The cost
of such is to be paid for by Tenant.

5.       TRASH DUMPSTER REMOVAL: Throughout the term of this Lease and any
extension hereof, at Tenant's sole cost and expense, Tenant shall contract with
an outside trash removal company to remove any and all trash generated by
Tenant. This vendor must have it on file, with the Landlord a certificate of
Insurance naming the Landlord and the Management Company as additional insured.
The Tenant further agrees that it will dispose of all garbage and refuse at
times and locations that Landlord specifies so as not to inconvenience or annoy
the tenants or visitors in the building of which the Premises form a part.
Tenant covenants and agrees that all garbage waiting collection shall be kept in
an adequately contained space within the Premises until such time as it is
actually disposed of. All trash must be kept in sealed, lockable containers so
as not to emit any odors or leakage and must be removed from the Premises once a
day. Tenant further covenants and agrees that it will wash and clean empty
refuse can in an area designated by Landlord.

6.       EXCLUSIVITY FOR GENERAL BANKING BUSINESS. Landlord hereby agrees that
Tenant and its operations shall be the exclusive banking entity on-site at the
Premises and/or project.

7.       SIGNAGE: Tenant shall not affix, paint, erect or inscribe any sign,
protection, awning, signal or advertisement of any kind to any part of the
Premises, Building or Project, including without limitation, the inside or
outside of windows or doors, without the prior written consent of Landlord.
Tenant shall be permitted to install signage at Tenant's cost and subject to
Landlord's consent, above its Premises along Wilshire Boulevard and any adjacent
street to its Premises. Signage rights shall be at no cost to Tenant, with
exception to cost of installation. Design shall be subject to Landlord and City
of Los Angeles approval Landlord shall have the right to remove any signs or
other matter installed without Landlord's permission, without being liable to
Tenant by reason of such removal, and to charge the cost of removal to Tenant as
additional Rent hereunder, payable within Ten (10) days of written demand by
Landlord. Tenant may utilize, letter style and graphics on all interior and
exterior (canopy) signage. Exterior signage shall be illuminated signage.
Landlord shall not unreasonably withhold its consent to Tenant's signs, which
conform, to Landlord's sign criteria and local sign ordinances. Said signage
shall be at Tenant's sole cost and expense and Tenant shall maintain signage in
good order and repair at all times at Tenant's sole cost and expense.

8.       TELEPONE AND COMMUNICATIONS: All private telephone and communications
systems must be installed in Tenant suite area. Special equipment shall not be
maintained in telephone terminal rooms.

                                                   Tenant           Landlord
                                              -s- [ILLEGIBLE]    -s- [ILLEGIBLE]

                                       41


9.       RISER CABLE: Landlord will maintain the telephone cable it has
installed inside the Property. Landlord, however, shall not be responsible for
interruption of service transmission, installation, and/or quality of intra-
building network of cable.

10.      PLUMBING REPAIRS: Landlord shall not be responsible for repair and
maintenance of any plumbing in the Premises such as sinks or kitchen facilities
in the suite. Tenant shall be responsible for cleaning, drain work that may be
necessary, repair of garbage disposal, and any other related costs to the extent
such costs are not covered by manufacturer or contractor warranties. Tenant
shall reimburse any costs incurred by Landlord for these items to Landlord.

11.      PLATE GLASS INSURANCE: During the entire term of the Lease, Tenant
shall maintain, at its own expense, an insurance policy covering all plate glass
and other glass in the premises which shall name Landlord as an additional
insured, and Tenant will deliver to Landlord such policy of insurance or
certificates therefore not less than Fifteen (15) days before the commencement
of the term of the Lease or before Tenant shall enter the Premises, whichever is
earlier, and will renew such policy and deliver such renewal policy to Landlord
not less than Fifteen (15) days before the expiration of the policy so renewed.
Should Tenant fail to deliver such insurance within the time aforesaid, Landlord
shall notify Tenant of Landlord's intention to procure such insurance. If Tenant
has not delivered evidence of such insurance within Ten (10) days following
receipt of such notice, Landlord may procure such insurance and pay the premiums
thereof, in which case, Tenant shall reimburse Landlord for the cost thereof as
additional rent on the first day of the calendar month following the receipt of
Landlord's evidence of payment thereof. Landlord shall have the same rights and
remedies in endorsing the payment of any such additional rent as in the case of
Tenant's failure to pay the rental herein reserved. Such plate glass insurance
shall be in an amount sufficient to replace all plate glass of like quality in
the Premises including the installation thereof.

12.      HVAC: Tenant acknowledges that the Premises has a separate air
conditioning system for after hours usage, which supplies the Premises
exclusively, and is under the care, custody and control of Tenant. Landlord
shall, prior to the Lease Commencement Date, service the HVAC units to make sure
they are in good working condition. Thereafter, Tenant shall be responsible for
all maintenance and repair costs or replacement relative to such systems
throughout the term of the Lease. Tenant shall keep and maintain the system in
good working order and repair throughout the term of the Lease, and Tenant shall
use contractors acceptable to Landlord for said maintenance, repair and/or
replacement.

13.      RENEWAL OPTIONS: Provided that no event of default has ever occurred
under any term or provision contained in this Lease and no condition exists
which with the passage of time or the giving of notice or both would constitute
an event of default pursuant to this lease and provided that Tenant has
continuously occupied the Premises for the permitted use during the Lease Term,
Tenant shall have the right and option (the "Renewal option") to renew this
Lease by written notice delivered to Landlord no later than Nine (9) months
prior to the expiration of the initial Lease Term, for Two (2) additional terms
(the renewal term) of Sixty (60) months under the same terms, conditions and
covenants contained in this Lease, except that: a) no abatements or other
concessions if any applicable to the initial Lease Term shall apply to the
Renewal Term: b) the Base Rental shall be equal to the Fair Market rate
including all applicable concessions for comparable space located in the
Building as of the end of the initial Lease Term or extended term: c) Tenant
shall have no option to renew this Lease beyond the expiration of the Renewal
Terms and the all leasehold improvements within the Premises shall be provided
in their then existing condition (on an "as is" basis) at the time the Renewal
Term commences. Failure by Tenant to notify Landlord in writing of Tenant's
election to exercise any Renewal Option herein granted within the time limits
set forth for such exercise shall constitute a waiver of such Renewal Option. In
the event Tenant elects to exercise the Renewal Option as set forth above,
Landlord shall within Thirty (30) days thereafter notify Tenant in writing of
the Proposed Rental for the Renewal Term (the "Proposed Renewal Rental" ).
Tenant shall within Thirty (30) days following delivery of the Proposed Renewal
Rental by Landlord notify Landlord in writing of the acceptance or rejection of
the Proposed Renewal Rental. If Tenant accepts Landlord's proposal, then the
Proposed Renewal Rental shall be the rental rate in effect during the Renewal
Term. Failure of Tenant to respond in writing during the aforementioned Thirty
(30) day period shall be deemed an acceptance by Tenant of the Proposed Renewal
Rental. Should Tenant reject Landlord's Proposed Renewal Rental during such
Thirty (30) day period, then Landlord and Tenant shall negotiate during the
Thirty (30) day period commencing upon Tenant's rejection of Landlord's Proposed
Renewal Rental to determine the rental for the Renewal Term.

14.      PRELIMINARY SPACE PLAN: Landlord to provide sixteen cents ($0.16) per
usable square foot. Said allowance is to pay for Tenant's space planner to
design a preliminary drawing of said space.

15.      MOVE-IN: The demised premises shall be thoroughly cleaned, at
Landlord's sole cost and expense, prior to the delivery of the Premises to
Tenant for construction.

16.      ABANDONMENT: Tenant shall not be in default for vacating the premises
so long as Tenant pays its rent per the Lease agreement and is not in default on
other provisions of this Lease.

         Upon exercise of Renewal Option by Tenant and subject to the conditions
set forth hereinabove, the Lease shall be extended for the period of such
Renewal Term without the necessity of the execution of any further instrument or
document, although if requested by either party, Landlord and Tenant shall enter
into a written agreement modifying and supplementing the Lease in accordance
with the provisions hereof. Any termination of the Lease during the initial
Lease Term shall terminate all renewal rights hereunder. The renewal rights of
Tenant hereunder shall not be severable from the Lease, nor may such rights be
assigned or otherwise conveyed in

                                                   Tenant           Landlord
                                              -s- [ILLEGIBLE]    -s- [ILLEGIBLE]

                                       42


connection with any permitted assignment of the Lease. Landlord's consent to any
assignment of the Lease shall not be construed as allowing an assignment of such
rights to any assignee.

         Except as amended herein, all other provisions of the Lease Agreement
remain in full force and effect. This Addendum I shall control in the event of
any inconsistency with the original lease. If Tenant shall be a corporation, the
authorized officers must sign on behalf of the corporation and indicate the
capacity in which they are signing.

LANDLORD:                                        TENANT:

3600 WILSHIRE, LLC, A California                 NARA BANK, National Association
limited liability company
By: JPB Partners, Inc., a California
corporation
Its: Manager                                     By: -s- BON T. GOO
                                                     ---------------------

By: -s- David Y. Lee, M.D.                       Print Name: BON T. GOO
    --------------------------
    David Y. Lee, M.D.                           Its: CFO & EVP
Its: President
                                                 Date: 2/6/03
Date: 2/7/03
                                                 By: -s- MICHEL URICH
                                                     ---------------------

                                                 Print Name: MICHEL URICH

                                                 Its: Director of Legal Affairs

                                                 Date: 2/6/03

                                                   Tenant           Landlord
                                              -s- [ILLEGIBLE]    -s- [ILLEGIBLE]

                                       43


                                ADDENDUM TO LEASE

                  This ADDENDUM TO LEASE (this "Addendum") is an addendum to and
part of that certain Lease dated January 17, 2003 (the "Lease") by and between
by and between 3600 Wilshire, LLC, a California limited liability company.
("Landlord") and Nara Bank, National Association ("Tenant").

         1.       Unless otherwise defined herein, all capitalized terms in this
Addendum shall have the meanings ascribed to them in the Lease. All references
herein to sections are to sections in the Lease.

         2.       The fourth line of Section 1.03 is amended to insert the words
"and Tenant's" after the word "Landlord's."

         3.       The first line of Section 1.10 is amended to delete "Banking
and Office" and to insert in its place and stead "banking, financial services,
insurance, general office or retail."

         4.       Section 1.10 is amended to add the following sentence at the
end of such section: "In the event of a conflict between the provisions of any
such rule or regulation and the provisions of this Lease (and all exhibits and
addenda attached hereto), the provisions of this Lease shall prevail and
control."

         5.       The third line of Section 1.11 is amended to insert the
following after "Thanksgiving Day": ", Martin Luther King, Jr.'s Birthday
(observed), Columbus Day, Veterans Day...."

         6.       Section 1.13 is amended to insert the following before the
period at the end of such section: "Attention: Branch Manager, with a copy to
3701 Wilshire Blvd., Second Floor, Los Angeles, CA 90019, Attention: Chief
Financial Officer."

         7.       A new Section 1.17 is inserted into the Lease, as follows:

                           1.17     BASE SHELL CONDITION. The term "Base Shell
                  Condition" shall mean the Premises, as modified by Landlord
                  upon the completion of the base building work to be performed
                  by Landlord as described in the Landlord's Work in Exhibit A
                  attached to the Addendum to Lease pursuasnt to which this
                  section is inserted into the Lease.

         8.       The first line of Section 2.01 is amended to insert the
following after "Lender hereby leases": "in Base Shell Condition, and inclusive
of all standard landlord representations and warranties, and with structural
integrity of the Building and the Premises".

         9.       Section 2.01 is amended to add the following at the end of
such section:

                  Tenant shall accept Landlord's tender of possession of the
                  Premises provided there are no material violations of
                  applicable laws (including, without limitation, hazardous
                  substances laws) other than as disclosed in the Asbestos
                  Notification attached hereto as Exhibit F and, Landlord shall,
                  at its sole cost and expense, shall cure any undisclosed
                  violations prior to delivering the Premises to Tenant for the
                  purpose of Tenant's performance of its portion of the tenant
                  improvement work.

                                       1


         10.      A new Section 2.03 is inserted into the Lease, as follows:

                  2.03     THIRD PARTY AGREEMENTS. Landlord represents and
warrants to Tenant that the leasing of the Premises and the execution of the
Lease by Landlord and Tenant does not cause a default under any lease, mortgage
or deed of trust affecting the Premises, or under any other agreement or
document to which Landlord is a party that affects the Building or the Premises

         11.      Section 3.01 is amended and restated in its entirety as
                  follows:

                           3.01     Except as otherwise provided in this Lease,
                  the Lease Term shall be for the period described in Section
                  1.04 of this Lease, commencing on the Commencement Date
                  described in Section 1.05 of this Lease and ending on the
                  Expiration Date described in Section 1.06 of this Lease;
                  provided, however, that, if, for any reason, Landlord is
                  unable to deliver possession of the Premises to Tenant in Base
                  Shell Condition on or before February 28, 2003, Landlord shall
                  not be liable for any damage caused thereby, nor shall the
                  Lease be void or voidable, but, rather, the Commencement Date
                  shall be extended by the same number of days as the number of
                  days between February 28, 2003 and the date that Landlord does
                  tender possession to Tenant of the Premises in Base Shell
                  Condition and, unless Landlord elects otherwise, the
                  Expiration Date described in Section 1.06 of this Lease shall
                  be extended by an equal number of days. NOTWITHSTANDING THE
                  FOREGOING, IF THE PREMISES ARE NOT DELIVERED IN BASE SHELL
                  CONDITION TO TENANT ON OR BEFORE APRIL 30,2003, TENANT MAY,
                  WITHIN THE FOLLOWING FIFTEEN (15) BUSINESS DAYS, AT ITS SOLE
                  OPTION, TERMINATE THIS LEASE AND HAVE NO LIABILITY TO LANDLORD
                  HEREUNDER OR THEREFOR.

         12.      Landlord and Tenant agree that the Lease is a modified gross
lease and that, accordingly, (a) Section 4.01(C) is hereby amended to delete in
their entirety the following subsections: (ix) - (xv) and (b) subsection (iii)
is amended and restated in its entirety as; follows: "(iii) Cleaning expenses,
including without limitation janitorial services and window cleaning.".

         13.      Section 4.02(B)(b), including its subsections (i) and (ii), is
deleted in its entirety. Landlord and Tenant agree that there shall be no
adjustment to rent based upon a consumer price index.

         14.      The first line of Section 4.03(B) is amended to delete "one
hundred twenty (120)" and to insert in its place and stead "ninety (90)".

         15.      The fourth line of the introductory paragraph of Section
4.04(A) is amended to delete "once" and to insert in its place and stead
"twice".

         16.      The first line of Section 4.04(A) is amended to delete "ten
(10)" and to insert in its place and stead "thirty (30)".

                                       2


         17.      The eighth line of Section 4.04(A) is amended to delete "once"
and to insert in its place and stead "twice".

         18.      The fourth line of Section 4.04(B) is amended to delete "of
national standing".

         19.      The sixth line of Section 4.04(B) is amended to insert the
following after "accountants": "legal counsel and real estate representatives
....."

         20.      The eighth line of Section 4.04(C) is amended to insert the
following after "Adjustment" and before the period that ends the sentence: ";
provided, however, that if the review occurs during the final year of the term
(or any renewal term) of this Lease, Landlord shall provide the refund within
sixty (60) days following the expiration of the term of this Lease".

         21.      Section 4.05 is amended to add the following sentence at the
end of such section: Notwithstanding any of the provisions of this section or
this Lease to the contrary, if a condition exists as a result of Landlord's
gross negligence or willful misconduct that injures, inconveniences or
interferes with Tenant's ability to conduct its business or that constitutes a
default hereunder and such condition persists for more than five (5) consecutive
business days or such other period as may be permitted by applicable law,
Tenantshall have the right to damages for such default and such other remedies
as may be permitted by this Lease and applicable law.

         22.      The seventh and eighth lines of Section 4.06 are amended to
delete "twelve percent (12%)" and insert in its place and stead "ten percent
(10%)".

         23.      A new Section 4.09 is added to the Lease, as follows:

                  Section 4.09 EFFECT OF PROPOSITION 13 REASSESSMENT.
                  Notwithstanding anything to the contrary herein, or any
                  actions taken by Landlord relating the to the Premises, if any
                  portion of the Premises is reassessed due to a "change in
                  ownership," "new construction," or other reassessment within
                  the meaning of Section XIIIA of the California Constitution (a
                  "Reassessment"), Tenant shall bear taxes attributable to such
                  Reassessment only to the extent such reassessment is due to a
                  modification of the Premises by Tenant. Nothing in this
                  section shall exempt Tenant from bearing its share of the
                  annual increases provided by applicable laws attributable to
                  the Premises which would be assessed regardless of the
                  occurrence of such a Reassessment.

         24.      Section 5.01 is deleted in its entirety.

         25.      Section 6.02(A) is hereby amended to delete "Tenant shall" and
insert in their place and stead: "Landlord and Tenant shall each have respective
responsibilities (allocated to each based upon the portion of the improvements
for which each is responsible to construct)".

         26.      THE LAST PARAGRAPH OF SECTION 7.01 IS DELETED IN ITS ENTIRETY.

         27.      The seventh line of Section 7.02 is amended to insert the
following after "Tenant" and before the period mat ends the sentence: ";
provided, however, if a condition exists as a result of

                                       3


Landlord's gross negligence or willful misconduct that injures, inconveniences
or interferes with Tenant's ability to conduct its business or that constitutes
a default hereunder and such condition persists for more than five (5)
consecutive business days or such other period as may be permitted by applicable
law, Tenantshall have the right to damages for such default and such other
remedies as may be permitted by this Lease and applicable law.

         28.      Section 8.01 is amended and restated, as follows:

                  8.01     LANDLORD'S OBLIGATIONS. Except as provided in
                  Sections 8.02 and 8.03 below, Landlord shall maintain the
                  Building in reasonable order and repair throughout the Lease
                  Term; provided, however, that Landlord shall not be liable for
                  any failure to make any repairs or to perform any maintenance
                  unless such failure shall persist for more than five (5)
                  business days after written notice of the need for such
                  repairs or maintenance is given to Landlord by Tenant, or such
                  greater period provided Landlord has commenced to cure, and
                  diligently pursues same to completion; provided, however, that
                  Tenant shall have the right to damages for such default and
                  such other remedies as may be permitted by this Lease and
                  applicable law.

         29.      The second line of Section 8.03 is amended to delete
"twenty-four (24)" and insert in its place and stead "forty-eight (48)".

         30.      Section 8.03 is amended to add the following at the end of
such section:

                  Notwithstanding any other provisions hereof to the contrary,
                  except in the case of emergency, Landlord shall enter the
                  Premises only during normal business hours following the
                  giving of forty-eight (48) hours notice (which shall be in
                  writing, unless notice is given to Tenant's Chief Financial
                  Officer or the branch manager on the Premises, either of whom
                  may request that any oral notice be confirmed with a written
                  notice) and Landlord shall be accompanied by a representative
                  of Tenant (except that such restrictions shall not apply on
                  such days as the Premises are not open for the conduct of
                  Tenant's business or in the event of an emergency, in which
                  cases Landlord shall make reasonable efforts to give oral
                  notice to Tenant's Chief Financial Officer or the branch
                  manager on the Premises). Furthermore, in the event of an
                  emergency, Landlord's representative shall enter the Premises
                  only with the accompaniment of the appropriate third-party
                  emergency response official from the Los Angeles Fire
                  Department, Los Angeles Police Department, or other
                  appropriate governmental agency. All such entries shall be in
                  conformance with all applicable federal and state laws and
                  regulations.

         31.      Section 9.01 is amended to add the following at the end of
such section:

                  Landlord's approval shall not be required for any Alteration
                  that costs Tenant $20,000.00 or less (but Tenant shall provide
                  reasonable prior written notice of Tenant's intent to make or
                  permit to be made any such Alteration) unless such Alteration
                  causes or requires modification of any of Landlord's service
                  systems or affects the structural integrity of the Premises.
                  Further, if Landlord's approval is required by any provision
                  of this section, such approval shall be provided within thirty
                  (30) days after Tenant's request therefor, and such

                                       4



                  approval shall not be unreasonably conditioned, withheld or
                  delayed.

         32.      Section 9.02 is amended to add the following at the end of
such section:

                  If any Alteration requires Landlord to enter the Premises,
                  such entry shall be subject to the requirements of the last
                  sentence of Section 8.03.

         33.      A new Section 9.05 is added to the Lease, as follows:

                          9.05     Tenant shall be responsible for the
                  installation of its vault and an automated teller machine ("
                  ATM") within the [Building lobby or the Premises] in
                  accordance with the provisions of this Article IX and such
                  improvements shall be subject to the provisions of this
                  Section 9; provided, however, that Tenant shall remove the ATM
                  within thirty (30) days following the expiration of the Lease,
                  subject to extension if necessary to satisfy all applicable
                  laws. Reasonable security for the use and operation of the
                  vault and the ATM shall be provided by Landlord throughout the
                  term of the Lease. Landlord shall have no duties to increase
                  spending on the security service as a result of the presence
                  of the ATM and the vault in the Premises, but the security
                  provided by Landlord for the Premises, as generally provided
                  for herein, shall include the ATM and the vault area (but
                  Tenant acknowledges that because the vault is within the
                  Premises, the Building's security guard cannot enter the
                  Premises). Landlord and Tenant shall use their best efforts to
                  approve a commercially reasonable location for Tenant's ATM,
                  which approval shall not be unreasonably conditioned, withheld
                  or delayed.

         34.      Section 10.01(A) is amended and restated in its entirety as
follows:

                           (A)      Tenant agrees to protect, indemnify, hold
                  harmless and defend Landlord and any Successor Landlord (as
                  defined below) from and against any and all loss, cost,
                  damage, liability or expense, including reasonable attorneys'
                  fees, with respect to any claim of damage or injury to persons
                  or property at the Premises, caused by the gross negligence or
                  willful misconduct of Tenant or its authorized agents or
                  employees.

         35.      Section 10.01(B) is amended and restated in its entirety as
follows:

                           (A)      Landlord agrees to protect, indemnify, hold
                  harmless and defend Tenant from and against any and all loss,
                  cost, damage, liability or expense, including reasonable
                  attorneys' fees, with respect to any claim of damage or injury
                  to persons or property at the Premises, caused by the gross
                  negligence or willful misconduct of Landlord or its authorized
                  agents or employees.

         36.      Section 10.06 is amended to add the following at the end of
such section:

                  The waivers contained in this Section 10.06 shall not apply to
                  any injury or loss caused by Tenant's or Landlord's gross
                  negligence or willful misconduct.

                                       5


         37.      The first line of Section 11.02 is amended to insert the
following after "If: "25% or more of.

         38.      The first line of Section 11.02 is amended 10 insert the
following after "and": "Tenant elect not to repair".

         39.      The second line of Section 11.02 is amended to insert the
following before "opinion": "reasonable".

         40.      Section 11.04 is deleted in its entirety.

         41.      The fourth line of Section 12.01 is amended to insert the
following after "premises": "on the ground floor of the Building".

         42.      The first line of Section 12.02 is amended to insert the
following after "award": ", unless otherwise specified that the amount awarded
is to be shared between Tenant and Landlord for Tenant's relocation and
improvement costs".

         43.      The eighteenth line of Section 14.01 is amended to delete
"twenty (20) days" and insert in its place and stead "ten (10) business days".

         44.      Section 14.01 is amended to add the following at the end of
such section:

                  Notwithstanding any of the provisions of this section or this
                  Lease to the contrary, any change of ownership of Tenant due
                  to merger of Tenant into, or acquisition of Tenant by, another
                  financial institution shall not be deemed an assignment or
                  sublease for purposes of this Lease. Further, if Landlord's
                  approval is required by any provision of this section, such
                  approval shall not be unreasonably conditioned, withheld or
                  delayed.

         45.      The third and fourth lines of Section 14.02 are amended to
delete "in connection with Tenant's request for Landlord's consent" and insert
in its place and stead "a notice containing".

         46.      The first line of Section 14.03 is amended to delete "twenty
(20) business days" and to insert in its place and stead "fifteen (15) business
days".

         47.      The eighth line of Section 14.03 is amended to delete "twenty
(20) day period" and to insert in its place and stead "fifteen (15) business day
period".

         48.      Section 14,03 is amended to add the following at the end of
such section:

                  Landlord acknowledges that notwithstanding any of the
                  provisions of this section, (i) Landlord shall have no
                  recapture rights in the event of any change of ownership of
                  Tenant due to merger of Tenant into, or acquisition of Tenant
                  by, another financial institution (and that any such event
                  shall not be deemed an assignment or sublease, as provided in
                  Section 14.01) and (ii) the recapture process, including,
                  without limitation, timing requirements, shall be subject to
                  all applicable federal and state regulatory

                                       6


                  requirements.

         50.      The second line of Section 15.01(A) is hereby amended insert
the following before the period at the end of such section: "or within five days
following when such payment is due".

         51.      Section 15.01 (D) is amended and restated in its entirety as
follows:

                           (D)      The failure by Tenant to observe or perform
                  any other provision of this Lease to be observed or performed
                  by Tenant, other than those described in Sections 15.01(A),
                  15.01(B) or 15.01 (C) above, shall constitute a default by
                  Tenant under this Lease only if such failure shall continue
                  for a period of thirty (30) days (or the additional time, if
                  any, that is reasonably necessary to promptly and diligently
                  cure the failure) after Tenant receives written notice from
                  Landlord specifying the default. The notice shall give in
                  reasonable detail the nature and extent of the failure and
                  shall identify the Lease provision(s) containing the
                  obligation(s). If Tenant shall default in the performance of
                  any of its obligations under this Lease (after notice and
                  opportunity to cure as provided herein), Landlord may pursue
                  any remedies available to it under the law and this Lease,
                  except that, in no event, shall Tenant be liable for punitive
                  damages, lost profits, business interruption, speculative,
                  consequential or other such damages.

         52.      Section 15.01(E) is hereby amended to delete each occurrence
of the phrase "or its Guarantor".

         53.      The third, sixth, seventh and eighth lines of Section 15.01(E)
are hereby amended to delete "thirty (30)" and to insert in its place and stead
"ninety (90)".

         54.      The second line of Section 15.01 (F) is hereby amended to
delete " or any Guarantor".

         55.      The introductory paragraph to Section 15.02 is amended and
restated in its entirety as follows:

                           15.02    LANDLORD'S RIGHT TO TERMINATE UPON TENANT
                  DEFAULT. In the event of any default by Tenant as provided in
                  Section 15.01 above, Landlord shall have the right to
                  terminate this Lease and recover possession of the Premises by
                  giving written notice to Tenant of Landlord's election to
                  terminate this Lease, in which event Landlord shall be
                  entitled to receive from Tenant, as provided in California
                  Civil Code Section 1951.2:

         56.      Section 15.04 is amended and restated in its entirety as
follows:

                           15.04    LANDLORD'S RIGHT TO CONTINUE LEASE UPON
                  TENANT DEFAULT. In the event of a default of this Lease and
                  abandonment of the Premises by Tenant, if Landlord does not
                  elect to terminate this Lease as provided in Section 15.02
                  above, (a) Landlord may from time to time, without terminating
                  this Lease, enforce all of its rights and remedies under this
                  Lease and (b) notwithstanding the timing requirements of
                  Section 14.02 above (i) Tenant may assign or sublet its
                  interest in the Premises by giving ten (10) days notice of the
                  proposed assignment or sublease and submitting the information
                  and

                                       7


                  documents required by Section 14.02 above and (ii) Landlord
                  shall, within twenty (20) business days after Landlord's
                  receipt of all of the information and documents required by
                  Section 14.02 above, approve or disapprove the proposed
                  assignment or sublease (with approval by Landlord not being
                  unreasonably withheld) or exercise its recapture rights under
                  Section 14.03 above. Without limiting the foregoing, Landlord
                  has the remedy described in California Civil Code Section
                  1951.4 (Landlord may continue this Lease in effect after
                  Tenant's default and abandonment and recover Rent as it
                  becomes due, if Tenant has the right to Transfer, subject to
                  reasonable limitations). In the event Landlord re-lets the
                  Premises, to the fullest extent permitted by law, the proceeds
                  of any reletting shall be applied first to pay to Landlord all
                  costs and expenses of such reletting (including without
                  limitation, costs and expenses of retaking or repossessing the
                  Premises, removing persons and property therefrom, securing
                  new tenants, including expenses for redecoration, alterations
                  and other costs in connection with preparing the Premises for
                  the new tenant, and if Landlord shall maintain and operate the
                  Premises, the costs thereof) and receivers' fees incurred in
                  connection with the appointment of and performance by a
                  receiver to protect the Premises and Landlord's interest under
                  this Lease and any necessary or reasonable alterations;
                  second, to the payment of any indebtedness of Tenant to
                  Landlord other than Rent due and unpaid hereunder; third, to
                  the payment of Rent due and unpaid hereunder; and the residue,
                  if any, shall be held by Landlord and applied in payment of
                  other or future obligations of Tenant to Landlord as the same
                  may become due and payable, and Tenant shall not be entitled
                  to receive any portion of such revenue.

         57.      Section 15.05 is amended and restated in its entirety as
follows:

                           15.05    RIGHT OF LANDLORD TO PERFORM. All covenants
                  and agreements to be performed by Tenant under this Lease
                  shall be performed by Tenant at Tenant's sole cost and
                  expense. If Tenant shall fail to pay any sum of money, other
                  than Rent, required to be paid by it hereunder or shall fail
                  to perform any other act on its part to be performed
                  hereunder, Landlord may, but shall not be obligated to, make
                  any payment or perform any such other act on Tenant's part to
                  be made or performed, without waiving or releasing Tenant of
                  its obligations under this Lease. Any sums so paid by Landlord
                  and all necessary incidental costs (including, without
                  limitation, reasonable attorneys fees), together with interest
                  thereon at the lesser of the maximum rate permitted by law if
                  any or eight percent (8%) per annum from the date of such
                  payment, shall be payable to Landlord as additional rent on
                  demand and Landlord shall have the same rights and remedies in
                  the event of nonpayment as in the case of default by Tenant in
                  the payment of Rent. If Tenant successfully disputes any sums
                  paid by Landlord pursuant to this Section, Tenant shall be
                  entitled to recover any and all such sums paid by Tenant to
                  Landlord pursuant to this Section, including any and all
                  interest, and shall be entitled to payment of its costs and
                  attorneys fees and other amounts recoverable under this Lease
                  by Tenant as the prevailing party in such dispute.

         58.      The first line of Section 15.02(D) is amended to insert the
                  following after "other": "reasonable".

         59.      Section 15.06 is deleted in its entirety.

                                       8


         60.      Section 17.01 and Section 17.02 are amended and restated in
their entirety as follows:

                           17.01    SUBORDINATION. This Lease, and the rights of
                  Tenant hereunder, are and shall be subject and subordinate to
                  the interest of (i) all present and future ground leases and
                  master leases of all or any part of the Building; (ii) present
                  and future mortgages and deeds of trust encumbering all or any
                  part of the Building; (iii) all past and future advances made
                  under any such mortgages or deeds of trust; and (iv) all
                  renewals, modifications, replacements and extensions of any
                  such ground leases, master leases, mortgages and deeds of
                  trust; provided, however, that as a condition precedent to
                  Tenant's subordination of this Lease, Landlord shall obtain
                  nondisturbance and attornment agreements in commercially
                  reasonable form from the landlord under any such ground lease
                  or master lease and from the holders of any such mortgages and
                  deeds of trust, as applicable. Further, any lessor under any
                  such ground lease or master lease or any mortgagee or
                  beneficiary under any such mortgage or deed of trust (any such
                  lessor, mortgagee or beneficiary is hereinafter referred to as
                  a "Mortgagee") shall have the right to elect, by written
                  notice given to Tenant, to have this Lease made superior in
                  whole or in part to any such ground lease, master lease,
                  mortgage or deed of trust (or subject and subordinate to such
                  ground lease, master lease, mortgage or deed of trust but
                  superior to any junior mortgage or junior deed of trust). Upon
                  demand, Tenant shall execute, acknowledge and deliver any
                  instruments reasonably requested by Landlord or any such
                  Mortgagee to effect the purposes of this Section 17.01. Such
                  instruments may contain, among other things, provisions to the
                  effect that such Mortgagee (hereafter, for the purposes of
                  this Section 17.01, a "Successor Landlord") shall (i) not be
                  liable for any act or omission of Landlord or its
                  predecessors, if any, prior to the date of such Successor
                  Landlord's succession to Landlord's interest under this
                  Lease;; and (ii) be entitled to receive notice of any Landlord
                  default under this Lease plus a reasonable opportunity to cure
                  such default prior to Tenant having any right or ability to
                  terminate this Lease as a result of such Landlord default..
                  Any obligations of any Successor Landlord under its respective
                  lease shall be non-recourse as 1o any assets of such Successor
                  Landlord other than its interest in the Premises and
                  improvements.

                           17.2     ATTORNMENT. If the interests of Landlord
                  under the Lease shall be transferred to any superior Mortgagee
                  or other purchaser or person taking title to the Building by
                  reason of the termination of any superior lease or the
                  foreclosure of any superior mortgage or deed of trust, and if
                  such superior Mortgagee or other purchaser or person taking
                  title to the Building shall not disturb Tenant, Tenant shall
                  be bound to such Successor Landlord under all of the terms,
                  covenants and conditions of the Lease for the balance of the
                  term thereof remaining and any extensions or renewals thereof
                  which may be effected in accordance with any option therefor
                  in the Lease, with the same force and effect as if Successor
                  Landlord were the landlord under the Lease, and Tenant shall
                  attorn to and recognize as Tenant's landlord under this Lease
                  such Successor Landlord, as its landlord, said attornment to
                  be effective and self-operative without the execution of any
                  further instruments upon Successor Landlord's succeeding to
                  the interest of Landlord under the Lease. Tenant shall, upon
                  demand, execute any documents reasonably requested by any such
                  person to evidence the attornment described in this Section
                  17.02.

                                       9


                  Concurrently, upon written request from Tenant, and provided
                  Tenant is not in default under this Lease, Landlord agrees to
                  use diligent, commercially reasonable efforts to obtain a
                  commercially reasonable Non-Disturbance Agreement from the
                  Successor Landlord. Such Non-Disturbance Agreement may be
                  embodied in the Mortgagee's customary form of Subordination
                  and Non-Disturbance Agreement if such form is commercially
                  reasonable. If, after exerting diligent, commercially
                  reasonable efforts, Landlord is unable to obtain a
                  Non-Disturbance Agreement from any such Mortgagee, Landlord
                  shall have no further obligation to Tenant with respect
                  thereto.

         61.      The fifth and seventh lines of Section 17.03 are hereby
amended to delete " twenty (20)" and to insert in its place and stead "thirty
(30)".

         62.      Section 21.01 is amended and restated in its entirety as
follows:

                           21.01    Landlord may enter the Premises during
                  normal business hours following the giving of forty-eight (48)
                  hours notice (which shall be in writing, unless notice is
                  given to Tenant's Chief Financial Officer or the branch
                  manager on the Premises, either of whom may request that any
                  oral notice be confirmed with a written notice) and Landlord
                  shall be accompanied by a representative of Tenant (except
                  that such restrictions shall not apply on such days as the
                  Premises are not open for the conduct of Tenant's business or
                  in the event of an emergency) to: inspect the same; exhibit
                  the same to prospective purchasers, Mortgagees or tenants;
                  determine whether Tenant is complying with all of its
                  obligations under this Lease; post notices of
                  non-responsibility; and make repairs or improvements in or to
                  the Building or the Premises; provided, however, that all such
                  work shall be done as promptly as reasonably possible and so
                  as to cause as little interference to Tenant as reasonably
                  possible. Tenant hereby waives any claim for damages for any
                  injury or inconvenience to, or interference with, Tenant's
                  business, any loss of occupancy or quiet enjoyment of the
                  Premises or any other loss on or about the Premises (excluding
                  Tenant's vaults, safes and similar areas designated by Tenant
                  in writing in advance) resulting from such entry (except if
                  such damages are the result of Landlord's gross negligence or
                  willful misconduct). In the event of an emergency, Landlord
                  shall make reasonable efforts to give oral notice to Tenant's
                  Chief Financial Officer or the branch manager on the Premises
                  and Landlord shall have the right to use any and all means by
                  which Landlord may deem proper to open such doors to obtain
                  entry to the Premises, and any entry to the Premises obtained
                  by Landlord by any such means, or otherwise, shall not under
                  any circumstances be deemed or construed to be a forcible or
                  unlawful entry into or a detainer of the Premises or an
                  eviction, actual or constructive, of Tenant from any part of
                  the Premises. Furthermore, in the event of an emergency,
                  Landlord's representative shall enter the Premises only with
                  the accompaniment of the appropriate third-party emergency
                  response official from the Los Angeles Fire Department, Los
                  Angeles Police Department, or other appropriate governmental
                  agency. All such entries shall be in conformance with all
                  applicable federal and state laws and regulations. An
                  emergency entry by Landlord shall not act as a termination of
                  Tenant's duties under this Lease. IF LANDLORD SHALL BE
                  REQUIRED TO OBTAIN ENTRY BY MEANS OTHER THAN A KEY PROVIDED BY
                  TENANT, THE COST OF SUCH ENTRY SHALL BY PAYABLE BY TENANT.

                                       10


         63.      Section 22.01 and Section 22.02 are amended and restated in
their entirety as follows:

                           22.1     LANDLORD'S LEASE UNDERTAKINGS.
                  Notwithstanding anything to the contrary contained in this
                  Lease or in any exhibits, Riders or addenda hereto attached
                  (collectively the "Lease Documents'"), it is expressly
                  understood and agreed by and between the parties hereto that:
                  (a) the recourse of Tenant or its successors or assigns
                  against Landlord with respect to the alleged breach by or on
                  the part of Landlord of any representation, warranty,
                  covenant, undertaking or agreement contained in any of the
                  Lease Documents or otherwise arising out of Tenant's use of
                  the Premises or the Building (collectively, "Landlord's Lease
                  Undertakings") shall extend only to an amount equal to the
                  value of Landlord's interest in the real estate of which the
                  Premises demised under the Lease Documents are a part
                  ("Landlord's Real Estate") and not to any other assets of
                  Landlord or its officers, directors or shareholders; and (b)
                  except for an amount equal to to the value of Landlord's
                  interest in Landlord's Real Estate, no personal liability or
                  personal responsibility of any sort with respect to any of
                  Landlord's Lease Undertakings or any alleged breach thereof is
                  assumed by, or shall at any time be asserted or enforceable
                  against, Landlord, or against any of their respective
                  directors, officers, employees, agents, constituent partners,
                  beneficiaries, trustees or representatives.

                           22.2     TRANSFER OF LANDLORD'S INTEREST. In the
                  event of any transfer of Landlord's interest in the Building,
                  Landlord shall be automatically freed and relieved from all
                  applicable liability (unless the occurrence upon which the
                  claim of liability is based occurred prior to the transfer)
                  with respect to performance of any covenant or obligation on
                  the part of Landlord, provided any deposits or advance rents
                  held by Landlord are turned over to the grantee and said
                  grantee expressly assumes, subject to the limitations of this
                  Section 22, all the terms, covenants and conditions of this
                  Lease to be performed on the part of Landlord, including all
                  liability for performance of any covenant or obligation from
                  which Landlord is released pursuant to this Section.

         64.      The fourth line of Section 23.01 is hereby amended to delete "
Two hundred percent (200%) and to insert in its place and stead One hundred
fifty percent (150%)".

         65.      The fourth line of Section 26.01 is hereby amended to delete
"may be conditioned as required by Landlord" and to insert the following in its
place and stead: "shall not be unreasonably conditioned, delayed or withheld".

         66.      Section 26.01 is amended to add the following at the end of
such section:

                  In the event that Tenant requires access to or space on the
                  top of the roof of the Building in connection with the
                  activities contemplated in this section in connection with
                  Lines, or elsewhere outside the Premises, then subject to
                  availability and the rights of any tenants under leases
                  executed before this Lease, Tenant shall provide plans or
                  specifications, as applicable, for such activities and request
                  Landlord's approval for such access, which

                                       11


                  approval shall not be unreasonably conditioned, delayed or
                  withheld. Such access shall not be denied if it will not be
                  disruptive to the Building's communications systems or cause
                  undue risk to Landlord or other Tenants of the Building.
                  Tenant shall pay to Landlord such fees as are reasonable
                  (which reasonableness shall be determined by comparison to the
                  fees charged by comparable buildings in the area) for such
                  access and use of the Building's rooftop and the Premises'
                  rooftop. Tenant's right to access and use of the Building's
                  rooftop and Premises' rooftop is subject to the rights of
                  other tenants in the Building whose leases existed prior to
                  the date of this Lease.

         67.      Section 26.04 is amended to add the following before the
period at the end of such section:

                  except to the extent that such Line Problems are caused by
                  Landlord's gross negligence or willful misconduct

         68.      Section 26.05 is amended to add the following before the
period at the end of such section:

                  "Reasonable notice" of an interruption or turning off of the
                  Electronic Services facilities shall be forty-eight (48) hours
                  prior notice, except in the case of emergencies, in which
                  event Landlord shall give to Tenant as much notice as is
                  reasonably possible. In addition, Landlord shall use its best
                  efforts to schedule any such interruptions for times other
                  than Tenant's business hours.

         69.      Section 26.07 is amended to add the following at the end of
such section:

                  Notwithstanding any of the provisions of this section.
                  Landlord agrees that Tenant will provide to Landlord a list of
                  Electronic Service Providers customarily used by Tenant and
                  that Landlord will not unreasonably condition, delay or
                  withhold its approval thereof and that further, in the event
                  that Landlord does withhold its approval, Landlord and Tenant
                  will meet to discuss and resolve in good faith Landlord's
                  objections.

         70.      Section 26.09 is amended and restated as follows:

                           26.09    INSTALLATION AND USE OF WIRELESS
                  TECHNOLOGIES. Tenant may utilize any wireless Electronic
                  Services equipment (including the usual and customary cellular
                  telephones), including antennae and satellite receiver dishes,
                  within the Tenant's premises, within the Building or attached
                  to the outside walls or roof of the Building, without
                  Landlord's prior written consent unless such equipment
                  adversely affects the Building or the conduct of business by
                  other tenants of the Building.

         71.      [INTENTIONALLY OMITTED.]

         72.      Section 28.04 is amended and restated in its entirety as
follows:

                           28.04    FORCE MAJEURE. Landlord and Tenant shall
                  incur no liability to each other with respect to, and shall
                  not be responsible for any failure to perform, any of their
                  obligations hereunder if such failure is caused by any reason
                  beyond the control of the

                                       12


                  party having the obligation, including, but not limited to,
                  strike, labor trouble, governmental rule, regulations,
                  ordinance, statute or interpretation, or by fire, earthquake,
                  civil commotion, or failure or disruption of utility services.
                  The amount of time for the party having such obligation to
                  perform any such shall be extended by the amount of time such
                  party is delayed in performing such obligation by reason of
                  any force majeure occurrence whether similar to or different
                  from the foregoing types of occurrences.

         73.      Section 28.06 is amended and restated in its entirety as
follows:

                           28,06    Light AND AIR. No diminution or shutting off
                  of any light, air or view by any structure erected or modified
                  by a third party, whether now or hereafter erected shall in
                  any manner affect this Lease or the obligations of Tenant
                  hereunder, or increase any of the obligations of Landlord
                  hereunder. Landlord shall not, however, by its acts or the
                  acts of its employees, agents, contractors or representatives,
                  cause any diminution or shutting off of any light, air or view
                  of Tenant or the view of any persons outside the Building of
                  the Building or any of Tenant's signs on the Building.

         74.      Section 28.07 is amended to add the following at the end of
such section:

                  LANDLORD AND TENANT EACH WAIVE ANY RIGHT TO A TRIAL BY JURY IN
                  ANY ACTION OR PROCEEDING TO ENFORCE OR DEFEND ANY RIGHTS UNDER
                  THIS LEASE OR UNDER ANY AMENDMENT, INSTRUMENT, DOCUMENT OR
                  AGREEMENT DELIVERED OR WHICH MAY IN THE FUTURE BE DELIVERED IN
                  CONNECTION HEREWITH AND AGREE THAT ANY SUCH ACTION OR
                  PROCEEDING SHALL BE TRIED BEFORE A COURT AND NOT A JURY.

         75.      Section 28.19 is amended to add the following at the end of
such section:

                  Notwithstanding any of the provisions of this section, Tenant
                  may, in its sole discretion, (a) install, affix and maintain
                  signs pertaining to advertising or marketing campaigns of
                  Tenant within the Premises without the consent of Landlord;
                  (b) install signs on, and have exclusive signage rights to all
                  sides of the exterior of the Premises, and (c) install,
                  operate and maintain security systems within the Premises
                  without the consent of Landlord; provided, however, that if
                  any signs or security systems affect or require modification
                  of any of the Building's systems, Landlord's prior consent
                  shall be required, which consent shall not be unreasonably
                  conditioned, withheld or delayed.

         76.      The first line of the fourth paragraph of Section 1 of the
portion of the Work Letter Agreement attached to the Lease as Exhibit B
[Landlord Performs Work] [Minor Work Only] is hereby amended (a) to delete
"Work" and insert "the portion of the Work necessary to deliver the Premises to
Tenant in Base Shell Condition" and (b) to delete "Commencement Date" and insert
in its place and stead "February 28, 2003".

         77.      The first line of the subsection (a) of Section 2 of the
portion of the Work Letter Agreement attached to the Lease as Exhibit B [Tenant
Performs Work] is hereby amended to delete

                                       13


"February 14, 2003" and insert in its place and stead "February 28, 2003".

         78.      Subsection (a)(iii) of Section 2 of the portion of the Work
Letter Agreement attached to the Lease as Exhibit B [Tenant Performs Work] is
hereby amended and restated in its entirety as follows:

                           (iii)    Tenant shall provide Landlord financial
                  statements as proof of its ability to pay the cost of the Work
                  as and when payments become due.

         79.      Subsection (a)(iv) of Section 2 of the portion of the Work
Letter Agreement attached to the Lease as Exhibit B [Tenant Performs Work] is
hereby amended to add the following at the end of such subsection:

                  Tenant shall submit to Landlord a list of proposed vendors for
         Landlord's approval, which shall not be unreasonably withheld,
         conditioned or delayed.

         80.      The fifteenth and sixteenth lines of subsection (b) of Section
2 of the portion of the Work Letter Agreement attached to the Lease as Exhibit B
[Tenant Performs Work] is hereby amended to delete therefrom "or the Work is
prohibited by any mortgage or trust deed encumbering the Building".

         81.      The eighteenth line of subsection (b) of Section 2 of the
portion of the Work Letter Agreement attached to the Lease as Exhibit B [Tenant
Performs Work] is hereby amended to delete "three (3)" and insert in its place
and stead "seven (7)".

         82.      Subsection (c)(iii) of Section 2 of the portion of the Work
Letter Agreement attached to the Lease as Exhibit B [Tenant Performs Work] is
hereby deleted in its entirety.

         83.      The first line of Section 5 of the portion of the Work Letter
Agreement attached to the Lease as Exhibit B [Tenant Performs Work] is hereby
amended to delete "All changes" and to insert in its place and stead "All
material changes".

         84.      The second, third and fourth lines of Section 6(e) of the
portion of the Work Letter Agreement attached to the Lease as Exhibit B [Tenant
Performs Work] are hereby amended to delete "in a good and workmanlike manner"
and the remainder of such section and to insert in its place and stead "in a
good and workmanlike manner, using first class commercial materials".

         85.      The third line of Section 6(g) of the portion of the Work
Letter Agreement attached to the Lease as Exhibit B [Tenant Performs Work] is
hereby amended to delete "from the building" and to insert in its place and
stead "from the building provided that Landlord has provided to Tenant written
notice and the opportunity to cure within five (5) business days".

         86.      The third line of Section 6(h) of the portion of the Work
Letter Agreement attached to the Lease as Exhibit B [Tenant Performs Work] is
hereby amended to delete "standard rates then in effect" and to insert in its
place and stead "actual cost plus an administrative fee of 7% of mat cost".

                                       14


         87.      The fourth and fifth lines of Section 6(h) of the portion of
the Work Letter Agreement attached to the Lease as Exhibit B [Tenant Performs
Work] is hereby amended to delete in its entirety the sentence beginning with
"Tenant shall pay".

         88.      Section 6(i) of the portion of the Work Letter Agreement
attached to the Lease as Exhibit B [Tenant Performs Work] is hereby amended to
add the following before the period at the end of such section:

                  ", provided that Landlord's review dues not materially
                  interfere or cause any delay of Tenant's work on the
                  Premises."

         89.      The second line of Section 6(J) of the portion of the Work
Letter Agreement attached to the Lease as Exhibit B [Tenant Performs Work] is
hereby amended to delete "twenty-one (21) days" and to insert in its place and
stead "four (4) months".

         90.      The first line of Section 6(k) of the portion of the Work
Letter Agreement attached to the Lease as Exhibit B [Tenant Performs Work] is
hereby amended to delete "have no authority to" and to insert in its place and
stead "shall not materially".

         91.      The first line of Section 6(L) of the portion of the Work
Letter Agreement attached to the Lease as Exhibit B [Tenant Performs Work] is
hereby amended to insert "at it sole cost and expense" after "ran".

         92.      The ninth line of Section 7(b) is hereby amended to insert the
following after "others" and before the period:

                  ; provided, however, that Tenant shall have no obligation to
                  indemnify, protect, defend or hold harmless Landlord, the
                  parties listed, or required by, the Lease to be named as
                  additionally-insured, Landlord's contractors, Landlord's
                  architects, or their respective beneficiaries, partners,
                  directors, officers, employees and agents, from and against
                  any claims, liabilities, losses, damages and expenses of
                  whatever nature arising out any of such parties' gross
                  negligence or willful misconduct.

         93.      Section 9 of the portion of the Work Letter Agreement attached
to the Lease as Exhibit B [Tenant Performs Work] is hereby deleted in its
entirety.

         94.      The third line of subsection (f) of Section 10 of the portion
of the Work Letter Agreement attached to the Lease as Exhibit B [Tenant Performs
Work] is hereby amended to delete "and enforceable solely against" and insert
the following in its place and stead "an amount equal to the value of".

         95.      The second sentence of Section 11 of the portion of the Work
Letter Agreement attached to the Lease as Exhibit B [Tenant Performs Work] is
deleted in its entirety.

         96.      [INTENTIONALLY OMITTED.]

                                       15


         97.      Section 2 of the Rules and Regulations attached to the Lease
as Exhibit C is amended to add the following at the end of such section:

                  Notwithstanding the other provisions of this section, Tenant
                  may attach promotional and marketing materials within the
                  Premises and in the windows of the Premises provided that such
                  materials do not damage the Premises or materially disrupt
                  Landlord's operation and maintenance of the Building or the
                  conduct of the business of other tenants of the Building.

         98.      The first line of Section 6 of the Rules and Regulations
attached to the Lease as Exhibit C is amended to add the following after
"Premises": "except as reasonably necessary to accommodate the special needs of
customers of Tenant who or disabled or handicapped, which exceptions shall
include permitting seeing eye dogs and wheelchairs to enter the Premises."

         99.      Section 10 of the Rules and Regulations attached to the Lease
as Exhibit C is amended to add the following before the period at the end of
such section: "provided, however, that Tenant may maintain armed security in or
about the Premises if such armed security is properly licensed and if Tenant
pays to Landlord an amount equal to any increase in Landlord's insurance
premiums resulting from Tenant's maintaining such armed security."

         100.     Section 14 of the Rules and Regulations attached to the Lease
as Exhibit C is amended to add the following at the end of such section:

                  Notwithstanding the foregoing, Tenant shall provide to
                  Landlord a list of approved providers of such services and
                  Tenant shall request Landlord's approval to utilize the
                  services of such providers, which approval shall not be
                  unreasonably conditioned, delayed or withheld In the event
                  that Landlord does withhold its approval, Landlord and Tenant
                  will meet to discuss and resolve in good faith Landlord's
                  objections.

         101.     The second line of Section 16 of the Rules and Regulations
attached to the Lease as Exhibit C is amended to delete "Saturdays".

         102.     The second line of Section 18 of the Rules and Regulations
attached to the Lease as Exhibit C is amended to delete "and left locked when
not in use".

         103.     Section 19 of the Rules and Regulations attached to the Lease
as Exhibit C is amended and restated in its entirety as follows:

                           19.      Any special requirements of Tenant in
                           connection with the Premises that are not expressly
                           provided for in this Lease or that are not implied as
                           a matter of law will be attended to only upon
                           application to the Office of the Building.

         104.     Section 21 of the Rules and Regulations attached to the Lease
as Exhibit C is amended and restated in its entirety as follows:

                           21.      All office equipment of any electrical or
                           mechanical nature which causes

                                       16


                           noise or adversely affects other tenants of the
                           Building shall be placed by Tenant in the Premises in
                           settings approved by Landlord (which shall not be
                           unreasonably conditioned, delayed or withheld) to
                           absorb or prevent any vibration, noises or annoyance.

         105.     Section 26 of the Rules and Regulations attached to the Lease
as Exhibit C is amended to end the first sentence thereof by inserting a period
after "cooling system" in the second line of such section.

         106.     A new paragraph is added to the second page of the Asbestos
Notification attached to the Lease as Exhibit F as follows:

                  If Tenant desires to abate the presence of asbestos within the
Premises, it may do so at its sole expense but it shall do so in compliance with
all applicable laws and without material disruption of the business of the
Building or any of the tenants of the Building. In addition, Tenant shall use
contractors approved by Landlord, which approval shall not be unreasonably
conditioned, delayed or withheld.

         107.     The fifth and sixth lines of the first paragraph of the
Parking Agreement attached to the Lease as Exhibit G is amended to delete "on a
month to month basis" and insert the following in its place and stead:
"throughout the term of this Lease and any renewal period thereof. Tenant may
purchase up to 50 passes per month at Tenant's sole option".

         108.     The eighth line of the first paragraph of the Parking
Agreement attached to the Lease as Exhibit G is amended to add the following
after "spaces": "as shown on the Parking Plan for the Building, a copy of which
has been provided by Landlord to Tenant and attached hereto as Schedule 1 to
Exhibit G."

         109.     The ninth line of the first paragraph of the Parking Agreement
attached to the Lease as Exhibit G is amended to add the following after
"visitors": "which shall be prominently marked as being Reserved for Nara Bank
Customers Only".

         110.     The fourteenth line of the first paragraph of the Parking
Agreement attached to the Lease as Exhibit G eventh paragraph below the caption
PARKING RULES AND REGULATIONS is amended to insert the following after "notice":
"and the passage of an additional fifteen (15) day period within which Tenant
shall have the right to cure such violation."

         111.     The third line of the seventh paragraph below the caption
PARKING RULES AND REGULATIONS of the Parking Agreement attached to the Lease as
Exhibit G is hereby amended to delete "$25.00" and to insert in it place and
stead "$10.00, except that such amount shall not be due and payable the first
time that such a violation occurs."

         112.     Section 1 of Addendum I is hereby amended to add the following
at the end of such section:

                  Tenant shall have the option to use its own window cleaning
                  vendor, subject to Landlord approval, which shall not be
                  unreasonably conditioned, delayed or withheld.

                                       17


         113.     The second line of Addendum I is hereby amended to delete
"from March 1, 2003 through June 30, 2003" and to insert the following in its
place and stead: "from the date that Landlord delivers possession of the
Premises to Tenant in Base Shell Condition through the date that is four mouths
later".

         114.     Section 4 of Addendum I is hereby amended to add the following
at the end of such section: "Notwithstanding any of the provisions of this
Section 4 and Section 3 above, Tenant's obligation to maintain the plumbing and
pest control shall be on an annual basis or as otherwise reasonably needed."

         115.     Section 5 of Addendum I is hereby amended to add the following
at the end of such section:

                  Notwithstanding the foregoing, following the Commencement
                  Date, Tenant shall pay no more than $100 per month for trash
                  removal unless Landlord can provide to Tenant reasonable
                  substantiation of a higher cost attributable to Tenant.

         116.     The tenth line of Section 7 of Addendum I is hereby amended to
add the following after "illuminated": "or non-illuminated".

         117.     Section 9 of Addendum I is hereby amended to add the following
before the period at the end of section: ", unless such interruption is the
result of Landlord's gross negligence or willful misconduct".

         118      Section 12 of Addendum I is hereby amended to add the
following at the end of such section:

                           The current HVAC system was installed in_____, and
         has been maintained as reasonably necessary for its usage and to the
         knowledge of Landlord, is appropriate for the Premise as the Premises
         will be used by Tenant

         119.     Section 13 of Addendum I is hereby amended to delete from the
first sentence thereof the first three lines thereof and the portion of the
fourth line thereof ending with ""Lease Term" and to insert the following in its
place and stead: "Provided that Tenant is not in material breach of the Lease at
the time for renewal thereof.

         120.     The ninth line of Section 13 of Addendum I is hereby amended
to delete "located in the Building" and to insert in its place and stead:
"competitive buildings within an [arm's length distance".]

         121.     Addendum I is hereby amended to delete therefrom all
references to "Proposed Renewal Rental" and to insert in its place and stead
"Proposed Rental Rate".

         122.     Section 16 of Addendum I is hereby deleted in its entirety,

         123.     The second paragraph of Section 16 of Addendum I is hereby
amended to add the

                                       18


following at the end of such section: "Tenant's Renewal Option shall extend to
any entity or person acquiring Tenant or its holding company, as applicable,
during the initial term of this Lease or during any extension thereof."

         124.     LANDLORD AND TENANT HEREBY AGREE THAT TENANT IS A BANK AND
THAT NOTWITHSTANDING ANY OF THE OTHER PROVISIONS OF THE LEASE: (I) TENANT CANNOT
CEASE TO OPERATE ITS BUSINESS ON THE PREMISES FOR MORE THAN 3 CONSECUTIVE DAYS
AND LANDLORD SHALL TAKE ALL STEPS NECESSARY TO ASSURE THAT TENANT IS ABLE TO BE
OPEN FOR BUSINESS IN COMPLIANCE WITH SUCH REQUIREMENT; (II) THE TERM HEREOF
SHALL NOT COMMENCE UNTIL TENANT HAS RECEIVED ALL NECESSARY APPROVALS FROM
APPLICABLE FEDERAL OR STATE BANKING AUTHORITIES TO OPERATE A BANK BRANCH WITHIN
THE PREMISES AND TENANT SHALL HAVE THREE MONTHS' FREE RENT FROM LANDLORD'S
TENDER OF POSSESSION OF THE PREMISES IN BASE SHELL CONDITION; AND (III) ANY
ATTEMPTED TERMINATION OF THE LEASE BY LANDLORD SHALL NOT BE EFFECTIVE UNTIL SUCH
TIME AS ALL FEDERAL AND STATE REGULATORY REQUIREMENTS FOR THE CLOSURE OF THE
BRANCH TO BE OPERATED WITHIN THE PREMISES HAVE BEEN SATISFIED.

                               [signatures follow]

                                       19


Landlord:

3600 Wilshire, LLC

By: /s/ [ILLEGIBLE]
    ------------------------
Its: [ILLEGIBLE]

Tenant:

Nara Bank, National Association

By: /s/ [ILLEGIBLE]
    ---------------------------
Its: [ILLEGIBLE]

      2/6/03

/s/ [ILLEGIBLE]

Director of Legal Affairs

       2/6/03

                                       20


                                    EXHIBIT A


SECTION I. BASE BUILDING CONSTRUCTION

                                                              
A.  Concrete and         Fire resistant or                          existing
    Steel                non-combustible construction
    Construction         (i.e., concrete slab with fire
                         rated structural steel beam &
                         column supports, etc.).

B.  Slab to underside    Minimum 2'-6" to 3'0" clearance               ,,
    of deck height       to the underside of beams.

C.  Floor Load           50 lbs. per sq. ft. Live Load,                ,,
                         20 lbs. per sq. ft. Dead Load

D.  Materials and        Build using appropriate                       ,,
    warrantee            materials of high quality and
                         durability to provide a
                         low-maintenance barrier to the
                         elements. Landlord shall
                         warrantee performance for the
                         term of the lease against
                         leakage and other failure.

E.  Codes and            Designed in accordance with                   ,,
    compliance           governing Codes, (i.e.,
                         municipal, state and/or
                         federal, B.O.C.A., U.B.C ,
                         etc.), with respect to Live
                         Loading, including loads due
                         to hurricanes, earthquake, and
                         the accumulation of snow, ice
                         and water.

F.  Dunnage              Include the installation of                   ,,
                         dunnage of other supports
                         required for roof-mounted Base
                         Building HVAC, Tenant
                         Supplemental AC, and other
                         equipment as required.

G.  Satellite dish       Allow access and support for               in lease
                         roof-mounted Tenant satellite
                         dish and provide penetrations
                         for connections to such devises
                         from the Tenant Premises.

H.  Base building shell  Base building shell must be                existing
                         fully insulated and
                         weatherproofed in accordance
                         with applicable Codes to avoid
                         excessive transfer of heat,
                         cold and moisture.

I.  Roof                 Roof must be designed to                      ,,
                         provide for proper drainage
                         and to prevent accumulation
                         of runoff around the
                         building.

J.  Concrete Slab        Insulation as required for                    ,,
    or Metal Deck        prevention of heat loss and
                         heat gain.

K.  Slab Condition       Smooth and level, pitch not                  ,,
                         to exceed 1/2 inch for every 10
                         ft. in every direction.

L.  Slab                 Seal to avoid moisture                        ,,
                         permeation from hydrostatic
                         pressure if on grade.
                         Insulation as required if open
                         garage above or below.

M.  Exterior             Fire resistant on                             ,,
    Wall Finishes        non-combustible fire rated
                         construction (i.e., glass,
                         metal, stone or masonry
                         facade).

N.  Windows              Non-operable double glazed                   ,,
                         E-reflective energy efficient
                         units.

O.  Tint                 Contingent upon orientation                  ,,
                         and/or applicability of
                         National Energy Conservation
                         Code.

P.  Window Module        5'-0" wide on center.                         ,,
    Size

Q.  Sill Height          30" -32" AFF.                                 ,,

R.  Window Height        To finished ceiling (8'-6"                    ,,
                         minimum).



                                       21


                                                              
S.  Window Treatment     Mini-blinds or building standard
                         blinds.

T.  Interior surfaces    All interior surfaces
                         (exterior walls, interior
                         walls and columns) shall be
                         insulated drywall, taped,
                         spackled and primed, ready to
                         receive Tenant's finishes.

U.  Doors                Main entry doors and rear egress           existing
                         doors in place with lock sets
                         (dead bolt) and/or panic
                         hardware as required to meet
                         applicable Building and Fire
                         Codes.



                                       22



SECTION II. BASE BUILDING HVAC

                                                              
A.  Variable Air         1 .75 CFM per sq. ft. with air             Landlord
    Volume Base          temperature of 35-57 degrees
                         Fahrenheit at main distribution
                         points of delivery (shaft). Air
                         distribution by V.A.V. system
                         with a minimum of 20 CFM of
                         outside air per person based
                         upon a design of one person per
                         100 useable square feet. Main
                         trunk live, in place for
                         Tenant's distribution.

B.  Type of exterior     The system shall produce                      ,,
    perimeter HVAC       interior temperatures in the
    system               Premises at-all times and in
                         all weather conditions of 72
                         degrees Fahrenheit with a
                         corresponding relative humidity
                         of fifty (50%) percent plus or
                         minus five (5%) percent.

C.  Return Air Plenum    Included as part of the base                  ,,
                         building HVAC system, (preferred
                         system). Landlord shall provide
                         a Base Building HVAC system
                         designed where the return air is
                         ducted, only if it is a
                         non-return air plenum, from
                         occupied space to the air
                         handling unit.

D.  24 Hour-             Landlord shall provide a minimum             Tenant
    Supplemental AC      of 5 tons for Tenant's                    responsible
                         Telecommunications Equipment
                         Room 24 hours per day, seven
                         days per week, 365 days per
                         year. If roof or attic mounted,
                         Landlord to design for adequate
                         structural support, including
                         dunnage, pads and penetrations
                         in place as per Tenant Plans and
                         Specifications. If mounted on
                         grade, Landlord to provide
                         supports including pad design.
                         Landlord to furnish and install
                         underground conduits for power,
                         refrigerant and all other
                         related services from pads into
                         Tenant's demised Premises for
                         Tenant connection as required.
                         Equipment area shall be
                         surrounded with enclosure that
                         compliments architecture, site,
                         landscape and design.

E.  Connection for       In multi-tenant building,                      ,,
    Supplemental AC      Landlord to provide condenser
                         water or chilled water tap
                         connection on floor of demised
                         Premises for Tenant tie-in.

F.  Condenser            Provided 24 hours per day,                    ,,
    Water/Chilled        seven days per week, 365 days
    Water                per year.



                                       23


SECTION III. BASE BUILDING ELECTRICAL

                                                              
A.  Wattage              Six (6) watts per RSF (less base           existing
                         building and HVAC) available at
                         panel on floor for distribution
                         by Tenant in multi-tenant
                         buildings. Eight (8) watts per
                         RSF in sole occupancy buildings.

B.  Design Capacity      Electrical service design                  Tenant
                         capacity to be exclusive of                responsible
                         building HVAC Landlord to
                         provide all disconnect switches,
                         transformers, meters and
                         distribution panels as required.
                         Panels shall provide for one (1)
                         branch circuit for every three
                         (3) workstations.

C.  EMF                  Maximum ten (1 0)                              N/A
                         milligauss, with five (5)
                         milligauss average at any
                         given point, within demised
                         Premises.

D.  Telephone Service    Available at designated                    Tenant
                         location of floor for Tenant               responsible
                         distribution.

E.  Satellite Dish       Landlord to provide roof space,             in lease
                         tower or facility to
                         accommodate (six (6) feel
                         maximum diameter of dish).

F.  Satellite Dish--     If satellite dish is roof                      ,,
    roof mounted         mounted, Landlord shall provide
                         location and pad with necessary
                         structural support inclusive of
                         pitch pockets, penetrations,
                         etc., for complete installation
                         of said satellite dish. Conduit
                         connections from roof to
                         Tenant's demised Premises shall
                         also be provided.

G.  Satellite Dish--     If satellite dish is mounted on                ,,
    tower or grade       tower or grade, Landlord shall
    mounted              provide the necessary pads,
                         conduits, etc. for connection of
                         dish to Tenant's
                         Telecommunications Equipment
                         room within the demised Premise.



                                       24


SECTION IV. BASE BUILDING LINE SAFETY

                                                              
A.  Sprinkler Loop &     100% wet pipe system. Main                 existing
    Branches             loop in place for Tenant
                         distribution. (S & Y Value)

B.  Standpipe            As required by Codes & NFPA                   ,,
                         requirements.

C.  Fire Extinguishers   Semi-recessed type fire                       ,,
                         extinguisher cabinets with ABC
                         extinguisher on site for Tenant
                         Contractor to install. The
                         number of extinguishers &
                         cabinets to be determined by
                         local Fire Department, Building
                         Department and NFPA
                         requirements.

D.  ADA Strobe &         Panel ports available for                     ,,
    Speaker              tie-in of Tenant's fire
                         protection and life safety
                         systems into Base Building
                         system.



SECTION V. BASE BUILDING CEILING

                                                              
A.  Ceiling Type         2x2 lay-ins (standard tile and                ,,
                         grid).

B.  Finish               8'-6" minimum.                                ,,
    Ceiling Height



SECTION VI. BASE BUILDING PLUMBING

                                                              
A.  Rest room            Ceramic tile floors and walls                 ,,
    Condition            with floor drain in each
                         facility.

B.  Accessories          Toilet paper, paper towel,                    ,,
                         sanitary napkin, soap
                         dispensers, trash
                         receptacle, mirrors, etc.
                         Commercial grade quality,
                         Bobrick or equal.

C.  ADA Facilities       Compliance with ADA laws.                  in lease

D.  Number of Fixtures   Sufficient to meet Tenant's                existing
                         staff requirements for male to
                         female ratio & governing
                         Building Codes.

E.  Tap & Drain          Plumbing Rough-in, in place                   ,,
                         for Tenant's pantry sink.

F.  Hot Water            Rest room and pantry to be                    ,,
                         separate from main boiler.

G.  Drinking Fountains   ADA compliant.                                ,,

H.  Exhaust              Exhaust fans and ducted                       ,,
                         exhaust for both rest room
                         facilities as per governing
                         Building Codes.

I.  Utility Room         Door shall be 'B' labeled,                    ,,
                         fire rated wood door to match
                         Tenant's wood finishes.

J.  Janitor's Closet     Janitor's closet shall be a                  N/A
                         separate room and shall have a
                         slop sink.



SECTION VII. MISCELLANEOUS

                                                              
A.  Building Access      ADA compliant entries                         ,,
                         including ramps, elevators,
                         parking, etc.

B.  Freight Elevators    Provide contact and Building                  ,,
                         Rules & Regulations.



                                  25


                                                              
C.  Building Standards   All entry points to the                      N/A
    Vestibules           building that lead directly
                         from the exterior shall be
                         protected by weather tight,
                         air-conditioned , permanent
                         enclosures The mode of
                         conditioning the air shall be
                         compatible with local climatic
                         conditions and shall meet all
                         governing federal, state and/or
                         municipal Energy Conservation
                         Codes. Finishes within vestibule
                         shall be of durable, non-slip,
                         weather-resistant materials
                         coordinated with Tenant's
                         interior finishes.

D.  Exterior Signage     Tenant's signage (illuminated)             in lease
                         and logo on face of building
                         and/or free-standing,
                         illuminated, monument sign.
                         Signage permits as required by
                         local City Codes to be procured
                         by Landlord.

E.  Interior Signage     Tenant's signage and logo at                   ,,
                         Tenant's entrance.

F.  Wood Finishes        If Tenant is sole occupant                    N/A
                         of building, all wood
                         finishes on interior shall
                         match wood finishes.

G   Parking spaces       Designate a minimum of one (1              in lease
                         ) parking space per 250 sq.
                         ft. of building area, or
                         compliance with governing
                         Building and Zoning
                         Regulations, whichever is
                         more.

H.  Lighting and         Site and Landscaping Plans                   N/A
    landscaping on       to be submitted for Tenant
    site                 review and approval.

I.  As Built A&E         Base Building As Built A&E                  Tenant
    Drawings             Drawings to be submitted to               Possession
                         Tenant on Auto Cad #13 or #14.

J.  Milestone Schedule   Landlord to provide Base                     N/A
                         Building Milestone Schedule
                         including weather-tight shell,
                         permanent power, permanent
                         Base Building HVAC, fully
                         functional elevator service,
                         etc.



SECTION II. RENT/LEASE RECAP (CURRENT AND NEW LOCATION)

                                                              
A.  FREE RENT                                                       in lease

B.  RENT START                                                         ,,
    DATE

C   PENALTIES DUE TO                                                   ,,
    LANDLORD'S DELAY

D.  HOLDOVER AT OUR                                                    N/A
    CURRENT LOCATION

E.  LL CONTRIBUTION               RSF or USF                        $      0



                                       26

EX-31.1

Nara Bancorp, Inc. - Form 10-Q

EX-31.2

Nara Bancorp, Inc. - Exhibit 31.2

EX-32.1

                                                                    EXHIBIT 32.1

Pursuant to Section 906 of the Public Company Accounting Reform and Investor
Protection Act of 2002 (18 U.S.C 1350, as adopted), Seong Hoon Hong, Chief
Executive Officer of Nara Bancorp, Inc. (the "Company") and Timothy Chang, Chief
Financial Officer of the Company hereby certifies that, to the best of their
knowledge:

         1.       The Company's Quarterly Report on Form 10-Q for the period
                  ended September 30, 2003, and to which this Certification is
                  attached as Exhibit 99.1 (the "Periodic Report"), fully
                  complies with the requirements of section 13(a) or section
                  15(d) of the Securities Exchange Act of 1934, and

         2.       The information contained in the Periodic Report fairly
                  presents, in all material respects, the financial condition
                  and results of operations of the Company.

         IN WITNESS WHEREOF, the undersigned have set their hands hereto as of
the 13th day of November 2003.

                                                   /s/ Seong Hoon Hong

                                                   --------------------------
                                                   Chief Executive Officer


                                                   /s/ Timothy Chang
                                                   ---------------------------
                                                   Chief Financial Officer