S-4/A

As filed with the Securities and Exchange Commission on September 1, 2005

Registration No. 333-126401

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

Pre-Effective Amendment
No. 2 to

FORM S-4

REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933

FCB BANCORP

(Exact Name of Registrant as Specified in its Charter)

California	20-3074387
(State or Other Jurisdiction of	(I.R.S. Employer
Incorporation or Organization)	Identification Number)

1100 Paseo Camarillo
Camarillo, California 93010
(805) 484-0534
(Address, including Zip Code, and Telephone Number,
including Area Code, of Registrant’s Principal Executive Offices)

C. G. Kum
President and Chief Executive Officer
FCB Bancorp
1100 Paseo Camarillo
Camarillo, California 93010
(805) 484-0534
(Address, including Zip Code, and Telephone Number,
including Area Code, of Agent for Service)

Copies to:
Gary M. Horgan, Esq.
Young H. Park, Esq.
Horgan, Rosen, Beckham & Coren, L.L.P.
23975 Park Sorrento, Suite 200
Calabasas, California 91302
Phone (818) 591-2121
Fax (818) 591-3838

Approximate date of commencement of proposed sale to the public:                     , 2005

     If the securities being registered on this Form are being offered in connection with the formation of a holding company and there is compliance with General Instruction G, check the following box. o

     If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of earlier effective registration statement for the same offering. o

     If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration number of the earlier effective registration statement for the same offering. o

CALCULATION OF REGISTRATION FEE

				Proposed			Proposed
Title of Each Class				Maximum			Maximum
of Securities to be	Amount to be			Offering Price			Aggregate		Amount of
Registered	Registered			Per Share			Offering Price		Registration Fee
Common Stock, no par value		2,241,057	1	$	20.07	2	$	44,978,013.99	$	5,293.91

1	The estimated maximum number of shares to be issued includes approximately 78,250 shares anticipated to be issued pursuant to the exercise of outstanding stock options.
2	Calculated in accordance with Rule 457(f)(1) under the Securities Act of 1933, as amended, based on the market value as of June 20, 2005, the date of the most recent trade in shares of First California Bank common stock.

     The Registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until the registration statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to Section 8(a), may determine.

[ON BANK LETTERHEAD]

PROSPECTUS
FCB BANCORP

                    , 2005

Dear Shareholder:

     You are cordially invited to attend a Special Meeting of Shareholders of First California Bank which will be held on                     , 2005, at the Bank’s main office located at 1150 Paseo Camarillo, Camarillo, California 93010, at                      p.m.

     You will be asked at the meeting to approve a merger agreement pursuant to which the Bank will become a wholly-owed subsidiary of a newly formed bank holding company, FCB Bancorp, which has been organized at the direction of your Board of Directors. If the merger is approved, your Bank stock will be converted, without recognition of gain or loss for tax purposes, into stock of FCB Bancorp on a share-for-share basis. Your current stock certificates will represent shares in the holding company, and it will not be necessary for you to exchange stock certificates, although you may do so if you so desire. A detailed explanation of the proposed merger is contained in the accompanying Proxy Statement.

     Management believes that the formation of a holding company will provide business alternatives for your Bank which are desirable to compete with other major banks and larger regional banks, many of which have been similarly reorganized. The formation of the holding company will also facilitate our proposed acquisition of South Coast Bancorp, Inc., also described in more detail in the accompanying Proxy Statement. Your Board of Directors unanimously believes that the proposed merger is in the best interests of the Bank’s shareholders and recommends a vote “For” the proposal.

     At the meeting you will also be asked to consider and approve the FCB Bancorp 2005 Stock Option Plan which is intended to replace the Bank’s stock option plan. This proposal is more fully described in the accompanying Proxy Statement. Your favorable vote on this matter is also requested by your Board of Directors.

     It is important that your shares be represented at the meeting. Whether or not you plan to attend the meeting you are requested to complete, date, sign and return the enclosed Proxy in the enclosed envelope, at your earliest convenience.

     The accompanying Proxy Statement is also deemed under federal securities laws to be a prospectus by which FCB Bancorp offers the Common Stock which you will receive in the proposed merger. This is the reason for the statement in bold-face type below which is required on all prospectuses.

Sincerely yours,

C. G. Kum

President and Chief Executive Officer

These securities have not been approved or disapproved by the Securities and Exchange Commission nor has the Commission passed upon the accuracy or adequacy of this prospectus. Any representation to the contrary is a criminal offense.

The date of this Prospectus is                     , 2005

1150 Paseo Camarillo
Camarillo, California 93010
Telephone: (805) 484-0534

NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
TO BE HELD                     , 2005
AT                      P.M.

TO THE SHAREHOLDERS OF FIRST CALIFORNIA BANK:

     NOTICE IS HEREBY GIVEN that, pursuant to the Bylaws of First California Bank and the call of its Board of Directors, a Special Meeting of Shareholders (the “Meeting”) of First California Bank (the “Bank”) will be held at the Bank’s main office located at 1150 Paseo Camarillo, Camarillo, California 93010, on                     ,                     , 2005, at                      p.m., for the purpose of considering and voting on the following matters:

     1. Approval of Bank Holding Company Reorganization. Considering and voting on a Plan of Reorganization and Merger Agreement dated May 19, 2005 (the “Merger Agreement”), which provides for the merger of the Bank with a wholly-owned subsidiary of the newly-formed holding company, FCB Bancorp, as a result of which shareholders of the Bank will receive for their shares of the Bank’s Common Stock an equal number of shares of FCB Bancorp’s Common Stock. These transactions are more fully described in the enclosed Proxy Statement and in the Merger Agreement attached as Exhibit A to the Proxy Statement.

     2. Approval of Stock Option Plan. Approving, as prospective shareholders of FCB Bancorp, the FCB Bancorp 2005 Stock Option Plan, which is intended to replace the Bank’s stock option plan, as described in the enclosed Proxy Statement.

     3. Adjournments. Approving, if necessary, to adjourn the Meeting to solicit additional proxies in favor of the Merger Agreement and/or the Stock Option Plan.

     4. Other Business. Transacting such other business as may properly come before the Meeting and any adjournment or adjournments thereof.

     The Board of Directors has fixed the close of business on                     , 2005, as the record date for determination of shareholders entitled to notice of, and the right to vote at, the Meeting.

     Since important matters are to be considered at the Meeting, it is very important that each shareholder vote.

     We urge you to sign and return the enclosed proxy as promptly as possible, whether or not you plan to attend the Meeting in person. The enclosed proxy is solicited by the Bank’s Board of Directors. Any shareholder who executes and delivers such a proxy has the right to revoke it at any time before it is exercised by giving written notice of revocation to the secretary of the Bank, by submitting prior to the meeting a properly executed proxy bearing a later date, or by being present at the Meeting and electing to vote in person by advising the chairman of the Meeting of such election.

     Please indicate on the proxy whether or not you expect to attend the Meeting so that the Bank can arrange for adequate accommodations.

By Order of the Board of Directors

Thomas E. Anthony,

Secretary

                    , 2005

TABLE OF CONTENTS

	Page
INTRODUCTION		3
Agenda for the Meeting		3
The Bank Holding Company Reorganization		3
Reasons for the Merger		3
South Coast Bancorp, Inc.		3
Differences in Rights as Shareholders of the Holding Company		4
Federal Income Tax Consequences		4
Government Regulation and Supervision		4
Rights of Dissenting Shareholders		5
Conditions for Consummation; Anticipated Effective Date; Termination		5
Revocability of Proxies		5
Persons Making the Solicitation		5
Vote Required		5
Adjournments		6
Selected Financial and Other Data		6
RISK FACTORS		8
Risks Related to the Holding Company Reorganization		8
Risks Related to First California Bank		8
Risks Related to FCB Bancorp Common Stock		11
Risks Related to the SCB, Inc. Acquisition		12
AVAILABLE INFORMATION		12
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS		12
VOTING SECURITIES		13
SHAREHOLDINGS OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT		14
PROPOSAL 1 - BANK HOLDING COMPANY REORGANIZATION		15
General		15
Reasons for the Merger		15
Description of the Merger		16
Ratification and Approval of the Merger		16
Description of FCB Bancorp Common Stock		17
Comparison of First California Bank and FCB Bancorp Corporate Structures		17
The Holding Company		18
Directors and Executive Officers		19
Supervision and Regulation — FCB Bancorp		21
Permitted Non-Banking Activities		24
Federal Income Tax Consequences		25
Dissenters’ Rights		26
Restrictions on Affiliates		26
Business of First California Bank		27
Management’s Discussion and Analysis of Financial Condition and Results of Operations — First California Bank		29
Quantitative and Qualitative Disclosures About Market Risk		47
Supervision and Regulation — First California Bank		51
Trading in the Bank’s and the Holding Company’s Common Stock		61
Pro Forma Capitalization		63
Vote Required		63
SOUTH COAST BANCORP, INC		64

	Page
Background and Description of South Coast Bancorp, Inc. Transaction		64
Description of the Acquisition Agreement		64
Selected Financial and Other Data — South Coast Bancorp, Inc.		70
Management’s Discussion and Analysis of Financial Condition and Results of Operations — South Coast Bancorp		72
Selected Historical Financial Data		82
Unaudited Pro Forma Combined Consolidated Financial Information		86
COMPENSATION AND OTHER TRANSACTIONS WITH MANAGEMENT AND OTHERS
Summary Compensation		95
Stock Options		95
Employment Agreements		96
Employee 401(k) Plan		96
Directors’ Compensation		97
Personnel Committee Interlocks and Insider Participation		97
Personnel Committee Report on Executive Compensation		97
Related Party Transactions		97
PROPOSAL 2 – APPROVAL OF 2005 STOCK OPTION PLAN		99
Introduction		99
Summary of the Plan		99
Federal Income Tax Consequences		101
Certain Information Concerning All Options		103
Exchange of Options in Reorganization		103
Vote Required		104
VALIDITY OF COMMON STOCK		104
EXPERTS		104
OTHER MATTERS		104
PLAN OF REORGANIZATION AND MERGER AGREEMENT	Exhibit A
INDEX TO FINANCIAL STATEMENTS		F-1
EXHIBIT 3.1
EXHIBIT 3.2
EXHIBIT 8
EXHIBIT 10.1
EXHIBIT 10.2
EXHIBIT 10.3
EXHIBIT 10.4
EXHIBIT 10.5
EXHIBIT 10.6
EXHIBIT 10.7
EXHIBIT 10.8
EXHIBIT 10.9
EXHIBIT 10.10
EXHIBIT 10.11

     No person has been authorized to give any information or make any representation not contained in this Proxy Statement in connection with the offer contained herein, and, if given or made, such information or representation must not be relied upon as having been authorized by FCB Bancorp or First California Bank. This Proxy Statement does not constitute an offer to sell or a solicitation of an offer to buy any securities other than those to which it relates or an offer to sell or a solicitation of an offer to buy any of the securities offered hereby to any person to whom it is unlawful to make such offer in any jurisdiction. Neither the delivery of this Proxy Statement nor any sale made hereunder shall create, under any circumstances, an implication that there has been no change in the affairs of First California Bank or FCB Bancorp since the date hereof.

     This Proxy Statement/Prospectus incorporates documents by reference which are not presented herein or delivered herewith. These documents are available without cost upon request from Romolo Santarosa, Executive Vice President and Chief Financial Officer, 1100 Paseo Camarillo, Camarillo, California 93010, phone (805) 322-9333. In order to ensure timely delivery of the documents, any request should be made by                     , 2005.

ii

INTRODUCTION

     This Proxy Statement is furnished in connection with the solicitation of Proxies for use at a Special Meeting of Shareholders (the “Meeting”) of First California Bank (the “Bank”) to be held at the Bank’s main office located at 1150 Paseo Camarillo, Camarillo, California 93010, on                     ,                     , 2005, at                     p.m., and at any and all adjournments thereof.

     It is expected that this Proxy Statement and accompanying Notice and form of Proxy will be mailed to shareholders on or about                     , 2005.

Agenda for the Meeting

     The matters to be considered and voted upon at the Meeting will be:

     1. Approval of Bank Holding Company Reorganization. Considering and voting on a Plan of Reorganization and Merger Agreement dated May 19, 2005 (the “Merger Agreement”), which provides for the merger of the Bank with a wholly-owned subsidiary of the newly-formed holding company, FCB Bancorp (the “Holding Company”), as a result of which shareholders of the Bank will receive for their shares of the Bank’s Common Stock an equal number of shares of FCB Bancorp’s Common Stock. These transactions are more fully described herein and in the Merger Agreement attached as Exhibit A hereto.

     2. Approval of Stock Option Plan. Approving, as prospective shareholders of FCB Bancorp, the FCB Bancorp 2005 Stock Option Plan, which is intended to replace the Bank’s stock option plan, as described more fully herein.

     3. Adjournments. Approving, if necessary, to adjourn the Meeting to solicit additional proxies in favor of the Merger Agreement and/or the Stock Option Plan.

     4. Other Business. Transacting such other business as may properly come before the Meeting and any adjournment or adjournments thereof.

The Bank Holding Company Reorganization

     At the direction of the Bank, FCB Bancorp was incorporated on January 25, 2005 under the laws of the State of California to serve as the holding company for the Bank. At the effective date of the merger, shareholders of the Bank will automatically become shareholders of the Holding Company; accordingly, shareholders will not be requested to surrender their Bank stock certificates for new certificates. The Bank will conduct its business in substantially the same manner and from the same offices as the Bank did prior to the merger. (See “PROPOSAL 1 — BANK HOLDING COMPANY REORGANIZATION — Description of the Merger.”)

Reasons for the Merger

     The Board of Directors believes the establishment of a holding company structure for the Bank will provide greater flexibility in responding to the expanding financial needs of the Bank’s customers and in meeting increasing and ever-changing forms of competition for the furnishing of financial services. (See “PROPOSAL 1 — BANK HOLDING COMPANY REORGANIZATION — Reasons for the Merger.”)

South Coast Bancorp, Inc.

     In addition to serving as the holding company for the Bank, the Holding Company, through its wholly-owned subsidiary SCB Merger Corp (the “Merger Sub”), intends to acquire South Coast Bancorp, Inc. (“South Coast Bancorp” or “SCB”), Irvine, California. FCB Bancorp entered into an Agreement and Plan of Reorganization dated as of February 2, 2005 (the “Acquisition Agreement”) with First California Bank, SCB Merger Corp., SCB, and South Coast Commercial Bank (“SCCB”), a wholly-owned subsidiary of SCB. Under the terms of the Acquisition Agreement, FCB Bancorp will acquire SCB and then immediately after the acquisition merge with SCB.

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     FCB Bancorp has organized SCB Merger Corp. as a new California corporation and wholly-owned subsidiary of FCB Bancorp. At the effective time of the merger, SCB Merger Corp. will merge with SCB, with SCB surviving the merger. As a result of the merger, SCB will be a wholly-owned subsidiary of FCB Bancorp before it is merged with FCB Bancorp, the surviving holding company. As a result of the Acquisition, First California Bank and SCCB will be separate wholly-owned subsidiaries of FCB Bancorp. As soon as practical after the Acquisition, FCB Bancorp intends to either consolidate the two banks under First California Bank’s charter or enter into an asset purchase and liability assumption agreement resulting in substantially all of the assets and liabilities of SCCB being acquired/assumed by First California Bank. The asset purchase alternative would be utilized if the California Department of Financial Institutions were to permit the acquisition of SCCB (reduced to a minimum level of capital, assets and liabilities) by a third party financial institution.

     SCB will be acquired by FCB Bancorp in consideration for the payment of the aggregate cash amount of $36.0 million, subject to certain adjustments, for all of the outstanding shares of South Coast Bancorp common stock. In anticipation of closing the Acquisition, FCB Bancorp: (i) raised approximately $22.0 million from a private placement offering (the “2005 Private Offering”) of its common stock for which Keefe, Bruyette & Woods acted as the placement agent; (ii) will issue approximately $10.0 million in “trust preferred securities,” a portion of which qualifies as Tier 1 capital; and (iii) will accept a cash dividend from First California Bank in the amount of approximately $5.0 million; substantially all of the proceeds of which will be used to fund the Acquisition and to pay the expenses (legal, accounting, printing, filing fees, etc.) to be incurred by FCB Bancorp in connection with both the holding company formation and the Acquisition.

     FCB Bancorp completed the 2005 Private Offering in June 2005. FCB Bancorp sold 1,115,000 shares of its common stock at a purchase price of $19.75 per share.

     FCB Bancorp will account for its acquisition of South Coast Bancorp using the purchase method of accounting for business combinations. Accordingly, the total estimated purchase price will be allocated to SCB’s net tangible and intangible assets based on their estimated fair values as of the date of the completion of the merger. The difference between the adjusted purchase price and the net assets acquired will be recorded as goodwill by FCB Bancorp and will be periodically evaluated in the future for impairment.

     Under the terms of the Acquisition Agreement, the proposed holding company formation is a condition to closing the Acquisition and in the event that shareholder approval of the proposed holding company reorganization is not obtained, the Acquisition will not be completed and the Holding Company, but not the Bank, may be liable to SCB for liquidated damages of $2.5 million. It is anticipated that the acquisition of SCB will close as soon as practicable after consummation of the holding company reorganization. Under the terms of the Acquisition Agreement, the acquisition must close by no later than September 30, 2005, subject to extension by agreement amongst the parties.

     Under California law, the acquisition of SCB does not require approval by the shareholders of either the Bank or FCB Bancorp. Therefore, the Bank is not seeking shareholder approval of the acquisition at the Meeting. The terms of the Acquisition Agreement and the proposed acquisition do, however, require the approval of SCB’s shareholders which approval was obtained at an annual meeting of shareholders duly held on April 12, 2005.

Differences in Rights as Shareholders of the Holding Company

     After consummation of the merger, matters requiring the approval of the Bank’s shareholders, such as amendments to the Bank’s Articles of Incorporation or a merger of the Bank and another corporation, will be subject to the approval of the Holding Company as the Bank’s sole shareholder. With respect to charter documents, under California law, amendments to the Bank’s Articles of Incorporation require the California Department of Financial Institution’s (the “DFI”) approval, in addition to any shareholder approvals which may be required. Amendments to the Holding Company’s Articles of Incorporation do not require the DFI’s approval. Additionally, there are differences in regulatory and statutory requirements for the payment of cash dividends by the Bank and the Holding Company. First California Bank has paid no cash dividends since 2001 due to its current policy of preserving capital to support additional growth; except, however, that a special cash dividend of $5.0 million will be paid to FCB Bancorp in connection with the acquisition of SCB. In the event that the holding company reorganization is approved, FCB Bancorp intends to follow the same policy of retaining earnings to increase capital and provide additional basis for growth. (See “PROPOSAL 1 — BANK HOLDING COMPANY REORGANIZATION — Dividends.”)

Federal Income Tax Consequences

     The merger is intended to qualify for federal income tax purposes as a tax-free “reorganization” under Section 368(a)(1)(A) of the Internal Revenue Code in which no gain or loss will be recognized by a Bank shareholder upon the receipt of Holding Company Common Stock in exchange for Bank Common Stock. A tax opinion to that effect has been obtained from Horgan, Rosen, Beckham & Coren, L.L.P., legal and special tax advisor to the Holding Company. (See “PROPOSAL 1 — BANK HOLDING COMPANY REORGANIZATION — Federal Income Tax Consequences.”)

Government Regulation and Supervision

     After the merger, the Holding Company will be subject to the Bank Holding Company Act of 1956, as amended (the “BHCA”), and will be subject to regulation by the Board of Governors of the Federal Reserve System (the “FRB”) with respect to its operations as a bank holding company. The Bank will continue to be subject to regulation by the same governmental agencies that currently regulate the Bank. (See “PROPOSAL 1 — BANK HOLDING COMPANY REORGANIZATION — Supervision and Regulation — FCB Bancorp” and “- Supervision and Regulation — First California Bank.”)

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Rights of Dissenting Shareholders

     Those shareholders of the Bank who object to the merger are not entitled to dissent from the merger and receive payment of the fair value of their shares.

Conditions for Consummation; Anticipated Effective Date; Termination

     The consummation of the merger is subject to, among other things: (i) the affirmative vote of the holders of a majority of the outstanding shares of the Bank’s Common Stock; (ii) the approval of the California Department of Financial Institutions; (iii) the approval of the Federal Deposit Insurance Corporation; and (iv) the approval of the Federal Reserve Board. Applications for the regulatory approvals have been filed with all 3 regulatory agencies. The merger is not expected to be consummated until September, 2005. The merger may be terminated by either the Holding Company or the Bank prior to the approval of the merger by the shareholders of such party or by the mutual consent of the Boards of Directors of the Holding Company and the Bank after any shareholder group has taken the requisite affirmative action. (See “PROPOSAL 1 — BANK HOLDING COMPANY REORGANIZATION - - Ratification and Approval of the Merger.”)

Revocability of Proxies

     A form of Proxy for voting your shares at the Meeting is enclosed. Any shareholder who executes and delivers such a Proxy has the right to revoke it at any time before it is exercised by filing with the Secretary of the Bank an instrument revoking it or a duly executed Proxy bearing a later date. In addition, the powers of the Proxy Holders will be revoked if the person executing the Proxy is present at the Meeting and elects to vote in person by advising the Chairman of such election. Subject to such revocation, all shares represented by a properly executed Proxy received in time for the Meeting will be voted by the Proxy Holders in accordance with the instructions specified on the Proxy. If no instruction is specified with respect to a proposal to be acted upon, the shares represented by your executed Proxy will be voted in favor of the proposal listed on the Proxy. If any other business is properly presented at the meeting, the Proxy will be voted in accordance with the recommendations of the Bank’s Board of Directors.

Persons Making the Solicitation

     This solicitation of Proxies is being made by the Board of Directors of the Bank. The expense of preparing, assembling, printing and mailing this Proxy Statement and the materials used in the solicitation of Proxies for the Meeting will be paid for by the Bank. Proxies will be solicited principally through the use of the mail, but officers, directors and employees of the Bank may solicit Proxies personally or by telephone, without receiving special compensation for such services. Although there is no formal agreement to do so, the Bank may reimburse banks, brokerage houses and other custodians, nominees and fiduciaries for their reasonable expenses in forwarding these Proxy Materials to shareholders whose stock in the Bank is held of record by such entities. In addition, the Bank may use the services of individuals or companies it does not regularly employ in connection with this solicitation of Proxies, if Management determines it advisable.

Vote Required

     A majority of the outstanding shares, represented in person or by proxy, is required for a quorum. Approval of the Merger Agreement requires the approval of the holders of a majority of the outstanding shares of the Bank’s Common Stock. Approval of the Stock Option Plan and authority to vote for adjournments to solicit additional Proxies require the approval of a majority vote of the shares represented at the Meeting. Abstentions and broker non-votes are counted towards a quorum but abstentions and broker non-votes are the equivalent of “no” votes with respect to the approvals of the Merger Agreement, the Stock Option Plan and authority to vote for adjournments to solicit additional Proxies. The Bank’s directors and executive officers own approximately 58% of the Bank’s issued and outstanding common stock.

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Adjournments

     Although it is not anticipated, the Meeting may be adjourned for the purpose of soliciting additional Proxies in favor of the Merger and/or the Stock Option Plan. Any adjournment of the Meeting may be made without notice, other than by an announcement made at the Meeting, by approval of the holders a majority of the shares of the Bank’s Common Stock present in person or represented by proxy at the Meeting, whether or not a quorum exits. Any adjournment of the Meeting for the purpose of soliciting additional proxies will allow the Bank’s shareholders who have already sent in their Proxies to revoke them at any time prior to their use; provided, however, that any and all Proxies voting against the Merger will not be used by the Bank (under the discretionary authority granted by the Proxies) to adjourn the Meeting to solicit additional Proxies in favor of the Merger and/or the Stock Option Plan.

Selected Financial and Other Data — First California Bank

The following table sets forth First California Bank’s statistical information as of and for each of the years in the five-year period ended December 31, 2004 and for the three and six months ended June 30, 2005 and 2004. This data should be read in conjunction with “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and First California Bank’s audited financial statements as of December 31, 2004 and 2003 and for each of the years in the three-year period ended December 31, 2004 and related notes included elsewhere herein and First California Bank’s unaudited financial statements as of and for the three and six months ended June 30, 2005 and 2004 and related notes included elsewhere herein. The selected financial data was derived as of and for the years ended December 31, 2000 through December 31, 2004 from First California Bank’s historical audited financial statements for those fiscal years and First California Bank’s unaudited financial statements as of and for the three and six months ended June 30, 2005 and 2004. First California Bank’s unaudited financial statements included, in Management’s opinion, all normal and recurring adjustments that they consider necessary for a fair statement of the results. The operating results for the three and six months ended June 30, 2005 are not necessarily indicative of the operating results that may be expected for the year ending December 31, 2005.

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FIRST CALIFORNIA BANK – SELECTED HISTORICAL DATA

	As of or for the Three Months						As of or for the Six Months
	Ended June 30,						Ended June 30,
	2005			2004			2005			2004
	(Dollars in thousands, except per share data)
Results of Operations
Net interest income	$	3,359		$	2,828		$	6,461		$	5,837
Provision for loan losses		122			104			244			208
Noninterest income		427			472			943			884
Noninterest expense		2,650			2,290			5,215			4,706
Net income	$	629		$	589		$	1,206		$	1,166
Per Share Data
Earnings per share:
Basic	$	0.29		$	0.27		$	0.56		$	0.58
Diluted	$	0.29		$	0.26		$	0.55		$	0.56
Book value per share	$	10.94		$	10.44		$	10.94		$	9.54
Financial Position
Assets	$	298,294		$	275,730		$	298,294		$	275,730
Loans		199,631			171,513			199,631			171,513
Allowance for loan losses		2,593			2,533			2,593			2,533
Deposits		238,468			216,151			238,468			216,151
Shareholders’ equity	$	23,664		$	20,625		$	23,664		$	20,625
Selected Ratios (1)
Return on average equity		10.60	%		10.09	%		10.33	%		12.11	%
Return on average assets		0.86	%		0.83	%		0.85	%		0.90	%
Efficiency ratio (2)		70.03	%		70.90	%		70.46	%		70.14	%
Net interest margin (tax equivalent) (3)		5.02	%		4.84	%		4.93	%		4.93	%
Nonaccrual loans to loans		1.08	%		1.38	%		1.08	%		1.38	%
Net charges-offs (recoveries) to average loans		0.03	%		0.00	%		0.00	%		0.00	%
Allowance for loan losses to loans		1.30	%		1.30	%		1.30	%		1.30	%
Allowance for loan losses to nonaccrual loans		120.16	%		107.24	%		120.16	%		107.24	%
Total capital ratio		11.63	%		12.36	%		11.63	%		12.36	%
Tier 1 capital ratio		10.44	%		11.11	%		10.44	%		11.11	%
Tier 1 leverage ratio		8.20	%		8.09	%		8.20	%		8.09	%

	As of or for the Year Ended December 31,
	2004			2003			2002			2001			2000
	(Dollars in thousands, except per share data)
Results of Operations
Net interest income	$	11,656		$	10,898		$	9,141		$	7,488		$	6,804
Provision for loan losses		418			510			510			576			115
Noninterest income		1,925			1,899			1,240			1,071			814
Noninterest expense		9,409			8,836			7,222			5,724			5,241
Net income	$	2,435		$	2,207		$	1,614		$	1,355		$	1,407
Per Share Data
Earnings per share:
Basic	$	1.17		$	1.12		$	0.91		$	0.86		$	0.88
Diluted	$	1.14		$	1.10		$	0.86		$	0.86		$	0.88
Book value per share	$	10.42		$	9.26		$	8.38		$	7.20		$	6.57
Financial Position
Assets	$	283,745		$	256,285		$	203,907		$	151,447		$	129,408
Loans		182,873			157,952			142,379			121,699			92,024
Allowance for loan losses		2,346			2,325			1,970			1,680			1,114
Deposits		277,190			211,929			186,661			139,356			118,319
Shareholders’ equity	$	22,545		$	18,365		$	16,448		$	11,248		$	10,450
Selected Ratios
Return on average equity		11.97	%		12.67	%		11.24	%		12.64	%		14.33	%
Return on average assets		0.91	%		0.99	%		0.88	%		0.97	%		1.25	%
Efficiency ratio (2)		69.76	%		68.92	%		69.78	%		67.55	%		68.80	%
Net interest margin (tax equivalent) (3)		4.78	%		5.45	%		5.47	%		5.96	%		6.75	%
Nonaccrual loans to loans		1.19	%		1.55	%		0.27	%		0.66	%		1.04	%
Net charges-offs (recoveries) to average loans		0.21	%		0.04	%		0.17	%		0.01	%		0.01	%
Allowance for loan losses to loans		1.28	%		1.47	%		1.38	%		1.38	%		1.21	%
Allowance for loan losses to nonaccrual loans		107.61	%		95.17	%		591.59	%		208.44	%		742.67	%
Total capital ratio		12.25	%		11.57	%		11.51	%		10.06	%		11.57	%
Tier 1 capital ratio		11.04	%		10.32	%		10.26	%		8.81	%		10.46	%
Tier 1 leverage ratio		8.61	%		7.54	%		8.14	%		7.47	%		8.27	%

(1)	Selected ratios for the three and six months ended June 30, 2005 and 2004 have been annualized.
(2)	Computed by dividing noninterest expense by net interest income and noninterest income.
	The ratio is a measurement of the amount of revenue that is utilized to meet overhead expenses.
(3)	Computed by dividing net income on a tax equivalent basis by average earning assets.

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RISK FACTORS

In addition to the other information included in this proxy statement - prospectus, including the matters addressed in “CAUTIONARY STATEMENT REGARDING FOWARD-LOOKING STATEMENTS,” you should carefully consider the matters described below in determining whether to approve the principal terms of the merger (i.e. the bank holding company reorganization).

Risks Related to the Holding Company Reorganization

     Differences in Corporate Structure Regarding Voting Rights on Bank Matters. Upon consummation of the merger, the Holding Company will have the same number of shares issued and outstanding as were issued and outstanding for the Bank just prior to consummation of the merger, but the Bank’s shareholders will become the Holding Company’s shareholders and the Holding Company will become the Bank’s sole shareholder. Thus, after consummation of the merger, matters requiring the approval of the Bank’s shareholders, such as amendments to the Bank’s Articles of Incorporation or a merger of the Bank and another corporation, will be subject to the approval of the Holding Company as the Bank’s sole shareholder. With respect to charter documents, under California law, amendments to the Bank’s Articles of Incorporation require the Commissioner’s approval, in addition to any shareholder approvals which may be required. Amendments to the Holding Company’s Articles of Incorporation do not require the Commissioner’s approval. The Bank’s present shareholders will become the shareholders of the Holding Company and will be entitled to vote on similar matters affecting that corporation.

     Differences in Dividend Rights. Under California law, funds available for cash dividend payments by a bank are restricted to the lesser of: (1) retained earnings; or (2) the bank’s net income for its last three fiscal years (less any distributions to shareholders made during such period). Cash dividends may also be paid out of the greater of: (i) net income for a bank’s last preceding fiscal year; (ii) a bank’s retained earnings; or (iii) net income for a bank’s current fiscal year, upon the prior approval of the Commissioner. If the Commissioner finds that the stockholders’ equity of a bank is not adequate or that the payment of a dividend would be unsafe or unsound for the bank, the Commissioner may order the bank not to pay any dividend to the bank’s shareholders.

     Under California law, the Holding Company would be prohibited from paying dividends unless: (1) its retained earnings immediately prior to the dividend payment equals or exceeds the amount of the dividend; or (2) immediately after giving effect to the dividend (i) the sum of the Holding Company’s assets would be at least equal to 125% of its liabilities, or, if the average of its earnings before taxes on income and before interest expense for the two preceding fiscal years was less than the average of its interest expense for the two preceding fiscal years, the current assets of the Holding Company would be at least equal to 125% of its current liabilities. (See “PROPOSAL 1 — BANK HOLDING COMPANY REORGANIZATION — Dividends” herein.)

Risks Related to First California Bank

     We are highly dependent on real estate and events that negatively impact the real estate market could hurt our business. A significant portion of our loan portfolio is dependent on real estate. At June 30, 2005, real estate served as the principal source of collateral with respect to approximately 72% of First California Bank’s loan portfolio. Our financial condition may be adversely affected by a decline in the value of the real estate securing our loans and, while we presently hold no real estate acquired through foreclosure or other judicial proceeding, a decline in the value of real estate that may be owned by us, through foreclosure or otherwise, in the future could adversely impact our financial condition. In addition, acts of nature, including earthquakes, brush fires and floods, which may cause uninsured damage and other loss of value to real estate that secures these loans, may also negatively impact our financial condition. This is particularly significant in light of the fact that substantially all of the real estate that makes up the collateral of our real estate secured loans is located in Southern California, where earthquakes and brush fires are common.

     Economic conditions in the Southern California area could adversely affect our operations. Our banking operations are concentrated primarily in Ventura and Los Angeles County. As a result of this geographic concentration, our results of operations depend largely upon economic conditions in these areas. Deterioration in economic conditions in our market area could have a material adverse impact on the quality of our loan portfolio and the demand for our retail and commercial banking products and services, which in turn may have a material adverse effect on our results of operations.

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     We are dependent on the continued services of key management. Our continued success depends on the retention, recruitment and continued contributions of key management, including C. G. Kum, the Bank’s President and Chief Executive Officer, Thomas E. Anthony, the Bank’s Executive Vice President and Chief Credit Officer and Romolo Santarosa, the Bank’s Executive Vice President and Chief Financial Officer, and other key officers of the Bank, and SCCB (upon consummation of the proposed acquisition of SCB). The loss of such key personnel could have an adverse affect on our growth and profitability, and many of these persons would be difficult or impossible to replace. The competition for qualified personnel is intense. The loss of services of members of our key personnel could have a material adverse effect on our business, financial condition and results of operations.

     We face strong competition from financial service companies and other companies that offer banking services that could hurt our business. The banking business in California, generally, and in the Ventura and Los Angeles County areas where our banking offices are located, specifically, is highly competitive with respect to both loans and deposits and is dominated by major banks, both domestic and foreign, which have many offices operating over wide geographic areas. We compete for deposits and loans principally with these major banks, but also with small independent banks located in our service area. Among the advantages which the major banks have over us are their ability to finance extensive advertising campaigns and to allocate their investment assets to regions of highest yield and demand. Many of the major commercial banks operating in our service area offer certain services that are not offered directly by us and, by virtue of their greater total capitalization, such banks have substantially higher lending limits than us. In addition, we face direct competition from newly chartered banks which are formed from time to time in our service area. Moreover, banks generally, and we in particular, face increasing competition for loans and deposits from non-bank financial intermediaries such as savings and loan associations, thrift and loan associations, credit unions, mortgage companies, insurance companies, and other lending institutions. Money market funds offer rates competitive with, or higher than those of, banks, and an increasingly sophisticated financial services industry continually develops new products for businesses and consumers that compete with banks for investment dollars. In addition, other entities (both public and private) seeking to raise capital through the issuance and sale of debt or equity securities compete with banks in the acquisition of deposits. Increasing levels of competition in the banking and financial services businesses may reduce our market share or cause the prices we charge for our services to fall. Our results may differ in future periods depending upon the nature or level of competition.

     We may not or will not sustain recent growth trends. The Bank has grown in recent years, including with respect to net income, assets, loans, deposits and other benchmarks. For example, the Bank’s net income for the year ended December 31, 2004 totaled $2.4 million, up 10.3% from $2.2 million earned in 2003. On a per share basis, the 2004 results equate to $1.14 per diluted share, versus $1.10 per diluted share in the prior year. At December 31, 2004, the Bank’s total assets were $283.7 million, compared with $256.3 million at the close of 2003. Total deposits amounted to $227.2 million, up from $211.9 million twelve months earlier, and loans increased to $182.9 million, compared with $158.0 million last year. No assurances can be given that such growth patterns can be sustained in the future.

     Our growth presents certain risks, including a decline in credit quality or capital adequacy. The Bank’s asset growth of recent years may continue, even if not at the same percentage rate we have experienced in recent years. Such growth presents certain risks. While management believes that the Bank has maintained good credit quality relative to its peers notwithstanding such growth, rapid growth is frequently associated with a decline in credit quality. Accordingly, continued asset growth could lead to a decline in our credit quality in the future. In addition, continued asset growth could cause a decline in the Company’s or the Bank’s capital adequacy for regulatory purposes, which could in turn cause the Company to have to raise additional capital in the future to maintain or regain “well capitalized’’ status as defined under applicable banking regulations.

     Failure to successfully execute our strategy could adversely affect our performance. Our financial performance and profitability depends on our ability to execute our corporate growth strategy. Continued growth may present operating and other problems that could adversely affect our business, financial condition and results of operations. Accordingly, there can be no assurance that we will be able to execute our growth strategy or maintain the level of profitability that we have recently experienced.

     Our performance and growth are dependent on our maintaining a high quality of service for our customers, and will be impaired by a decline in our quality of service. Our continued growth is dependent on our maintaining a

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high quality of service for our customers. As we continue to grow, it may become increasingly difficult to maintain high service quality for our customers. This could cause a decline in our performance and growth with respect to net income, deposits, assets and other benchmarks.

     Our size subjects us to lower lending limits than many of our competitors are subject to. The Bank and SCCB are subject to lending limits, calculated as a function of our respective capital. After the acquisition of SCCB and subsequent consolidation with the Bank, the Bank will have a greater lending limit as a result of the increased capital. Notwithstanding the increased capital of the Bank after the merger, however, because of the Bank’s size, the Bank will be limited in the size of loans it will be able to make, singly or in the aggregate, to existing or potential customers. As of June 30, 2005, the Bank’s lending limit for secured loans was approximately $6.5 million and the Bank’s lending limit for unsecured loans was approximately $3.9 million. On a pro forma basis (giving effect to the consolidation of SCCB with the Bank), as of June 30, 2005, the Bank’s lending limit for secured loans would be approximately $14.5 million and the Bank’s lending limit for unsecured loans would be approximately $8.7 million. In the event that a customer’s loan demands exceed the Bank’s lending limits, the Bank may attempt to arrange for such loans on a participation basis with its correspondent banks. Where this is not feasible, the Bank may be unable to make the loan. This may result in the loss of existing or prospective business.

     We are subject to other government regulation that could limit or restrict our activities, which in turn could adversely impact our operations. The financial services industry is regulated extensively. Federal and state regulation is designed primarily to protect the deposit insurance funds and consumers, rather than our shareholders. These regulations can sometimes impose significant limitations on our operations. In addition, these regulations are constantly evolving and may change significantly over time. New laws and regulations or changes in existing laws and regulations or repeal of existing laws and regulations may adversely impact our business. The impact on us and our financial performance of the recently enacted Sarbanes-Oxley Act of 2002 and various rule makings by the SEC and the NASD cannot presently be determined. Further, federal monetary policy, particularly as implemented through the Federal Reserve System, significantly affects economic conditions for us.

     If a significant number of borrowers, guarantors and related parties fail to perform as required by the terms of their loans, we will sustain losses. A significant source of risk for us arises from the possibility that losses will be sustained if a significant number of our borrowers, guarantors and related parties fail to perform in accordance with the terms of their loans and guaranties. This risk increases when the economy is weak. We have adopted underwriting and credit monitoring procedures and credit policies, including the establishment and review of the allowance for loan losses, that management believes are appropriate to minimize this risk by assessing the likelihood of nonperformance, tracking loan performance and diversifying our credit portfolio. These policies and procedures, however, may not prevent unexpected losses that could materially adversely affect our results of operations.

     Our business is subject to interest rate risk and changes in interest rates may adversely affect our performance and financial condition. Our earnings are impacted by changing interest rates, which are unpredictable and beyond our control. Changes in interest rates impact the demand for new loans, the credit profile of our borrowers, the rates received on loans and securities and rates paid on deposits and borrowings. The difference between the rates received on loans and securities and the rates paid on deposits and borrowings is known as interest rate spread. Given our current volume and mix of interest-bearing liabilities and interest-earning assets, we would expect our interest rate spread to increase if interest rates rise and, conversely, to decline if interest rates fall. Although we believe our current level of interest rate sensitivity is reasonable, significant fluctuations in interest rates may have an adverse effect on our business, financial condition and results of operations.

     We could be adversely affected by general economic conditions. A decline in current economic conditions or rising interest rates could have an adverse effect on the demand for new loans and the ability of borrowers to repay outstanding loans, which could adversely affect our financial condition and results of operations in general and the market value of our common stock.

     We are exposed to risk of environmental and other liabilities with respect to properties to which we take title. In the course of our business, we may foreclose and take title to real estate, and could be subject to environmental or other liabilities with respect to these properties. We may be held liable to a governmental entity or to third persons for property damage, personal injury, investigation and clean-up costs incurred by these parties in connection with environmental contamination, or may be required to investigate or clean up hazardous or toxic substances, or chemical releases at a property. The costs associated with investigation or remediation activities could be

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substantial. In addition, in the event we become the owner or former owner of a contaminated site, we may be subject to common law claims by third parties based on damages and costs resulting from environmental contamination emanating from the property. If we ever become subject to significant environmental liabilities, our business, financial condition, liquidity and results of operations could be materially and adversely affected.

     Our internal operations are subject to a number of risks. We are subject to certain operations risks, including, but not limited to, data processing system failures and errors, customer or employee fraud and catastrophic failures resulting from terrorist acts or natural disasters. We maintain a system of internal controls to mitigate against such occurrences and maintain insurance coverage for such risks that are insurable, but should such an event occur that is not prevented or detected by our internal controls and uninsured or in excess of applicable insurance limits, it could have a significant adverse impact on our business, financial condition or results of operations.

     We will incur additional costs as a result of operating as a public company. Upon consummation of the holding company reorganization, the Company will be a “public company’’ and will be required to comply with the reporting requirements under the Securities Exchange Act of 1934, as amended (the “Exchange Act’’) and its related regulations, including the rules implementing the provisions of the Sarbanes-Oxley Act of 2002, or the SOX. As a financial institution, the Bank has a history of filing regulatory reports and being subject to frequent government oversight. The Bank’s audit committee consists entirely of outside (i.e., non-employee) directors. The Bank also has a system of internal controls. Although the Bank cannot be certain of the effect, if any, the new requirements and regulations as a public company will have on its business, the Bank and the Company do not anticipate that complying with these regulations and requirements will result in any material changes in corporate governance, business or results of operations other than the additional costs associated with the reporting requirements under the Exchange Act and the enhanced disclosures under the SOX. At this point, such additional costs cannot be estimated or predicted and could be significant. Future changes in the laws, regulation, or policies that could also impact the Bank and the Company cannot necessarily be predicted and may have a material adverse effect on business and earnings.

Risks Related to FCB Bancorp Common Stock

     The Company’s common stock is currently not traded and only a limited trading market exists for the Bank’s common stock. Presently, there is no trading market for the Company’s common stock. In connection with the holding company formation, the Bank’s shareholders will exchange their shares of the Bank’s common stock for the Company’s common stock on a one-for-one basis. As of                     , 2005, there were 2,162,807 shares of the Bank’s common stock issued and outstanding. Only a limited trading market for the Bank’s common stock exists on the OTC “Bulletin Board.’’ We are aware of four dealers currently trading shares of the Bank’s common stock. However, we cannot assure you that an active public market for the Company’s common stock will ever develop or the extent to which those dealers will continue trading the Company’s common stock after the holding company formation.

     The interests of our controlling shareholders may differ from yours. As of the Record Date, the Bank’s directors, executive officers and their related interests have voting control with respect to approximately 58% of its outstanding shares. In particular, James O. Birchfield, the Bank’s Chairman, together with members of his immediate family, beneficially own and have voting power with respect to approximately 35% of the Bank’s outstanding common stock. After the holding company formation, Mr. Birchfield will own the same percentage voting interests in the Company as he owns in the Bank. The interests of these controlling shareholders may differ from yours. Because of this beneficial ownership and voting power, our controlling shareholders have the power to substantially control any matter presented to shareholders for a vote, including with respect to the election of directors or other material transactions, such as a future issuance of securities, a potential acquisition of, or take-over proposal made by, another company. As a result, these controlling shareholders may cause the defeat of a proposal you support, or cause the passing of a proposal you oppose.

     A holder with as little as a 5% interest in FCB Bancorp could, under certain circumstances, be subject to regulation as a “bank holding company.’’ A holder (not including a natural person) of 25% or more of the outstanding FCB Bancorp common stock, or 5% or more if such holder otherwise exercises a “controlling influence’’ over FCB Bancorp, may be subject to regulation as a “bank holding company’’ in accordance with the Bank Holding Company Act of 1956, as amended (the BHCA). In addition, (i) any bank holding company or foreign bank with a U.S. presence may be required to obtain the approval of the Federal Reserve Board under the BHCA to

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acquire or retain 5% or more of the outstanding FCB Bancorp common stock and (ii) any person other than a bank holding company may be required to obtain the approval of the Federal Reserve Board under the Change in Bank Control Act to acquire or retain 10% or more of the outstanding FCB Bancorp common stock. Becoming a bank holding company imposes certain statutory and regulatory restrictions and burdens, and might require the holder to divest all or a portion of the holder’s investment in FCB Bancorp. In addition, because a bank holding company is required to provide managerial and financial strength for its bank subsidiary, such a holder may be required to divest investments that may be deemed incompatible with bank holding company status, such as a material investment in a company unrelated to banking.

Risks Related to the SCB Acquisition

     The acquisition of SCB may not be consummated as planned. Although we have every reason to believe that the acquisition of SCB will be consummated as planned, the Company’s ability to consummate the acquisition is subject to a number of material conditions and there can be no assurances that we will be able to consummate the transaction. (See “SOUTH COAST BANCORP, INC. – Description of the Acquisition Agreement” herein for detailed information regarding the material conditions to consummating the acquisition.

     There is a risk that we may not be able to integrate our business successfully with SCB. If we are unable to integrate our businesses successfully, our business and earnings may be negatively effected. The acquisition involves the integration of companies that have previously operated independently. Successful integration of SCB’s consolidated operations will depend primarily on our ability to consolidate operations, systems and procedures and to eliminate redundancies and costs. No assurance can be given that we will be able to integrate our operations without encountering difficulties including, without limitation, the loss of key employees and customers, the disruption of our respective ongoing businesses or possible inconsistencies in standards, controls, procedures and policies. If we have difficulties with the integration, we might not achieve the economic benefits we expect to result from the acquisition and this would likely hurt our business and our earnings.

AVAILABLE INFORMATION

     First California Bank’s Common Stock is not registered under the Securities Exchange Act of 1934, as amended (the “Exchange Act”) and, therefore, the Bank is not subject to the reporting and other requirements of the Exchange Act. Upon the Registration Statement (see below) being declared effective by the Securities and Exchange Commission (the “SEC”), however, FCB Bancorp (the “Holding Company”) will be subject to the reporting requirements under the Exchange Act and will file such reports with the SEC.

     The Holding Company has filed with the SEC a Registration Statement (the “Registration Statement”) on Form S-4 under the Securities Act of 1933, as amended (the “Securities Act”), relating to the shares of the Holding Company’s Common Stock to be issued in connection with the merger. As permitted by the rules and regulations of the SEC, certain information included in the Registration Statement is omitted from this Proxy Statement/Prospectus. For further information and reference, the Registration Statement, including the exhibits and schedules filed as a part thereof, can be inspected and copied at the public reference room of the SEC, 450 Fifth Street, N.W., Room 1024, Washington, D.C. 20549, and copies of such materials can be obtained by mail from the Public Reference Section of the SEC, 450 Fifth Street, N.W., Room 1024, Washington, D.C. 20549, at prescribed rates. Please call the SEC at 1-800-SEC-0330 for further information on the operations of the public reference rooms. The SEC maintains an Internet web site that contains reports, proxy and information statements and other information regarding issuers who file electronically with the SEC. The address of that site is http://www.sec.gov. Additional information about us is available on our internet website at www.fcbank.com. The same information available that is available at the public reference room of the SEC for public inspection can be accessed at the SEC’s website.

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

     Certain statements contained in this Proxy Statement, including, without limitation, statements containing the words “believes,” “anticipates,” “intends,” “expects,” “may,” “will,” “should,” “would,” and similar words, constitute “forward-looking statements”. Such forward looking statements

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involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Such factors include, among others, the following: general economic and business conditions in those areas in which the Bank operates, demographic changes, competition, fluctuations in interest rates, changes in business strategy or development plans, changes in governmental regulation, credit quality, the availability of capital to fund the expansion of the Bank’s business, and other risk factors referenced in the Proxy Statement. The factors set forth under “Risk Factors” and other cautionary statements made in the Proxy Statement should be read and understood as being applicable to all related forward-looking statements wherever they appear in the Proxy Statement.

     These statements are further qualified by important factors, in addition to those under “Risk Factors” in the Proxy Statement and the documents which are incorporated by reference in this Proxy Statement, that could cause actual results to differ significantly from those in the forward-looking statements, including, among other things, economic conditions and other risks. Forward-looking statements are not guarantees of performance. By their nature, they involve risks, uncertainties and assumptions. The future results and shareholder values may differ significantly from those expressed in these forward-looking statements. You are cautioned not to put undue reliance on any forward-looking statement. Any such statement speaks only as of the date of the Proxy Statement, and in the case of documents incorporated by reference, as of the date of those documents. Neither the Bank nor the Holding Company undertake any obligation to update or release any revisions to any forward-looking statements, to report any new information, future event or other circumstances after the date of the Proxy Statement or to reflect the occurrence of unanticipated events, except as required by law. However, your attention is directed to any further disclosures made on related subjects in the Holding Company’s subsequent reports filed with the SEC on Forms 10-K, 10-Q and 8-K.

VOTING SECURITIES

     There were issued and outstanding 2,162,807 shares of the Bank’s Common Stock on                     , 2005, which has been fixed as the record date for the purpose of determining the shareholders entitled to notice of, and to vote at, the Meeting (the “Record Date”). On any matter submitted to the vote of the shareholders, each holder of Common Stock will be entitled to one vote, in person or by Proxy, for each share of Common Stock held of record on the books of the Bank as of the record date for the Meeting.

     A majority of the outstanding shares, represented in person or by proxy, is required for a quorum. Approval of the Merger Agreement requires the approval of the holders of a majority of the outstanding shares of the Bank’s Common Stock. Approval of the Stock Option Plan and authority to vote for adjournment to solicit additional Proxies require the approval of a majority vote of the shares represented at the Meeting. Abstentions and broker non-votes are counted towards a quorum but abstentions and broker non-votes are the equivalent of “no” votes with respect to the approvals of the Merger Agreement, the Stock Option Plan, and authority to vote for adjournment to solicit additional Proxies.

     The Meeting is being called to approve the Merger Agreement and the Stock Option Plan. The Proxy also solicits authority to adjourn the Meeting, if necessary, to solicit additional Proxies. No other business is stated in the accompanying Notice. Therefore, no other matters or business will be transacted at the Meeting. However, the proxy confers discretionary authority to vote on administrative matters, except adjournment to solicit additional Proxies, in accordance with the recommendation of the Holding Company’s Board of Directors.

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SHAREHOLDINGS OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

     Except as set forth below, Management of the Bank does not know of any person who owns beneficially or of record, more than 5% of the Bank’s outstanding Common Stock. The following table sets forth certain information as of                     , 2005, concerning the beneficial ownership of the Bank’s outstanding Common Stock by each of the directors and executive officers¹ and by all directors and executive officers of the Bank as a group. Management is not aware of any change in control of the Bank which has occurred since January 1, 2004, or of any arrangement which may, at a subsequent date, result in a change in control of the Bank, except the bank holding company reorganization.

	Number of Shares of
	Common Stock		Percent of Class
Name and Position Held	Beneficially Owned2,3		Beneficially Owned2
Richard D. Aldridge,		195,888		9.06	%
Director
Thomas E. Anthony,		14,222		0.66	%
Executive Vice President and Chief Credit Officer
James O. Birchfield,		460,270		21.28	%
Chairman of the Board
John W. Birchfield,		290,911		13.45	%
Vice Chairman
Tenisha M. Fitzgerald,		38,641		1.79	%
Director
C. G. Kum,		26,948		1.25	%
Director, President and Chief Executive Officer
Syble R. Roberts,		231,754		10.72	%
Director
Romolo Santarosa,		500		0.02	%
Executive Vice President and Chief Financial Officer
All Directors and Executive Offices as a Group (8 in number)		1,259,134		58.22	%

1	As used throughout this Proxy Statement, the term “executive officer” means our President and Chief Executive Officer, our Executive Vice President and Chief Credit Officer, and our Executive Vice President and Chief Financial Officer. Our Chairman of the Board, Corporate Secretary, and other vice presidents are not deemed to be executive officers.
2	No stock options held by any director or executive officer were exercisable within 60 days after                     , 2005.
3	Includes shares held by or with such person’s spouse (except where legally separated) and minor children; shares held by any other relative of such person who has the same home; shares held by a family trust as to which such person is a trustee with sole voting and investment power (or shares power with a spouse); shares held as custodian for minor children; or shares held in an Individual Retirement Account or pension plan as to which such person has pass-through voting rights and investment power. Does not include shares which may be acquired upon exercise of stock options, which are identified separately in this table.

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PROPOSAL 1

BANK HOLDING COMPANY REORGANIZATION

General

     Shareholders will consider and vote upon a Plan of Reorganization and Merger Agreement pursuant to which the business of the Bank will be conducted as a wholly-owned subsidiary of FCB Bancorp, a California corporation, and each outstanding share of the Bank’s Common Stock will be converted into an equal number of shares of FCB Bancorp’s no par value Common Stock, if approved by the Bank’s shareholders and the regulatory authorities.

     The board of directors of the bank has unanimously approved the proposed merger and is recommending that the bank’s shareholders vote “FOR” the proposal.

     The following summary of the material terms and provisions of the Merger Agreement is qualified in its entirety by reference to the Merger Agreement, which is attached as Exhibit A to this Proxy Statement and incorporated herein by this reference.

Reasons for the Merger

     General. Management believes a holding company will permit shareholders of the Bank to participate in the ownership of a more flexible entity for financing and growth within the banking field and in areas related to banking. For example, in the event an opportunity for the acquisition of another bank were to develop, it might be desirable to maintain the separate existence of the other bank after the acquisition rather than merging it into the Bank. The existence of a holding company would allow such an acquisition. In fact, the Holding Company has already entered into a definitive agreement to acquire another commercial bank. (See “South Coast Bancorp Acquisition” below.)

     A bank holding company may provide more alternatives in the raising of funds required by the Bank, or by the Holding Company, under changing conditions in financial and monetary markets, including funds raised through the issuance of trust preferred securities. In fact, it is anticipated that the Holding Company will raise approximately $10.0 million from the issuance of trust preferred securities in order to finance in part the acquisition of SCB. (See “South Coast Bancorp Acquisition” below.)

     A bank holding company also provides certain flexibility for acquiring or engaging in other businesses related to banking. Prudent bank management might dictate that some of those activities be carried on wholly apart from the Bank. A holding company would easily permit that kind of separation.

     Finally, it is believed that the merger will enhance the Bank’s ability to continue to satisfy ever changing and expanding needs of present customers for banking and banking-related services and to continue to attract new customers for financial services. The recommended corporate form will better suit expansion into new areas of service and interstate banking acquisitions than would the existing structure. Most major banking institutions in the United States and in California have been reorganized into bank holding companies and the Bank’s directors believe that such reorganization is desirable for the Bank to maintain and enhance its competitive position.

     South Coast Bancorp Acquisition. After the consummation of the holding company formation, FCB Bancorp will acquire SCB and SCB’s wholly-owned subsidiary, SCCB. Immediately thereafter, SCB will be merged with and into FCB Bancorp with FCB Bancorp surviving the merger. As a result of the acquisition and merger, SCCB will become a wholly-owned separate subsidiary of FCB Bancorp and sister corporation of the Bank; provided, however, that as soon as practical after the Acquisition, FCB Bancorp intends to either consolidate the two banks under First California Bank’s charter or enter into an asset purchase and liability assumption agreement pursuant to which substantially all of the assets and liabilities of SCCB would be acquired/assumed by First California Bank. The asset purchase alternative would be utilized if the California Department of Financial Institutions were to permit the acquisition of SCCB (reduced to a minimum level of capital, assets and liabilities) by a third party financial institution. (See “SOUTH COAST BANCORP” herein for additional information regarding the Acquisition transaction.)

          Under the terms of the Acquisition Agreement, the proposed holding company formation is a condition to closing the Acquisition and in the event that shareholder approval of the proposed holding company reorganization is not obtained, the Acquisition will not be completed and FCB Bancorp, but not the Bank, may be liable to SCB for liquidated damages of $2.5 million. It is anticipated that the Acquisition will close as soon as practicable after consummation of the holding company reorganization. Under the terms of the Acquisition Agreement, the Acquisition must close by no later than September 30, 2005, subject to extension by agreement amongst the parties.

          Under California law, the Acquisition does not require approval by the shareholders of either the Bank or FCB Bancorp. Therefore, shareholder approval of the Acquisition will not be sought at the Meeting. The terms of the Acquisition Agreement and the proposed acquisition do, however, require the approval of SCB’s shareholders, which approval was obtained at an annual meeting of shareholders duly held on April 12, 2005.

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Description of the Merger

     FCB Bancorp has been organized under the laws of the State of California at the direction of the Bank’s Board of Directors and holds all of the stock of FCB Merger Corp. (the “Subsidiary”), a newly organized California corporation.¹ The merger is proposed to be accomplished by merging the Subsidiary into the Bank pursuant to the terms of the Merger Agreement, a copy of which is attached as Exhibit A hereto. Upon the effective date of the merger of the Subsidiary into the Bank, the shares of capital stock of the respective corporate parties to the Merger Agreement shall be converted as follows:

     1. Each outstanding share of the Bank’s Common Stock shall be converted into one share of the Holding Company’s Common Stock. Shareholders of the Bank will be entitled to exchange their present share certificates for new certificates evidencing shares of the Common Stock of the Holding Company. If no request is made, new certificates will be issued whenever old certificates are surrendered for transfer. Until so exchanged, the certificates for the Bank’s shares will represent the Holding Company’s shares into which the Bank’s shares have been converted.

     2. FCB Merger Corp. will disappear and all the outstanding shares of the Bank’s Common Stock will be owned by the Holding Company.

     3. The shareholders of the Bank will be the shareholders of the Holding Company. As shareholders of the Holding Company, they will have essentially the same rights to govern that corporation’s activities as they have with respect to the Bank; however, as shareholders of the Holding Company, they will not be entitled to vote on matters requiring the approval of the Bank’s shareholder. A discussion of those rights is contained in the section entitled “BANK HOLDING COMPANY REORGANIZATION — Comparison of First California Bank and FCB Bancorp Corporate Structures” herein.

Ratification and Approval of the Merger

     Applications for approval for the proposed reorganization have been filed with the California Department of Financial Institutions (the “DFI”), the Federal Deposit Insurance Corporation (the “FDIC”) and the Federal Reserve Bank of San Francisco (the “FRB”). All necessary regulatory approvals are anticipated to be received by September 2005, however, no assurances can be given that such approvals will be obtained by that time, if at all.

     Implementation of the merger requires the affirmative vote of the holders of a majority of the outstanding shares of the Bank’s Common Stock. The directors of the Bank, the Holding Company, and FCB Merger Corp. have unanimously approved the Merger Agreement.

     The merger will become effective when all necessary ratifications and approvals have been obtained and the requisite filings, as described in the Merger Agreement, have been made. It is anticipated that the merger will become effective during September, 2005.

     If any action, suit, proceeding or claim has been instituted, made or threatened relating to the merger so as to make its consummation inadvisable in the opinion of the Board of Directors of the Bank, then the merger may be terminated at any time before it becomes effective.

     Should the shareholders of the Bank fail to approve the merger or should it be otherwise terminated, the Merger Agreement would be cancelled and the Bank would continue to operate with the same shareholders as it had prior to adoption of the Merger Agreement. Upon termination, there shall be no liability by reason of the merger or the termination thereof on the part of the Bank, FCB Merger Corp., the Holding Company or their respective directors, officers, employees, agents or shareholders; except, however, that under the terms of the Acquisition Agreement, the Holding Company, but not the Bank, may be liable to SCB for liquidated damages of $2.5 million.

¹ FCB Bancorp and FCB Merger Corp. were incorporated on January 25, 2005 and February 25, 2005, respectively, and organized at the direction of the Bank’s Board of Directors for the purpose of facilitating the merger.

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     The expenses of the merger are estimated at approximately $100,000 (this figure does not include any costs or expenses related to the South Coast Bancorp acquisition).The Bank and the Holding Company will each bear their respective portion of the transaction expenses.

Description of FCB Bancorp Common Stock

     The authorized capital stock of the Holding Company consists of 10,000,000 shares of Common Stock, no par value (the “Holding Company’s Common Stock” or “FCB Bancorp’s Common Stock”), and 10,000,000 shares of serial preferred stock (the “Preferred Stock”). The Preferred Stock may be divided into such number of series as the Board of Directors may determine. The Board of Directors is authorized to determine and alter the rights, preferences, privileges and restrictions granted to and imposed upon any wholly unissued series of Preferred Stock, and to fix the number of shares of any series of Preferred Stock and the designation of any such series of Preferred Stock. The Board of Directors, within the limits and restrictions stated in any resolution or resolutions of the Board of Directors originally fixing the number of shares constituting any series, may increase or decrease (but not below the number of shares of such series then outstanding) the number of shares of any series subsequent to the issue of shares of that series.

     The issuance of Preferred Stock could affect the rights of holders of Common Stock. No shares of Preferred Stock will be issued in connection with the merger and there are no plans to issue Preferred Stock at the present time.

     Holders of shares of the Holding Company’s Common Stock are entitled to one vote for each share held of record on all matters voted upon by shareholders.

     Upon liquidation or dissolution of the Holding Company, the assets legally available for distribution to holders of shares of the Holding Company’s Common Stock, after payment of all obligations of the Holding Company and payment of any liquidation preference of all other classes and series of stock entitled thereto, including Preferred Stock, if any, are distributable ratably among the holders of the Holding Company’s Common Stock.

     The holders of the Holding Company’s Common Stock have no preemptive rights to subscribe for new issue securities, and shares of the Holding Company’s Common Stock are not subject to redemption, conversion, or sinking fund provisions. The shares of the Common Stock, when issued in connection with the merger, will be validly issued, fully paid, and non assessable.

     After the preferential dividends upon all other classes and series of stock entitled thereto shall have been paid or declared and set apart for payment and after the Holding Company shall have complied with all requirements, if any, with respect to the setting aside of sums as a sinking fund or for a redemption account on any class of stock, then the holders of the Holding Company’s Common Stock are entitled to such dividends as may be declared by the Board of Directors out of funds legally available therefore under the laws of the State of California. (See “BANK HOLDING COMPANY REORGANIZATION — Comparison of First California Bank and FCB Bancorp Corporate Structures” herein.)

     In connection with the 2005 Private Offering, FCB Bancorp has agreed to provide investors with registration rights relating to their shares. Under the terms of these registration rights, FCB Bancorp will be required to file a shelf registration statement pursuant to Rule 415 under the Securities Act, relating to the shares of FCB Bancorp common stock sold in, and within 90 days after the closing date of, the 2005 Private Offering. In the event that FCB Bancorp fails to timely file such registration statement or it is not declared effective within 150 days of the closing date of the 2005 Private Offering or such registration statement ceases to be effective, FCB Bancorp may be liable to the investors for certain liquidated damages.

Comparison of First California Bank and FCB Bancorp Corporate Structures

     General. The following discusses some of the similarities and some of the differences in the corporate structures of the Bank and the Holding Company. Upon consummation of the merger, the Holding Company will have the same number of shares issued and outstanding as were issued and outstanding for the Bank just prior to consummation of the merger, but the Bank’s shareholders will become the Holding Company’s shareholders and the Holding Company will become the Bank’s sole shareholder. Thus, after consummation of the merger, matters requiring the approval of the Bank’s shareholders, such as amendments to the Bank’s Articles of Incorporation or a merger of the Bank and another corporation, will be subject to the approval of the Holding Company as the Bank’s sole shareholder. The Bank’s present shareholders will become the shareholders of the Holding Company and will be entitled to vote on similar matters affecting that corporation.

     Similarities. The Articles of Incorporation of both corporations authorize indemnification of directors, officers and agents to the fullest extent permissible under California law, eliminate directors’ liability for monetary damages to the fullest extent permissible under California law, and authorize the purchase of liability insurance. The Bank has

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such liability insurance and it is anticipated that the Holding Company will assume the Bank’s insurance coverage. Further, the Holding Company has entered into indemnification agreements with each of its directors and officers to implement the indemnification provisions of its Articles of Incorporation. Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers or persons controlling the Holding Company pursuant to the foregoing provisions, the Holding Company has been informed that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is therefore unenforceable. In addition, both corporations have the same liquidation rights and shareholders of both corporations have no preemptive rights.

     Differences. The Bank’s and the Holding Company’s corporate structures differ with respect to dividends and amendments to their charter documents. Under California law, funds available for cash dividend payments by a bank are restricted to the lesser of: (1) retained earnings; or (2) the bank’s net income for its last three fiscal years (less any distributions to shareholders made during such period). Cash dividends may also be paid out of the greater of: (i) net income for a bank’s last preceding fiscal year; (ii) a bank’s retained earnings; or (iii) net income for a bank’s current fiscal year, upon the prior approval of the Commissioner. If the Commissioner finds that the stockholders’ equity of a bank is not adequate or that the payment of a dividend would be unsafe or unsound for the bank, the Commissioner may order the bank not to pay any dividend to the bank’s shareholders.

     Under California law, the Holding Company would be prohibited from paying dividends unless: (1) its retained earnings immediately prior to the dividend payment equals or exceeds the amount of the dividend; or (2) immediately after giving effect to the dividend (i) the sum of the Holding Company’s assets would be at least equal to 125% of its liabilities, or, if the average of its earnings before taxes on income and before interest expense for the two preceding fiscal years was less than the average of its interest expense for the two preceding fiscal years, the current assets of the Holding Company would be at least equal to 125% of its current liabilities. (See “BANK HOLDING COMPANY REORGANIZATION — Dividends” herein.)

     With respect to their charter documents, under California law, amendments to the Bank’s Articles of Incorporation require the Commissioner’s approval, in addition to any shareholder approvals which may be required. Amendments to the Holding Company’s Articles of Incorporation do not require the Commissioner’s approval.

The Holding Company

     General. The Holding Company was incorporated under the laws of the State of California on January 25, 2005, at the direction of the Board of Directors of the Bank for the purpose of acquiring all of the outstanding shares of the Bank’s Common Stock.

     The Holding Company has filed an application with the FRB for prior approval to become a bank holding company and applications with the FDIC and the DFI for approval of the proposed merger. All necessary regulatory approvals are anticipated to be received by September 2005, however, no assurances can be given that such approvals will be obtained by that time, if at all.

     The Holding Company presently has total assets of $1,000, owns no properties and, therefore, as necessary, will use the Bank’s existing premises, facilities and personnel. The Holding Company’s needs in this regard are expected to be minimal, and the Holding Company will reimburse the Bank for such expenses. The Holding Company’s offices are located at 1100 Paseo Camarillo, Camarillo, California. The Holding Company does not contemplate any substantial expenditures for equipment, office space, or additional personnel prior to consummation of the merger or for the foreseeable future.

     Neither the Holding Company nor the Bank is a party to any pending legal proceedings before any court, administrative agency or other tribunal. Further, neither the Holding Company nor the Bank is aware of any material litigation which is threatened against it or the Bank, respectively, in any court, administrative agency, or other tribunal.

     After consummation of the merger, the business of the Bank will then be carried on as a subsidiary of the Holding Company. Administrative expenses and taxes incurred in the operation of the Holding Company will be in addition to those of the Bank; however, the merger is not expected to result in any change in management

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remuneration or benefits. Although the Holding Company’s initial expenses will be paid from the proceeds of the 2005 Private Offering, on an ongoing basis it is anticipated that the Bank will pay cash dividends to the Holding Company to provide the Holding Company with liquid resources to fund its separate operations.

     South Coast Bancorp Acquisition. As discussed above, after the holding company formation is consummated, the Holding Company will acquire and merge with South Coast Bancorp, Inc., whereby the Holding Company will survive the merger and South Coast Commercial Bank will become its wholly-owned subsidiary and sister corporation of the Bank. (See “SOUTH COAST BANCORP” for additional information on the South Coast Bancorp acquisition.)

Directors and Executive Officers

     After the merger, the Bank’s directors will remain the same and will, in addition, continue to serve as the directors of the Holding Company until the 2006 Annual Meetings of Shareholders of both corporations or until their successors are elected and have qualified. The following officers of the Bank have been appointed to serve as the initial officers of the Holding Company:

Name	Position with the Bank	Position with the Holding Company
James O. Birchfield	Chairman of the Board	Chairman of the Board
John W. Birchfield	Vice Chairman	Vice Chairman
C. G. Kum	President and Chief Executive Officer	President and Chief Executive Officer
Thomas E. Anthony	Executive Vice President and Chief Credit Officer	Executive Vice President and Chief Credit Officer
Romolo Santarosa	Executive Vice President and Chief Financial Officer	Executive Vice President and Chief Financial Officer

     The following table sets forth certain information with respect to the Bank’s directors and executive officers as of                     , 2005:

Name	Age		Position
Richard D. Aldridge		57	Director
James O. Birchfield		77	Chairman of the Board
John W. Birchfield		53	Vice Chairman
Tenisha M. Fitzgerald		30	Director
C. G. Kum		51	President and Chief Executive Officer
Thomas E. Anthony		57	Executive Vice President and Chief Credit Officer
Syble R. Roberts		68	Director
Romolo Santarosa		48	Executive Vice President and Chief Financial Officer

     The Board has not yet determined which of its directors, if any, is an “audit committee financial expert” within the meaning of the SEC’s rules and regulations.

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Executive Officers

          C. G. Kum, President and Chief Executive Officer. Mr. Kum began his banking career in 1977 as a corporate banking trainee with Bank of California in San Francisco, California. He served as Regional Vice President and Manager of Asset Quality Administration for United Banks of Colorado from 1984 until 1987. Mr. Kum then served as Vice President and Division Manager of Special Projects Division for Colorado National Bank from 1987 until 1993. Mr. Kum moved to California in 1993 and served as Executive Vice President and Chief Credit Officer of City Commerce Bank, Santa Barbara, California from 1993 until 1999.

          Mr. Kum was appointed to his current position as the President and the Chief Executive Officer of First California Bank (formerly known as Camarillo Community Bank) on September 1, 1999. Under his leadership, the Bank has grown from total assets of $100 million and two branches in 1999, to total assets as of March 31, 2005 of $286 million and six branches (the sixth branch was opened on January 24, 2005 in the City of Simi Valley). He is a graduate of University of California at Berkeley and received his Masters Degree in Business Administration from Pepperdine University. Mr. Kum also is a graduate of Stonier Graduate School of Banking. He has served as a member of Board of Directors of Casa Pacifica, a non profit organization that serves high risk youths in Ventura County, California State University at Channel Islands Foundation, and the United Way of Ventura County. He was recently elected to the position of the President of the Board of Directors of Community Bankers of California, an association of California community bank presidents, for the fiscal year of 2005-06. Mr. Kum lives in Camarillo, California with his wife Vikki and their three children.

          Thomas E. Anthony, Executive Vice President and Chief Credit Officer. Mr. Anthony moved from Illinois and began his banking career in 1970 as a commercial loan trainee with the then United California Bank in Los Angeles. He served as Vice President — Commercial Lender at Independence Bank from 1988 to 1992. He then served as Executive Vice President and Chief Credit Officer at Channel Islands National Bank from 1992 until 1998 when it was merged with American Commercial Bank, where he served in the same capacity from 1998 until 1999. Mr. Anthony joined First California Bank in 1999 as Executive Vice President and Chief Credit Officer.

          Mr. Anthony graduated from Northern Illinois University with a degree in Management. He has held several commercial lending and credit administration positions with banks in California and has been active on several community boards/committees and with charitable and professional organizations.

          Romolo Santarosa, Executive Vice President and Chief Financial Officer. Mr. Santarosa began his banking career in 1991 with Shawmut National Corporation as its Controller. In 1995, Mr. Santarosa joined Sanwa Bank California and served as Controller until 1997. He then served as Chief Financial Officer of Southern Pacific Bank from 1997 until 2000, of Eldorado Bancshares, Inc. from 2000 to 2001, and of Treasury Bank, N.A. from 2001 to 2002. Mr. Santarosa joined First California Bank in November 2002 as Executive Vice President and Chief Financial Officer.

          Mr. Santarosa is a graduate (1978) of Ithaca College, Ithaca, New York. He began his career in public accounting with Price Waterhouse, an international public accounting firm. He also is a certified public accountant in New York and Connecticut. Mr. Santarosa is active in several professional and community organizations.

Directors

          Richard D. Aldridge has been a director since 1993. After receiving an Honorable Discharge from the U.S. Air Force in 1971, Mr. Aldridge attended L.H. Bates Technical Institute and graduated with a degree in communications electronics and a Federal Communications Commission license for broadcast engineering. He was then employed for 19 years by Weyerhaeuser Company in Longview, Washington, where he began as a communications maintenance foreman for several years, then was appointed business manager for a new company profit center, quadrupling revenues in the first three years. He then served on the company’s Top Safety Committee, and represented Weyerhaeuser nationally serving on the Board of Directors of Forest Industries Telecommunications, an F.C.C. certified trade association. He also participated in frequent seminars and strategic planning meetings at the company’s corporate headquarters in Tacoma, Washington.

          Mr. Aldridge began investing in real estate in 1988 and community banking in 1990, acquiring his first shares in First California Bank (formerly Camarillo Community Bank). In 1991 he voluntarily left Washington to

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pursue further opportunities in real estate and banking in Ventura, California, while employed as President and CEO of B & R Supply, Inc., a long established industrial tool and supply company. Since 1990, he has held investments in Channel Islands Bank, City Commerce Bank, American Commercial Bank, Mid-State Bank and Trust, and First California Bank. Since his appointment as a director, Mr. Aldridge has served on several committees including CRA, Audit, Loan, funds management, and executive committees. Mr. Aldridge also served as interim Chairman of the Board from 1998 to 1999. First California Bank represents the largest single investment in his portfolio.

          Mr. Aldridge is the father of Tenisha M. Fitzgerald, a director of First California Bank since 1997.

          James O. Birchfield is the Chairman of the Board. Mr. Birchfield is a retired businessman whose active career was centered around an industrial tool and supply company which he founded in 1965. He has also been extensively involved with real estate investments since 1960.

          Mr. Birchfield has been an active investor in the local community banking industry for over twenty five years, holding positions in First State Bank of the Oaks, Ventura County National Bank, Channel Islands National Bank, American Commercial Bank, City Commerce Bank, Community West Bancshares and Mid State Bank and Trust.

          While serving as a director at First California Bank for over 14 years, Mr. Birchfield has actively provided leadership in many areas. Since becoming Chairman of the Board in 1997, he has guided the Bank through the most significant period of expansion in its history. In addition to his role as Chairman, he sits on several committees including, the Loan Committee, Funds Management Committee, Personnel Committee, and Audit Committee.

          Mr. Birchfield is the father of John W. Birchfield, the current Vice Chairman of the Board and a director of First California Bank since 1993.

          John W. Birchfield has been a director since 1993. Mr. Birchfield was awarded a Bachelor of Science degree in Business Finance in 1973 from the College of Business Administration at Northern Arizona University. Since 1995, Mr. Birchfield has served as the Chairman of the Board at B & R Supply Inc. He is also the managing partner of Ralston Properties LP, a privately held real estate management company.

          Since first being elected to the Board of Directors of First California Bank in 1993, he has actively participated in guiding the Bank through various business cycles, a management change and a name change as well as the development and execution of a long-term strategic plan. In 1998-99 he chaired the Board’s Y2K compliance committee.

          Currently he serves as the Vice Chairman of the Board as well as the Chairman of the Audit Committee at First California Bank. He is also an active member of the Loan Committee, the Funds Management Committee and Personnel Committee.

          Mr. Birchfield is the son of James O. Birchfield, the current Chairman of the Board and a director of First California Bank for over 14 years.

          Tenisha M. Fitzgerald has been a director since 1997. Ms. Fitzgerald graduated in 1997 from California Lutheran University with a degree in music education and a teaching certificate. Ms. Fitzgerald then taught at several elementary schools for approximately 6 years in the Port Hueneme, California school district. For the last two years, Ms. Fitzgerald has been serving as the accounts receivable manager for B & R Supply, Inc. Since her appointment to the Board of Directors in 1997, she has served on the Bank’s Loan and CRA Committees.

          Ms. Fitzgerald is the daughter of Richard D. Aldridge, a director of First California Bank since 1993.

          Syble R. Roberts has been a Director of First California Bank since 1989 and is the personnel committee chairman. Ms. Roberts was also a Founding Director of City Commerce Bank, Santa Barbara, opened in 1978 and now owned by Mid-State Bank.

          Ms. Roberts’ background is in the legal, title insurance and escrow, and real estate investment fields. Ms. Roberts attended Ventura Junior College and studied first year law through LaSalle Extension University, as well as continuing studies of business management, taxation and real estate. Ms. Roberts became a. specialist in the escrow field of multiple tax-deferred exchanges and long order leasehold estates and was involved in the start-ups of a title insurance company and several escrow and mortgage banking companies. Ms. Roberts has served on numerous community organizations including See International, Hospice, and Recordings for the Blind, and Women’s Council of NAREB.

Supervision and Regulation — FCB Bancorp

     The Bank Holding Company Act of 1956, as amended, places the Holding Company under supervision of the Board of Governors of the Federal Reserve System (the “FRB”). In the future, the Holding Company will be

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required to obtain the approval of the FRB before it may acquire all or substantially all of the assets of any bank, or ownership or control of any voting securities of any bank if, after giving effect to such acquisition, the Holding Company would own or control more than 5% of the voting shares of such bank.

     A bank holding company is prohibited from engaging in, or acquiring direct or indirect control of more than 5% of the voting shares of any company engaged in, non-banking activities unless the FRB, by order or regulation, has found such activities to be so closely related to banking or managing or controlling banks as to be a proper incident thereto. In making such determinations, the FRB considers whether the performance of such activities by a bank holding company would offer advantages to the public which outweigh possible adverse effects. (See “BANK HOLDING COMPANY REORGANIZATION — Permitted Non-Banking Activities” herein.)

     The Holding Company will be required to file reports with the FRB and provide such additional information as the FRB may require. The FRB will also have the authority to examine the Holding Company and each of its subsidiaries with the cost thereof to be borne by the Holding Company.

     Under California banking law, the Holding Company and its subsidiaries are also subject to examination by, and may be required to file reports with, the Commissioner. Regulations have not yet been proposed or adopted or steps otherwise taken to implement the Commissioner’s powers in this regard.

     The Holding Company and any subsidiaries which it may acquire or organize after the merger will be deemed affiliates of the Bank within the meaning of the Federal Reserve Act. Pursuant thereto, loans by the Bank to affiliates, investments by the Bank in affiliates’ stock, and taking affiliates’ stock by the Bank as collateral for loans to any borrower will be limited to 10% of the Bank’s capital in the case of all affiliates. (See “COMPENSATION AND OTHER TRANSACTIONS WITH MANAGEMENT AND OTHERS — Certain Transactions” herein.) The Holding Company and its subsidiaries will also be subject to certain restrictions with respect to engaging in the underwriting, public sale and distribution of securities.

     The Holding Company and its subsidiaries are prohibited from engaging in certain tying arrangements in connection with any extension of credit, sale or lease of property or furnishing of services. For example, with certain exceptions the Bank may not condition an extension of credit on a customer’s obtaining other services provided by it, the Holding Company or any other subsidiary, or on a promise from its customer not to obtain other services from a competitor.

     The shares of the Holding Company’s Common Stock to be issued in connection with the merger will be registered with the SEC pursuant to the Securities Act of 1933 and qualified with the California Department of Corporations (“DOC”). Future stock issuances by the Holding Company will be subject to registration with the SEC and DOC, absent available exemptions, in accordance with the SEC’s rules and regulations and California securities law.

     The Sarbanes-Oxley Act of 2002. The Sarbanes-Oxley Act of 2002, or the SOX, became effective on July 30, 2002, and represents the most far reaching corporate and accounting reform legislation since the enactment of the Securities Act of 1933 and the Exchange Act. The SOX is intended to provide a permanent framework that improves the quality of independent audits and accounting services, improves the quality of financial reporting, strengthens the independence of accounting firms and increases the responsibility of management for corporate disclosures and financial statements. It is intended that by addressing these weaknesses, public companies will be able to avoid the problems encountered by many notable companies in 2001-2002.

     The SOX’s provisions are significant to all companies that have a class of securities registered under Section 12 of the Exchange Act or are otherwise reporting to the SEC (or the appropriate federal banking agency) pursuant to Section 15(d) of the Exchange Act (collectively, “public companies”), including the Holding Company.

     The SOX’s provisions become effective at different times, ranging from immediately upon enactment to later dates specified in the SOX or the date on which the required implementing regulations become effective. Wide- ranging in scope, the SOX will have a direct and significant impact on banks and bank holding companies that are public companies, including us.

     The following briefly describes some of the key provisions of the SOX:

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• Section 301 establishes certain oversight, independence, funding and other requirements for the audit committees of public companies, and requires the SEC to issue rules that prohibit any national securities exchange or national securities association from listing the securities of a company that doesn’t comply with these audit committee requirements.

• Section 302 mandates that the SEC adopt rules that require the principal executive officer(s) and principal financial officer(s) of public companies to include certain certifications in the company’s annual and quarterly reports filed under the Exchange Act.

• Section 906 includes another certification requirement that is separate from the certification requirements of Section 302. Section 906 provides that all periodic reports that contain financial statements and that are filed by public companies under Sections 13(a) or 15(d) of the Exchange Act must include a written certification by the CEO and CFO (or equivalent) that (1) the report complies with the requirements of Section 13(a) or 15(d) of the Exchange Act; and (2) the information contained in the periodic report fairly presents, in all material respects, the financial condition and results of operations of the issuer. Section 906 became effective on July 30, 2002, and persons who knowingly or willfully violate Section 906 are subject to specified criminal penalties.

• Section 303 which requires the SEC to issue rules prohibiting the officers and directors of public companies, and persons acting under their direction, from fraudulently influencing, coercing, manipulating, or misleading the company’s independent auditor in order to render the financial statements materially misleading.

• Section 304 requires the CEO and CFO of public companies to reimburse the company for certain compensation and profits received if the company is required to restate its financial reports due to material noncompliance resulting from misconduct, with the Federal securities laws.

• Section 306(a) prohibits the directors and executive officers of any public company from purchasing, selling or transferring any equity security acquired by the director or executive officer in connection with his or her service as a director or executive officer during any “blackout period” with respect to the company’s securities. Blackout periods refer to periods when most public company employees are not permitted to sell shares in their 401(k) plans.

• Section 401(b) requires the SEC to issue rules that prohibit issuers from including misleading pro forma financial information in their filings with the SEC or in any public release, and that requires issuers to reconcile any pro forma financial information included in such filings or public releases with their financial statements prepared in accordance with generally accepted accounting principles.

• Section 404 mandates that the SEC issue rules that require all annual reports filed under Sections 13(a) or 15(d) of the Exchange Act to include certain statements and assessments related to the issuer’s internal control structures and procedures for financial reporting.

• Section 406 mandates that the SEC adopt rules that require public companies to (1) disclose in their periodic reports filed under the Exchange Act whether the company has adopted a code of ethics for its senior financial officers and, if not, the reasons why; and (2) promptly disclose on Form 8-K any change to, or waiver of, the company’s code of ethics.

• Section 407 mandates that the SEC adopt rules that require public companies to disclose in their periodic reports filed under the Exchange Act whether the audit committee of the company includes at least one financial expert and, if not, the reasons why.

     In addition to the provisions discussed above, the SOX also includes a variety of other provisions that will affect all public companies.

     As a financial institution, the Bank has a history of filing regulatory reports and being subject to frequent government oversight. The Bank has an independent audit committee and a system of internal controls. Although

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the Bank cannot be certain of the effect, if any, of the foregoing legislation on its business, the Bank and Holding Company do not anticipate that complying with the SOX will result in any material changes in corporate governance, business or results of operations other than the additional costs associated with such enhanced disclosures. Future changes in the laws, regulation, or policies that impact the Bank and Holding Company cannot necessarily be predicted and may have a material adverse effect on business and earnings.

     The California Corporate Disclosure Act. On January 1, 2003, the California Corporate Disclosure Act, or the CCD, became effective. The CCD, also a reaction to the “Enron scandal,” increases the frequency and expands the scope of information required in filings by publicly traded companies with the California Secretary of State. Some of the new information required includes the following:

• The name of the independent auditor for the publicly traded company, a description of the services rendered by the auditor during the previous 24 months, the date of the last audit and a copy of the report;

• The annual compensation paid to each director and executive officer, including options or shares granted to them that were not available to other employees of the company;

• A statement indicating whether any bankruptcy has been filed by the company’s executive officers or directors during the past 10 years; and

• A statement indicating whether any of the company’s executive officers or directors were convicted of fraud during the past 10 years.

     For purposes of the CCD, a “publicly traded company” is any company with securities that are listed on or admitted to trading on a national or foreign exchange, or is the subject of a two-way quotation, such as both “bid” and “asked” prices, that is regularly published by one or more broker-dealers in the National Daily Quotations Service or a similar service. The Holding Company is deemed to be a “publicly traded company” under the CCD.

Permitted Non-Banking Activities

     The FRB’s Regulation “Y” sets out those activities which are regarded as closely related to banking or managing or controlling banks and, thus, permissible for bank holding companies under the law, subject to the FRB’s approval or prior notification; depending on the activity. The future scope of permitted activities may change; however, the major non-banking activities which may presently be carried on by a bank holding company or its affiliates are:

(1)	Making or acquiring loans or other extensions of credit for its own account or for the account of others.
(2)	Servicing loans and other extensions of credit for any person.
(3)	Operating an industrial bank, Morris Plan bank, or industrial loan company, as authorized under state law, so long as the institution is not a bank.
(4)	Operating a trust company in the manner authorized by federal or state law, so long as the institution is not a bank and does not make loans or investments or accept deposits, except as permitted under the FRB’s Regulation Y.
(5)	Subject to certain limitations, acting as an investment or financial adviser to investment companies and other persons.
(6)	Leasing personal and real property or acting as agent, broker, or adviser in leasing such property in accordance with various restrictions imposed by Regulation Y, including a restriction that it is reasonably anticipated that each lease will compensate the lessor for not less than the lessor’s full investment in the property.
(7)	Making equity and debt investments in corporations or projects designed primarily to promote community welfare.

-24-

(8)	Providing financial, banking, or economic data processing and data transmission services, facilities, data bases, or providing access to such services, facilities, or data bases.
(9)	Acting as principal, agent, or broker for insurance directly related to extensions of credit which are limited to assuring the repayment of debts in the event of death, disability, or involuntary unemployment of the debtor.
(10)	Acting as agent or broker for insurance directly related to extensions of credit by a finance company subsidiary.
(11)	Owning, controlling, or operating a savings association provided that the savings association engages only in activities permitted for bank holding companies under Regulation Y.
(12)	Providing courier services of limited character.
(13)	Providing management consulting advice to non-affiliated bank and nonbank depository institutions, subject to the limitations imposed by Regulation Y.
(14)	Selling money orders, travelers’ checks and U.S. Savings Bonds.
(15)	Appraisal of real estate and personal property.
(16)	Acting as an intermediary for the financing of commercial or industrial income-producing real estate.
(17)	Providing securities brokerage services, related securities credit activities pursuant to Regulation T, and other incidental activities.
(18)	Underwriting and dealing in obligations of the U.S., general obligations of states and their political subdivisions, and other obligations authorized for state member banks under federal law.
(19)	Providing general information and statistical forecasting, advisory and transactional services with respect to foreign exchange through a separately incorporated subsidiary.
(20)	Acting as a futures commission merchant for non-affiliated persons in the execution and clearance on major commodity exchanges of futures contracts and options on futures contracts through a separately incorporated subsidiary.
(21)	Providing investment advice, including counsel, publications, written analysis and reports, as a futures commission merchant with respect to the purchase and sale of futures contracts and options on futures contracts.
(22)	Providing advice, educational courses, and instructional materials to consumers on individual financial management matters.
(23)	Providing individuals, businesses, and nonprofit organizations and tax planning and tax preparation services.
(24)	Providing check guaranty services.
(25)	Operating an agency for the collection of overdue accounts.
(26)	Operating a consumer credit bureau for the collection and reporting of consumer credit information.

Federal Income Tax Consequences

     The Merger Agreement has been structured to qualify the merger as a tax-free reorganization under Section 368(a)(1)(A) of the Internal Revenue Code of 1986, as amended, (the “Code”). Neither the Holding Company nor

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the Bank has requested nor will request a ruling from the Internal Revenue Service with regard to any of the tax consequences of the holding company reorganization. Instead, Horgan, Rosen, Beckham & Coren, L.L.P., legal and special tax advisor to the Holding Company, has rendered an opinion to the effect that:

• The merger will constitute a “reorganization” within the meaning of section 368(a) of the Code, and Bank, FCB Merger Corp., and Holding Company will each be a party to the reorganization within the meaning of section 368 (b) of the Code.

• Neither FCB Merger Corp. nor Holding Company will recognize any gain or loss as a result of the merger.

• The Bank will not recognize any gain or loss as a result of the merger.

• Holders of Bank Common Stock exchanged in the merger for Holding Company Common Stock will not recognize any gain or loss as a result of the merger.

• The adjusted basis of the assets of the Bank after the merger will be the same as the adjusted basis of the assets held by the Bank and (if any) by FCB Merger Corp. immediately before the merger.

• With regard to shareholders who held their shares of Bank’s Common Stock as capital assets, the period for which they have held such Common Stock will be included in their holding period for the Holding Company’s Common Stock received in the exchange.

• The tax basis of the shares of Holding Company Common Stock received by a shareholder of the Bank will equal the tax basis of such shareholder’s shares of Bank Common Stock exchanged in the merger.

     The preceding discussion does not purport to be a complete analysis of all potential tax consequences of the merger that may be relevant to a particular Bank shareholder. You are urged to consult with your own tax advisor regarding the specific tax consequences to you of the holding company reorganization, including the applicability and effect of foreign, state, local, and other tax laws.

Dissenters’ Rights

     California law does not provide dissenters’ rights for holders of the Bank’s Common Stock who object to the merger.

Restrictions on Affiliates

     The obligation of the Bank and the Holding Company to consummate the merger is subject to the condition that each person who is an “affiliate” of the Bank for the purposes of Rule 145 promulgated under the Securities Act of 1933, as amended (the “Securities Act”), executes and delivers a letter to the effect that, among other things: (1) such person will not dispose of any shares of the Holding Company’s Common Stock to be received by him pursuant to the Merger Agreement (a) in violation of the Securities Act or the rules and regulations of the SEC promulgated thereunder (and, accordingly, that any public offering or sale of such shares will require either registration under the Securities Act or compliance with the resale provisions of Rule 145 or the availability of another exemption from the registration requirements of the Securities Act), or (b) prior to such time as financial results covering at least 30 days of post-merger combined operations have been published; and (2) such person consents to the placing of a legend on the certificate evidencing such shares referring to the issuance of such shares in a transaction to which Rule 145 is applicable and to the giving of stop-transfer instructions to the Holding Company’s transfer agent with respect to such certificates.

     For the purposes of Rule 145, affiliates include the Bank’s directors, executive officers, and principal shareholders. According to Rule 145, the affiliates will be restricted in their ability to resell their stock. The restrictions include the limitation, subject to certain exemptions, that not more than 1% of the total number of shares outstanding be sold for the account of any affiliate in any three month period.

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Business of First California Bank

     First California Bank is a full-service commercial bank headquartered in Camarillo, California. The Bank is chartered under the laws of the State of California and is subject to supervision by the California Commissioner of Financial Institutions. The Federal Deposit Insurance Corporation insures the Bank’s deposits up to the maximum legal limit.

     The Bank opened for business in 1979 under the name “Camarillo Community Bank” with one branch office located in Camarillo. The Bank provides a broad range of banking products and services, including credit, cash management and deposit services through six full service banking offices which are located in Camarillo, Westlake Village, Oxnard, Thousand Oaks, Ventura and Simi Valley. In October 2001, the Bank changed its name to “First California Bank” in order to reflect the Bank’s growth beyond its initial primary market of Camarillo.

     The Bank’s goal is to offer our customers a consistently high level of individualized personal service. The Bank’s strategy in attaining its goals has been to implement and maintain risk management and controls to achieve a safe and sound business policy, employing an aggressive marketing plan which emphasizes relationship banking and the “personal touch,” offering competitive products and managing our growth. The Bank provides convenience through six banking offices with ATM access, 24 hour telephone access to account information, on line banking and courier service. The diversity of our delivery systems enables customers to choose the method of banking, which is most convenient for them. The Bank trains its staff to recognize each customer, greet them, and be able to address them by name so that they feel as if they have a “private banker.”

     Internet Banking Services. The Bank has its own “home page” address on the world wide web which serves as an additional means of providing customer access to a variety of banking services. The Bank’s website address is: www.fcbank.com.

     Premises. The Bank owns its executive offices located at 1100 Paseo Camarillo, Camarillo, California. The building has approximately 5,100 square feet of space and adequate parking facilities.

     The Bank also leases approximately 5,931 square feet of space for its administrative functions located at 730 Paseo Camarillo, Camarillo, California. The lease is with an unaffiliated third party. The lease term is for 5 years and commenced on August 1, 2004. The monthly base rent for the premises is $7,248 for 2005.

     The Bank also leases approximately 1,532 square feet of space for its Camarillo Office located at 1200 Paseo Camarillo, Suite 170, Camarillo, California. The lease term is for 5 years and commenced on July 1, 2001, with one 5-year renewal option. The monthly base rent for the premises is $2,275 for 2005. The office is being sublet to an unaffiliated third party. The sublease commenced September 28, 2004 and expires June 30, 2006. The monthly base rent for the sublease is $2,275.

     The Bank owns its main branch located at 1150 Paseo Camarillo, Camarillo, California. The building has approximately 9,032 square feet of space and adequate parking facilities.

     The Bank also leases approximately 4,000 square feet of space for its Westlake Village Branch Office located at 32111 Agoura Road, Westlake Village, California. The lease term is for 5 years and commenced on September 1, 2004, with one 5-year renewal option. The lease is with an unaffiliated third party. The monthly base rent for the premises is $6,800 for 2005.

     The Bank also leases approximately 1,672 usable square feet of space for its Oxnard Branch Office located at 300 Esplanade Drive, Suite 102, Oxnard, California. The premises is located on the first floor. The lease term is for 5 years and commenced on April 1, 2000, with one 5-year renewal option. The lease is with an unaffiliated third party. The Bank exercised its option and the monthly base rent for the premises is $3,295 for 2005.

     The Bank also leases approximately 2,373 square feet of space for its Ventura Branch Office located at 1794 S. Victoria, Suite B, Ventura, California. The premises is located on the first floor. The lease term is for 10 years and commenced on August 26, 2002, with two 5-year renewal options. The lease is with an unaffiliated third party. The monthly base rent for the premises is $6,498 for 2005.

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     The Bank also leases approximately 3,850 square feet of space for its Thousand Oaks Branch Office located at 11 E. Hillcrest Drive, Suite A, Thousand Oaks, California. The lease term is for 10 years and commenced on October 15, 2003, with two 5-year renewal options. The lease is with an unaffiliated third party. The monthly base rent for the premises is $13,475 for 2005.

     The Bank also leases approximately 990 square feet of space for its Simi Valley Branch Office located at 1177 East Los Angeles Avenue, Suite A, Simi Valley, California. The lease term is for 1 year and commenced on December 1, 2004, with no renewal options. The lease is with an unaffiliated third party. The monthly base rent for the premises is $2,200 for 2005.

     The Bank also leases approximately 5,000 square feet of space for its ground lease located at Simi Valley Towne Center, Simi Valley, California. The lease term is for 20 years. Estimated occupancy will commence on January 2006, with six 5-year renewal options. The lease is with an unaffiliated third party. The monthly base rent for the premises is $10,417 for 2006.

     The Bank believes that its premises will be adequate for present and anticipated needs. The Bank also believes that it has adequate insurance to cover its premises.

     Employees. At June 30, 2005, the Bank had 88 full-time equivalent employees. The Bank’s employees are not represented by any union or other collective bargaining agreement and the Bank considers its relations with employees to be excellent.

     Market Area. The Bank offers a wide range of commercial and consumer banking services primarily within the general area commonly known as the “101” corridor stretching from the City of Ventura to Calabasas, California. The Bank’s secondary markets include the Moorpark-Simi Valley corridor, and the western San Fernando Valley. The Bank’s officers have many years of experience in dealing with the businesses and professional service providers in our market area. This area has significant diversification and geographic concentration of the desired businesses with annual sales of up to $20 million and real estate development industries that we target.

     Competition. The banking business in California, generally, and in the Bank’s service areas, specifically, is highly competitive with respect to both loans and deposits and is dominated by a number of major banks that have many offices operating over wide geographic areas. The Bank competes for deposits and loans principally with these major banks, savings and loan associations, finance companies, credit unions and other financial institutions located in our market areas. Among the advantages that the major banks have over the Bank are their ability to finance extensive advertising campaigns and to allocate their investment assets to regions of highest yield and demand. Many of the major commercial banks operating in the Bank’s service areas offer certain services (such as trust and international banking services) that are not offered directly by the Bank and, by virtue of their greater total capitalization, such banks have substantially higher lending limits.

     As of June 30, 2004, the most recent period for which figures are available, data reported by state and federal agencies indicated that the 153 banks and savings and loan offices then open in the Bank’s primary market area, Ventura County, held approximately $10.9 billion in total deposits averaging approximately $71.7 million per banking office. The Bank’s total deposits ($216.2 million) in the Ventura market area constituted 1.97% of the total deposits in that market.

     Moreover, all banks face increasing competition for loans and deposits from non-bank financial intermediaries such as mortgage companies, insurance companies, credit unions and securities firms.

     In November 1999, the President signed the Gramm-Leach-Bliley Act, or the GLB Act, into law, which significantly changed the regulatory structure and oversight of the financial services industry. The GLB Act revised the Bank Holding Company Act of 1956 and repealed the affiliation prohibitions of the Glass-Steagall Act of 1933. Consequently, a qualifying holding company, called a financial holding company, can engage in a full range of financial activities, including banking, insurance, and securities activities, as well as merchant banking and additional activities that are “financial in nature” or “incidental” to those financial activities. Expanded financial affiliation opportunities for existing bank holding companies are now permitted. Moreover, various non-bank financial services providers can acquire banks while also offering services like securities underwriting and

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underwriting and brokering insurance products. The GLB Act also expanded passive investment activities by financial holding companies, permitting investments in any type of company, financial or non-financial, through acquisitions of merchant banking firms and insurance companies.

     Given that the traditional distinctions between banks and other providers of financial services have been effectively eliminated, the Bank will face additional competition from thrift institutions, credit unions, insurance companies and securities firms. Additionally, their ability to cross-market banking products to their existing customers or the customers of affiliated companies may make it more difficult to compete. The Bank and many similarly situated institutions have not yet experienced the full impact of the GLB Act and therefore, it is not possible to determine the potential effects, if any, that the GLB Act will have on community banks in general, or on the Bank’s operations specifically.

     In order to compete, the Bank uses to the fullest extent possible the familiarity of its directors and officers with the market area and its residents and businesses and the flexibility that the Bank’s independent status will permit. This includes an emphasis on specialized services, local promotional activity, and personal contacts by directors, officers and other employees. The Bank uses advertising, including radio and newspaper ads and direct mail pieces, to inform the community of the services it offers. The Bank also utilizes emerging marketing techniques, such as the Internet, to reach target markets. The Bank also has an active calling program where officers, including commissioned business development officers, contact targeted prospects to solicit both deposit and loan business.

     The Bank has developed programs that are specifically addressed to the needs of consumers, professionals and small-to medium-sized businesses. In the event there are customers whose loan demands exceed the Bank’s lending limits, it arranges for such loans on a participation basis with other financial institutions and intermediaries. The Bank also assists those customers requiring other services not offered by the Bank to obtain those services from correspondent banks. In addition, the Bank offers ATM services, a night depository, courier services, bank-by-mail services, merchant windows and direct deposit services.

     The Bank’s management believes that the Bank’s reputation in the communities served and personal service philosophy enhance the ability to compete favorably in attracting and retaining individual and business clients. The Bank also believes that it has an advantage over the larger national and “super regional” institutions because it is managed by well respected and experienced bankers.

     Mergers, acquisitions and downsizing have and will continue to foster impersonal banking relationships which, in turn, may cause dissatisfaction among the Bank’s targeted customer population. Moreover, larger competitors may not offer adequate personalized banking services, since their emphasis is on large volume and standardized retail products.

     The Bank faces growing competition from other community banks. These institutions have similar marketing strategies, have also been successful and are strong evidence regarding the potential success of the community banking sector.

     No assurance can be given that ongoing efforts to compete will continue to be successful.

Management’s Discussion and Analysis of Financial Condition and Results of Operations – First California Bank.

     The following discussion is designed to provide a better understanding of significant trends related to the Bank’s financial condition, results of operations, liquidity, capital resources and interest rate sensitivity. The discussion and information is derived from the Bank’s unaudited financial statements and notes thereto for the three and six months ended June 30, 2005 and 2004, and the audited financial statements and notes thereto for the three years ended December 31, 2004, 2003, and 2002 included elsewhere herein. You should read this discussion in conjunction with these financial statements.

     In addition to the historical information referenced above, this discussion contains certain forward-looking statements. You should understand that all such forward looking statements are subject various uncertainties and risks that could affect their outcome.

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Critical accounting policies

     The discussion and analysis of our results of operations and financial condition are based upon our unaudited and audited financial statements which have been prepared in accordance with accounting principles generally accepted in the United States of America. The preparation of these financial statements requires management to make estimates and judgments that affect the reported amounts of assets and liabilities, income and expense, and the related disclosures of contingent assets and liabilities at the date of these financial statements. Management believes these estimates and assumptions to be reasonably accurate; however, actual results may differ from these estimates under different assumptions or circumstances. The following are the principal critical accounting policies of the Bank.

     An estimate of probable losses incurred in the loan portfolio is necessary in determining the amount of the allowance for loan losses which is presented as a reduction of our loan balances. The provision for loan losses, charged to operations, is the amount that is necessary to establish the allowance. The information used by management to make this estimate is described later in this section and in the notes to the financial statements. The allowance for loan losses was $2,593,000 at June 30, 2005 and was $2,346,000 at December 31, 2004.

     An estimate of probable income tax benefits that will not be realized in future years is required in determining the necessity for a valuation allowance for deferred tax assets. The information used by management to make this estimate is described later in this section and in the notes to the financial statements. Net deferred tax assets were $694,000 at June 30, 2005 and were $448,000 at December 31, 2004; there was no valuation allowance.

Overview

     Net income for the Bank for the second quarter of 2005 increased 7 percent to $629,000 or $0.29 per diluted share compared with $589,000 or $0.28 per diluted share for the second quarter of 2004. For the first six months of 2005, net income was $1,206,000 or $0.55 per diluted share compared with $1,116,000, or $0.56 per diluted share for the same period last year. The earnings per share data for 2005 reflect the increase in outstanding weighted average shares that resulted from the exercise of 179,300 warrants in the second quarter of 2004.

     The following table sets forth the financial results summary:

	Three months ended June 30,				Six month ended June 30,
	2005		2004		2005		2004
	(in thousands, except per share)
Net income	$	629	$	589	$	1,206	$	1,166
Basic earnings per share	$	0.29	$	0.29	$	0.56	$	0.58
Diluted earnings per share	$	0.29	$	0.28	$	0.55	$	0.56

	For the years ended
	December 31,
	2004		2003		2002
	(in thousands, except per share data)
Net income	$	2,435	$	2,207	$	1,614
Basic earnings per share	$	1.17	$	1.12	$	0.91
Diluted earnings per share	$	1.14	$	1.10	$	0.86

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     For 2004 the Bank had net income of $2,435,000, up 10 percent from 2003. On a diluted per share basis, net income for 2004 was $1.14 compared with $1.10 for 2003. The growth in net income followed from an increase in earning assets — loans and securities. The earnings per share data for the year reflect the increase in weighted average shares outstanding that resulted from the exercise of warrants at the end of the second quarter of 2004.

     Net income for 2003 was $2,207,000, up 37 percent from 2002 net income of $1,614,000. Earnings per diluted share for 2002 were $0.86. The increase in net income again was a result of an increase in earning assets.

     Net income for the three years ended December 31, 2004 has increased at a compound average annual rate of 22 percent. The growth in net income reflects:

• The opening of four de novo branches since 1999,

• Our focus on services and technology to meet the needs of the small business banking market,

• An expanded customer base in Ventura and surrounding counties, and

• The successful issuance in 2002 of 400,000 shares of common stock, with 200,000 warrants attached, for a total of $5.5 million in capital to support our growth strategy.

Results of Operations

Net interest income

     Net interest income is the difference between interest and fees earned on loans, securities and federal funds sold [that is, earning assets] and the interest paid on deposits and borrowings [that is, interest-bearing funds]. Net interest margin is net interest income expressed as a percentage of earning assets.

     Net interest income for the three months ended June 30, 2005 increased to $3,359,000, up 19 percent from $2,828,000 for the three months ended June 30, 2004. Net interest income for the first six months of 2005 was $6,461,000 and increased 11 percent from $5,837,000 posted for the same period last year.

     The net interest margin on a tax equivalent basis for the second quarter of 2005 was 5.02 percent compared with 4.71 percent for the second quarter of 2004. For the first six months of 2005 and 2004 the net interest margin was 4.93 percent. The net interest margin has increased each quarter since the third quarter of 2004 reflecting the asset-sensitive nature of the Bank’s balance sheet. The net interest margin for the first quarter of 2005, the fourth quarter of 2004 and the third quarter of 2004 was 4.84 percent, 4.64 percent, and 4.48 percent, respectively. The Bank should continue to experience an increase in net interest margin as the prime rate increases.

     Average loans for the six months ended June 30, 2005 were $185,255,000 and represented 69 percent of average earning assets, compared with 68 percent of average earning assets for the year ended December 31, 2004. Average securities for the first six months of 2005 were $76,720,000 and represented 29 percent of average earning assets, the same percentage relationship that existed for the year ended December 31, 2004.

     Average deposits for the six months ended June 30, 2005 were $231,110,000 and represented 87 percent of average earning assets, the same relationship that existed for the year ended December 31, 2004. Average FHLB advances for the first six months of 2005 were $32,091,000 compared with $29,706,000 for the year ended December 31, 2004.

     The following table shows average balances and interest income or interest expense, with resulting average yield or rates on a tax equivalent basis, by category of earning assets or interest bearing liabilities:

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	Six months ended June 30,
	2005							2004
(Dollars in thousands)	Average Balance		Income/ Expense		Average Rate			Average Balance		Income/ Expense		Average Rate
Assets
Loans:
Commercial	$	79,955	$	3,058		7.71	%	$	67,179	$	2,602		7.79	%
Real estate		98,197		3,046		6.26	%		91,046		2,749		6.07	%
Consumer		7,102		220		6.26	%		5,558		228		8.27	%
														%
Total loans		185,255		6,325		6.88	%		163,783		5,580		6.85	%
														%
Securities:
Taxable		69,148		1,168		3.38	%		60,523		871		2.88	%
Nontaxable		7,572		148		5.92	%		7,569		152		6.07	%
														%
Total securities		76,720		1,316		3.63	%		68,092		1,023		3.23	%
														%
Federal funds sold and deposits with banks		4,909		68		2.82	%		8,480		44		1.05	%
														%
Total earning assets		266,885		7,709		5.87	%		240,355		6,647		5.61	%
														%
Nonearning assets		20,993							31,268
Total assets	$	287,878						$	271,623
Liabilities and shareholder’s equity
Interest bearing deposits
Interest bearing demand deposits	$	20,563		11		0.10	%	$	19,622		11		0.11	%
Savings		63,273		230		0.73	%		60,916		244		0.81	%
Certificates of deposit		55,033		616		2.26	%		51,501		353		1.38	%
														%
Total interest bearing deposits		138,868		857		1.24	%		132,040		609		0.93	%
Borrowed funds:
Federal funds purchased		—		—		—			—		—		—
FHLB advances		32,091		391		2.46	%		24,780		201		1.63	%
														%
Total borrowed funds		32,091		391		2.46	%		24,780		201		1.63	%
														%
Total interest bearing funds		170,959		1,248		1.47	%		156,820		810		1.04	%
														%
Noninterest bearing demand deposits		92,242							95,358
Other liabilities		1,185							163
Shareholders’ equity		23,492							19,283
Total liabilities and shareholder’s equity	$	287,878						$	271,623
Net interest income			$	6,461						$	5,837
														%
Net interest margin (tax equivalent)						4.93	%						4.93	%
														%

     Net interest income for 2004 was $11,656,000, up 7 percent from $10,898,000 for 2003. Net interest income was $9,141,000 for 2002. The increase in net interest income reflects the increase in earning assets. Average earning assets increased 22 percent to $247,283,000 for 2004 from $202,091,000 for 2003. Average earning assets for 2002 were $168,891,000.

     The net interest margin [on a tax equivalent basis] for 2004 was 4.78% compared with 5.45% for 2003. Net interest margin was 5.47% for 2002. The decline in the net interest margin reflects the change in the mix of earning assets and funding sources from the year ago periods.

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     The following table shows average balances and interest income or interest expense, with resulting average yield or rates on a tax equivalent basis, by category of earning assets or interest bearing liabilities:

	For the years ended December 31,
	2004							2003							2002
	Average		Income/		Average			Average		Income/		Average			Average		Income/		Average
(Dollars in thousands)	Balance		Expense		Rate			Balance		Expense		Rate			Balance		Expense		Rate
Assets
Loans:
Commercial	$	69,317	$	5,046		7.28	%	$	60,022	$	4,370		7.28	%	$	49,936	$	3,627		7.26	%
Real estate		94,088		5,758		6.12	%		81,573		5,926		7.26	%		75,218		5,951		7.91	%
Consumer		5,209		405		7.78	%		7,591		642		8.46	%		7,081		548		7.74	%
Total loans		168,614		11,209		6.65	%		149,186		10,938		7.33	%		132,235		10,126		7.66	%
Securities:
Taxable		65,584		1,970		3.00	%		40,128		1,194		2.98	%		17,569		643		3.66	%
Nontaxable		7,308		299		6.20	%		4,752		212		6.76	%		4,206		199		7.17	%
Total securities		72,892		2,269		3.11	%		44,880		1,406		3.13	%		21,775		842		3.87	%
Federal funds sold and deposits with banks		5,777		74		1.28	%		8,025		85		1.06	%		14,881		232		1.56	%
Total earning assets		247,283		13,552		5.48	%		202,091		12,429		6.15	%		168,891		11,200		6.63	%
Nonearning assets		19,220							20,430							13,901
Total assets	$	266,503						$	222,521						$	182,792
Liabilities and shareholders’ equity
Interest bearing deposits:
Interest bearing demand deposits	$	19,776		21		0.11	%	$	17,946		19		0.11	%	$	16,303		21		0.13	%
Savings		61,697		487		0.79	%		51,807		372		0.72	%		35,414		277		0.78	%
Certificates of deposit		52,138		807		1.55	%		54,804		949		1.73	%		62,216		1,761		2.83	%
Total interest bearing deposits		133,611		1,315		0.98	%		124,557		1,340		1.08	%		113,933		2,059		1.81	%
Borrowed funds:
Federal funds purchased		70		2		2.86	%		—		—		—			—		—		—
FHLB advances		29,706		579		1.95	%		12,405		191		1.54	%		—		—		—
Total borrowed funds		29,776		581		1.95	%		12,405		191		1.54	%		—		—		—
Total interest bearing funds		163,387		1,896		1.16	%		136,962		1,531		1.12	%		113,933		2,059		1.81	%
Noninterest bearing demand deposits		81,455							67,400							53,472
Other liabilities		1,315							746							1,022
Shareholders’ equity		20,346							17,413							14,365
Total liabilities and shareholders’ equity	$	266,503						$	222,521						$	182,792
Net interest income			$	11,656						$	10,898						$	9,141
Net interest margin (tax equivalent)						4.78	%						5.45	%						5.47	%

     Average loans were $168,614,000 for 2004 and represented 68 percent of average earning assets, compared with $149,186,000 and 74 percent for 2003. For 2002, average loans were $132,235,000 or 78 percent of average earning assets. Average loans increased 13 percent in 2004 and 2003. The increase in loans reflects the expansion of our branch network over these periods and the success of our business strategy.

     Average securities were $72,891,000 for 2004 and represented 29 percent of average earning assets, compared with $44,880,000 and 22 percent for 2003. For 2002, average securities were $21,775,000 or 13 percent of average earning assets. Average securities increased 62 percent for 2004 and 106 percent for 2003. Beginning in 2003, the Bank began to more actively manage its investments, core funding sources, alternative funding sources and capital. In this regard, mid-year 2003, the Bank purchased approximately $30,000,000 U.S. agency mortgage-backed securities with a final maturity of seven years. In addition, the Bank secured $25,000,000 of FHLB term advances with final maturities of three months to three years. From mid-year 2004 to year-end 2004, the Bank made

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several other purchases of U.S. agency mortgage-backed securities of approximately $15,000,000 with concomitant FHLB term advances of $14,900,000. While the addition of these securities had the effect of decreasing, in part, the net interest margin for the periods presented, net interest income has increased.

     Average deposits were $215,066,000 for 2004 and represented 87 percent of average earning assets, compared with 191,957,000 and 95 percent for 2003. Average deposits were $167,405,000 or 99 percent for 2002. Average deposits increased 12 percent for 2004 and 15 percent for 2003. The increase in deposits, especially in noninterest-bearing demand deposits, reflects the expansion of our branch network and the success of our business strategy. The Bank does not accept broker certificates of deposits.

     Average FHLB advances were $29,706,000 for 2004 compared with $12,405,000 for 2003. There were no FHLB advances for 2002. The increase in FHLB advances reflects the more active management of investments, core funding sources, alternative funding sources and capital described above.

     Net interest income is affected by changes in the level and mix of average earning assets and average interest-bearing funds. The changes between periods in these categories are referred to as volume changes. The effect on net interest income from changes in average volume is measured by multiplying the change in volume between the current period and the prior period by the prior period average rate. Net interest income is also affected by changes in the average rate earned or paid on assets and liabilities and these are referred to as rate changes. The effect on net interest income from changes in average rates is measured by multiplying the change in the average rate between the current period and the prior period by the prior period average volume. Changes attributable to both rate and volume are allocated on a pro rata basis to the change in average volume and the change in average rate.

     The following tables reflect changes in net interest income attributable to volume and rate for the periods indicated:

     Analysis of changes in net interest income and expense for the six months ended June 30,

	2005 to 2004
	due to:
(Dollars in thousands)	Rate			Volume			Total
Interest income
Interest on loans	$	14		$	731		$	745
Interest on securities		164			130			294
Interest on Federal funds sold		42			(19	)		23
Interest on deposits with banks		—			—			—
Total interest income		220			842			1,062
Interest expense
Interest bearing demand deposits		(1	)		1			—
Savings		(25	)		10			(15	)
Certificates of deposit		238			24			262
Total interest on deposits		212			35			247
Interest on borrowings		134			59			192
Total interest expense		346			93			439
Net interest income	$	(125	)	$	748		$	624

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Analysis of changes in net interest income and expense for the years ended December 31,

	2004 to 2003									2003 to 2002
	due to:									due to:
(Dollars in thousands)	Rate			Volume			Total			Rate			Volume			Total
Interest income
Interest on loans	$	(1,153	)	$	1,424		$	271		$	(486	)	$	1,298		$	812
Interest on securities		(15	)		878			863			375			189			564
Interest on Federal funds sold.		14			(25	)		(11	)		(40	)		(107	)		(147	)
Total interest income		(1,154	)		2,277			1,123			(151	)		1,380			1,229
Interest expense
Interest bearing demand deposits		1			2			3			(4	)		2			(2	)
Savings		44			72			116			(41	)		136			95
Certificates of deposit		(98	)		(46	)		(144	)		(602	)		(210	)		(812	)
Total interest on deposits		(53	)		28			(25	)		(647	)		(72	)		(719	)
Interest on borrowings		122			268			390			—			191			191
Total interest expense		69			296			365			(647	)		119			(528	)
Net interest income	$	(1,223	)	$	1,981		$	758		$	496		$	1,261		$	1,757

Provision for loan losses

     The provision for loan losses for the three months ended June 30, 2005 was $122,000 compared with $104,000 for the same period a year ago. For the six months ended June 30, 2005 the provision for loan losses was $244,000 compared with $208,000 for the year ago period.

     For the year of 2004 the provision for loan losses was $418,000 compared with $510,000 for 2003. The provision for loan losses for 2002 was $510,000. See also the discussion of the allowance for loan losses later in this section.

Noninterest income

     Noninterest income for the second quarter of 2005 was $427,000 compared with $472,000 for the second quarter of 2004. Service charges, fees and other income for the second quarter of 2005 totaled $359,000 compared with $401,000 for the second quarter of 2004. Loan commissions and sales totaled $66,000 for the second quarter of 2005 and $71,000 for the second quarter of 2004.

     For the first half of 2005, noninterest income was $943,000 compared with $884,000 for the same period a year ago. Excluding securities transactions, noninterest income for the first half of 2005 was up 8 percent on higher levels of loan commissions and sales.

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     The following table is a summary of noninterest income:

	For the three months				For the six months
	ended June 30,				ended June 30,
(Dollars in thousands)	2005		2004		2005		2004
Service charges on deposit accounts	$	256	$	238	$	549	$	487
Earnings on cash value of life insurance		56		55		111		111
Commissions on brokered loans		35		10		90		14
Net gain on loan sales		31		61		78		75
Net servicing fees		11		9		21		20
Other income		36		99		92		165
Subtotal service charges, fees and other		425		472		941		872
Net gain (loss) on sales of securities		2		—		2		12
Total noninterest income	$	427	$	472	$	943	$	884

	Year ended December 31,
(Dollars in thousands)	2004		2003			2002
Service charges on deposit accounts	$	1,056	$	965		$	744
Earnings on cash value of life insurance		224		260			—
Commissions on brokered loans		132		307			43
Net gain on loan sales		87		75			119
Net servicing fees		42		34			32
Other income		290		280			271
Subtotal service charges, fees and other		1,831		1,921			1,209
Net gain (loss) on sales of securities		94		(22	)		31
Total noninterest income	$	1,925	$	1,899		$	1,240

     Noninterest income was $1,925,000 for 2004 compared with $1,899,000 for 2003. Noninterest income was $1,240,000 for 2002.

     Service charges on deposit accounts increased 9 percent to $1,056,000 for 2004 from $965,000 for 2003. Service charges on deposit accounts were $744,000 for 2002. The increase in service charge income reflects the higher level of checking and savings accounts from the year ago periods as well as a general increase in scheduled service fees.

     Earnings on cash surrender value of life insurance were $224,000 for 2004 compared with $260,000 for 2003. There were no earnings in 2002. The Bank purchased life insurance policies at the end of December 2002 to support life insurance benefits for several key employees and salary continuation benefits for certain executives.

     Gains on loan sales and commissions on brokered loans totaled $219,000 for 2004 compared with $382,000 for 2003. Gains on loans sales and commissions on brokered loans totaled $162,000 for 2002. The Bank originates SBA 7(a) loans and sells the guaranteed portion of the loan into the secondary market for a gain. The Bank also arranges SBA 504 and other loans for customers that are ultimately funded by other institutions and receives commissions for its services. The change in income reflects the change in the number and amount of loans sold or brokered in each period.

Noninterest expense

     Noninterest expense for the three months ended June 30, 2005 was $2,650,000, up from $2,290,000 for the same period a year ago. For the first half of 2005, noninterest expenses were $5,215,000, up from $4,706,000 a year ago. The increase in noninterest expenses reflects principally the increase in salaries and benefits costs and premises and equipment costs stemming from the new Simi Valley branch that opened in January 2005, the expansion of our Westlake Village office in the fourth quarter of 2004 and our move into a

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new operations center in the fourth quarter of 2004. Notwithstanding these growth-related increases, we have been able to reduce our data processing expenses by more than a third as a result of the year-ago conversion to a new core data processing application system.

     The efficiency ratio [the amount of noninterest expense as a percentage of the sum of net interest income and noninterest income, excluding securities transactions] for the second quarter of 2005 was 70.03 percent compared with 69.39 percent for the same quarter a year ago. For the first half of 2005, the efficiency ratio was 70.46 percent compared with 70.14 percent for the same period last year.

     The following table is a summary of noninterest expense:

	For the three				For the six
	months ended June 30,				months ended June 30,
(Dollars in thousands)	2005		2004		2005		2004
Salaries and benefits	$	1,491	$	1,161	$	3,020	$	2,701
Premises and equipment		389		305		775		592
Data processing		138		215		273		410
Legal, audit and other professional		153		73		261		160
Printing, stationary and supplies		48		42		94		64
Telephone		36		35		72		73
Directors’ fees		33		33		66		62
Advertising and marketing		122		106		209		169
Postage		10		26		28		45
Other expense		230		294		417		430
Total noninterest expenses	$	2,650	$	2,290	$	5,215	$	4,706

	For the years
	ended December 31,
(Dollars in thousands)	2004		2003		2002
Salaries and benefits	$	5,373	$	5,220	$	4,131
Premises and equipment		1,301		972		693
Data processing		758		836		743
Legal, audit and other professional		418		328		326
Printing, stationary and supplies		141		166		199
Telephone		163		161		92
Directors’ fees		128		106		103
Advertising and marketing		299		298		289
Postage		81		84		86
Other expense		747		665		560
Total noninterest expenses	$	9,409	$	8,836	$	7,222

     Noninterest expense for 2004 was $9,409,000, up 6 percent from $8,836,000 for 2003. Noninterest expense for 2002 was $7,222,000. The efficiency ratio was 69.76 percent for 2004 compared with 68.92 percent for 2003 and 69.78 percent for 2002.

     The Bank has pursued a growth strategy through de novo branching. This requires the Bank to recruit and hire personnel and lease or build facilities to operate and house the new branch. These expenses are incurred prior to the opening of the branch and generally are in excess of the income from the branch when it commences operations. The increase in salaries and benefits expense and premises and equipment expense reflects this growth strategy. The Oxnard office was opened in the spring of 2000, the Ventura office was opened in the summer of 2002, the Thousand Oaks office was opened in the fall of 2003 and the Simi Valley office was opened in January of 2005. The Bank also expanded into a new operations center in the summer of 2004 consolidating into one facility loan, deposit and technology operations.

     In addition, in 2004, the Bank implemented a new core application processing system that is anticipated to lower unit costs while providing a platform that more readily supports growth and expansion of services.

Income taxes

     The provision for income taxes for the second quarter of 2005 was $385,000 and for the second quarter of 2004, the provision for income taxes was $317,000. The effective tax rate [the provision for income taxes as a percentage of pretax income] was 38.0 percent for the second quarter of 2005 compared with 35.0 percent for second quarter of 2004. For the first half of 2005, the effective tax rate was 38.0 percent compared with 35.5 percent for the same period last year.

     The provision for income taxes was $1,319,000 for 2004 compared with $1,244,000 for 2003. The provision for income taxes was $1,035,000 for 2002. The effective tax rate was 35.1% for 2004 compared with 36.0% for 2003 and 39.1% for 2002.

     The combined federal and state statutory rate for all periods was 41.2%. The effective tax rate was less than the combined statutory tax rate as a result of excluding from taxable income interest income on municipal securities and the earnings on the cash surrender value of life insurance.

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Financial Position

Securities

     The Bank purchases securities to generate interest income and to assist in the management of liquidity risk. Securities are classified as ‘available-for-sale’ for accounting purposes and, as such, are recorded at their fair or market values in the balance sheet. Fair values are based on quoted market prices. Changes in the fair value of securities [that is, unrealized holding gains or losses] are reported as ‘other comprehensive income’ and carried as accumulated comprehensive income or loss within shareholders’ equity until realized.

     The following table is a summary of securities by maturity distribution and weighted average yield:

	The six months ended June 30, 2005
				After one			After five
	One year or			year to five			years to ten			Over ten
(Dollars in thousands)	less			years			years			years			Total
Maturity distribution
Mortgage-backed securities		—		$	39,411		$	8,290		$	4,157		$	51,858
Collateralized mortgage obligations		—			—			3,617			—			3,617
U.S. Treasury Obligations		2,995			—			—			—			2,995
State and municipal securities		102			558			2,214			5,383			8,257
U.S. Agency securities		746			7,049			—			—			7,795
Total	$	3,843		$	47,018		$	14,121		$	9,540		$	74,522
Weighted average yield
Mortgage-backed securities		—			3.16	%		4.36	%		4.66	%		3.74	%
Collateralized mortgage obligations		—			—			4.89	%		—			4.89	%
U.S. Treasury obligations		2.75	%		—			—			—			2.75	%
State and municipal securities		6.49	%		6.49	%		6.17	%		6.17	%		5.98	%
U.S. Agency securities		3.32	%		3.13	%		—			—			3.08	%
Total		3.18	%		3.17	%		3.57	%		5.08	%		3.63	%

     Securities, at amortized cost, decreased 4 percent to $74,522,000 at June 30, 2005 from $77,785,000 at December 31, 2004. The decline principally reflects maturities and principal payments on securities. Net unrealized holding losses at June 30, 2005 were $588,000 and as a percentage of securities at amortized cost represented a decline in valuation of 0.79 percent. Securities are comprised largely of U.S. Government Agency obligations, mortgage-backed securities and California municipal general obligation bonds. The Bank has evaluated unrealized losses of its securities and determined that these as of June 30, 2005 are temporary and are related to the fluctuation in market interest rates since purchase.

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     The following table is a summary of securities by maturity distribution and weighted average yield:

	December 31, 2004
				After One			After Five
	One Year or			Year to Five			Years to Ten			Over Ten
(Dollars in thousands)	Less			Years			Years			Years			Total
Maturity distribution
Mortgage-backed securities	$	1,226		$	36,848		$	10,314		$	7,960		$	56,348
Collateralized mortgage obligations		—			—			1,568			3,347			4,915
U.S. Treasury Obligations		2,993			—			—			—			2,993
State and municipal securities		100			295			2,723			3,615			6,733
U.S. agency securities		3,746			3,050			—			—			6,796
Total	$	8,065		$	40,193		$	14,605		$	14,922		$	77,785
Weighted average yield
Mortgage-backed securities		3.75	%		3.26	%		4.10	%		4.50	%		3.60	%
Collateralized mortgage obligations		—			—			4.91	%		4.72	%		4.78	%
U.S. Treasury obligations		2.75	%		—			—			—			2.75	%
State and municipal securities		7.12	%		7.96	%		5.47	%		6.03	%		5.90	%
U.S. Agency securities		2.69	%		2.62	%		—			—			2.66	%
Total		2.93	%		3.25	%		4.44	%		4.92	%		3.76	%

     Securities, at amortized cost, increased to $77,785,000, or 19 percent, at December 31, 2004 from $65,286,000 at December 31, 2003. Securities, at amortized cost, were $27,001,000 at December 31, 2002. The increase in securities reflect (i) the shift from investing in overnight, lower-yielding federal funds sold into longer-term, higher-yielding securities, (ii) the increase in core deposits over the periods, and (iii) a more active use of equity capital and alternative funding sources to generate interest income.

     Net unrealized holding losses at December 31, 2004 and 2003 were $440,000 and $512,000, respectively. There were net unrealized holding gains at December 31, 2002 of $308,000. As a percentage of securities, at amortized cost, unrealized holding losses and gains were 0.57 percent, 0.78 percent and 1.11 percent at the end of each respective period. Securities are comprised largely of U.S. Government Agency obligations, mortgage-backed securities and California municipal general obligation bonds. The Bank has evaluated unrealized losses of its securities and determined that these as of December 31, 2004 were temporary and are related to the fluctuation in market interest rates since purchase.

Loans

     We provide a variety of credit products to meet the needs of borrowers primarily located in Ventura and Los Angeles counties. We offer both secured and unsecured loans for working capital, equipment acquisition, business expansion, purchase or improvement of real property, as well as seasonal loans and lines of credit. We maintain a portfolio of construction loans and provide “mini-perm” real estate financing. Commercial loans are made available to business and professional customers. While consumer loans comprise a small portion of the total loan portfolio, these loans are offered for a variety of personal, family, and household needs, including automobiles, home equity loans and lines of credit and unsecured revolving lines of credit.

     Total loans were $199,631,000 at June 30, 2005 an increase of 9 percent from year-end 2004. Total loans increased 16 percent to $182,873,000 at December 31, 2004 from $157,952,000 at December 31, 2003. Total loans were $142,379,000 at December 31, 2002. Loan growth is the result of increased lending in our immediate market area and the opening of four additional banking offices since September 1999.

     The following table sets forth the Bank’s portfolio of loans:

	June 30,						December 31,
(Dollars in thousands)	2005			2004			2004			2003			2002
Commercial real estate	$	104,057		$	92,210		$	83,457		$	87,638		$	80,020
Commercial loans and lines		52,380			45,171			68,996			42,076			31,876
Construction		20,464			11,636			12,330			16,540			16,842
Home equity loans and lines		7,053			6,930			2,114			5,808			7,036
Home mortgage		11,528			13,380			11,558			2,898			2,756
Installment and credit card		4,149			2,186			4,418			2,992			3,849
Total loans		199,631			171,513			182,873			157,952			142,379
Allowance for loan losses		(2,593	)		(2,533	)		(2,346	)		(2,325	)		(1,970	)
Loans, net	$	197,038		$	168,980		$	180,527		$	155,627		$	140,409

     The loan categories above are derived from bank regulatory reporting standards for loans secured by real estate; however, a large portion of the commercial real estate loans above are loans that we consider a commercial loan for which we have taken real estate collateral as additional support or as an abundance of caution. In these instances we are not looking to the real property as its primary source of repayment, but rather as a secondary or tertiary source of repayment.

     All categories of loans present credit risk. Major risk factors applicable to all loan categories include changes in international, national and local economic conditions such as interest rates, inflation, unemployment levels, consumer and business confidence and the supply and demand for goods and services.

     Commercial real estate loans rely upon the cash flow originating from the underlying real estate collateral. Real estate is a cyclical industry that is affected not only by general economic conditions but also by local supply and demand. In the office sector, the demand for office space is highly dependent on employment levels. In the retail sector, the demand for retail space and the levels of retail rents are affected by consumer spending and confidence. The industrial sector has exposure to the level of exports, defense spending and inventory levels. Vacancy rates, location, and other factors affect the amount rental income for commercial real estate property. Tenants may relocate, fail to honor their lease or go out of business.

     Construction loans provide developers or owners with funds to build or improve properties that will ultimately be sold or leased. Construction loans are generally considered to involve a higher degree of risk than other loan categories because they rely upon the developer’s or owner’s ability to complete the project within specified cost and time limits. Cost overruns can cause the project cost to exceed the project sales price or exceed the amount of the committed permanent funding. Construction projects also can be delayed for a number of reasons such as poor weather, material or labor shortages, labor difficulties, or substandard work that must be redone to pass inspection.

     Commercial loans rely upon the cash flow originating from the underlying business activity of the enterprise. The manufacture, distribution or sale of goods or sale of services are not only affected by general economic conditions but also by the ability of the enterprise’s management to adjust to local supply and demand conditions, maintain good labor, vendor and customer relationships, as well as market, price and sell their goods or services for a profit. Customer demand for goods and services of the enterprise may change because of competition or obsolescence.

     Home mortgages and home equity loans and lines of credit are secured by first or second trust deeds on a borrower’s real estate property, typically their principal residence. These loans are dependant on a person’s ability to regularly pay the principal and interest due on the loan and, secondarily, on the value of real estate property that serves as collateral for the loan. Home mortgages are generally considered to involve a lower degree of risk than other loan categories because of the relationship of the loan amount to the value of the residential real estate and a person’s reluctance to forego their principal place of residence. Home real estate values however are not only affected by general economic conditions but also on local supply and demand. Installment loans and credit card lines are also dependant on a person’s ability to regularly pay principal and interest on a loan; however, these loans generally are not secured by collateral or, if they are secured, the collateral value can rapidly decline as is the case for automobiles. A person’s ability to service debt is highly dependant upon their continued employment or financial stability. Job loss, divorce, illness, bankruptcy are just a few of the risks that may affect a person’s ability to service their debt.

     Since the risks in each category of loan changes based on a number of factors, it is not possible to state whether a particular type of lending carries with it a greater or lesser degree of risk at any specific time in the economic cycle. In a stabilized economic environment it is generally considered that home mortgage loans have the least risk, followed by home equity loans, commercial real estate loans, commercial loans and lines and finally construction loans. However, this ordering may vary from time to time and the degree of risk from the credits with the least risk to those with the highest risk profile may expand or contract with the general economy.

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     A large part of our loan portfolio is secured by real estate and of this the largest segment is commercial real estate (CRE). CRE represented 52.1 percent and 45.6 percent of the total loan portfolio at June 30, 2005, and December 31, 2004 respectively. This compares to 55.5 percent at December 31, 2003 and 56.2 percent at December 31, 2002.

     Commercial real estate loans are collateralized by as many as 15 different types of property. Over the past 3 years, the top three categories of CRE have generally been office, industrial, and retail. The office category represented 23.7 percent of the CRE portfolio at June 30, 2005 and 25.5 percent at December 31, 2004. At December 31, 2003 and December 31, 2002, the percentages were 22.6 and 25.3 respectively. In addition, the CRE portfolio is tracked by 22 different geographic locales. While most of the CRE lending is in Ventura County, there is excellent dispersal within the various cities.

     A mitigant to the Bank’s real estate concentration is the fact that underwriting of CRE credits, as with other real estate loans in the portfolio, is done on a conservative basis. Our loan policy specifies that CRE loans are written with a maximum loan to value of 70% and a minimum debt coverage ratio of 1.25. These specifications, however, may become even more stringent dependent upon the type of property. The loan policy also specifies a maximum for the aggregate of real estate loans to Tier 1 capital and further places maximum ratios to Tier 1 capital on various sub-segments within the real estate portfolio (e.g., CRE, residential 1-4 units, multi-family). The Bank is a cash flow lender. Consequently, regardless of the value of the collateral, the project must cash flow on its own or the principals must provide sufficient outside cash flow to supplement the project. Each CRE loan analysis has an accompanying “stress test” that specifically tests for changes in interest rates, vacancy rates, and lease / rent rates in order to determine the affect on cash flow. Further, it is the policy of the Bank that real estate loans are written on a recourse basis with the guaranty of the owners. Additionally, on an annual basis, the Bank requests updates on the cash flows of the CRE collateral and has its lending staff personally visit the properties where practicable.

     Commercial and industrial loans are made for the purpose of providing working capital, financing the purchase of equipment or for other business purposes. Commercial loans may be unsecured or secured by assets such as equipment, inventory, receivables, and junior liens of property or personal guarantees. These loans may also have partial guarantees from the Small Business Administration (SBA). Additionally, we make loans guaranteed by an agency of the State of California and have recently entered into an Agreement with the United States Department of Agriculture which will provide guarantees of business and industrial loans in the rural communities of our service area. Commercial business loans are generally more dependent on the borrower’s continuing financial strength, cash flow, and management ability. We look to the borrower’s cash flow and ability to service the debt from earnings as the primary source of repayment rather than the liquidation of collateral. Commercial loans and lines of credit are generally for shorter terms and are subject to annual review.

     Commercial loans and lines of credit constituted 26 percent of total loans outstanding at of June 30, 2005. This portfolio is made up of broadly diversified sectors with the largest sectors in real estate/construction, finance and insurance, healthcare, manufacturing and professional services. The Bank requires commercial loan maturities to not exceed seven years and requires payments to be fully amortized within the term of the loan. Traditional working capital lines of credit are written for a 12 month period and have a 30 day out-of-debt requirement. The Bank also provides accounts receivable and inventory financing revolving lines of credit. These lines have an annual maturity date, a maximum advance rate (i.e., accounts receivable advance maximum is 75 percent; maximum advance rate against eligible inventory is 25 percent), and a requirement for an annual field audit for lines in excess of $200,000. Field audits are performed by third-party vendors. For these lines, the Bank also requires the customer to furnish, on a monthly basis, a borrowing base certificate and a receivables and payables aging.

     The Bank also has a growing portfolio of higher-yielding, asset-based loans that involves the Bank purchasing customer invoices on a recourse basis. This product is called ‘Cash Flow Maximizer” (CFM). Using software, technical and marketing support provided by a third-party vendor, the Bank is able to purchase customer invoices, with full recourse, at a discount and pay the customer 98.5 to 95.0 percent of the face value of the invoice. The amount is repaid, generally in 30 to 45 days, by the merchant remitting payment of the invoice directly to the Bank. The discount is recognized in income at the time of purchase. The Bank further reduces the purchase amount to the customer by an average of 10 percent of the face value of the invoice; setting aside this reserve amount in a restricted interest-bearing savings account held at the Bank to cover any losses on any purchase. Additionally, as part of our normal analysis of the adequacy of our allowance for loan losses, we allocate approximately one percent to outstanding CFM balances. As of June 30, 2005, there were 21 active accounts with outstanding balances of $7,751,000. CFM is included in the commercial loans and lines category in the loan distribution table.

     We maintain a portfolio of real estate construction loans consisting of single-family homes and commercial construction projects. At June 30, 2005 and December 31, 2004 real estate constructions loans comprised approximately 10.3 percent and 6.7 percent respectively of our loan portfolio. At December 31, 2003 these loans represented 10.5 percent of the portfolio as compared to 11.8 percent at December 31, 2002. Our real estate construction loans are primarily interim loans made to finance the construction of commercial and single family residential property. These loans are typically short term. For commercial (nonresidential) construction loans, the Bank has a maximum loan to value requirement of 70 percent of the FIRREA conforming appraised value. For residential (1-4 units) construction loans, the maximum loan to value ranges from 80 percent on loans under $500,000 to 70 percent on loans greater than $1,000,000. The Bank requires the borrower to provide in cash at least 20 percent of the cost of the project. At the borrower’s expense, the Bank utilizes a third party vendor for funds control, lien releases and inspections. The Bank’s construction loan portfolio is roughly evenly divided between commercial (non residential) and residential (1-4 units) projects. The Bank manages inherent market risks associated with interim construction lending by monitoring the economic cycle and the marketplace for evidence of deterioration in real estate values.

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     The following table presents the Bank’s fixed rate loan maturity schedule and an adjustable rate loan schedule:

	As of June 30, 2005
			After one
	One year		year to		After five
(Dollars in thousands)	or less		five years		years		Total
Fixed rate loan maturities
Commercial real estate	$	1,671	$	1,195	$	8,427	$	11,293
Commercial loans and lines		655		3,293		540		4,488
Construction		—		—		—		—
Consumer		136		303		37		476
Other		9,766		364		4,960		15,090
Total fixed rate loan maturities		12,228		5,155		13,964		31,347
Adjustable rate loan
Commercial real estate	$	39,019	$	47,347	$	—	$	86,366
Commercial loans and lines		50,807		5,252		—		56,059
Construction		18,845		—		—		18,845
Consumer		3,151		—		—		3,151
Other		3,863		—		—		3,863
Total adjustable rate loan maturities		115,685		52,599		—		168,284
Total maturities	$	127,913	$	57,754	$	13,964	$	199,631

	December 31, 2004
	One Year		One Year to		After
(Dollars in thousands)	or Less		Five Years		Five Years		Total
Fixed rate loan maturities
Commercial real estate	$	669	$	3,394	$	3,484	$	7,547
Commercial loans and lines		476		3,955		685		5,116
Consumer		84		582		22		688
Other		7,275		—		5,653		12,928
Total fixed rate loan maturities		8,504		7,931		9,844		26,279
Adjustable rate loan
Commercial real estate		38,728		42,389		—		81,117
Commercial loans and lines		50,677		4,388		1,950		57,015
Construction		12,609		—		—		12,609
Consumer		3,308		—		—		3,308
Other		2,545		—		—		2,545
Total adjustable rate loan maturities		107,867		46,777		1,950		156,594
Total maturities	$	116,371	$	54,708	$	11,794	$	182,873

Allowance for loan losses

     We maintain an allowance for loan losses to provide for inherent losses in the loan portfolio. Additions to the allowance are established through a provision charged to expense. All loans which are judged to be uncollectible are charged against the allowance while any recoveries are credited to the allowance. It is the policy of the Bank to charge off any known losses at the time of determination. Any unsecured loan more than 90 days delinquent in payment of principal or interest and not in the process of collection is charged off in total. Secured loans are evaluated on a case by case basis to determine the ultimate loss potential to the Bank subsequent to the liquidation of collateral. In those cases where the Bank is inadequately protected, a charge off will be made to reduce the loan balance to a level equal to the liquidation value of the collateral.

     Included in our loan policy are procedures designed to adequately evaluate and assess the risk factors associated with our loan portfolio, to enable us to assess such risk factors prior to granting new loans and to evaluate the sufficiency of the allowance. We conduct an assessment of the allowance on a monthly basis and do a critical evaluation quarterly. At the time of the monthly review, the Board of Directors will examine and formally approve the adequacy of the allowance. The quarterly evaluation includes an assessment of the following factors: any external loan review and any regulatory examination, estimated potential loss exposure on each pool of loans, concentrations of credit, value of collateral, the level of delinquency and non-accruals, trends in the portfolio volume, effects of any changes in the lending policies and procedures, changes in lending personnel, present economic conditions at

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the local, state and national level, amount of undisbursed / off-balance sheet commitments, and the migration analysis of historical losses / recoveries for the prior eight quarters.

     The following table presents the allowance for loan losses:

	Three months ended June 30,						Six months ended June 30,
(Dollars in thousands)	2005			2004			2005			2004
Beginning balance	$	2,537		$	2,436		$	2,346		$	2,325
Provision for loan losses		122			104			244			208
Loans charged-off		(74	)		(36	)		(74	)		(36	)
Recoveries on loans charged-off		8			29			77			36
Ending balance	$	2,593		$	2,533		$	2,593		$	2,533
Ratio of net charge-offs to average loans		0.03	%		0.00	%		0.00	%		0.00	%

	December 31,
(Dollars in thousands)	2004			2003			2002
Beginning balance	$	2,325		$	1,970		$	1,680
Provision for loan losses		418			510			510
Loans charged-off		(359	)		(124	)		(336	)
Recoveries on loans charged-off		12			69			116
Transfers to undisbursed commitment liability		(50	)		(100	)		—
Ending balance	$	2,346		$	2,325		$	1,970
Ratio of net charge-offs to average loans		0.21	%		0.04	%		0.17	%

     The allowance for loan losses, as a percentage of total loans, was 1.30 percent at June 30, 2005 compared with 1.28 percent at December 31, 2004. At December 31, 2003 and December 31, 2002 this ratio was 1.47 percent and 1.38 percent respectively.

     The provision for loan losses for the second quarter of 2005 was $122,000 compared with $104,000 for the second quarter of 2004. The provision for loan losses for the first half of 2005 was $244,000 compared with $208,000 for the same period last year. The provision for loan losses for year 2004 was $418,000 compared with $510,000 for 2003. The provision for loan losses for 2002 was $510,000.

     For the second quarter of 2005, we had net loan charge-offs of $66,000 compared with net loan charge-offs of $7,000 for the second quarter of 2004. For the first six months of 2005, we had net loan recoveries of $3,000. For the year ago period, loans charged-off were in the same amount as recoveries on loans previously charged-off resulting in zero net loan charge-offs. Net loan charge-offs for 2004 were $347,000 compared with $55,000 for 2003 and $220,000 for 2002.

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     The following table presents the Bank’s percent of loans in category to total loans:

						December 31,
	June 30, 2005					2004					2003					2002
			Percent of					Percent of					Percent of					Percent of
			Loans in					Loans in					Loans in					Loans in
			Category to					Category to					Category to					Category to
(Dollars in thousands)	Amount		Total Loans			Amount		Total loans			Amount		Total loans			Amount		Total loans
Commercial real estate	$	946		52	%	$	880		49	%	$	899		55	%	$	470		56	%
Commercial loans		832		26	%		821		34	%		421		27	%		570		23	%
Construction loans		102		10	%		62		7	%		83		10	%		84		12	%
Home equity loans		35		4	%		13		1	%		39		4	%		35		5	%
Home mortgage		58		6	%		60		7	%		14		2	%		14		2	%
Installment and credit card		43		2	%		45		2	%		26		2	%		31		3	%
Subtotal	$	2,016				$	1,881				$	1,482				$	1,204
Unallocated		577					465					843					766
Total	$	2,593		100	%	$	2,346		100	%	$	2,325		100	%	$	1,970		100	%

     The allocation presented above should not be interpreted as an indication that charges to the allowance will be incurred in these amounts or proportions. The amounts attributed to each loan category are based on the analysis described above.

     The following table presents past due and nonaccrual loans. The Bank had no restructured loans for the periods presented.

	June 30,						December 31,
(Dollars in thousands)	2005			2004			2004			2003			2002
Accruing loans past due 90 days or more	$	116			—		$	—		$	132		$	18
Nonaccrual loans	$	2,158		$	2,362		$	2,180		$	2,443		$	333
Ratios:
Accruing loans past due 90 days or more to average loans		0.06	%		0.00	%		0.00	%		0.09	%		0.01	%
Nonaccrual loans to average loans		1.14	%		1.44	%		1.29	%		1.45	%		0.25	%
Interest income on nonaccrual loans:
Contractually due	$	50		$	58		$	197		$	254		$	47
Collected	$	50		$	58		$	69		$	14		$	52

     The Bank does not accrue interest on loans for which payment of interest or principal is not expected. Nonaccrual loans at June 30, 2005 totaled $2,158,000 and represents a single loan, fully secured by real estate. Nonaccrual loans were $2,180,000 at December 31, 2004, $2,443,000 at December 31, 2003 and $333,000 at December 31, 2002.

     The increase in nonaccrual loans from 2002 to 2003 represents a participation in a construction loan with several other banks to a borrower who defaulted on the payment terms and filed for bankruptcy. In December 2004, the bankruptcy court approved a settlement and the borrower has, in 2005, resumed payments under the approved settlement. The Bank has not charged off any amount of this loan, does not anticipate any loss, and anticipates the full repayment with interest.

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Deposits

     The Bank primarily accepts deposits of small businesses located principally in Ventura and Los Angeles counties. Core deposits [representing checking, savings and small balance certificates of deposit (that is, balances under $100,000)] totaled $207,225,000 at June 30, 2005 up 6 percent from $194,939,000 at December 31, 2004. Core deposits increased 6 percent for 2004 from $184,432,000 at the end of 2003. At December 31, 2002, core deposits totaled $155,471,000. Core deposits represent a significant low-cost source of funds that support the Bank’s lending activities.

     The Bank, stressing both loan and deposit relationships with customers, employs a ‘core deposit’ funding strategy. Core deposits represent checking, savings and small balance certificates of deposits. Large balance certificates of deposit are not central to this strategy. The Bank has participated in the State of California time deposit program, which began in 1997, for several years. This time deposit program is one element of the Pooled Money Investment Account (PMIA) that is managed by the State Treasurer. At June 30, 2005, PMIA had $60.5 billion in investments of which $7.0 billion represented time deposits placed at various financial institutions. At June 30, 2005 State of California time deposits placed at the Bank ,with original maturities of three or six months, totaled $18.0 million. Management believes that the State Treasurer will continue this time deposit program. Additionally, management believes that it has the ability to establish large balance certificate of deposit rates that will enable it to attract, replace, or retain those deposits accepted from customers in our local market area if it becomes necessary under a modified funding strategy.

     The following tables set forth the average balance and the average rate paid on each deposit category for the periods indicated:

	For the six months ended June 30,
	2005					2004
	Average					Average
(Dollars in thousands)	Balance		Rate			Balance		Rate
Core deposits
Noninterest bearing demand deposits	$	92,242		—		$	95,358		—
Interest checking		20,563		0.10	%		19,622		0.11	%
Savings accounts		63,273		0.73	%		60,916		0.81	%
Time deposits less than $100,000		30,023		2.17	%		23,987		1.58	%
Total core deposits	$	206,101				$	199,884
Noncore deposits
Time deposits of $100,000 or more		25,009		2.36	%		27,514		1.21	%
Total deposits	$	231,110				$	227,398
Total interest bearing deposits	$	138,868		1.24	%	$	132,040		0.93	%

	For the years ended December 31,
	2004					2003					2002
	Average		Average			Average		Average			Average		Average
(Dollars in thousands)	Balance		Rate			Balance		Rate			Balance		Rate
Core deposits
Noninterest bearing demand deposits	$	81,455		—		$	67,400		—		$	53,472		—
Interest checking		19,776		0.11	%	$	17,946		0.11	%		16,303		0.13	%
Savings accounts		61,697		0.79	%		51,807		0.72	%		35,414		0.78	%
Time deposits less than $100,000.		24,783		1.79	%		26,724		1.93	%		33,505		3.05	%
Total core deposits		190,283					165,233					138,694
Noncore deposits
Time deposits of $100,000 or more		27,355		1.33	%		28,080		1.54	%		28,712		2.58	%
Total deposits	$	215,066				$	191,957				$	167,405
Total interest bearing deposits	$	133,611		0.98	%	$	124,557		1.08	%	$	113,933		1.81	%

     Large balance certificates of deposits [that is, balances of $100,000 or more] totaled $31,243,000 at June 30, 2005 compared with $32,251,000 at December 31, 2004. Large balance certificates of deposits were $27,497,000 at December 31, 2003 and $31,190,000 at December 31, 2002. A majority of these large balance time deposits represent deposits placed by the State Treasurer of California with

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the Bank. The remainder represent time deposits accepted from customers in the Bank’s market area. There were no broker deposits during or as of any period presented.

     The following table sets forth the maturity of large balance certificates of deposits for the periods indicated:

	June 30, 2005					December 31, 2004
(Dollars in thousands)	Amount		Percentage			Amount		Percentage
Three months or less	$	9,090		29	%	$	17,394		54	%
Over three months through six months		14,404		46	%		7,571		23	%
Over six months through one year		6,723		22	%		2,086		6	%
Over one year		1,026		3	%		5,200		16	%
Total	$	31,243		100	%	$	32,251		100	%

Borrowings

     The Bank is a member of the Federal Home Loan Bank of San Francisco [FHLB]. Membership allows the Bank to borrow, approximately $75.0 million at June 30, 2005 and $70.0 million at December 31, 2004, to meet funding needs and otherwise assist in the management of liquidity risk. Borrowings with the FHLB are collateralized by the Bank’s investment in FHLB stock as well as loans or securities which may be pledged. At June 30, 2005 the Bank’s investment in FHLB stock totaled $1,886,000 and at December 31, 2004 the Bank’s investment totaled $1,992,000.

     The following table sets forth the amounts and weighted average interest rate of FHLB advances:

	As of or for the six months ended June 30, 2005
	Federal Home Loan		Weighted average
(Dollars in thousands)	Bank Advances		interest rate
Amount outstanding at end of period	$	34,940		2.85	%
Maximum amount outstanding at any month-end during the period	$	34,940		2.85	%
Average amount outstanding during the period	$	32,080		2.67	%

     The following table is a schedule of maturities for FHLB advances:

Amount		Maturity Year
$	18,140	2005
	11,550	2006
	5,250	2007
$	34,940

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     The following table sets forth the amounts and weighted average interest rate of FHLB advances:

	As of or for the year ended December 31,
	2004					2003					2002
	Federal		Weighted			Federal					Federal		Weighted
	Home Loan		Average			Home Loan		Weighted			Home Loan		Average
	Bank		Interest			Bank		Average			Bank		Interest
(Dollars in thousands)	Advances		Rate			Advances		Interest Rate			Advances		Rate
Amount outstanding at end of period	$	32,850		2.39	%	$	25,000		1.63	%		—		—
Maximum amount outstanding at any month-end during the period	$	32,850		2.39	%	$	25,000		1.63	%		—		—
Average amount outstanding during the period	$	29,706		1.95	%	$	12,405		1.54	%		—		—

     The following table is a schedule maturities for FHLB advances:

Amount		Maturity Year
$	16,050	2005
	11,550	2006
	5,250	2007
$	32,850

Commitments, contingent liabilities, contractual obligations and off-balance sheet arrangements

     In the normal course of business, the Bank makes commitments to extend credit or issues letters of credit to customers. These commitments generally are not recognized in the balance sheet. These commitments do involve, to varying degrees, elements of credit risk; however, the Bank uses the same credit policies and procedures as it does for on-balance sheet credit facilities. Commitments to extend credit totaled $62,179,000 at June 30, 2005, compared with $63,604,000 at December 31, 2004, $45,291,000 at December 31, 2003, and $51,894,000 at December 31, 2002. Commercial and standby letters of credit $343,000 at June 30, 2005 and were $914,000, $1,337,000, and $552,000 at December 31, 2004, 2003, and 2002, respectively.

     The following is a schedule of the Bank’s current contractual obligations by maturity and/or payment due date:

	June 30, 2005
			One to		Three to		Greater
	Less Than		Three		Five		Than Five
(Dollars in thousands)	One Year		Years		Years		Years		Total
FHLB term advances	$	18,890	$	16,050	$	—	$	—	$	34,940
Salary continuation benefits		—		—		—		235		235
Operating lease obligations		553		1,188		2,760		1,880		6,381
Total	$	19,443	$	17,238	$	2,760	$	2,115	$	41,556

	December 31, 2004
			One to		Three to		Greater
	Less Than		Three		Five		Than Five
(Dollars in thousands)	One Year		Years		Years		Years		Total
FHLB term advances	$	16,050	$	11,550	$	5,250	$	—	$	32,850
Salary continuation benefits		—		—		—		180		180
Operating lease obligations.		332		846		276		960		2,414
Total	$	16,382	$	12,396	$	5,526	$	1,140	$	35,444

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Quantitative and Qualitative Disclosures About Market Risk

Credit risk

     Credit risk is the risk to earnings or capital arising from an obligor’s failure to meet the terms of any contract with the Bank or otherwise to perform as agreed. Credit risk is found in all activities in which success depends on counterparty, issuer, or borrower performance. Credit risk is present any time Bank funds are extended, committed, invested, or otherwise exposed through actual or implied contractual agreements, whether reflected on or off the balance sheet.

     The Bank manages credit risk through Board approved policies and procedures. These policies are reviewed and approved at least annually by the Directors. Lending policies provide Bank management with a framework for consistent loan underwriting and a basis for sound credit decisions. Lending policies specify, among other things, the parameters for the type or purpose of the loans, the required debt service coverage and the required collateral requirements. Credit limits are also established and certain loans require approval by the Directors’ Loan Committee. The Directors’ Audit Committee also engages a third party to perform a credit review of the loan portfolio to ensure compliance with policies and assist in the evaluation of the credit risk inherent in the loan portfolio.

     An estimate of probable losses incurred in the loan portfolio is necessary in determining the amount of the allowance for loan losses which is presented as a reduction of our loan balances. This estimate is performed monthly by management and reviewed and approved by the Board of Directors. This estimate takes into consideration, among other things, the type of loans, the delinquency or default status of loans, the trends in the loan portfolio, and current and future economic conditions that may affect the borrower’s ability to pay.

     Nonaccrual loans, as a percentage of total loans, were 1.08 percent at June 30, 2005 compared with 1.19 percent at December 31, 2004. At December 31, 2003, nonaccrual loans as a percentage of total loans were 1.55 percent. The decline from 2003 was a result of a loan charge-off. Nonaccrual loans are comprised principally of a participation in a construction loan with several other banks to a borrower who defaulted on the payment terms and filed bankruptcy. In December 2004, the bankruptcy court approved a settlement and the borrower has, in 2005, resumed payments under the approved settlement. The Bank anticipates the full repayment of this loan with interest; consequently this loan is expected to return to accrual status in the second half of 2005.

Interest rate risk

     Interest rate risk is the risk to earnings or capital arising from movements in interest rates. Interest rate risk arises from differences between the timing of rate changes and the timing of cash flows [re-pricing risk], from changing the rate relationships among different yield curves affecting bank activities [basis risk], from changing rate relationships across the spectrum of maturities [yield curve risk], and from interest-related options embedded in loans and products [options risk].

     The Bank manages interest risk through Board approved policies and procedures. These policies are reviewed and approved at least annually by the Directors. Interest rate risk policies provide Bank management with a framework for consistent evaluation of risk [a modified-gap analysis, an earnings-at-risk analysis and an economic value of equity analysis] and establish risk tolerance parameters. Management’s Asset and Liability Committee meets regularly to evaluate interest rate risk, engages a third party to assist in the measurement and evaluation of risk and reports quarterly to the Directors’ Funds Management Committee on compliance with policies. The Directors’ Audit Committee also engages a third party to perform a review of management’s asset and liability practices to ensure compliance with policies.

     The Bank’s funding sources are dominated by checking and savings accounts, which either have no interest rate or are re-priced infrequently. The Bank’s loan portfolio is dominated by loans that use the Wall Street Journal prime rate as an index. The Bank’s securities portfolio is comprised chiefly of U.S. Agency mortgage-backed securities that are either fixed rate, adjustable or a hybrid. This composition produces a balance sheet that is generally asset-sensitive, that is as the general level of interest rates rise, net interest income generally increases and as the general level of interest rates fall, net interest income generally decreases.

     Management focuses on the net re-pricing imbalances in the cumulative 1 year gap and the Board has established a limit of plus or minus 15 percent. The Board also has established a limit of plus or minus 30 percent for the cumulative 5 year gap. No limits have been established for the cumulative 3 month gap or the gap beyond 5 years. The 1 year and 5 year gap ratios at June 30, 2005 and December 31, 2004 are within established limits. The cumulative 1 year gap at June 30, 2005 was a negative 0.85 percent compared to a positive 3.73 percent at December 31, 2004. The change in the cumulative gap is chiefly attributable to an increase in variable rate loans.

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     The following is an interest rate sensitivity gap summary table:

	June 30, 2005
	By repricing interval
				4 - 12
(Dollars in thousands)	0-3 Months			Months			1-5 Years			> 5 Years			Total
Earning assets
Loans	$	116,574		$	9,601		$	57,242		$	13,964		$	197,381
Securities		4,537			13,276			37,456			18,665			73,934
Federal funds sold		3,715												3,715
Total earning assets		124,826			22,877			94,698			32,629			275,030
Interest bearing funds
Deposits		49,458			75,379			17,224			—			142,061
Borrowings		16,890			8,500			9,550			—			34,940
Total interest bearing funds		66,348			83,879			26,774			—			177,001
Period gap	$	58,478		$	(61,002	)	$	67,924		$	32,629		$	98,029
Cumulative gap	$	58,478		$	(2,524	)	$	65,400		$	98,029
Cumulative gap as a percentage of earning assets		19.60	%		-0.85	%		21.92	%		32.86	%

	December 31 , 2004
	By repricing interval
				4-12
(Dollars in thousands)	0-3 Months			Months			1-5 Years			> 5 Years			Total
Earning assets
Loans	$	96,499		$	3,659		$	69,888		$	10,481		$	180,527
Securities		4,755			9,569			38,308			24,713			77,345
Federal funds sold		4,055			—			—			—			4,055
Total interest earning assets		105,309			13,228			108,196			35,194			261,927
Interest bearing funds
Deposits		35,669			57,048			49,773			—			142,490
Borrowings		2,500			13,550			16,800			—			32,850
Total interest bearing funds		38,169			70,598			66,573			—			175,340
Period gap	$	67,140		$	(57,370	)	$	41,623		$	35,194		$	86,587
Cumulative gap	$	67,140		$	9,770		$	51,393		$	86,578
Cumulative gap as a percentage of interest earning assets		25.63	%		3.73	%		19.62	%		33.06	%

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Liquidity risk

     Liquidity risk is the risk to earnings or capital arising from the Bank’s inability to meet its obligations when they come due without incurring unacceptable losses. Liquidity risk includes the inability to manage unplanned decreases or changes in funding sources as well as the failure to recognize or address changes in market conditions that affect the ability to liquidate assets quickly and with minimal loss in value.

     The Bank manages liquidity risk through Board approved policies and procedures. These policies are reviewed and approved at least annually by the Directors. Liquidity risk policies provide Bank management with a framework for consistent evaluation of risk and establish risk tolerance parameters. Management’s Asset and Liability Committee meets regularly to evaluate liquidity risk, review and establish deposit interest rates, review loan and deposit in-flows and out-flows and reports quarterly to the Directors’ Funds Management Committee on compliance with policies. The Directors’ Audit Committee also engages a third party to perform a review of management’s asset and liability practices to ensure compliance with policies.

     The Bank enjoys a large base of core deposits (representing checking, savings and small balance certificates of deposit). At June 30, 2005 core deposits totaled $207,225,000 compared with $194,939,000 at December 31, 2004. At December 31, 2003 core deposits totaled $184,432,000 and core deposits totaled $155,471,000 at December 31, 2002. Core deposits represent a significant low-cost source of funds that support the Bank’s lending activities.

     The Bank, as a member of the Federal Home Loan Bank of San Francisco (FHLB) has access to borrowing arrangements with a maximum available borrowing of approximately $75.0 million. Borrowings under these arrangements are collateralized by the Bank’s FHLB stock as well as loans or securities. As of June 30, 2005, the Bank had borrowings outstanding with the FHLB of $34,940,000.

     In addition, the Bank has lines of credit with three other financial institutions providing for federal funds facilities up to a maximum of $14.0 million. The lines of credit support short-term liquidity needs and cannot be used for more than 15 consecutive days. These lines are unsecured, have no formal maturity date and can be revoked at any time by the granting institutions. There were no borrowings under these lines of credit at June 30, 2005.

     The Bank also maintains a secured borrowing facility of $800,000 with the Federal Reserve Bank of San Francisco. There were no borrowings under this facility at June 30, 2005.

Capital Resources

     The Board of Directors recognizes that a strong capital position is vital to growth, continued profitability, and depositor and investor confidence. The policy of the Board of Directors is to maintain sufficient capital at not less than the well-capitalized thresholds established by banking regulators. In 2002, the Bank successfully issued 400,000 shares of common stock, with 200,000 warrants attached, for a total of $5.5 million in capital to support our growth strategy. The Bank has not paid cash or stock dividends since 2001.

     The following tables set forth the Bank’s actual capital amounts and ratios and a comparison to the minimum ratios for the periods indicated:

											To be Well
											Capitalized Under
						For Capital					Prompt Corrective
	Actual					Adequacy Purposes					Action Provision
(Dollars in thousands)	Amount		Ratio			Amount		Ratio			Amount		Ratio
June 30, 2005
Total capital	$	26,753		11.63	%	$	18,403		8.00	%	$	23,003		10.00	%
(to risk weighted assets)
Tier I capital	$	24,010		10.44	%	$	9,199		4.00	%	$	13,799		6.00	%
(to risk weighted assets)
Tier I capital	$	24,010		8.20	%	$	11,712		4.00	%	$	14,640		5.00	%
(to average assets)

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											To be Well
											Capitalized Under
						For Capital					Prompt Corrective
	Actual					Adequacy Purposes					Action Provision
(Dollars in thousands)	Amount		Ratio			Amount		Ratio			Amount		Ratio
December 31, 2004
Total capital	$	25,300		12.25	%	$	16,518		8.00	%	$	20,647		10.00	%
(to risk weighted assets)
Tier I capital	$	22,804		11.04	%	$	8,259		4.00	%	$	12,388		6.00	%
(to risk weighted assets)
Tier I capital	$	22,804		8.61	%	$	10,974		4.00	%	$	13,718		5.00	%
(to average assets)

     The Bank’s capital ratios exceed the levels established by banking regulators for a ‘well-capitalized’ institution at June 30, 2005 and December 31, 2004.

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Supervision and Regulation — First California Bank

     General. As a state-chartered bank whose deposits are insured by the Federal Deposit Insurance Corporation up to the maximum extent provided by law, the Bank is subject to supervision, examination and regulation by the California Department of Financial Institutions and by federal bank regulatory agencies. The Bank’s primary federal bank regulatory agency is the FDIC. The regulations of these agencies govern most aspects of the Bank’s business, including capital adequacy ratios, reserves against deposits, restrictions on the rate of interest which may be paid on some deposit instruments, limitations on the nature and amount of loans which may be made, the location of branch offices, borrowings, and dividends. Supervision, regulation and examination of the Bank by the regulatory agencies are generally intended to protect depositors and are not intended for the protection of the Bank’s shareholders.

     Significant Legislation. The laws, regulations and policies governing financial institutions are continuously under review by Congress, state legislatures and federal and state regulatory agencies. From time to time laws or regulations are enacted which have the effect of increasing the cost of doing business, limiting or expanding the scope of permissible activities, or changing the competitive balance between banks and other financial and non-financial institutions. Various federal laws enacted in recent years have expanded the lending authority and permissible activities of certain non-bank financial institutions, such as savings and loan associations and credit unions, and have given federal regulators increased enforcement authority. These laws have generally had the effect of altering competitive relationships existing among financial institutions, reducing the historical distinctions

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between the services offered by banks, savings and loan associations and other financial institutions, and increasing the cost of funds to banks and other depository institutions. Future changes in the laws, regulations or polices that impact the Bank cannot necessarily be predicted, but they may have a material effect on the Bank’s business and earnings.

     USA Patriot Act. On October 26, 2001, the President signed into law comprehensive anti-terrorism legislation, the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001, known as the USA Patriot Act. Title III of the USA Patriot Act requires financial institutions, including the Bank, to help prevent, detect and prosecute international money laundering and the financing of terrorism. The Bank has augmented its systems and procedures to accomplish this requirement. We believe that the cost of compliance with Title III of the USA Patriot Act is not likely to be material to the Company.

     Gramm-Leach-Bliley Act. In November 1999, the Gramm-Leach-Bliley Act, or the GLB Act, became law, significantly changing the regulatory structure and oversight of the financial services industry. The GLB Act repealed the provisions of the Glass-Steagall Act that restricted banks and securities firms from affiliating. It also revised the Bank Holding Company Act to permit a “qualifying” bank holding company, called a financial holding company, to engage in a full range of financial activities, including banking, insurance, securities, and merchant banking activities. It also permits qualifying bank holding companies to acquire many types of financial firms without the FRB’s prior approval.

     The GLB Act thus provides expanded financial affiliation opportunities for existing bank holding companies and permits other financial services providers to acquire banks and become bank holding companies without ceasing any existing financial activities. Previously, a bank holding company could only engage in activities that were “closely related to banking.” This limitation no longer applies to bank holding companies that qualify to be treated as financial holding companies. To qualify as a financial holding company, a bank holding company’s subsidiary depository institutions must be well-capitalized, well-managed and have at least a “satisfactory” Community Reinvestment Act examination rating. “Nonqualifying” bank holding companies are limited to activities that were permissible under the Bank Holding Company Act as of November 11, 1999.

     The GLB Act changed the powers of national banks and their subsidiaries, and made similar changes in the powers of state banks and their subsidiaries. National banks may now underwrite, deal in and purchase state and local revenue bonds. A subsidiary of a national bank may now engage in financial activities that the bank cannot itself engage in, except for general insurance underwriting and real estate development and investment. In order for a subsidiary of a national bank to engage in these new financial activities, the national bank and its depository institution affiliates must be “well capitalized,” have at least “satisfactory” general, managerial and Community Reinvestment Act examination ratings, and meet other qualification requirements relating to total assets, subordinated debt, capital, risk management, and affiliate transactions. Subsidiaries of state banks can exercise the same powers as national bank subsidiaries if they satisfy the same qualifying rules that apply to national banks, except that state-chartered banks do not have to satisfy the statutory managerial and debt rating-requirements of national banks.

     The GLB Act also reformed the overall regulatory framework of the financial services industry. In order to implement its underlying purposes, the GLB Act preempted state laws that would restrict the types of financial affiliations that are authorized or permitted under the GLB Act, subject to specified exceptions for state insurance laws and regulations. With regard to securities laws, the GLB Act removed the blanket exemption for banks from being considered brokers or dealers under the Exchange Act and replaced it with a number of more limited exemptions. Thus, previously exempted banks may become subject to the broker-dealer registration and supervision requirements of the Exchange Act. The exemption that prevented bank holding companies and banks that advise mutual funds from being considered investment advisers under the Investment Advisers Act of 1940 was also eliminated.

     Separately, the GLB Act imposes customer privacy requirements on any company engaged in financial activities. Under these requirements, a financial company is required to protect the security and confidentiality of customer nonpublic personal information. Also, for customers that obtain a financial product such as a loan for personal, family or household purposes, a financial company is required to disclose its privacy policy to the customer at the time the relationship is established and annually thereafter, including its policies concerning the sharing of the customer’s nonpublic personal information with affiliates and third parties. If an exemption is not

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available, a financial company must provide consumers with a notice of its information sharing practices that allows the consumer to reject the disclosure of its nonpublic personal information to third parties. Third parties that receive such information are subject to the same restrictions as the financial company on the reuse of the information. Finally, a financial company is prohibited from disclosing an account number or similar item to a third party for use in telemarketing, direct mail marketing or other marketing through electronic mail.

     Risk-Based Capital Guidelines.

     General. The federal banking agencies have established minimum capital standards known as risk-based capital guidelines. These guidelines are intended to provide a measure of capital that reflects the degree of risk associated with a bank’s operations. The risk-based capital guidelines include both a new definition of capital and a framework for calculating the amount of capital that must be maintained against a bank’s assets and off-balance sheet items. The amount of capital required to be maintained is based upon the credit risks associated with the various types of a bank’s assets and off-balance sheet items. A bank’s assets and off-balance sheet items are classified under several risk categories, with each category assigned a particular risk weighting from 0% to 100%. A bank’s risk-based capital ratio is calculated by dividing its qualifying capital, which is the numerator of the ratio, by the combined risk weights of its assets and off-balance sheet items, which is the denominator of the ratio.

     Qualifying Capital. A bank’s total qualifying capital consists of two types of capital components: “core capital elements,” known as Tier 1 capital, and “supplementary capital elements,” known as Tier 2 capital. The Tier 1 component of a bank’s qualifying capital must represent at least 50% of total qualifying capital and may consist of the following items that are defined as core capital elements:

• common stockholders’ equity;

• qualifying noncumulative perpetual preferred stock (including related surplus); and

• minority interests in the equity accounts of consolidated subsidiaries.

     The Tier 2 component of a bank’s total qualifying capital may consist of the following items:

• a portion of the allowance for loan and lease losses;

• certain types of perpetual preferred stock and related surplus;

• certain types of hybrid capital instruments and mandatory convertible debt securities; and

• a portion of term subordinated debt and intermediate-term preferred stock, including related surplus.

     Risk Weighted Assets and Off-Balance Sheet Items. Assets and credit equivalent amounts of off-balance sheet items are assigned to one of several broad risk classifications, according to the obligor or, if relevant, the guarantor or the nature of the collateral. The aggregate dollar value of the amount in each risk classification is then multiplied by the risk weight associated with that classification. The resulting weighted values from each of the risk classifications are added together. This total is the bank’s total risk weighted assets.

     Risk weights for off-balance sheet items, such as unfunded loan commitments, letters of credit and recourse arrangements, are determined by a two-step process. First, the “credit equivalent amount” of the off-balance sheet items is determined, in most cases by multiplying the off-balance sheet item by a credit conversion factor. Second, the credit equivalent amount is treated like any balance sheet asset and is assigned to the appropriate risk category according to the obligor or, if relevant, the guarantor or the nature of the collateral. This result is added to the bank’s risk weighted assets and comprises the denominator of the risk-based capital ratio.

     Minimum Capital Standards. The supervisory standards set forth below specify minimum capital ratios based primarily on broad risk considerations. The risk-based ratios do not take explicit account of the quality of individual asset portfolios or the range of other types of risks to which banks may be exposed, such as interest rate, liquidity, market or operational risks. For this reason, banks are generally expected to operate with capital positions above the minimum ratios.

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     All banks are required to meet a minimum ratio of qualifying total capital to risk weighted assets of 8%. At least 4% must be in the form of Tier 1 capital, net of goodwill. The maximum amount of supplementary capital elements that qualifies as Tier 2 capital is limited to 100% of Tier 1 capital, net of goodwill. In addition, the combined maximum amount of subordinated debt and intermediate-term preferred stock that qualifies as Tier 2 capital is limited to 50% of Tier 1 capital. The maximum amount of the allowance for loan and lease losses that qualifies as Tier 2 capital is limited to 1.25% of gross risk weighted assets. The allowance for loan and lease losses in excess of this limit may, of course, be maintained, but would not be included in a bank’s risk-based capital calculation.

     The federal banking agencies also require all banks to maintain a minimum amount of Tier 1 capital to total assets, referred to as the leverage ratio. For a bank rated in the highest of the five categories used by regulators to rate banks, the minimum leverage ratio of Tier 1 capital to total assets is 3%. For all banks not rated in the highest category, the minimum leverage ratio must be at least 4% to 5%. These uniform risk-based capital guidelines and leverage ratios apply across the industry. Regulators, however, have the discretion to set minimum capital requirements for individual institutions which may be significantly above the minimum guidelines and ratios.

     The following table sets forth the Bank’s actual capital amounts and ratios and a comparison to the minimum ratios:

											To be Well
											Capitalized Under
						For Capital					Prompt Corrective
	Actual					Adequacy Purposes					Action Provision
(Dollars in thousands)	Amount		Ratio			Amount		Ratio			Amount		Ratio
June 30, 2005
Total capital	$	26,753		11.63	%	$	18,403		8.00	%	$	23,003		10.00	%
(to risk weighted assets)
Tier I capital	$	24,010		10.44	%	$	9,199		4.00	%	$	13,799		6.00	%
(to risk weighted assets)
Tier I capital	$	24,010		8.20	%	$	11,712		4.00	%	$	14,640		5.00	%
(to average assets)

     Other Factors Affecting Minimum Capital Standards. The federal banking agencies have established certain benchmark ratios of loan loss reserves to be held against classified assets. The benchmark ratio established by the federal banking agencies is the sum of:

• 100% of assets classified loss;

• 50% of assets classified doubtful;

• 15% of assets classified substandard; and

• estimated credit losses on other assets over the upcoming twelve months.

     Our loan loss reserves equal or exceed the established benchmark ratios.

     The risk-based capital rules adopted by the federal banking agencies take account of concentrations of credit and the risks of engaging in non-traditional activities. Concentrations of credit refers to situations where a lender has a relatively large proportion of loans involving a single borrower, industry, geographic location, collateral or loan type. Non-traditional activities are considered those that have not customarily been part of the banking business, but are conducted by a bank as a result of developments in, for example, technology, financial markets or other additional activities permitted by law or regulation. The regulations require institutions with high or inordinate levels of risk to operate with higher minimum capital standards. The federal banking agencies also are authorized to review an institution’s management of concentrations of credit risk for adequacy and consistency with safety and soundness standards regarding internal controls, credit underwriting or other operational and managerial areas. We do not have any concentrations of credit or risk associated with non-traditional activities that would affect our capital ratios.

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     The federal banking agencies also limit the amount of deferred tax assets that are allowable in computing a bank’s regulatory capital. Deferred tax assets that can be realized from taxes paid in prior carryback years and from future reversals of existing taxable temporary differences are generally not limited. However, deferred tax assets that can only be realized through future taxable earnings are limited for regulatory capital purposes to the lesser of:

• the amount of the deferred tax assets that can be realized within one year of the quarter-end report date; or

• 10% of Tier 1 capital.

     The amount of any deferred tax in excess of this limit would be excluded from Tier 1 capital, total assets and regulatory capital calculations. We do not have any deferred tax assets in excess of the regulatory limits.

     The federal banking agencies have also adopted a joint agency policy statement which provides that the adequacy and effectiveness of a bank’s interest rate risk management process and the level of its interest rate exposures are critical factors in the evaluation of the bank’s capital adequacy. A bank with material weaknesses in its interest rate risk management process or high levels of interest rate exposure relative to its capital will be directed by the federal banking agencies to take corrective actions. Financial institutions which have significant amounts of their assets concentrated in high risk loans or nontraditional banking activities, and who fail to adequately manage these risks, may be required to set aside capital in excess of the regulatory minimums.

     Prompt Corrective Action. The federal banking agencies possess broad powers to take prompt corrective action to resolve the problems of insured banks. Each federal banking agency has issued regulations defining five capital categories: “well capitalized,” “adequately capitalized,” “undercapitalized,” “significantly undercapitalized,” and “critically undercapitalized.” Under the regulations, a bank shall be deemed to be:

• “well capitalized” if it has a total risk-based capital ratio of 10.0% or more, has a Tier 1 risk-based capital ratio of 6.0% or more, has a leverage capital ratio of 5.0% or more, and is not subject to specified requirements to meet and maintain a specific capital level for any capital measure;

• “adequately capitalized” if it has a total risk-based capital ratio of 8.0% or more, a Tier 1 risk-based capital ratio of 4.0% or more, and a leverage capital ratio of 4.0% or more (3.0% under certain circumstances) and does not meet the definition of “well capitalized”;

• “undercapitalized” if it has a total risk-based capital ratio that is less than 8.0%, a Tier 1 risk-based capital ratio that is less than 4.0%, or a leverage capital ratio that is less than 4.0% (3.0% under certain circumstances);

• “significantly undercapitalized” if it has a total risk-based capital ratio that is less than 6.0%, a Tier 1 risk-based capital ratio that is less than 3.0% or a leverage capital ratio that is less than 3.0%; and

• “critically undercapitalized” if it has a ratio of tangible equity to total assets that is equal to or less than 2.0%.

     As of March 31 , 2005, the most recent notification from the regulatory agencies categorized the Bank as “well capitalized” under the regulatory framework for prompt corrective action. There are no conditions or events since that notification that management believes have changed the Bank’s category.

     Banks are prohibited from paying dividends or management fees to controlling persons or entities if, after making the payment the bank would be “undercapitalized,” that is, the bank fails to meet the required minimum level for any relevant capital measure. Asset growth and branching restrictions apply to “undercapitalized” banks. Banks classified as “undercapitalized” are required to submit acceptable capital plans guaranteed by its holding company, if any. Broad regulatory authority was granted with respect to “significantly undercapitalized” banks, including forced mergers, growth restrictions, ordering new elections for directors, forcing divestiture by its holding company, if any, requiring management changes, and prohibiting the payment of bonuses to senior management. Even more severe restrictions are applicable to “critically undercapitalized” banks, those with capital at or less than 2%. Restrictions for these banks include the appointment of a receiver or conservator after 90 days, even if the bank is still solvent. All of the federal banking agencies have promulgated substantially similar regulations to implement this system of prompt corrective action.

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     A bank, based upon its capital levels, that is classified as “well capitalized,” “adequately capitalized” or “undercapitalized” may be treated as though it were in the next lower capital category if the appropriate federal banking agency, after notice and opportunity for a hearing, determines that an unsafe or unsound condition, or an unsafe or unsound practice, warrants such treatment. At each successive lower capital category, an insured bank is subject to more restrictions. The federal banking agencies, however, may not treat an institution as “critically undercapitalized” unless its capital ratios actually warrant such treatment.

     Deposit Insurance Assessments. The FDIC has implemented a risk-based assessment system in which the deposit insurance premium relates to the probability that the deposit insurance fund will incur a loss. The FDIC sets semi-annual assessments in an amount necessary to maintain or increase the reserve ratio of the insurance fund to at least 1.25% of insured deposits or a higher percentage as determined to be justified by the FDIC.

     Under the risk-based assessment system adopted by the FDIC, banks are categorized into one of three capital categories (“well capitalized,” “adequately capitalized,” and “undercapitalized”). Assignment of a bank into a particular capital category is based on supervisory evaluations by its primary federal regulator. After being assigned to a particular capital category, a bank is classified into one of three supervisory categories. The three supervisory categories are:

• Group A — financially sound with only a few minor weaknesses;

• Group B — demonstrates weaknesses that could result in significant deterioration; and

• Group C — poses a substantial probability of loss.

     The capital ratios used by the FDIC to define “well-capitalized,” “adequately capitalized” and “undercapitalized” are the same as in the prompt corrective action regulations.

     Because of the FDIC’s favorable loss experience and a healthy reserve ratio in the Bank Insurance Fund, well-capitalized and well-managed banks have in recent years paid minimal premiums for FDIC Insurance. A number of factors suggest that as early as the first half of 2004, even well-capitalized and well-managed banks may be required to pay higher premiums for deposit insurance. The amount of any such premiums will depend on the outcome of legislative and regulatory initiatives as well as the Bank Insurance Fund loss experience and other factors, none of which we can predict.

     The current assessment rates are summarized below, expressed in terms of cents per $100 in insured deposits:

	Assessment Rates
	Supervisory Group
Capital Group	Group A		Group B		Group C
Well capitalized.		0		3		17
Adequately capitalized		3		10		24
Undercapitalized		10		24		27

     Interstate Banking and Branching. Bank holding companies from any state may generally acquire banks and bank holding companies located in any other state, subject in some cases to nationwide and state-imposed deposit concentration limits and limits on the acquisition of recently established banks. Banks also have the ability, subject to specific restrictions, to acquire by acquisition or merger branches located outside their home state. The establishment of new interstate branches is also possible in those states with laws that expressly permit it. Interstate branches are subject to many of the laws of the states in which they are located.

     California law authorizes out-of-state banks to enter California by the acquisition of or merger with a California bank that has been in existence for at least five years, unless the California bank is in danger of failing or in certain other emergency situations, but limits interstate branching into California to branching by acquisition of an existing bank.

     Enforcement Powers. In addition to measures taken under the prompt corrective action provisions, insured banks may be subject to potential enforcement actions by the federal regulators for unsafe or unsound practices in

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conducting their businesses, or for violation of any law, rule, regulation, condition imposed in writing by the regulatory agency, or term of a written agreement with the regulatory agency. Enforcement actions may include:

• the appointment of a conservator or receiver for the bank;

• the issuance of a cease and desist order that can be judicially enforced;

• the termination of the bank’s deposit insurance;

• the imposition of civil monetary penalties;

• the issuance of directives to increase capital;

• the issuance of formal and informal agreements;

• the issuance of removal and prohibition orders against officers, directors and other institution-affiliated parties; and

• the enforcement of such actions through injunctions or restraining orders based upon a judicial determination that the deposit insurance fund or the bank would be harmed if such equitable relief was not granted.

     The DFI, as the primary regulator for state-chartered banks, also has a broad range of enforcement measures, from cease and desist powers and the imposition of monetary penalties to the ability to take possession of a bank, including causing its liquidation.

     FDIC Receiverships. The FDIC may be appointed conservator or receiver of any insured bank or savings association. In addition, the FDIC may appoint itself as sole conservator or receiver of any insured state bank or savings association for any, among others, of the following reasons:

• insolvency;

• substantial dissipation of assets or earnings due to any violation of law or regulation or any unsafe or unsound practice;

• an unsafe or unsound condition to transact business, including substantially insufficient capital or otherwise;

• any willful violation of a cease and desist order which has become final;

• any concealment of books, papers, records or assets of the institution;

• the likelihood that the institution will not be able to meet the demands of its depositors or pay its obligations in the normal course of business;

• the incurrence or likely incurrence of losses by the institution that will deplete all or substantially all of its capital with no reasonable prospect for the replenishment of the capital without federal assistance; or

• any violation of any law or regulation, or an unsafe or unsound practice or condition which is likely to cause insolvency or substantial dissipation of assets or earnings, or is likely to weaken the condition of the institution or otherwise seriously prejudice the interests of its depositors.

     As a receiver of any insured depository institution, the FDIC may liquidate such institution in an orderly manner and dispose of any matter concerning such institution as the FDIC determines is in the best interests of such institution, its depositors and the FDIC. Further, the FDIC shall, as the conservator or receiver, by operation of law, succeed to all rights, titles, powers and privileges of the insured institution, and of any shareholder, member, account holder, depositor, officer or director of such institution with respect to the institution and the assets of the institution; may take over the assets of and operate such institution with all the powers of the members or shareholders,

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directors and the officers of the institution and conduct all business of the institution; collect all obligations and money due to the institution and preserve and conserve the assets and property of the institution.

     Safety and Soundness Guidelines. The federal banking agencies have adopted guidelines to assist in identifying and addressing potential safety and soundness concerns before capital becomes impaired. These guidelines establish operational and managerial standards relating to:

• internal controls, information systems and internal audit systems;

• loan documentation;

• credit underwriting;

• asset growth; and

• compensation, fees and benefits.

     Additionally, the federal banking agencies have adopted safety and soundness guidelines for asset quality and for evaluating and monitoring earnings to ensure that earnings are sufficient for the maintenance of adequate capital and reserves. If an institution fails to comply with a safety and soundness standard, the appropriate federal banking agency may require the institution to submit a compliance plan. Failure to submit a compliance plan or to implement an accepted plan may result in enforcement action.

     The federal banking agencies have issued regulations prescribing uniform guidelines for real estate lending. The regulations require insured depository institutions to adopt written policies establishing standards, consistent with such guidelines, for extensions of credit secured by real estate. The policies must address loan portfolio management, underwriting standards and loan to value limits that do not exceed the supervisory limits prescribed by the regulations.

     Risk Management and Exposure. The federal banking agencies have begun examining banks and bank holding companies with respect to their exposure to and management of different categories of risk, including: legal, operations, market, credit, interest rate, price, foreign exchange, transaction, compliance, strategic, credit, liquidity, and reputation risk. This examination approach causes bank regulators to focus on risk management procedures, rather than simply examining every asset and transaction. This approach supplements rather than replaces existing rating systems based on the evaluation of an institution’s capital, assets, management, earnings and liquidity.

     Money Laundering and Currency Controls. Various federal statutory and regulatory provisions are designed to enhance recordkeeping and reporting of currency and foreign transactions. Pursuant to the Bank Secrecy Act, financial institutions must report high levels of currency transactions or face the imposition of civil monetary penalties for reporting violations. The Money Laundering Control Act imposes sanctions, including revocation of federal deposit insurance, for institutions convicted of money laundering.

     The International Money Laundering Abatement and Financial Anti-Terrorism Act of 2001 (“IMLAFATA”), a part of the USA Patriot Act, authorizes the Secretary of the Treasury, in consultation with the heads of other government agencies, to adopt special measures applicable to banks and other financial institutions to enhance recordkeeping and reporting requirements for certain financial transactions that are of primary money laundering concern. Among its other provisions, IMLAFATA requires each financial institution to: (i) establish an anti-money laundering program; (ii) establish due diligence policies, procedures and controls with respect to its private banking accounts and correspondent banking accounts involving individuals and certain foreign banks; and (iii) avoid establishing, maintaining, administering, or managing correspondent accounts in the Untied States for, or on behalf of, a foreign bank that does not have a physical presence in any country. In addition, IMLAFATA contains a provision encouraging cooperation among financial institutions, regulatory authorities and law enforcement authorities with respect to individuals, entities and organizations engaged in, or reasonably suspected of engaging in, terrorist acts or money laundering activities. IMLAFATA mandates that federally-insured banks and other financial institutions establish customer identification programs designed to verify the identity of persons opening new accounts, to maintain the records used for verification, and to determine whether the person appears on any list of known or suspected terrorists or terrorist organizations.

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     Consumer Protection Laws and Regulations. The bank regulatory agencies are focusing greater attention on compliance with consumer protection laws and implementing regulations. These laws and implementing regulations impact overall bank operations as well as specific consumer-oriented products and services. Examination and enforcement have become more intense in nature, and insured institutions have been advised to carefully monitor compliance with various consumer protection laws and implementing regulations. Banks are subject to many federal consumer protection laws and regulations, including:

• the Community Reinvestment Act, or the CRA;

• the Truth in Lending Act, or the TILA;

• the Fair Housing Act, or the FH Act;

• the Equal Credit Opportunity Act, or the ECOA;

• the Home Mortgage Disclosure Act, or the HMDA; and

• the Real Estate Settlement Procedures Act, or the RESPA.

     The CRA is intended to encourage insured depository institutions, while operating safely and soundly, to help meet the credit needs of their communities. The CRA specifically directs the federal bank regulatory agencies, in examining insured depository institutions, to assess their record of helping to meet the credit needs of their entire community, including low- and moderate-income neighborhoods, consistent with safe and sound banking practices. The CRA further requires the agencies to take a financial institution’s record of meeting its community credit needs into account when evaluating applications for, among other things, domestic branches, consummating mergers or acquisitions, or holding company formations.

     The federal banking agencies have adopted regulations which measure a bank’s compliance with its CRA obligations on a performance-based evaluation system. This system bases CRA ratings on an institution’s actual lending service and investment performance rather than the extent to which the institution conducts needs assessments, documents community outreach or complies with other procedural requirements. The ratings range from “outstanding” to a low of “substantial noncompliance.”

     The ECOA prohibits discrimination in any credit transaction, whether for consumer or business purposes, on the basis of race, color, religion, national origin, sex, marital status, age (except in limited circumstances), receipt of income from public assistance programs, or good faith exercise of any rights under the Consumer Credit Protection Act. In March 1994, the Federal Interagency Task Force on Fair Lending issued a policy statement on discrimination in lending. The policy statement describes the three methods that federal agencies will use to prove discrimination:

• overt evidence of discrimination;

• evidence of disparate treatment; and

• evidence of disparate impact.

     This means that if a creditor’s actions have had the effect of discriminating, the creditor may be held liable — even when there is no intent to discriminate.

     The FH Act regulates many practices, including making it unlawful for any lender to discriminate against any person in its housing-related lending activities because of race, color, religion, national origin, sex, handicap, or familial status. The FH Act is broadly written and has been broadly interpreted by the courts. A number of lending practices have been found to be, or may be considered, illegal under the FH Act, including some that are not specifically mentioned in the FH Act itself. Among those practices that have been found to be, or may be considered, illegal under the FH Act are:

• declining a loan for the purposes of racial discrimination;

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• making excessively low appraisals of property based on racial considerations;

• pressuring, discouraging, or denying applications for credit on a prohibited basis;

• using excessively burdensome qualifications standards for the purpose or with the effect of denying housing to minority applicants;

• imposing on minority loan applicants more onerous interest rates or other terms, conditions or requirements; and

• racial steering, or deliberately guiding potential purchasers to or away from certain areas because of race.

     The TILA is designed to ensure that credit terms are disclosed in a meaningful way so that consumers may compare credit terms more readily and knowledgeably. As a result of the TILA, all creditors must use the same credit terminology and expressions of rates, the annual percentage rate, the finance charge, the amount financed, the total payments and the payment schedule.

     HMDA grew out of public concern over credit shortages in certain urban neighborhoods. One purpose of HMDA is to provide public information that will help show whether financial institutions are serving the housing credit needs of the neighborhoods and communities in which they are located. HMDA also includes a “fair lending” aspect that requires the collection and disclosure of data about applicant and borrower characteristics as a way of identifying possible discriminatory lending patterns and enforcing anti-discrimination statutes. HMDA requires institutions to report data regarding applications for one-to-four family real estate loans, home improvement loans, and multifamily loans, as well as information concerning originations and purchases of those types of loans. Federal bank regulators rely, in part, upon data provided under HMDA to determine whether depository institutions engage in discriminatory lending practices.

     RESPA requires lenders to provide borrowers with disclosures regarding the nature and costs of real estate settlements. Also, RESPA prohibits certain abusive practices, such as kickbacks, and places limitations on the amount of escrow accounts.

     The GLB Act requires disclosure of our privacy policy at the time a customer relationship is established and annually thereafter. Under the provisions of the GLB Act, we must put systems in place to safeguard the non-public personal information of our customers.

     Violations of these various consumer protection laws and regulations can result in civil liability to the aggrieved party, regulatory enforcement including civil money penalties, and even punitive damages.

     Other Aspects of Banking Law. We are also subject to federal statutory and regulatory provisions covering, among other things, security procedures, insider and affiliated party transactions, management interlocks, electronic funds transfers, funds availability, and truth-in-savings. There are also a variety of federal statutes which regulate acquisitions of control and the formation of bank holding companies.

     Impact of Monetary Policies. Banking is a business that depends on rate differentials. In general, the difference between the interest rate paid by a bank on its deposits and its other borrowings and the interest rate earned by a bank on its loans, securities and other interest-earning assets comprises the major source of the bank’s earnings.

     These rates are highly sensitive to many factors which are beyond the bank’s control and, accordingly, the earnings and growth of the bank are subject to the influence of economic conditions generally, both domestic and foreign, including inflation, recession, and unemployment; and also to the influence of monetary and fiscal policies of the United States and its agencies, particularly the FRB. The FRB implements national monetary policy, such as seeking to curb inflation and combat recession, by:

• its open-market dealings in United States government securities;

• adjusting the required level of reserves for financial institutions subject to reserve requirements;

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• placing limitations upon savings and time deposit interest rates; and

• adjustments to the discount rate applicable to borrowings by banks which are members of the Federal Reserve System.

     The actions of the FRB in these areas influence the growth of bank loans, investments, and deposits and also affect market interest rates. Since January 2001 the FRB has decreased interest rates numerous times, reducing the overnight “Federal Funds” rate from 6.50% to as low as 1.00%, the lowest level in over four decades. Since June 2004, the FRB has reversed direction and increased rates eight times to 3.00%. The nature and timing of any future changes in such policies and their impact on us cannot be predicted; however, depending on the degree to which our interest-earning assets and interest-bearing liabilities are rate sensitive, increases in rates would have a temporary effect of increasing our net interest margin, while decreases in interest rates would have the opposite effect. In addition, adverse economic conditions, including a downturn in the local or regional economy and rising energy prices, could make a higher provision for loan losses a prudent course and could cause higher loan charge-offs, thus adversely affecting our net income or other operating costs.

     Conclusion. As a result of the recent federal and California legislation, including the GLB Act, there has been a competitive impact on commercial banking. There has been a lessening of the historical distinction between the services offered by banks, savings associations, credit unions, securities dealers, insurance companies, and other financial institutions. Banks have also experienced increased competition for deposits and loans that may result in increases in their cost of funds, and banks have experienced increased overall costs. Further, the federal banking agencies have increased enforcement authority over banks and their directors and officers.

     Future legislation is also likely to impact our business. However, our management cannot predict what legislation might be enacted or what regulations might be adopted or the effects thereof.

Trading in the Bank’s and the Holding Company’s Common Stock

     Trading History. Presently, there is no market for the Company’s common stock. There has been a limited trading market for the Bank’s common stock on the OTC “Bulletin Board” (trading symbol “FCAA”) and no assurance can be given that a more active public trading market for the Company’s common stock will develop in the future. The Company is aware of only four dealers that effected trades in the Bank’s common stock. The Company’s common stock is not registered under the Securities Exchange Act of 1934 and, therefore, is not currently eligible for listing on any exchange or on the Nasdaq National Market.

     The information in the following table indicates the high and low sales prices and volume of trading for the Bank’s common stock for each quarterly period since January 1, 2003, and is based upon information provided by the OTC “Bulletin Board.” Because of the limited market for the Bank’s common stock, these prices may not be indicative of the fair market value of the Bank’s common stock. The information does not include transactions for which no public records are available. The trading prices in such transactions may be higher or lower than the prices reported below.

	Sales Prices
					Approximate Number
Quarter Ended	High		Low		of Shares Traded
March 31, 2003	$	10.87	$	10.50		13,700
June 30, 2003	$	12.00	$	11.00		15,600
September 30, 2003	$	13.00	$	11.75		4,300
December 31, 2003	$	15.75	$	13.10		11,488
March 31, 2004	$	22.00	$	15.80		32,387
June 30, 2004	$	20.80	$	17.95		13,559
September 30, 2004	$	19.75	$	17.75		24,272
December 31, 2004	$	23.00	$	19.25		14,693
March 31, 2005	$	23.00	$	22.50		190,970

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Period Ended

June ___, 2005

     According to information provided by the OTC “Bulletin Board,” the most recent trade in the Bank’s Common Stock prior to the date of this Proxy Statement occurred on                     , 2005 for                     shares, at a sales price of $                     per share.

     As of the date of this Proxy Statement the Bank has approximately                      shareholders of record; however, the Bank believes that there are an additional                      shareholders who own their shares in “street name” through brokerage firms.

     It is anticipated that, upon consummation of the merger, the Holding Company’s Common Stock will be quoted on the OTC Bulletin Board.

     Dividends. The Bank has not paid any cash dividends since 2001. Payment of cash dividends in the future will depend upon our earnings and financial condition and other factors deemed relevant by our Board of Directors. No assurance can be given that any cash dividends will be declared in the foreseeable future; except, however, that a special cash dividend of $5.0 million will be paid to FCB Bancorp in connection with the acquisition of SCB. In the event the merger is approved, it is anticipated that management of the Holding Company will follow the same policy of retaining earnings to increase our capital and provide additional basis for growth.

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Pro Forma Capitalization

     The following table sets forth the actual capitalization of the Bank, FCB Merger Corp. and the Holding Company at June 30, 2005, and the pro forma capitalization of the Holding Company, on a consolidated basis, to reflect the consummation of the merger:

				FCB Merger				Pro Forma FCB Bancorp,
	First California			Corp.1		FCB Bancorp2		consolidated
	Bank (unaudited)			(unaudited)		(unaudited)		(unaudited)
Shareholders’ Equity:
Common Stock	$	11,965,000		$	500	$	2,000	$	11,965,000
Retained earnings		12,045,000		$	0	$	0		12,045,000
Accumulated other comprehensive loss		(346,000	)	$	0	$	0		(346,000	)
Total Shareholders’ Equity	$	23,664,000		$	500	$	2,000	$	23,664,000
Common Stock Data:
Authorized		2,500,000			10,000,000		10,000,000		10,000,000
Outstanding		2,162,807			100		200		2,162,807
Preferred Stock Data:
Authorized		0			10,000,000		10,000,000		10,000,000
Outstanding		0			0		0		0

1	Funds to capitalize FCB Merger Corp. were obtained by issuing 100 shares to the Holding Company for $500. At the time of the merger the shares will be cancelled.
2	Funds to capitalize the Holding Company were obtained by issuing 200 shares to Mr. James O. Birchfield, the Bank’s Chairman of the Board, for $2,000. At the time of the merger and pursuant to a written agreement, these shares will be repurchased for $2,000 and cancelled by the Holding Company.

Vote Required

The Merger Agreement and transaction contemplated therein, including the merger, requires the approval by a majority of the outstanding shares of the Bank’s Common Stock.

THE BOARD OF DIRECTORS RECOMMENDS A VOTE OF “FOR” ON THIS PROPOSAL.

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SOUTH COAST BANCORP, INC.

Background and Description of South Coast Bancorp Transaction

     FCB Bancorp entered into an Agreement and Plan of Reorganization dated as of February 2, 2005 (the “Acquisition Agreement”) with First California Bank, SCB Merger Corp., SCB, and South Coast Commercial Bank (“South Coast”), pursuant to which FCB Bancorp will acquire and then immediately thereafter merge with SCB, and whereby SCCB will become a wholly-owned separate subsidiary bank of FCB Bancorp and the Bank’s sister corporation (the “Acquisition”).

     FCB Bancorp has organized SCB Merger Corp. as a new California corporation and wholly-owned subsidiary of FCB Bancorp. At the effective time of the merger, SCB Merger Corp. will merge with SCB, with SCB surviving the merger. As a result of the merger, SCB will be a wholly-owned subsidiary of FCB Bancorp before it is merged with FCB Bancorp, the surviving holding company. As a result of the Acquisition, First California Bank and SCCB will be separate wholly-owned subsidiaries of FCB Bancorp. As soon as practical after the Acquisition, FCB Bancorp intends to either consolidate the two banks under First California Bank’s charter or enter into an asset purchase and liability assumption agreement resulting in substantially all of the assets and liabilities of SCCB being acquired/assumed by First California Bank. The asset purchase alternative would be utilized if the California Department of Financial Institutions were to permit the acquisition of SCCB (reduced to a minimum level of capital, assets and liabilities) by a third party financial institution.

     SCB will be acquired by FCB Bancorp in consideration for the payment of the aggregate cash amount of $36.0 million, subject to certain adjustments, for all of the outstanding shares of SCB common stock. In anticipation of closing the Acquisition, FCB Bancorp: (i) raised approximately $22.0 million from a private placement offering (the “2005 Private Offering”) of its common stock for which Keefe, Bruyette & Woods acted as the placement agent; (ii) will issue approximately $10.0 million in “trust preferred securities,” a portion of which qualifies as Tier 1 capital; and (iii) will accept a cash dividend from First California Bank in the amount of approximately $5.0 million; substantially all of the proceeds of which will be used to fund the Acquisition and to pay the expenses (legal, accounting, printing, filing fees, etc.) to be incurred by FCB Bancorp in connection with both the holding company formation and the Acquisition.

     FCB Bancorp completed the 2005 Private Offering in June 2005. FCB Bancorp sold 1,115,000 shares of its common stock at a purchase price of $19.75 per share.

     Under the terms of the Acquisition Agreement, the proposed holding company formation is a condition to closing the Acquisition and in the event that shareholder approval of the proposed holding company reorganization is not obtained, the Acquisition will not be completed and FCB Bancorp, but not the Bank, may be liable to SCB for liquidated damages of $2.5 million. It is anticipated that the Acquisition will close as soon as practicable after consummation of the holding company reorganization. Under the terms of the Acquisition Agreement, the Acquisition must close by no later than September 30, 2005, subject to extension by agreement amongst the parties.

     Under California law, the Acquisition does not require approval by the shareholders of either the Bank or FCB Bancorp. Therefore, shareholder approval of the Acquisition will not be sought at the Meeting. The terms of the Acquisition Agreement and the proposed acquisition do, however, require the approval of a majority of the outstanding voting securities of SCB, which approval was obtained at an annual meeting of shareholders duly held on April 12, 2005.

Description of the Acquisition Agreement

     The following summary of the material terms and provisions of the Acquisition Agreement (as defined below) is qualified in its entirety by reference to the Acquisition Agreement, which is included as an exhibit to the Registration Statement and incorporated herein by reference.

     Regulatory Approvals Required for the Acquisition. The closing of the Acquisition is conditioned upon the receipt of all approvals of regulatory authorities required for the first merger and the second merger without the imposition of any conditions or requirements that would materially and adversely impact the economic or business benefits to FCB Bancorp of the Acquisition. Under the terms of the Acquisition Agreement, FCB Bancorp and SCB have agreed to use their reasonable best efforts to obtain all necessary actions or non-actions, extensions, waivers, consents and approvals from any governmental authority necessary, proper or advisable to consummate the Acquisition. In order to complete the Acquisition, we must first obtain the approval of the Board of Governors of the Federal Reserve System (the “FRB”), the Federal Deposit Insurance Corporation (the “FDIC”) and the California Department of Financial Institutions (the “DFI”). Applications for approval of the Acquisition were filed with the FRB, FDIC and DFI on or about May 31, 2005.

     Material Federal Income Tax Considerations of the Merger. FCB Bancorp may elect to treat the Acquisition as an acquisition of the assets of SCB for federal income tax purposes, in which case it may be able to get a stepped-up basis for SCB’s assets, resulting in increased federal income tax deductions for depreciation and amortization. A final determination as to whether that election will be made and the allocation of the purchase price among the assets acquired and liabilities assumed, based on their fair market values, has not yet been made. FCB

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Bancorp will determine the fair market values of SCB’s respective assets and liabilities and what appropriate tax accounting adjustments would be necessary before making that determination.

     Effective Time. The effective time of the Acquisition will be the time and date when the Acquisition becomes effective, as set forth in Section 2.02 of the Acquisition Agreement. We anticipate that the Acquisition will be completed by September 2005. However, completion of the Acquisition could be delayed if there is a delay in obtaining the required regulatory approvals or in satisfying other conditions to the Acquisition.

     Representations and Warranties. The Acquisition Agreement contains substantially similar representations and warranties of FCB Bancorp, Merger Subsidiary, First California Bank, SCB, and SCCB, as to, among other things:

• corporate organization and existence;

• capitalization;

• the corporate organization and existence of subsidiaries of FCB Bancorp and SCB;

• corporate power and authority;

• governmental and third-party approvals required to complete the Acquisition;

• timely filing of required regulatory reports and absence of regulatory investigations or restrictive agreements with regulators;

• environmental matters;

• that no action has been taken that would give rise to a claim by any party for a broker or finder’s fee or other like payment;

• absence of litigation;

• and insurance coverage

     In addition, the Acquisition Agreement contains further representations and warranties of SCB and SCC Bank as to, among other things:

• employee benefit matters;

• validity of, and the absence of material defaults under, certain contracts;

• interest rate risk management instruments, such as swaps and options;

• title to real and personal property;

• transactions with affiliates;

• compliance with laws;

• the absence of a trust business;

• tax matters;

• books and records have been properly and accurately maintained;

• labor matters;

• and its allowance for loan losses is adequate under established governmental standards.

Conduct of Business Pending the Acquisition. Prior to the effective time of the Acquisition,
except as expressly contemplated by the Acquisition Agreement, each of FCB Bancorp, SCB and SCCB
has agreed to:

• conduct its business in the ordinary course;

• not take any action that would adversely affect or delay the ability of the parties to perform any of their obligations in a timely manner.

     Furthermore, prior to the effective time, except as expressly contemplated by the Acquisition Agreement, SCB and SCCB have agreed that, without the consent of FCB Bancorp, they will not, among other things:

• incur any indebtedness for borrowed money (other than deposits, federal funds borrowings or borrowings from the Federal Home Loan Bank of San Francisco), or assume, guarantee, endorse or otherwise become responsible for the obligations of any other individual or entity;

• make any loan, loan commitment, renewal or extension to any person or immediate family member of such person exceeding $100,000 without submitting a complete loan package to FCB Bancorp for a review and comment;

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• from January 2, 2005 until the closing, (i) make, declare or pay any dividend in excess of (A) Five Hundred and Eighty-Five Thousand Dollars ($585,000) plus (B) the amount of retained cash in SCB accounts as of January 2, 2005, and any interest as may be earned thereon (constituting a portion of previously taxed but undistributed income), but not to exceed Two Hundred Seventy Thousand Dollars ($270,000.00) or (ii) directly or indirectly adjust, split, combine, redeem, reclassify, purchase or otherwise acquire, any shares of its capital stock;

• issue, sell or otherwise permit to become outstanding any additional shares or rights to acquire shares;

• permit additional shares of stock to become subject to grants of employee or director options;

• enter into, amend or renew any employment, consulting severance or similar agreements or increase in any manner the compensation or fringe benefits of any of its employees or directors, except for: (i) normal increases for employees made in the ordinary course of business consistent with past practice provided that no increase shall result in an annual adjustment of more than 5%, (ii) other changes that are required by applicable law, (iii) satisfy contractual obligations existing as of the date of the Acquisition Agreement and set forth in a disclosure schedule, or (iv) grants of awards to newly hired employees consistent with past practice;

• enter into or amend any of its benefit plans;

• hire any person as employee of SCB or SCCB or promote any employee except (i) to satisfy contractual obligations, (ii) persons hired to fill any vacancies arising after the date of the Acquisition Agreement and whose employment is terminable at the will of SCB or of SCCBank, or (iii) a new employee whose annual base salary and bonus do not exceed $70,000;

• establish, adopt or amend any pension, retirement, stock option, stock purchase, savings, profit sharing, deferred compensation, consulting, bonus, group insurance or other employee benefit, incentive or welfare contract, plan or arrangement or any related trust agreement, in respect of any current or former director, officer or employee of SCB or SCCB or take any action to accelerate the vesting or exerciseability of stock options, restricted stock or other compensation or benefits payable thereunder;

• sell, transfer, mortgage, encumber or otherwise dispose of or discontinue or any of its business, properties, assets or deposits that together with all other such transactions other than in the ordinary course of business, are not material to SCB or SCCB;

• acquire, other than by way of foreclosures or acquisitions of control in a bona fide fiduciary capacity or in satisfaction of debts previously contracted in the ordinary course of business consistent with past practice, all or any portion of the assets, business, deposits or property of any entity except in the ordinary course of business consistent with past practice that is not material to SCB and SCCB;

• make payment not then required under any contract that calls for aggregate annual payments of $25,000 or more which is not terminable at will or with 60 days or less notice, without payment of a premium or penalty other than loans or other transactions made in the ordinary course of the banking business;

• except as required by law or regulation, implement or adopt any material change interest rate or other risk management policies, fail to follow existing policies, or fail to use commercially reasonable means to avoid any material increase in its aggregate exposure to interest rate risk;

• enter into any settlement or similar agreement with respect to, or take any other significant action with respect to conduct of any action, suit, proceeding or investigation that SCB or SCCB becomes a party to after the date of the Acquisition Agreement which settlement, individually or for all such settlements that exceed $25,000, are material to SCB or SCCB or would impose any material restriction on the business of SCB or SCCB or create precedent for claims reasonably likely to be material to SCB or SCCB;

• except as may be required by applicable law or specifically permitted by the Acquisition Agreement, knowingly take any action that is intended or would reasonably be expected to result in (i) any of SCB’s and SCCB’s representations or warranties set forth in the Acquisition Agreement being or becoming untrue in any material respect, (ii) any of the conditions to the merger set forth in the Acquisition Agreement not being satisfied, or (iii) in a material violation of any provision of the Acquisition Agreement except as may be required by applicable law or regulation;

• make any capital expenditures other than in the ordinary course of business and not to exceed $10,000 individually or $25,000 in the aggregate;

• amend its articles of incorporation or its bylaws;

• make any direct investment either by contributions to capital, property transfers or purchase of any property or assets of any person other than in the ordinary course of business not to exceed $100,000 or purchases of direct obligations of the United States of America or obligations of U.S. government agencies which are

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	entitled to the full faith and credit of the United States, in any case with a remaining maturity at the time of purchase of two years or less;
•	implement or adopt any change in its accounting principles, practices or methods, other than as may be required by GAAP or regulatory guidelines;
•	settle any material audit, make or change any material tax election, file any amended tax return, take any action which could materially adversely affect the tax position of SCB or SCCB, or of FCB Bancorp after the Acquisition or take any action with respect to taxes that is outside the ordinary course of business or inconsistent with past practice;
•	agree to take or make any commitment to take any of these prohibited actions.

     Conduct of Business of FCB Bancorp Pending the Acquisition. Prior to the effective time, except as expressly contemplated by the Acquisition Agreement, FCB Bancorp has agreed that, without the consent of SCB, it and its subsidiaries will not:

• take any action reasonably likely to have an adverse effect on FCB’s ability to perform any of its material obligations under the Acquisition Agreement;

• except as may be required by applicable law, take any action that is intended or would reasonably be expected to result in (i) any of FCB’s representations or warranties set forth in the Acquisition Agreement being or becoming untrue in any material respect, (ii)any of the conditions to the Acquisition set forth in the Acquisition Agreement not being satisfied, (iii) a violation of any provision of the Acquisition Agreement, or (iv) a material violation of any provision of the Acquisition Agreement;

• agree to take or make any commitment to take any of these prohibited actions.

     Additional Covenants. SCB and FCB Bancorp have agreed to:

• use their reasonable best efforts to take all actions necessary to consummate the Acquisition;

• consult each other before issuing any press releases with respect to the Acquisition or the Acquisition Agreement; provided, however, that a party may, without the prior consent of the other party (but after such consultation, to the extent practicable in the circumstances), issue such press release or make such public statements as may upon the advice of outside counsel be required by law or the rules or regulations of NASDAQ;

• obtain all governmental consents necessary to consummate the transactions contemplated in the Acquisition Agreement;

• notify each other of any circumstance that is reasonably likely to result in a material adverse effect on them or would cause a material breach of their respective obligations under the Acquisition Agreement;

• use reasonable efforts to have the Acquisition qualify as taxable purchase of all of the outstanding stock of SCB by FCB Bancorp, followed by the liquidation of SCB pursuant to Section 322 of the Internal Revenue Code; and

     SCB and SCCB have further agreed to:

• afford FCB Bancorp access to certain information and personnel;

• use its reasonable best efforts to maintain and preserve intact its business organization, employees and advantageous business relationships;

• convene a shareholders meeting to vote on the merger as soon as practicable after the delivery of this proxy statement-prospectus and recommend to its shareholders that they approve the Acquisition;

• refrain from soliciting any offers with respect to a merger or other similar transaction involving all or substantially all of its assets or more than 10% of its outstanding equity securities; provided, however, that SCB and SCCB and its board may take actions required of them by law or directors’ fiduciary duties;

• allow FCB Bancorp to participate in any meetings or interviews with employees called by SCB or SCCB to discuss the Acquisition;

• assist FCB Bancorp in obtaining any required comments by third-party vendors in order to ensure a smooth transition after the Acquisition;

• cause to be delivered to FCB Bancorp, shareholder agreements executed by each shareholder of SCB;

• modify its accounting and certain other policies and practices to match those of FCB Bancorp;

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• keep FCB Bancorp reasonably informed as to the status of certain transactions being negotiated as of the date of the Acquisition Agreement;

• provide audited consolidated financial statements of SCB for the year ended December 31, 2004 within ten business days after receiving them

     FCB Bancorp has further agreed to:

• following the effective time of the Acquisition, indemnify present and former directors and officers of SCB and SCCB in connection with any claim arising out of actions or omissions occurring at or prior to the effective time to the fullest extent that SCB and SCCB is permitted to indemnify its directors and officers;

• In addition, FCB Bancorp is obligated for three years from the effective time, to provide the portion of directors and officers liability insurance that serves to reimburse the present and former directors and officers of SCB on terms and conditions comparable to those provided by SCB; provided, however, that FCB Bancorp is not required to spend on an annual basis more than 150% of the current amount spent by SCB to procure such insurance coverage; provided further, that if FCB Bancorp is unable to maintain or obtain such insurance coverage, FCB Bancorp shall use its commercially reasonable efforts to obtain as much comparable insurance as is available for such insurance coverage; and

• provide former employees of SCB and SCCB who continue as employees of FCB Bancorp with employee benefit plans no less favorable, in the aggregate, than those provided to similarly situated employees of FCB Bancorp;

     Conditions to Consummation of the Acquisition. Each party’s obligation to effect the Acquisition is subject to the satisfaction or waiver, where permissible, of the following conditions:

• approval of the Acquisition Agreement by SCB shareholders;

• receipt of all regulatory approvals required to complete the Acquisition and all those approvals remaining in effect and all statutory waiting periods with respect to those approvals having expired;

• effectiveness of the registration statement, of which this proxy statement-prospectus forms a part, under the Securities Act, and no stop order suspending the effectiveness of the registration statement having been issued and no proceedings for that purpose having been initiated and not withdrawn by the SEC;

• absence of any order, injunction, decree, statute, rule, regulation or judgment issued or enacted by any court or agency of competent jurisdiction or other legal restraint or prohibition preventing the completion of the Acquisition or any of the other transactions contemplated by the Acquisition Agreement;

• accuracy of the representations and warranties of the other party in all material respects as of the closing date of the Acquisition as though made on the closing date;

• performance by each party all material respects of all obligations required to be performed by it under the Acquisition Agreement at or prior to the closing date; and

• FCB Bancorp’s obligation to effect the Acquisition is subject to satisfaction, or waiver, of the following additional conditions: (i) FCB Bancorp shall have received executed Non-Competition Agreements from all the directors of SCB; SCB has delivered to FCB Bancorp a summary of all professional service fees to SCB and SCCB incurred in connection with the Acquisition; (ii) SCB and SCCB shall have obtained any third-party consents necessary to transfer so as not to be in default under any contract as a result of the Acquisition; (iii) performance by SCB shareholders who have signed shareholder agreements of all material obligations under such agreements; (iv) SCB’s net income, on a consolidated basis and excluding payments, costs and accruals as described in the merger agreement, shall not be less than $1,300,000; (v) the adjusted shareholders’ equity shall not be less than $14,000,000; and

• SCB shall have provided FCB consolidated financial statements presenting the financial condition of SCB as of the end of the last day of the last month prior to effective time of the Acquisition.

     We cannot assure you if, or when, we will obtain the required regulatory approvals necessary to consummate the Acquisition, or whether all of the other conditions precedent to the Acquisition will be satisfied or waived by the party permitted to do so. If the Acquisition is not completed on or before September 30, 2005, either FCB Bancorp or SCB may terminate the Acquisition Agreement, unless the failure to effect the merger by that date is due to the failure of the party seeking to terminate the merger agreement to perform or observe covenants and agreements of that party set forth in the merger agreement.

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     Nonsolicitation. Under the terms of the Acquisition Agreement, SCB has agreed not to solicit, initiate or encourage any takeover proposals or other forms of business combination with a third party. In addition, SCB has agreed not to negotiate, furnish information or otherwise cooperate in any way in connection with any competing takeover proposals by third parties, unless SCB’s board of directors determines that (i) the takeover proposal, if consummated, would result in a transaction more favorable to holders of SCB common stock than the Acquisition, and (ii) considering the advice of counsel, it has a fiduciary duty to act on the completing proposal.

     Factors Affecting the Amount of Consideration. The aggregate amount payable in cash for all of the outstanding shares of SCB Common Stock shall be the Base Merger Consideration ($36,000,000); provided that SCB’s Adjusted Shareholders’ Equity is at least equal to the Base Shareholders’ Equity ($16,500,000). Should SCB’s Adjusted Shareholders’ Equity (as determined 4 business days prior to the effective date of the first merger) be less than the Base Shareholders’ Equity, then the Base Merger Consideration shall be reduced by the lesser of (i) that amount by which the Adjusted Shareholders’ Equity is less than the Base Shareholders’ Equity, or (ii) Two Million Five Hundred Thousand Dollars ($2,500,000) (the Base Merger Consideration as so reduced shall be referred to as the “Adjusted Merger Consideration.”). The amount payable for each outstanding share of SCB Common Stock shall be equal to the quotient obtained by dividing (i) the Base Merger Consideration or the Adjusted Merger Consideration, as applicable, by (ii) the total number of shares of SCB Common Stock outstanding immediately prior to the Effective Time of the Merger (including Dissenting Shares).

     Termination of the Acquisition Agreement. The parties may terminate the Acquisition Agreement and abandon the Acquisition at any time prior to the effective time, whether before or after approval by the shareholders of SCB (i) by mutual consent of FCB Bancorp and SCB, if the board of directors of each so determines by a vote of a majority of the members of its entire board, (ii) by the board of directors of either party, if any governmental entity that must grant a requisite regulatory approval has denied approval of the merger and that denial has become final and nonappealable, an application shall have been permanently withdrawn or the shareholders of SCB fail to approve the Acquisition Agreement, (iii) by the board of directors of either party, if the Acquisition is not completed on or before September 30, 2005, unless the failure of the closing to occur by this date is due to the default of the party seeking to terminate the Acquisition Agreement; and (iv) by the board of directors of either party (so long as the terminating party is not then in material breach of the Acquisition Agreement), if there has been a breach of any of the covenants or agreements or any of the representations or warranties set forth therein on the part of the nonterminating party, which breach: individually or in the aggregate, would constitute, if occurring or continuing on the closing date, the failure of the conditions described under “The Acquisition Agreement— Conditions to Consummation of the Acquisition,” (v) is not cured within 30 days following written notice to the party committing the breach or which by its nature or timing cannot be cured prior to the closing date, (vi) by FCB Bancorp if SCB exercises its rights under Section 6.08 of the Acquisition Agreement in entertaining a competing takeover proposal and either continues discussions with a third party for more than 10 business days after receiving a competing proposal, or has not rejected a publicly disclosed takeover proposal within 10 business days after the proposal was made, (vii) by FCB Bancorp if SCB’s board of directors shall have failed to make its recommendation to approve the Acquisition, withdrawn such recommendation or modified or changed such recommendation in a manner adverse in any respect to the interests of FCB, (viii) by SCB upon the failure of FCB Bancorp either (A) to satisfy the conditions specified in Section 6.23 within thirty (30) days of receipt of all necessary regulatory approvals to consummate the Acquisition or (B) to enter into binding agreements by June 30, 2005 providing for such financing, subject only to the receipt of all necessary regulatory approvals to consummate the Acquisition and the absence of material adverse changes and other normal and customary closing conditions, (ix) by FCB if it determines that any item in the Disclosure Schedules under Section 5.01 of the Acquisition agreement is unacceptable to it, after providing SCB notice and a three business days opportunity to resolve the Disclosure Schedule issues.

     Waiver and Amendment of the Acquisition Agreement. At any time prior to the closing of the Acquisition, FCB Bancorp and SCB, by action taken or authorized by their respective boards of directors, may, if legally allowed (i) amend or modify the agreement in writing, or (ii) waive any provision in the Acquisition Agreement that benefited them. However, after any approval of the transactions contemplated by the Acquisition Agreement by the shareholders of SCB, there may not be, without further approval of those shareholders, any extension or waiver of the Acquisition agreement or any portion of the Acquisition Agreement which reduces the amount or changes the form of the consideration to be delivered to the SCB shareholders under the Acquisition Agreement, other than as contemplated by the Acquisition Agreement. Any agreement by a party to any extension or waiver must be set forth in a written instrument signed on behalf of such party and shall not operate as a waiver of, or estoppel with respect to, any subsequent or other failure. Subject to compliance with applicable law and the ability of the parties to

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change the structure effecting the merger, FCB Bancorp and SCB may amend the Acquisition Agreement by action taken or authorized by their respective boards of directors at any time before or after approval of the Acquisition Agreement by SCB shareholders. However, after any approval of the Acquisition Agreement by SCB shareholders, there may not be, without further approval of those shareholders, any amendment of the Acquisition Agreement that changes the amount or the form of the consideration to be delivered to the SCB shareholders, other than as contemplated by the Acquisition Agreement.

     Termination Fee. In the event the merger is terminated by FCB Bancorp pursuant to Sections 8.01(e) (competing takeover proposal) or (f) (failure by SCB to recommend the transaction to stockholders) of the Acquisition Agreement, SCB shall pay FCB Bancorp a termination fee, representing liquidated damages, of $2,500,000. In the event the Acquisition is terminated by FCB Bancorp or by SCB pursuant to Section 8.01(b) (material breach) of the Acquisition Agreement, the non-terminating party shall pay a termination fee, representing liquidated damages, of $2,500,00 to the terminating party. In the event the Acquisition is terminated by SCB pursuant to Section 8.01(g) (failure to raise required capital) of the Acquisition Agreement, FCB Bancorp shall pay to SCB a termination fee, representing liquidated damages, equal to $250,000 plus the actual out-of-pocket costs incurred by SCB in connection with the Acquisition. In the event the Acquisition Agreement is terminated by FCB Bancorp pursuant to Section 8.01(h) (unacceptable items in disclosure schedules) of the Acquisition Agreement, SCB shall pay FCB Bancorp a termination fee of $100.

     Expenses. The Acquisition Agreement provides that each of FCB Bancorp and SCB will pay its own costs and expenses incurred in connection with the Acquisition Agreement and the transactions contemplated therein.

     Shareholder Agreements. All of the shareholders of SCB outstanding common and preferred stock have separately entered into shareholder agreements with FCB Bancorp in which they have agreed to vote all shares of SCB common and preferred stock that they owned as of the date of their respective agreements and that they subsequently acquire in favor of the merger agreement and the transactions contemplated therein.

     Non-Competition Agreements. Simultaneously with the execution of the merger agreement, all of the directors of SCB entered into non-competition agreements with FCB Bancorp. The agreements provide that for a period of two years from the effective date of the Acquisition, none of the directors of SCB will engage, have ownership interest or participate in the financing, operation, management or control of any entity engaged in commercial banking, except that they may own bonds, preferred stock or up to 5% of the outstanding common stock of any such entity and may conduct business with any such entity. This restriction extends to the geographic area in Los Angeles, Orange, San Diego and Ventura Counties.

Selected Financial and Other Data — South Coast Bancorp, Inc.

     The following table sets forth South Coast Bancorp’s statistical information as of and for each of the years in the five-year period ended December 31, 2004 and for the three and six months ended June 30, 2005 and 2004. This data should be read in conjunction with “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and South Coast Bancorp’s audited consolidated financial statements as of December 31, 2004 and 2003 and for each of the years in the two-year period ended December 31, 2004 and related notes included elsewhere herein and South Coast Bancorp’s unaudited consolidated financial statements as of June 30, 2005 and for the three and six months ended June 30, 2005 and 2004 and related notes included elsewhere herein. The selected financial data was derived as of and for the years ended December 31, 2000 through December 31, 2004 from South Coast Bancorp’s historical audited consolidated financial statements for those fiscal years and South Coast Bancorp’s unaudited consolidated financial statements as of June 30, 2005 and for the three and six months ended June 30, 2005 and 2004. South Coast Bancorp’s unaudited consolidated financial statements included, in South Coast Bancorp’s opinion, all normal and recurring adjustments that they consider necessary for a fair statement of the results. The operating results for the six months ended June 30, 2005 are not necessarily indicative of the operating results that may be expected for the year ending December 31, 2005.

	As of or for the three						As of or for the six
(Dollars in thousands,	months ended June 30,						months ended June 30,
except per share data)	2005			2004			2005			2004
Results of Operations
Net interest income	$	1,491		$	1,493		$	2,927		$	3,027
Provision (credit) for loan losses		1			(6	)		(9	)		(50	)
Noninterest income		140			130			291			384
Noninterest expense		836			903			1,780			1,859
Net income	$	766		$	701		$	1,396		$	1,546
Financial Position
Assets	$	147,497		$	140,022		$	147,497		$	140,022
Loans		121,003			115,094			121,003			115,094
Allowance for loan losses		1,174			1,189			1,174			1,189
Deposits		129,473			122,918			129,473			122,918
Shareholders’ equity	$	17,429		$	16,044		$	17,429		$	16,044
Selected Ratios
Return on average equity (1)		17.84	%		17.57	%		16.57	%		19.62	%
Return on average assets (2)		2.09	%		2.01	%		1.92	%		2.23	%
Efficiency ratio (3)		51.26	%		55.64	%		55.31	%		54.50	%
Net interest margin		4.14	%		4.35	%		4.09	%		4.43	%
Nonaccrual loans to loans		0.00	%		0.00	%		0.00	%		0.00	%
Net charge-offs (recoveries) to loans		0.00	%		0.02	%		0.01	%		0.02	%
Allowance for loan losses to loans		0.97	%		1.03	%		0.97	%		1.03	%
Allowance for loan losses to nonaccrual loans (4)
Total capital ratio		14.61	%		15.55	%		14.61	%		15.55	%
Tier 1 capital ratio		13.69	%		14.48	%		13.69	%		14.48	%
Tier 1 leverage ratio		11.84	%		11.46	%		11.84	%		11.46	%

(1)	Computed by dividing net income by average equity. Average equity is the average of beginning equity and ending equity for the period.
(2)	Computed by dividing net Income by average assets. Average assets is the average beginning assets and ending assets for the period.
(3)	Computed by dividing noninterest expense by net interest income and noninterest income. The ratio is a measurement of the amount of revenue that is utilized to meet overhead expenses.
(4)	There were no nonaccrual loans for the periods presented.

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										C Corporation
	As of or for the Year Ended December 31,
	2004			2003			2002			2001 (1)			2000 (1)
Results of Operations
Net interest income	$	5,809		$	6,255		$	6,262		$	5,663		$	5,499
Provision (credit) for loan losses		(55	)		(4	)		(81	)		66			89
Noninterest income		715			1,271			895			536			386
Noninterest expense		3,558			3,888			3,486			3,229			3,050
Net income	$	2,915		$	3,515		$	3,620		$	1,682		$	1,592
Financial Position
Assets	$	146,725		$	142,679		$	133,805		$	130,499		$	121,968
Loans		120,719			115,646			104,714			103,705			100,438
Allowance for loan losses		1,183			1,211			1,199			1,273			1,216
Deposits		128,799			125,485			117,260			115,357			108,496
Shareholders’ equity	$	16,767		$	15,781		$	15,037		$	13,571		$	12,379
Selected Ratios
Return on average equity (2)		17.91	%		22.81	%		25.31	%		12.96	%		13.62	%
Return on average assets (3)		2.01	%		2.54	%		2.74	%		1.33	%		1.35	%
Efficiency ratio (4)		54.54	%		51.66	%		48.71	%		52.09	%		51.83	%
Net interest margin		4.12	%		4.71	%		4.92	%		4.63	%		4.85	%
Nonaccrual loans to loans		0.00	%		0.07	%		0.00	%		0.00	%		0.00	%
Net charge-offs (recoveries) to loans		-0.02	%		-0.01	%		-0.01	%		0.00	%		0.06	%
Allowance for loan losses to loans		0.98	%		1.05	%		1.15	%		1.23	%		1.21	%
Allowance for loan losses to nonaccrual loans (5)					155.26	%
Total capital ratio		14.01	%		15.23	%		14.92	%		14.12	%		13.49	%
Tier 1 capital ratio		13.07	%		14.13	%		13.80	%		12.88	%		12.27	%
Tier 1 leverage ratio		11.24	%		11.25	%		11.13	%		10.40	%		10.13	%

1.	SCB was a C corporation for Federal income tax purposes for the years ended December 31, 2001 and 2000.
2.	Computed by dividing net income by average equity. Average equity is the average of beginning equity and ending equity for the period.
3.	Computed by dividing net income by average assets. Average assets is the average beginning assets and ending assets for the period.
4.	Computed by dividing noninterest expense by net interest income and noninterest income. The ratio is a measurement of the amount of revenue that is utilized to meet overhead expenses.
5.	Except at December 31, 2003, there were no nonaccrual loans for the periods presented.

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Management’s Discussion and Analysis of Financial Condition and Results of Operations - South Coast Bancorp.

     The following discussion is designed to provide a better understanding of significant trends related to the South Coast Bancorp’s financial condition, results of operations, liquidity, capital resources and interest rate sensitivity. The discussion and information is derived from the South Coast Bancorp’s unaudited financial statements and notes thereto for the three months and six ended June 30, 2005 and June 30, 2004, and the audited financial statements and notes thereto for the two years ended December 31, 2004 and 2003, included elsewhere herein. You should read this discussion in conjunction with these financial statements.

     In addition to the historical information referenced above, this discussion contains certain forward-looking statements. You should understand that all such forward looking statements are subject various uncertainties and risks that could affect their outcome.

Critical accounting policies

     The discussion and analysis of South Coast Bancorp’s results of operations and financial condition are based upon financial statements which have been prepared in accordance with accounting principles generally accepted in the United States of America. The preparation of these financial statements requires South Coast Bancorp’s management to make estimates and judgments that affect the reported amounts of assets and liabilities, income and expense, and the related disclosures of contingent assets and liabilities at the date of these financial statements.

South Coast Bancorp believes these estimates and assumptions to be reasonably accurate; however, actual results may differ from these estimates under different assumptions or circumstances. Material estimates that are particularly susceptible to significant change in the near-term relate to the determination of the allowance for loan losses.

     The allowance for loan losses is maintained by first and foremost promptly identifying potential credit weaknesses that could jeopardize repayment. The elements to South Coast Bancorp’s process for evaluating the adequacy of the allowance for loan loss allowances is: assigning potential loss percentages to each credit with the creation of a credit grading system and accompanying risk analysis for determining an adequate level of allowances. The risks are assessed by rating each account based upon paying habits, loan to value, financial condition and level of classification. The allowance for loan losses was $1,174,000 at June 30, 2005 and $1,183,000 at December 31, 2004.

Overview

     Net income for South Coast Bancorp for the second quarter of 2005 totaled $766,000, up from $701,000 for the same period a year ago principally due to lower levels of noninterest expense. For the first six months of 2005, net income was $1,396,000, down from $1,546,000 last year on lower levels of noninterest income.

     The following is a financial results summary:

	For the three				For the six				For the years
	months ended June 30,				months ended June 30,				ended December 31,
(Dollars in thousands)	2005		2004		2005		2004		2004		2003
Net income	$	766	$	701	$	1,396	$	1,546	$	2,915	$	3,515

For 2004, South Coast Bancorp had net income of $2,915,000, down 17 percent from $3,515,000 for 2003. Net income declined principally on lower levels of noninterest income, specifically, net gains on loans held for sale.

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Results of Operations

Net interest income

Net interest income is the difference between interest and fees earned on loans, securities and federal funds sold [i.e., earning assets] and the interest paid on deposits and borrowings [i.e., interest-bearing funds]. Net interest margin is net interest income expressed as a percentage of earning assets.

Net interest income for the second quarter of 2005 was $1,491,000, slightly down from $1,493,000 for the same period a year ago. Net interest income for the first half of 2005 was $2,927,000, down from $3,027,000 a year ago.

     The following table shows, for the six month periods ended June 30, 2005 and 2004, average balances and interest income or interest expense, with resulting average yield or rates by category of earning assets or interest bearing liabilities.

	For the six months ended June 30,
	2005							2004
	Average		Income/		Average			Average		Income/		Average
(Dollars in thousands)	Balance		Expense		Rate			Balance		Expense		Rate
Loans	$	122,285	$	4,736		7.75	%	$	113,732	$	4,594		8.08	%
U.S. Treasury securities		4,518		59		2.61	%		4,032		48		2.38	%
Federal Funds Sold		7,400		92		2.49	%		8,929		40		0.90	%
Interest-bearing balances due from interest bearing institutions		10,013		152		3.04	%		11,221		138		2.46	%
Total earning assets	$	144,216	$	5,039		6.99	%	$	137,914	$	4,820		6.99	%
Interest bearing transaction accounts	$	16,496	$	157		1.90	%	$	18,417	$	144		1.56	%
Savings deposits		13,024		126		1.93	%		15,529		123		1.58	%
Time deposits		99,265		1,829		3.69	%		93,116		1,526		3.28	%
Total interest bearing funds	$	128,785	$	2,112		3.28	%	$	127,062	$	1,793		2.82	%
Net interest income (1)			$	2,927						$	3,027
Net yield on interest earning assets						4.06	%						4.39	%

(1) Net interest income before provision for credit losses

Net interest income for 2004 was $5,809,000, down $446,000 or 7 percent from $6,255,000 for 2003.

The decline in net interest income from 2003 to 2004 reflects principally the decline in the yield on loans. For example, the prime interest rate was 4.75% at November 1, 2002. By June 2003, the prime interest rate fell to 4.00%. The prime interest has since increased to 5.25% at the end of 2004.

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The following table shows, for each of the years in the two-year period ended December 31, 2004, average balances and interest income or interest expense, with resulting average yield or rates, by category of earning assets or interest bearing liabilities.

	For the years ended December 31,
	2004							2003
	Average		Income/		Average			Average		Income/		Average
(Dollars in thousands)	Balance		Expense		Rate			Balance		Expense		Rate
ASSETS
Interest-bearing balances due from depository institutions	$	11,915	$	308		2.58	%	$	11,665	$	308		2.64	%
U.S. Treasury securities		4,203		94		2.24	%		4,010		123		3.07	%
Federal funds sold		8,358		105		1.26	%		9,467		92		0.97	%
Loans		116,349		9,075		7.80	%		107,690		9,445		8.77	%
Total earning assets	$	140,825	$	9,582		6.80	%	$	132,832	$	9,968		7.50	%
LIABILITIES
Interest bearing transaction accounts	$	18,416	$	24		0.13	%	$	20,662	$	52		0.25	%
Savings Deposits		15,367		773		5.03	%		17,636		793		4.50	%
Time Deposits		91,579		2,976		3.25	%		82,051		2,868		3.50	%
Total interest bearing funds	$	125,362	$	3,773		3.01	%	$	120,349	$	3,713		3.09	%
Net interest income (1)			$	5,809						$	6,255
Net yield on interest earnings assets						4.12	%						4.71	%

(1) Net interest income before provision for credit losses.

     Average loans were $116,349,000 for 2004 and represented 83 percent of average earning assets, compared with $107,690,000 and 81 percent for 2003. Average loans increased 8 percent in 2004.

     Average securities were $4,203,000 for 2004 and represented 3 percent of average earning assets, compared with $4,010,000 and 3 percent for 2003.

     Average deposits were $125,362,000 for 2004 and represented 89 percent of average earning assets, compared with 120,349,000 and 91 percent for 2003. Average deposits increased 4 percent for 2004.

Net interest income is affected by changes in the level and mix of average earning assets and average interest-bearing funds. The changes between periods in these categories are referred to as volume changes. The effect on net interest income from changes in average volume is measured by multiplying the change in volume between the current period and the prior period by the prior period average rate. Net interest income is also affected by changes in the average rate earned or paid on assets and liabilities and these are referred to as rate changes. The effect on net interest income from changes in average rates is measured by multiplying the change in the average rate between the current period and the prior period by the prior period average volume. Changes attributable to both rate and volume are allocated on a pro rata basis to the change in average volume and the change in average rate.

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The following tables illustrate the changes in net interest income attributable to volume and rate for the periods indicated.

Analysis of changes in net interest income and expense for the six months ended June 30,

	2005 to 2004
	due to:
(Dollars in thousands)	Volume			Rate			Total
Interest Income
Interest on loans	$	334		$	(191	)	$	143
Interest on securities		6			5			11
Interest on Federal funds sold		(8	)		59			52
Interest on deposits with banks		(16	)		30			14
Total		316			(97	)		219
Interest expense
Interest bearing demand deposits		(16	)		29			13
Savings		(22	)		24			3
Certificates of Deposit		104			199			304
Total		67			253			319
Net interest income	$	249		$	(349	)	$	(100	)

Analysis of changes in net interest income and expense for the year ended December 31:

	2004 to 2003
	due to:
(Dollars in thousands)	Rate			Volume			Total
Interest income
Interest on loans	$	(1,094	)	$	724		$	(370	)
Interest on securities		(35	)		6			(29	)
Interest on Federal funds sold		25			(12	)		13
Interest on deposits with banks		(7	)		7			—
Total		(1,111	)		725			(386	)
Interest expense
Interest bearing demand deposits		(23	)		(5	)		(28	)
Savings		88			(108	)		(20	)
Certificates of deposit		(210	)		318			108
Total		(145	)		205			60
Net interest income	$	(966	)	$	520		$	(446	)

Provision (Credit) for loan losses

The provision for loan losses was $1,000 for the second quarter of 2005 compared with a credit of $6,000 for the second quarter of 2004. For the first six months of 2005, the credit for loan losses was $9,000 compared with a credit of $50,000 for the same period last year. For the two years ended December 31, 2004, the credit for loan losses was $55,000 and $4,000, respectively.

The process for determining the appropriate level of the allowance for loan losses is accomplished by a grading system wherein the loan portfolio is evaluated monthly by using significant factors such as historical losses associated with the loan portfolio, changes in the value and nature of new credits, recent economic trends and the changes in the concentration of credits.

All loans in the portfolio are assigned a credit score and reserve allowance which represents the potential risk associated with that credit based on repayment habits, loan to value, current financial condition and other mitigating factors as determined by management discretion.

Because of the relatively small size of South Coast Bancorp, we have the ability to monitor the portfolio continuously and aggressively in order to identify potential problems. As a result, the loan portfolio has not suffered any losses in the last five years. In addition, as of June 30, 2005, the loan portfolio had no delinquent loans.

Reasoning for a credit to the loan loss reserve for the two years ending December 31, 2004, is two-fold. Firstly, payoff of adversely classified assets that were assigned a higher allowance percentage had been replaced with better quality assets which, by their nature, posed less risk of loss and therefore assigned a lower allowance percentage in the year ending December, 2003. Secondly, a decrease in market interest rates resulted in a high level of payoffs in all allowance percentage categories and slow portfolio growth in the year ending December 2004.

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Noninterest income

Noninterest income for the second quarter of 2005 was $140,000, compared with $130,000 that was posted for the second quarter of 2004. For the first six months of 2005, noninterest income was $291,000 compared with $384,000 last year.

     The following table is a summary of noninterest income:

	For the three				For the six				For the years ended
	months ended June 30,				months ended June 30,				December 31,
(Dollars in thousands)	2005		2004		2005		2004		2004			2003
Delinquency charges	$	3	$	6	$	8	$	17	$	37		$	34
Rental income		55		35		107		99		194			264
Fee income		80		85		172		262		481			409
(Loss) gain on sale of assets		0		0		—		—		(9	)		38
Net gain on sales of loans held for sale		0		0		—		—		—			516
Deposit account fees		2		4		4		6		2			3
Other income						—		—		10			7
Total noninterest income	$	140	$	130	$	291	$	384	$	715		$	1,271

Noninterest income for 2004 was $715,000, down $556,000 from $1,271,000 for 2003. The decline in noninterest income reflects the absence of gains on sales of loans held for sale. In the years 2002 to 2003, SCCB originated and sold 1-4 family loans; this activity was discontinued in 2004.

Noninterest expense

Noninterest expenses for the second quarter of 2005 were $836,000, and $903,000 was recorded for the second quarter 2004.
For the first half of the year, noninterest expenses were $1,780,000 down from $1,859,000 a year ago.

The following table is a summary of noninterest expense:

	For the three				For the six				For the years
	months ended June 30,				months ended June 30,				ended December 31,
(Dollars in thousands)	2005		2004		2005		2004		2004		2003
Salaries and wages	$	530	$	605	$	1,107	$	1,272	$	2,394	$	2,582
Occupancy		100		85		199		167		372		380
Promotion & advertising		32		36		57		82		120		174
Postage & supplies		18		26		36		55		94		119
Data processing		25		22		45		44		83		73
Insurance and fidelity bonds		25		21		46		42		97		87
Accounting & auditing services		34		28		89		50		100		114
Equipment maintenance		14		10		31		22		44		36
Board meetings & directors’ fees		24		13		35		24		48		49
Other expense		34		58		135		101		206		274
Total noninterest expenses	$	836	$	903	$	1,780	$	1,859	$	3,558	$	3,888

Noninterest expense for 2004 was $3,558,000, down $330,000 or 8 percent from $3,888,000 from 2003. The decline in noninterest expense for 2004 reflects the reduction in incentive pay and other production or volume based expenses.

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Income taxes

South Coast Commercial Bank elected, effective January 1, 2002, to be taxed as an S Corporation under federal and state income tax laws. These laws provide that, in lieu of corporate income taxes, the shareholders separately account for their share of income, deductions, losses and credits. As a result, no corporate income taxes have been provided for in the results of operations except for certain state and income taxes.

	For the six						For the years
	months ended June 30,						ended December 31,
(Dollars in thousands)	2005			2004			2004			2003
Earnings before income taxes	$	1,447		$	1,602		$	3,021		$	3,642
Income taxes		51			56			106			127
Net income	$	1,396		$	1,546		$	2,915		$	3,515
Effective tax rate		3.52	%		3.50	%		3.51	%		3.49	%

Financial position

Securities

The South Coast Bancorp purchases securities to generate interest income. All securities have been recorded as ‘held-to-maturity’ as management has the positive intent and ability to hold these securities to maturity. These securities are reported at amortized cost and any premium or discount is amortized using the interest method.

The following summarizes the scheduled maturities of securities at June 30, 2005 and December 31, 2004.

	As of June 30, 2005
	Less than
(Dollars in thousands)	1 Year		1 - 5 Year		5 - 10 Years		Total
Maturity Distribution
US Treasury Obligations	$	1,490	$	3,019		—	$	4,509

	As of December 31, 2004
	Less than
	1 Year		1 - 5 Year		5 - 10 Years		Total
Maturity Distribution
US Treasury Obligations	$	1,500	$	3,028		—	$	4,528

Loans

     The portfolio consists of commercial real estate loans primarily secured by commercial, retail and industrial properties located throughout Southern California. Although the portfolio is diversified among various types of borrowers and collateral, our measure of success has been our skill in determining which applicants have both the ability and the intent to repay the loan.

     South Coast Bancorp does not make construction loans, spec loans, or loans underwritten on pro-forma or potential income generated from the property. The concentration of receivables in any one project or limited area is discouraged so any downturn in real estate values would not materially affect a significant amount of our portfolio.

     South Coast Bancorp underwrites loan files by establishing the borrower’s primary and secondary repayment source. The primary source of income, in most cases, is the subject property which is underwritten using a debt coverage ratio based on the property’s current income, tenant structure, stable tenant basis, and equity cushion using a conservative loan to value, ie. 65% LTV on refinance, 75% on purchase money. In cases where the subject property income does not sufficiently debt service the loan, South Coast Bancorp will look to the borrower’s secondary source of income, ie. Borrower’s personal cash flow, liquidity, and overall net worth.

     South Coast Bancorp scrutinizes each borrower’s intent for repayment by analyzing their credit history and experience in ownership and/or management of commercial real estate property.

     South Coast Bancorp does not entertain loans to borrowers without a significant credit history or where the collateral is difficult to evaluate or value. Because South Coast Bancorp is a collateral based lender, an accurate portrayal of the subject property including inspection and valuation is crucial to our success.

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The following table shows the maturity distribution of loans at June 30, 2005 and December 31, 2004.

	As of June 30, 2005
(Dollars in thousands)	One year or less		One - Five Years		Over Five Years		Total
Commercial Real Estate — Fixed Rate	$	221	$	—	$	96	$	317
Commercial Real Estate — Adjustable Rate		95,734		24,862		778		121,374
Total maturities and repricings	$	95,955	$	24,862	$	874	$	121,691

	As of December 31, 2004
	One year or less		One - Five Years		Over Five Years		Total
Commercial Real Estate — Fixed Rate	$	—	$	—	$	99	$	99
Commercial Real Estate — Adjustable Rate		96,937		22,907		820		120,664
Total maturities and repricings	$	96,937	$	22,907	$	919	$	120,763

Allowance for loan losses

We maintain an allowance for loan losses to provide for inherent risks in the loan portfolio. Additions to the allowance are established through a provision charged to expense; reductions to the allowance are likewise established through a credit to expense. All loans which are judged to be uncollectible are charged against the allowance while any recoveries are credited to the allowance. We have instituted loan policies to adequately evaluate, assess, and analyze risk factors associated with our loan portfolio and to enable us to assess such risk factors prior to granting new loans and to assess the sufficiency of the allowance. We conduct an assessment of the allowance on a monthly basis and a critical evaluation quarterly. This evaluation includes an assessment of the following factors: any external loan review and any regulatory examination findings, loan loss experience, estimated potential loss exposure on each pool of loans, concentrations of credit, value of collateral, present economic conditions and migration analysis based on historical loss ratios for the past 12 quarters.

	For the three months					For the six months						For the year
	ended June 30,					ended June 30,						ended December 31,
(Dollars in thousands)	2005		2004			2005			2004			2005			2004
Beginning balance	$	1,173	$	1,167		$	1,183		$	1,211		$	1,211		$	1,199
Provision (credit) for loan losses		1		(6	)		(9	)		(50	)		(55	)		(4	)
Recoveries on loans charged-off		—		28			—			28			27			16
Ending balance	$	1,174	$	1,189		$	1,174		$	1,189		$	1,183		$	1,211

The allowance for loan losses, as a percentage of total loans, was 0.96 % at June 30, 2005 compared with 0.98% at December 31, 2004. At December 31, 2003 this ratio was 1.05%.

The charge to expense to increase the allowance for loan losses for the second quarter of 2005 was $1,000 compared to a credit to expense of $6,000 for the same period a year ago. The credit to expense to reduce the allowance for loan losses for the first six

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months of 2005 was $9,000 compared with $50,000 for the first six months of 2004. The credit to expense to reduce the allowance of loan losses for the year 2004 was $55,000 compared with $4,000 for 2003.

Past due and nonaccrual loans

South Coast Bancorp ceases to accrue interest on loans when full payment of principal and interest is not expected and such loans are not performing or are greater than 90 days delinquent and therefore meet the criteria for nonaccrual status.

At June 30, 2005 and 2004, South Coast Bancorp had no loans that were past due 90 days or more and still accruing interest; likewise, there were no loans at December 31, 2004 or 2003 that were past due 90 days or more and still accruing interest.

South Coast Bancorp had no nonaccrual loans at June 30, 2005 or 2004 or at December 31, 2004. Nonaccrual loans were $78,000 at December 31, 2003.

Deposits

South Coast Bancorp primarily accepts deposits of individuals and small businesses located principally in Orange and Los Angeles counties. Core deposits (representing checking, savings and small certificates of deposit (i.e., under $100,000)) totaled $88,971,000 at June 30, 2005, compared with $91,940,000 at December 31, 2004. Core deposits decreased 4 percent for 2004 from $95,575,000 at the end of 2003.

	For the six months ended June 30,
	2005							2004
	Average					Average
(Dollars in thousands)	Balance		Rate			Balance			Rate
Noninterest bearing demand deposits	$	301				$	689
Interest checking		16,496		1.90	%		18,417			1.56	%
Savings accounts		13,024		1.93	%		15,529			1.58	%
Time deposits less than $100,000		60,674		3.11	%		59,372			2.94	%
		90,495					94,006
Time deposits of $100,000 or more		38,591		4.60	%		33,744			3.86	%
Total	$	129,085		3.48	%	$	127,752			3.16	%

	For the years ended December 31,
	2004					2003
	Average					Average
(Dollars in thousands)	Balance		Rate			Balance		Rate
Noninterest bearing demand deposits	$	936				$	906
Interest checking		18,416		1.27	%		20,662		1.33	%
Savings accounts		15,367		1.75	%		17,636		1.97	%
Time deposits less than $100,000		60,966		3.88	%		54,699		4.28	%
		95,685					93,903
Time deposits of $100,000 or more		30,697		3.95	%		27,352		4.35	%
Total	$	126,382		3.28	%	$	121,255		3.55	%

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Large certificates of deposits [i.e., $100,000 or more] totaled $40,502,000 at June 30, 2005 compared with $36,859,000 at December 31, 2004. Large certificates of deposits were $29,910,000 at December 31, 2003. These numbers represent time deposits accepted from customers in the South Coast Bancorp’s market area. There were no broker deposits during or as of any period presented.

	For the six months					For the year ended
	ended June 30, 2005					December 31, 2004
(Dollars in thousands)	Amount		Percentage			Amount		Percentage
Three months or less	$	405		1	%	$	151		0	%
Over three months through six months		9,424		23	%		5,708		15	%
Over six months through one year		10,814		27	%		8,398		23	%
Over one year		19,859		49	%		22,602		62	%
Total	$	40,502		100	%	$	36,859		100	%

Quantitative and qualitative disclosures about risk

Credit risk

Credit risk is the risk to earnings or capital arising from an obligor’s failure to meet the terms of any contract with the South Coast Bancorp or otherwise to perform as agreed. Credit risk is found in all activities in which success depends on counterparty, issuer, or borrower performance. Credit risk is present any time South Coast Bancorp funds are extended, committed, invested, or otherwise exposed through actual or implied contractual agreements, whether reflected on or off the balance sheet.

South Coast Bancorp manages credit risk through Board approved policies and procedures. These policies are reviewed and approved at least semi-annually by the Directors. Lending policies provide South Coast Bancorp management with a framework for consistent loan underwriting and a basis for sound credit decisions. Among the items taken into consideration are the concentration of assets in any one type of product or collateral, geographic location, individual borrower or group and the expertise and ability of management to properly manage its assets. All loans require the approval by the Loan Committee.

An estimate of probable losses incurred in the loan portfolio is necessary in determining the amount of the allowance for loan losses which is presented as a reduction of our loan balances. This estimate is performed monthly by management and reviewed and approved by the Board of Directors. This estimate takes into consideration, among other things, the type of loans, the delinquency or default status of loans, the trends in the loan portfolio, and current and future economic conditions that may affect the borrower’s ability to pay.

South Coast Bancorp had no nonaccrual loans at June 30, 2005 or at December 31, 2004.

Interest rate risk

Interest rate risk is the risk to earnings or capital arising from movements in interest rates. Interest rate risk arises from differences between the timing of rate changes and the timing of cash flows [re-pricing risk], from changing the rate relationships among different yield curves affecting South Coast Bancorp activities [basis risk], from changing rate relationships across the spectrum of maturities [yield curve risk], and from interest-related options embedded in loans and products [options risk].

South Coast Bancorp manages interest risk through Board approved policies and procedures. These policies are reviewed and approved at least annually by the Directors. Interest rate risk policies provide South Coast Bancorp management with a framework for consistent evaluation of risk and establish risk tolerance parameters. Management’s Asset and Liability Committee meets regulatory to evaluate interest rate risk, engages a third party to assist in the measurement and evaluation of risk and reports quarterly to the Board of Directors. The Company also engages a third party to perform a quarterly review of management’s asset and liability practices to ensure compliance with policies.

     South Coast Bancorp’s funding sources are dominated by savings accounts and certificates of deposits, which are re-priced frequently. The South Coast Bancorp’s loan portfolio is dominated by loans that use primarily the Wall Street Journal prime rate as an index. The South Coast Bancorp’s securities portfolio is comprised chiefly of U.S. Treasury bills.

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The following table, used by South Coast Bancorp in the management of interest rate risk, sets forth the distribution of assets and liabilities and the resultant periodic and cumulative interest rate sensitivity gap. The relationship between assets and liabilities is one of many factors that may affect interest rate sensitivity; other factors include the response or behavior of borrowers and depositors to changes in interest rates. Therefore the information in the table below should be used only as a guide to the possible effect changes in interest rates might have on net interest margin.

The following is a gap summary table at March 31, 2005:

																									Non-Rate
(Dollars in thousands)	0-3 Months			3-6 Months			6-12 Months			1-2 Years			2-3 Years			3-5 Years			5-10 Years			>10			Sensitive			Total
Certificates of Deposit		2,502			2,970			3,069			1,089			198			594			—			—			—			10,422
US Government Securities		500			—			992			1,027			1,498			499			—			—			—			4,516
Fed Funds Sold		7,500			—			—			—			—			—			—			—			—			7,500
Fixed Real Estate		(3	)		(3	)		(7	)		(14	)		(30	)		(101	)		100			772			—			714
Variable Real Estate		120,588			—			—			—			—			—			—			—			—			120,588
Non-Earning Assets		—			—			—			—			—			—			—			—			4,222			4,222
Total Assets		131,087			2,967			4,054			2,102			1,666			992			100			772			4,222			147,962
Non-Interest Bearing		—			—			—			—			—			—			—			—			1,068			1,068
Interest Checking		67			67			133			267			267			533			955			—			—			2,289
Money Maket Accounts		1,306			1,306			2,612			5,225			3,483			—			—			—			—			13,932
Savings Accounts		458			458			916			1,831			1,831			3,663			3,815			—			—			12,972
CDs/IRAs Under $100,000		11,765			13,130			15,485			6,198			8,416			6,323			—			—			—			61,317
CDs/IRAs Over $100,000		7,752			8,354			7,377			2,669			7,434			5,264			—			—			—			38,850
Non-Fundins Liabilities		—			—			—			—			—			—			—			—			374			374
Capital		—			—			—			—			—			—			—			—			17,160			17,160
Total Liabilities and Capital		21,348			23,315			26,523			16,190			21,431			15,783			4,770			—			18,602			147,962
Periodic Gap		109,738			(20,348	)		(22,469	)		(14,088	)		(19,765	)		(14,791	)		(4,670	)		773			(14,380	)		—
Cumulative Gap		109,738			89,390			66,921			52,833			33,068			18,277			13,607			14,380			—			—
Periodic Gap (% Total Assets)		74.17	%		-13.75	%		-15.19	%		-9.52	%		-13.36	%		-10.00	%		-3.16	%		0.52	%		-9.72	%		0.00	%
Cum Gap (% Total Assets)		74.17	%		60.41	%		45.23	%		35.71	%		22.35	%		12.35	%		9.20	%		9.72	%		0.00	%		0.00	%
Periodic Assets/Total Assets		88.60	%		2.01	%		2.74	%		1.42	%		1.13	%		0.67	%		0.07	%		0.52	%		2.85	%		100	%
Periodic Liab/Total Liab		14.43	%		15.76	%		17.93	%		10.94	%		14.48	%		10.67	%		3.22	%		0.00	%		12.57	%		100	%

Liquidity risk

Liquidity risk is the risk to earnings or capital arising from the South Coast Bancorp’s inability to meet its obligations when they come due without incurring unacceptable losses. Liquidity risk includes the inability to manage unplanned decreases or changes in funding sources as well as the failure to recognize or address changes in market conditions that affect the ability to liquidate assets quickly and with minimal loss in value.

South Coast Bancorp manages interest risk through Board approved policies and procedures. These policies are accomplished through the Investment Committee and approved by the Board of Directors. The committee seeks to maintain a reasonable balance between prudent and safe investments while maintaining cash reserves to meet unexpected withdrawals and unusually high loan demand. Liquidity risk policies provide South Coast Bancorp management with a framework for consistent evaluation of risk and establish risk tolerance parameters. Management’s Investment Committee meets regularly to evaluate liquidity risk, review and establish deposit interest rates, review loan and deposit in-flows and out-flows and reports quarterly to the Board of Directors. The Company also engages a third party to perform a review of management’s asset and liability practices to ensure compliance with policies

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South Coast Bancorp enjoys its base of core deposits [representing checking, savings and small certificates of deposit] in the management of liquidity risk. At June 30, 2005 core deposits totaled $88,971,000 compared with $91,940,000 at December 31, 2004. At December 31, 2003 core deposits totaled $95,575,000. In addition, South Coast Bancorp looks to its balances of Federal funds sold, interest-earning deposits and investment securities in the management of liquidity risk. These balances totaled $23,429,000 at June 30, 2005 and $23,534,000 at December 31, 2004.

Capital resources

The Board of Directors recognizes that a strong capital position is vital to growth, continued profitability, and depositor and investor confidence. The policy of the Board of Directors is to maintain sufficient capital at not less than the well-capitalized thresholds established by South Coast Bancorp regulators.

											To be Well
											Capitalized Under
						For Capital					Prompt Corrective
	Actual					Adequacy Purposes					Action Provision
(Dollars in thousands)	Amount		Ratio			Amount		Ratio			Amount		Ratio
June 30, 2005
Total capital	$	18,603		14.61	%	$	10,186		8.00	%	$	12,733		10.00	%
(to risk weighted assets)
Tier I capital	$	17,429		13.69	%	$	5,092		4.00	%	$	7,639		6.00	%
(to risk weighted assets)
Tier I capital	$	17,429		11.84	%	$	5,888		4.00	%	$	7,360		5.00	%
(to average assets)

											To be Well
											Capitalized Under
						For Capital					Prompt Corrective
	Actual					Adequacy Purposes					Action Provision
(Dollars in thousands)	Amount		Ratio			Amount		Ratio			Amount		Ratio
December 31, 2004
Total capital	$	17,691		14.01	%	$	10,100		8.00	%	$	12,625		10.00	%
(to risk weighted assets)
Tier I capital	$	16,508		13.07	%	$	5,051		4.00	%	$	7,577		6.00	%
(to risk weighted assets)
Tier I capital	$	16,508		11.24	%	$	5,874		4.00	%	$	7,342		5.00	%
(to average assets)

Selected Historical Financial Data

We are providing the following information to aid you in your analysis of the financial effects of the merger. The following tables show financial results, consisting of historical figures actually achieved by each of First California Bank and South Coast Bancorp, Inc.

The financial information as of and for the three and six months ended June 30, 2005 and 2004 has been derived from the unaudited financial statements of First California Bank and the unaudited consolidated financial statements of South Coast Bancorp, Inc. In the opinion of management of First California Bank and South Coast Bancorp, Inc., respectively, all adjustments, consisting solely of normal recurring accruals, considered necessary for the fair presentation of the results for the periods presented have been included. Annual historical figures are derived from the financial statements of First California Bank and the consolidated financial statements of South Coast Bancorp, Inc. as of December 31, 2004, 2003, 2002, 2001 and 2000.

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FIRST CALIFORNIA BANK – SELECTED HISTORICAL FINANCIAL DATA

	As of or for the Three						As of or for the Six
	Months						Months
	Ended June 30,						Ended June 30,
(Dollars in thousands, except per share data)	2005			2004			2005			2004
Results of Operations
Net interest income	$	3,359		$	2,828		$	6,461		$	5,837
Provision for loan losses		122			104			244			208
Noninterest income		427			472			943			884
Noninterest expense		2,650			2,290			5,215			4,706
Net income	$	629		$	589		$	1,206		$	1,166
Per Share Data
Earnings per share:
Basic	$	0.29		$	0.27		$	0.56		$	0.58
Diluted	$	0.29		$	0.26		$	0.55		$	0.56
Book value per share	$	10.94		$	10.44		$	10.94		$	9.54
Financial Position
Assets	$	298,294		$	275,730		$	298,294		$	275,730
Loans		199,631			171,513			199,631			171,513
Allowance for loan losses		2,593			2,533			2,593			2,533
Deposits		238,468			216,151			238,468			216,151
Shareholders’ equity	$	23,664		$	20,625		$	23,664		$	20,625
Selected Ratios (1)
Return on average equity		10.60	%		10.09	%		10.33	%		12.11	%
Return on average assets		0.86	%		0.83	%		0.85	%		0.90	%
Efficiency ratio (2)		70.03	%		70.90	%		70.46	%		70.14	%
Net interest margin (tax equivalent) (3)		5.02	%		4.84	%		4.93	%		4.93	%
Nonaccrual loans to loans		1.08	%		1.38	%		1.08	%		1.38	%
Net charges-offs (recoveries) to average loans		0.03	%		0.00	%		0.00	%		0.00	%
Allowance for loan losses to loans		1.30	%		1.30	%		1.30	%		1.30	%
Allowance for loan losses to nonaccrual loans		120.16	%		107.24	%		120.16	%		107.24	%
Total capital ratio		11.63	%		12.36	%		11.63	%		12.36	%
Tier 1 capital ratio		10.44	%		11.11	%		10.44	%		11.11	%
Tier 1 leverage ratio		8.20	%		8.09	%		8.20	%		8.09	%

(1)	Selected ratios for the three and six months ended June 30, 2005 and 2004 have been annualized.
(2)	Computed by dividing noninterest expense by net interest income and noninterest income. The ratio is a measurement of the amount of revenue that is utilized to meet overhead expenses.
(3)	Computed by dividing net income on a tax equivalent basis by average earning assets.

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FIRST CALIFORNIA BANK – SELECTED HISTORICAL DATA

	As of or for the Year Ended December 31,
(Dollars in thousands, except per share data)	2004			2003			2002			2001			2000
Results of Operations
Net interest income	$	11,656		$	10,898		$	9,141		$	7,488		$	6,804
Provision for loan losses		418			510			510			576			115
Noninterest income		1,925			1,899			1,240			1,071			814
Noninterest expense		9,409			8,836			7,222			5,724			5,241
Net income	$	2,435		$	2,207		$	1,614		$	1,355		$	1,407
Per Share Data
Earnings per share:
Basic	$	1.17		$	1.12		$	0.91		$	0.86		$	0.88
Diluted	$	1.14		$	1.10		$	0.86		$	0.86		$	0.88
Book value per share	$	10.42		$	9.26		$	8.38		$	7.20		$	6.57
Financial Position
Assets	$	283,745		$	256,285		$	203,907		$	151,447		$	129,408
Loans		182,873			157,952			142,379			121,699			92,024
Allowance for loan losses		2,346			2,325			1,970			1,680			1,114
Deposits		277,190			211,929			186,661			139,356			118,319
Shareholders’ equity	$	22,545		$	18,365		$	16,448		$	11,248		$	10,450
Selected Ratios
Return on average equity		11.97	%		12.67	%		11.24	%		12.64	%		14.33	%
Return on average assets		0.91	%		0.99	%		0.88	%		0.97	%		1.25	%
Efficiency ratio(1)		69.76	%		68.92	%		69.78	%		67.55	%		68.80	%
Net interest margin (tax equivalent)(2)		4.78	%		5.45	%		5.47	%		5.96	%		6.75	%
Nonaccrual loans to loans		1.19	%		1.55	%		0.27	%		0.66	%		1.04	%
Net charges-offs (recoveries) to average loans		0.21	%		0.04	%		0.17	%		0.01	%		0.01	%
Allowance for loan losses to loans		1.28	%		1.47	%		1.38	%		1.38	%		1.21	%
Allowance for loan losses to nonaccrual loans		107.61	%		95.17	%		591.59	%		208.44	%		742.67	%
Total capital ratio		12.25	%		11.57	%		11.51	%		10.06	%		11.57	%
Tier 1 capital ratio		11.04	%		10.32	%		10.26	%		8.81	%		10.46	%
Tier 1 leverage ratio		8.61	%		7.54	%		8.14	%		7.47	%		8.27	%

(1)	Computed by dividing noninterest expense by net interest income and noninterest income. The ratio is a measurement of the amount of revenue that is utilized to meet overhead expenses.
(2)	Computed by dividing net income on a tax equivalent basis by average earning assets.

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SOUTH COAST BANCORP, INC. – SELECTED HISTORICAL CONSOLIDATED FINANCIAL DATA

	As of or for the three						As of or for the six
	months ended June 30,						months ended June 30,
(Dollars in thousands, except per share data)	2005			2004			2005			2004
Results of Operations
Net interest income	$	1,491		$	1,493		$	2,927		$	3,027
Provision for loan losses		1			(6	)		(9	)		(50	)
Noninterest income		140			130			291			384
Noninterest expense		836			903			1,780			1,859
Net income	$	766		$	701		$	1,396		$	1,546
Financial Position
Assets	$	147,497		$	140,022		$	147,497		$	140,022
Loans		121,003			115,094		$	121,003		$	115,094
Allowance for loan losses		1,174			1,189		$	1,174		$	1,189
Deposits		129,473			122,918		$	129,473		$	122,918
Shareholders’ equity		17,429			16,044		$	17,429		$	16,044
Selected Ratios
Return on average equity (2)		17.84	%		17.57	%		16.57	%		19.62	%
Return on average assets (3)		2.09	%		2.01	%		1.92	%		2.23	%
Efficiency ratio (4)		51.26	%		55.64	%		55.31	%		54.50	%
Net interest margin		4.14	%		4.35	%		4.09	%		4.43	%
Nonaccrual loans to loans		0.00	%		0.00	%		0.00	%		0.00	%
Net charge-offs (recoveries) to loans		0.00	%		0.02	%		0.01	%		0.02	%
Allowance for loan losses to loans		0.97	%		1.03	%		0.97	%		1.03	%
Allowance for loan losses to nonaccrual loans (5)
Total capital ratio		14.62	%		15.55	%		14.61	%		15.55	%
Tier 1 capital ratio		13.69	%		14.48	%		13.69	%		14.48	%
Tier 1 leverage ratio		11.84	%		11.46	%		11.84	%		11.46	%

										C Corporation
	As of or for the Year Ended December 31,
(Dollars in thousands, except per share data)	2004			2003			2002			2001(1)			2000(1)
Results of Operations
Net interest income	$	5,809		$	6,255		$	6,262		$	5,663		$	5,499
Provision for loan losses		(55	)		(4	)		(81	)		66			89
Noninterest income		715			1,271			895			536			386
Noninterest expense		3,558			3,888			3,486			3,229			3,050
Net income	$	2,915		$	3,515		$	3,620		$	1,682		$	1,592
Financial Position
Assets	$	146,725		$	142,679		$	133,805		$	130,499		$	121,968
Loans		120,719			115,646			104,714			103,705			100,438
Allowance for loan losses		1,183			1,211			1,199			1,273			1,216
Deposits		128,799			125,485			117,260			115,357			108,496
Shareholders’ equity		16,767			15,781			15,037			13,571			12,379
Selected Ratios
Return on average equity (2)		17.91	%		22.81	%		25.31	%		12.96	%		13.62	%
Return on average assets (3)		2.01	%		2.54	%		2.74	%		1.33	%		1.35	%
Efficiency ratio (4)		54.54	%		51.66	%		48.71	%		52.09	%		51.83	%
Net interest margin		4.12	%		4.71	%		4.92	%		4.63	%		4.85	%
Nonaccrual loans to loans		0.00	%		0.07	%		0.00	%		0.00	%		0.00	%
Net charge-offs (recoveries) to loans		-0.02	%		-0.01	%		-0.01	%		0.00	%		0.06	%
Allowance for loan losses to loans		0.98	%		1.05	%		1.15	%		1.23	%		1.21	%
Allowance for loan losses to nonaccrual loans (5)		0.00	%		0.00	%		0.00	%		0.00	%		0.00	%
Total capital ratio		14.01	%		15.23	%		14.92	%		14.12	%		13.49	%
Tier 1 capital ratio		13.07	%		14.13	%		13.80	%		12.88	%		12.27	%
Tier 1 leverage ratio		11.24	%		11.25	%		11.13	%		10.40	%		10.13	%

1.	SCB was a C corporation for Federal income tax purposes for the years ended December 31, 2001 and 2000.
2.	Computed by dividing net income by average equity. Average equity is the average of beginning equity and ending equity for the period.
3.	Computed by dividing net income by average assets. Average assets is the average beginning assets and ending assets for the period.
4.	Computed by dividing noninterest expense by net interest income and noninterest income. The ratio is a measurement of the amount of revenue that is utilized to meet overhead expenses.
5.	Except at December 31, 2003, there were no nonaccrual loans for the periods presented.

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Unaudited Pro Forma Combined Consolidated Financial Information

The following tables present financial data at and for the six months ended June 30, 2005, and for the year ended December 31, 2004 for First California Bank after giving effect to the formation of the holding company (“FCB Bancorp”), completion of the proposed common stock offering and trust preferred securities offering, and acquisition of South Coast Bancorp, Inc. (referred to as “pro forma” information).

The pro forma combined financial data gives effect to the acquisition under the purchase method of accounting in accordance with accounting principles generally accepted in the United States of America. The unaudited pro forma combined consolidated financial statements combine the historical financial statements of First California Bank and the historical consolidated financial statements of South Coast Bancorp, Inc., giving effect to the acquisition of South Coast Bancorp, Inc. as if it had been effective on June 30, 2005 with respect to the applicable unaudited pro forma combined consolidated balance sheet and as of the beginning of the period indicated with respect to the unaudited pro forma combined consolidated statements of income.

The information for the year ended December 31, 2004 is derived from First California Bank’s audited financial statements, including the related notes, and from South Coast Bancorp, Inc.’s audited consolidated financial statements, including the related notes, reflected in the financial statements included in this proxy statement-prospectus. See “Index to Financial Statements” at page F-1 of this proxy statement-prospectus.

First California Bank expects to incur reorganization and restructuring expenses as a result of the proposed acquisition. The effect of the estimated merger and reorganization costs expected to be incurred in connection with the proposed acquisition has been reflected in the unaudited pro forma combined condensed consolidated balance sheet. First California Bank also anticipates that the acquisition will provide the combined company with some future financial benefits that include reduced operating expenses and opportunities to earn more revenue. However, First California Bank does not reflect any of these anticipated cost savings or benefits in the pro forma financial information. Therefore, the pro forma financial information, while helpful in illustrating the financial characteristics of the combined company under one set of assumptions, does not attempt to predict or suggest future results. The pro forma financial information also does not attempt to show how the combined company would actually have performed had the companies been combined throughout the periods presented. First California Bank has included in the pro forma financial combined consolidated statements all the adjustments necessary for a fair statement of results of the historical periods.

Given the information regarding the proposed acquisition, the actual consolidated financial position and results of operations will differ, perhaps significantly, from the pro forma amounts reflected herein because, among other reasons:

a) assumptions used in preparing the pro forma financial data may be revised in the future due to changes in values of assets or liabilities, including finalization of the calculation of a core deposit intangible, and changes in operating results between the dates of the unaudited pro forma financial data and the date on which the acquisition takes place; and

b) adjustments may need to be made to the unaudited historical financial data upon which such pro forma data are based.

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FIRST CALIFORNIA BANK AND SOUTH COAST BANCORP, INC.
SELECTED PRO FORMA COMBINED HISTORICAL FINANCIAL DATA
(in thousands, except share and per share amounts and ratios)

	Six months			Year ended
	ended			December 31,
	June 30, 2005			2004
STATEMENT OF OPERATIONS DATA:
Net interest income	$	8,631		$	15,951
Provision for loan losses	$	235		$	363
Noninterest income	$	1,234		$	2,640
Noninterest expense	$	7,018		$	13,012
Income before income taxes	$	2,612		$	5,216
Income taxes	$	494		$	833
Net income	$	2,118		$	4,383
PER SHARE DATA:
Earnings per share — basic	$	0.65		$	1.37
Earnings per share — diluted	$	0.64		$	1.35
Cash dividends per share	$	—
Book value per share	$	13.51
Tangible book value per share	$	8.64
Common shares outstanding — basic		3,277,807			3,195,142
Common shares outstanding — diluted		3,299,062			3,250,634
Common shares outstanding — actual		3,277,807
BALANCE SHEET DATA:
Assets	$	463,509
Loans	$	326,313
Allowance for loan losses	$	3,767
Deposits	$	369,292
Shareholders’ equity	$	44,294
SELECTED RATIOS:(1)
Return on average equity		10.44	%		12.03	%
Return on average tangible equity		17.21	%		22.15	%
Return on average assets		0.96	%		1.07	%
Net interest margin (tax equivalent)		4.28	%		4.17	%
Efficiency ratio (noninterest expense to net interest income and noninterest income)		71.14	%		69.99	%
Total capital ratio		11.92	%
Tier 1 capital ratio		10.67	%
Tier 1 leverage ratio		8.66	%
Nonaccrual loans to total loans		0.70	%
Net chargeoffs (recoveries) to average loans		0.00	%
Allowance for loan losses to total loans		1.15	%
Allowance for loan losses to nonaccrual loans		165.66	%

(1) Selected ratios for the six months ended June 30, 2005 have been annualized.

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FIRST CALIFORNIA BANK AND SOUTH COAST BANCORP, INC.
PRO FORMA COMBINED CONSOLIDATED BALANCE SHEET
(Unaudited)
June 30, 2005
(dollars in thousands)

						Adjusted						Final			Final
	Pro Forma			Proceeds		Pro Forma						Pro Forma			Pro Forma
	FCB Bancorp			from		FCB Bancorp			South Coast			Purchase			FCB Bancorp
	Consolidated(1)			Offerings(2)		Consolidated			Bancorp, Inc.			Adjustments(3)			Consolidated
Assets
Cash and due from banks	$	9,155		$	30,630	$	39,785		$	9,171		$	(35,674)	(a)	$	13,282
Federal funds sold		3,715			—		3,715			11,000			—			14,715
Securities		73,934			—		73,934			4,509			(42)	(b)		78,401
Loans		199,630			—		199,630			121,691			4,992	(b)		326,313
Allowance for loan losses		(2,593	)		—		(2,593	)		(1,174	)		—			(3,767	)
Premises and equipment, net		4,981			—		4,981			1,685			1,800	(b)		8,466
Goodwill		—			—		—			—			15,977	(b)		15,977
Other assets		9,472			—		9,472			650			—			10,122
Total Assets	$	298,294		$	30,630	$	328,924		$	147,532		$	(12,947	)	$	463,509
Liabilities
Deposits	$	238,468		$	—	$	238,468		$	129,473		$	1,351	(b)	$	369,292
FHLB Borrowings		34,940			—		34,940			—			—			34,940
Junior subordinated debt		—			10,000		10,000			—			—			10,000
Other liabilities		1,222			—		1,222			631			3,130	(b)		4,983
Total Liabilities		274,630			10,000		284,630			130,104			4,481			419,215
Shareholders’ Equity
Common stock		11,965			20,630		32,595			2,265			(2,265)	(a)		32,595
Retained earnings		11,699			—		11,699			15,163			(15,163)	(a)		11,699
Total Shareholders’ Equity		23,664			20,630		44,294			17,428			(17,428	)		44,294
Total Liabilities and Shareholders’ Equity	$	298,294		$	30,630	$	328,924		$	147,532		$	(12,947	)	$	463,509

See notes to the Unaudited Pro Forma Combined Consolidated Financial Information.

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FIRST CALIFORNIA BANK AND SOUTH COAST BANCORP, INC.
PRO FORMA COMBINED CONSOLIDATED INCOME STATEMENT
(Unaudited)
SIX MONTHS ENDED JUNE 30, 2005
(in thousands, except per share data)

	Pro Forma					Pro Forma			Pro Forma
	FCB Bancorp		South Coast			Purchase			FCB Bancorp
	Consolidated(1)		Bancorp, Inc.			Adjustments(3)			Consolidated
Interest income
Interest and fees on loans	$	6,325	$	4,736		$	(624)	(g)	$	10,437
Taxable interest on securities		1,168		59			7	(g)		1,234
Nontaxable interest on securities		148		—			—			148
Interest on federal funds sold and other		68		244			(25)	(c)		287
Total interest income		7,709		5,039			(642	)		12,106
Interest expense
Interest on deposits		857		2,112			(135)	(g)		2,834
Interest on borrowings		391		—			250	(d)		641
Total interest expense		1,248		2,112			115			3,475
Net interest income		6,461		2,927			(757	)		8,631
Provision (credit) for loan losses		244		(9	)		—			235
Net interest income after provision (credit) for loan losses		6,217		2,936			(757	)		8,396
Noninterest income
Service charges on deposit accounts		549		180			—			729
Other income		394		111			—			505
Total noninterest income		943		291			—			1,234
Noninterest expense
Salaries and employee benefits		3,020		1,107			—			4,127
Premises and equipment		775		199			23	(g)		997
Other expenses		1,420		474			—	(e)		1,894
Total noninterest expense		5,215		1,780			23			7,018
Income before provision for income taxes		1,945		1,447			(780	)		2,612
Provision for income taxes		739		51			(296)	(f)		494
Net income	$	1,206	$	1,396		$	(484	)	$	2,118
Earnings per share:(i)
Basic	$	0.56							$	0.65
Diluted	$	0.55							$	0.64
Average shares outstanding:
Basic		2,162,807					1,115,000			3,277,807
Diluted		2,184,062					1,115,000			3,299,062

(i) South Coast Bancorp, Inc. is an S-corporation with a limited number of Shareholders. As such, earnings per share has historically not been calculated or disclosed.

See notes to the Unaudited Pro Forma Combined Consolidated Financial Information.

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FIRST CALIFORNIA BANK AND SOUTH COAST BANCORP, INC.
PRO FORMA COMBINED CONSOLIDATED INCOME STATEMENT
(Unaudited)
YEAR ENDED DECEMBER 31, 2004
(in thousands, except per share data)

	Pro Forma					Pro Forma			Pro Forma
	FCB Bancorp		South Coast			Purchase			FCB Bancorp
	Consolidated(1)		Bancorp, Inc.(1)			Adjustments(3)			Consolidated
Interest income
Interest and fees on loans	$	11,209	$	9,075		$	(1,248)	(g)	$	19,036
Taxable interest on securities		1,970		94			14	(g)		2,078
Nontaxable interest on securities		299		—			—			299
Interest on federal funds sold and other		74		413			(50)	(c)		437
Total interest income		13,552		9,582			(1,284	)		21,850
Interest expense
Interest on deposits		1,315		3,773			(270)	(g)		4,818
Interest on borrowings		581		—			500	(d)		1,081
Total interest expense		1,896		3,773			230			5,899
Net interest income		11,656		5,809			(1,514	)		15,951
Provision (credit) for loan losses		418		(55	)		—			363
Net interest income after provision (credit) for loan losses		11,238		5,864			(1,514	)		15,588
Noninterest income
Service charges on deposit accounts		1,056		518			—			1,574
Other income		869		197			—			1,066
Total noninterest income		1,925		715			—			2,640
Noninterest expense
Salaries and employee benefits		5,373		2,394			—			7,767
Premises and equipment		1,301		372			45	(g)		1,718
Other expenses		2,735		792			—	(e)		3,527
Total noninterest expense		9,409		3,558			45			13,012
Income before provision for income taxes		3,754		3,021			(1,559	)		5,216
Provision for income taxes		1,319		106			(592)	(f)		833
Net income	$	2,435	$	2,915		$	(967	)	$	4,383
Earnings per share:(i)
Basic	$	1.17							$	1.37
Diluted	$	1.14							$	1.35
Shares:
Basic		2,080,142					1,115,000			3,195,142
Diluted		2,135,634					1,115,000			3,250,634

(i) South Coast Bancorp, Inc. is an S-corporation with a limited number of Shareholders. As such, earnings per share has historically not been calculated or disclosed.

See notes to the Unaudited Pro Forma Combined Consolidated Financial Information.

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NOTES TO THE UNAUDITED PRO FORMA
COMBINED CONSOLIDATED FINANCIAL INFORMATION

NOTE 1 — BASIS OF PRESENTATION

The unaudited pro forma combined consolidated statements of income for the three months ended March 31, 2005 and for the year ended December 31, 2004 are presented as if the merger had occurred at the beginning of the respective periods. The unaudited pro forma combined consolidated balance sheet as of March 31, 2005 is presented as if the merger had occurred as of that date. The pro forma information for FCB Bancorp assumes its formation and approval as a holding company for First California Bank occurred prior to March 31, 2005.

The unaudited pro forma combined consolidated financial statements are based on the estimates and assumptions set forth in the notes to these statements, which are preliminary and have been made solely for purposes of developing such pro forma information. The unaudited pro forma combined consolidated financial statements are not necessarily an indication of the results that would have been achieved had the merger been consummated as of the dates indicated or that may be achieved in the future.

First California Bank’s cost estimates are forward-looking. While the costs represent First California Bank’ current estimate of stock offering, merger, and reorganization costs that will be incurred, the type and amount of actual costs could vary materially from these estimates if future developments differ from the underlying assumptions used by management in determining the current estimate of these costs. For additional factors that may cause actual results to differ, see “Information Regarding Forward-Looking Statements” on page ___.

NOTE 2 – PROCEEDS RECEIVED BY FCB BANCORP FOR THE ACQUISITION OF SOUTH COAST BANCORP, INC.

Preceding closing of the acquisition of South Coast Bancorp, Inc., FCB Bancorp will receive net proceeds of $20,630,000 from a private placement offering (issuing approximately 1,115,000 shares) and will issue approximately $10,000,000 in junior subordinated debentures (trust preferred securities) to assist in funding the acquisition of South Coast Bancorp, Inc. In addition, First California Bank anticipates paying a special cash dividend of approximately $5,000,000 to FCB Bancorp to facilitate the acquisition. The $5,000,000 dividend has no impact on pro forma consolidated capital. The following summarizes these transactions (in thousands):

Common stock issued in Private Placement offering	$	22,000
Less investment banking, legal and accounting fees		(1,370	)
Net equity from issuance of common stock		20,630
Issuance of junior subordinated debt		10,000
Total cash acquired by FCB Bancorp	$	30,630

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NOTE 3 — PRO FORMA ADJUSTMENTS, INCLUDING MERGER RELATED COSTS

Summarized below are the pro forma adjustments necessary to reflect the merger based on the purchase method of accounting:

     (a) FCB Bancorp will acquire all of the outstanding stock of South Coast Bancorp, Inc. for a purchase price that is not to exceed $36,000,000. The purchase price will be reduced if the consolidated equity of South Coast Bancorp, Inc. is less than $16,500,000, based upon calculations set forth in the closing financial statements of South Coast Bancorp. For purposes of the pro forma balance sheet presentation, the following summarizes the assumed computation of the South Coast Bancorp, Inc. acquisition price (in thousands):

South Coast Bancorp, Inc. consolidated shareholders’ equity				$	17,428
Less transaction costs of South Coast Bancorp, Inc.:
Legal and accounting fees	$	(200	)
Severance and employment contract expenses		(1,465	)
Transfer of bank-owned automobile		(37	)
Total transaction costs					(1,702	)
Adjusted consolidated shareholders’ equity					15,726
Shareholders’ equity required					16,500
Purchase price adjustment					(774	)
Base purchase price					36,000
Adjusted purchase price					35,226
Plus direct transaction costs of FCB Bancorp:
Investment banking, legal and accounting fees					310
Estimated restructuring charges					138
Calculated purchase price				$	35,674

     (b) FCB Bancorp will account for its acquisition of South Coast Bancorp, Inc. using the purchase method of accounting for business combinations. Accordingly, the total estimated purchase price as shown in the above table is allocated to South Coast Bancorp’s net tangible and intangible assets based on their estimated fair values as of the date of the completion of the merger. The difference between the adjusted purchase price and the net assets acquired will be recorded as goodwill by FCB Bancorp and will be periodically evaluated in the future for impairment. The following summarizes the preliminary estimated purchase price that is allocated based on preliminary estimates of fair value (in thousands).

South Coast Bancorp, Inc. assets acquired				$	147,532
South Coast Bancorp, Inc. liabilities assumed					130,104
Net assets acquired					17,428
Less transaction costs of South Coast Bancorp, Inc.					(1,702	)
Fair value adjustments:
Securities	$	(42	)
Loans		4,992
Premises and equipment		1,800
Deposits		(1,351	)
Fair value adjustments					5,399
Deferred taxes related to adjustments					(1,428	)
Fair value of net assets acquired					19,697
Calculated purchase price					35,674
Excess of calculated purchase price over net assets acquired, recorded as goodwill				$	15,977

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The fair value adjustments have been computed as follows: (i) the fair value of investment securities is estimated based on an average between bid and ask prices published in financial journals, (ii) the fair value of loans receivable is estimated by a method that discounts the future cash flows using the current rates at which similar loans would be made to borrowers with similar credit ratings and maturities; most of South Coast Bancorp’s loans receivable contain terms, which include variable interest rates with “floors” and “ceilings” as to the range of interest rate change, (iii) for statement savings and demand deposits, fair value is the amount reported as payable in the financial statements as such amounts are payable on demand; for certificates of deposit, fair value is estimated using the rates currently offered for deposits of similar remaining maturities, and (iv) the fair value of premises and equipment is based upon property appraisal or tax information currently available.

A reconciliation of the pro forma deferred taxes related adjustment is as follows (in thousands):

							Deferred Tax
	Gross			Tax			(Asset)
	Amount			Effect			Liability
Severance and employment contract expenses	$	(1,465	)		38	%	$	(557	)
Transfer of bank-owned automobile		(37	)		38	%		(14	)
Gross fair value adjustments		5,399			38	%		2,052
Estimated restructuring charges		(138	)		38	%		(52	)
Deferred tax liability							$	1,428

     (c) Opportunity costs of the cash dividend paid to FCB Bancorp and distributed for the purchase of the South Coast Bancorp, Inc. (assumed interest rate of 1.00%).

     (d) Interest expense related to trust preferred securities issuance (assumed rate of 5.00%).

     (e) Amortization expense related to the estimated core deposit intangible asset is not considered significant.

     (f) The provision for income taxes related to pro forma adjustments is computed using a combined federal and state effective tax rate of 38%. The pro forma combined provision for income taxes does not necessarily reflect the amounts that would have resulted had FCB Bancorp and South Coast Bancorp filed consolidated income tax returns during the periods presented.

     (g) For purposes of the proforma consolidated and combined income statements, interest income, interest expense, and noninterest expense are impacted by the respective impact to yield, cost of funds, or expense FCB Bancorp will realize on assets and liabilities acquired from South Coast Bancorp, Inc., based on their estimated fair values at the date of acquisition. The increase or decrease in related accounts for assets and liabilities acquired is summarized as follows (in thousands):

				Estimated
				Average
				Term to		Adjustment for Period
	Fair Value			Maturity		June 30,			December 31,
	Adjustments			(years)		2005			2004
Interest income
Securities		(42	)		3	$	7		$	14
Loans		4,992			4		(624	)		(1,248	)
Interest expense
Deposits		(1,351	)		5		135			270
Noninterest expense
Premises and equipment		1,800			40		(23	)		(45	)
Total adjustments to income before income taxes						$	(505	)	$	(1,009	)

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HISTORICAL AND PRO FORMA PER SHARE DATA FOR FIRST CALIFORNIA BANK
AND SOUTH COAST BANCORP, INC.

The table below shows the earnings, book value and dividends per share for First California Bank and South Coast Bancorp, Inc. on a historical and a pro forma combined basis. The pro forma data was derived by combining historical consolidated financial information of First California Bank and South Coast Bancorp, Inc. using the purchase method of accounting for business combinations, and including the effect of the stock and debt offerings.

You should read the respective audited financial statements and related footnotes of First California Bank and South Coast Bancorp, Inc. included in this proxy statement-prospectus. See “Index to Financial Statements” at page F-1 of this proxy statement-prospectus.

	Six months		Year ended
	ended		December 31,
	June 30, 2005		2004
Book value per share
First California Bank	$	10.94	$	10.42
South Coast Bancorp, Inc.	$	5.72	$	5.50
Pro forma combined	$	13.51	$	13.17
Tangible book Value per share
First California Bank	$	10.94	$	10.42
South Coast Bancorp, Inc.	$	5.72	$	5.50
Pro forma combined	$	8.64	$	8.10
Dividends declared per share
First California Bank	$	—	$	—
Pro forma combined	$	—	$	—
Basic earnings per share
First California Bank	$	0.56	$	1.17
Pro forma combined	$	0.65	$	1.37
Diluted earnings per share
First California Bank	$	0.55	$	1.14
Pro forma combined	$	0.64	$	1.35

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COMPENSATION AND OTHER TRANSACTIONS
WITH MANAGEMENT AND OTHERS

Summary Compensation

     The following table sets forth a summary of annual and long-term compensation for services in all capacities to the Bank for the Bank’s President and Chief Executive Officer and the Bank’s two other executive officers for the years noted:

									Long-Term
			Annual Compensation						Compensation Awards
							Other Annual		Securities		All Other
Name and Title	Year		Salary		Bonus		Compensation 1		Underlying Options		Compensation
C. G. Kum,		2004	$	210,047	$	65,759		—		9,000	$	0
President and Chief		2003	$	195,000	$	75,000		—		10,000	$	0
Executive Officer		2002	$	180,000	$	50,058		—		0	$	0
Thomas E. Anthony,		2004	$	134,000	$	28,765		—		4,500	$	0
Executive Vice President and		2003	$	120,721	$	39,396		—		5,000	$	0
Chief Credit Officer		2002	$	114,243	$	30,617		—		0	$	0
Romolo Santarosa,		2004	$	133,951	$	34,587		—		4,500	$	0
Executive Vice President and		2003	$	120,000	$	39,396		—		1,000	$	0
Chief Financial Officer		2002	$	15,000	$	0		—		0	$	0

Stock Options

     The Bank adopted the 2003 Stock Option Plan that allows for the granting of both incentive and nonstatutory stock options. The option price for incentive stock options cannot be less than 100% of the fair market value of the shares on the date of grant. The stock options expire eight years from the date of grant. The option price, number of shares granted to recipients, and duration for the plan stock options are determined and approved by the Board of Directors.

     As of December 31, 2004, all options outstanding vest five years and expire eight years after the date of grant. The following table summarizes information regarding stock options outstanding at December 31, 2004:

Incentive Stock Options					Nonstatutory Stock Options
			Weighted Average						Weighted Average
			Remaining						Remaining
	Number		Contractual Life				Number		Contractual Life
Exercise Price	Outstanding		(in years)		Exercise Price		Outstanding		(in years)
$11.25		31,750		6.47	$	11.25		10,000		6.47
$20.25		26,500		7.31	$	20.25		10,000		7.31
		58,250						20,000

     Under the plan, an aggregate of no more than 200,000 shares of the Bank’s common stock were approved for grant. At December 31, 2004, there were 121,750 shares reserved and available for grant. Upon shareholder and regulatory approval of the holding company reorganization, outstanding Bank stock options will be exchanged for Company stock options on a one-for-one basis and on the same terms and conditions as the Bank stock options.

¹ Perquisites paid to an executive officer that total less than the lesser of $50,000 or 10% of salary and bonus are omitted.

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     The following table sets forth certain information regarding stock options granted during 2004 to Messrs. Kum, Anthony and Santarosa, all executive officers as a group, and all directors as a group:

							All Executive
							Officers as a		All Directors
					Romolo		Group (3 in		as a Group
	C. G. Kum		Thomas E. Anthony		Santarosa		Number)		(6 in Number)
Options granted during 2004:
Number of shares		9,000		4,500		4,500		18,000		19,000
Average exercise price per share	$	20.25	$	20.25	$	20.25	$	20.25	$	20.25

     The following table sets forth certain information regarding unexercised options held by Messrs. Kum, Anthony, and Santarosa:

					Value of Unexercised
	Number of Unexercised				in-the-Money Options
	Options at December 31, 2004				at December 31, 2004(1)
Name	Exercisable		Unexercisable		Exercisable		Unexercisable
C. G. Kum		0		19,000		N/A	$	52,500
Thomas E. Anthony		0		9,500		N/A	$	26,250
Romolo Santarosa		0		5,500		N/A	$	5,250

Employment Agreements

     In March 2003, the Bank entered into a Salary Continuation Agreement with C. G. Kum. The agreement provides for a maximum annual benefit of $160,471, which will be paid over the lesser of 17 years or such shorter period of time based upon the number of years that Mr. Kum is employed by the Bank prior to normal retirement. The Salary Continuation Agreement is an unfunded arrangement, which means that Mr. Kum has no rights under the agreement beyond those of a general creditor of the Bank, and there are no specific assets set aside by the Bank in connection with the establishment of the agreement. The Salary Continuation Agreement is not an employment contract. If Mr. Kum leaves the Bank’s employ by virtue of early voluntary retirement (prior to attaining age 65) or is terminated “for cause” (as defined the agreement), he will not be eligible for a benefit under the agreement. In the event Mr. Kum leaves the Bank’s employ by virtue of death (either prior or subsequent to retirement), involuntary termination (without cause), disability or, under certain circumstances, a change in control, he will receive partial benefits under the agreement or certain benefits under the Split Dollar Agreement (see below). The Bank also entered into a split-dollar life insurance agreement with Mr. Kum in March 2003. Pursuant to the terms of that agreement, the Bank owns the insurance policies, is entitled to the cash value of the policies and is responsible for paying the associated premiums. Upon Mr. Kum’s death, the beneficiary is entitled to receive $1.5 million of the total proceeds, with the Bank entitled to the balance. The Bank paid an aggregate premium in 2002 amounting to $1.4 million.

     In March 2003, the Bank also entered into a Salary Continuation Agreement with Thomas E. Anthony. The agreement provides for a maximum annual benefit of $84,667, which will be paid over the lesser of 11 years or such shorter period of time based upon the number of years that Mr. Anthony is employed by the Bank prior to normal retirement. If the Bank agrees to extend Mr. Anthony’s employment beyond normal retirement (age 65 for purposes of the agreement), the annual benefit payment will be extended for one additional year for each full year of service beyond normal retirement to a maximum aggregate of 15 years. The Salary Continuation Agreement is an unfunded arrangement, which means that Mr. Anthony has no rights under the agreement beyond those of a general creditor of the Bank, and there are no specific assets set aside by the Bank in connection with the establishment of the agreement. The Salary Continuation Agreement is not an employment contract. If Mr. Anthony leaves the Bank’s employ by virtue of early voluntary retirement (prior to attaining age 65) or is terminated “for cause” (as defined in the agreement), he will not be eligible for a benefit under the agreement. In the event Mr. Anthony leaves the Bank’s employ by virtue of death (either prior or subsequent to retirement), involuntary termination (without cause), disability or, under certain circumstances, a change in control, he will receive partial benefits under the agreement or certain benefits under the Split Dollar Agreement (see below). The Bank also entered into a split-dollar life insurance agreement with Mr. Anthony in March 2003. Pursuant to the terms of that agreement, the Bank owns the insurance policies, is entitled to the cash value of the policies and is responsible for paying the associated premiums. Upon Mr. Anthony’s death, the beneficiary is entitled to receive $1.05 million of the total proceeds, with the Bank entitled to the balance. The Bank paid an aggregate premium in 2002 amounting to $1.0 million.

Employee 401(k) Plan

     The Bank has adopted a 401(k) savings investment plan which allows employees to defer certain amounts of compensation for income tax purposes under Section 401(k) of the Internal Revenue Code. Essentially, all eligible employees may elect to defer and contribute up to statutory limits. The Bank may, at its discretion, make matching contributions, the total of which may not exceed 15% of eligible compensation. For the years ending December 31, 2004, 2003, and 2002, the Bank made matching contributions of approximately $89,000, $59,000, and $67,000, respectively, to the plan.

     The Bank has also established an employee incentive compensation program which provides eligible participants additional compensation based upon the achievement of certain Bank goals. For the years ending December 31, 2004, 2003 and 2002, additional compensation expense of approximately $270,000, $350,000, and $260,000, respectively, was recognized and paid subsequent to each year-end to eligible employees, pursuant to this program.

⁽¹⁾ Assuming a market value of $16.50 per share on December 31, 2004.

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Directors’ Compensation

     Directors were paid for attendance at Board and committee Meetings at the rate of $2,000 per month. In addition, the Chairman of the Board received an additional $1,000 each month. Mr. C. G. Kum does not receive directors’ fees.

Personnel Committee Interlocks and Insider Participation

     The members of the Bank’s Personnel Committee (the “Personnel Committee”) are Directors Syble Roberts (Chair), James O. Birchfield, John W. Birchfield and C. G. Kum, none of whom serve as an officer of the Bank except for Mr. Kum, who is the Bank’s President and Chief Executive Officer. None of the Bank’s executive officers served on the board of directors or compensation committee, or equivalent, of another entity, one of whose executive officers served on the Bank’s Personnel Committee or the Bank’s board of directors. Mr. Kum does not participate in Committee deliberations and voting regarding his compensation.

Personnel Committee Report on Executive Compensation

     The Personnel Committee is responsible for reviewing and approving the Bank’s overall compensation and benefit programs, and for administering the compensation of the Bank’s executive and senior officers.

     The objectives of the Bank’s compensation programs are to attract, motivate and retain executive and senior officers by insuring that appropriate total compensation is paid for positions of equivalent responsibility when compared to a sample of peer banks.

     As a general rule, the Committee evaluates management and public relations skills as well as annual corporate goals, such as profitability, asset quality and growth in loans and deposits, in determining compensation levels. Approximately 50% of compensation is based on Bank performance and approximately 50% is based on individual criteria.

     In evaluating Mr. Kum’s compensation the Committee, with Mr. Kum absent, evaluates compensation surveys for peer banks covering salary and other compensation components for presidents and CEOs. Consistent with the Committee’s compensation philosophy, approximately 50% of Mr. Kum’s compensation is based on an evaluation of his management and public relations skills. Approximately 50% of Mr. Kum’s compensation is based on Bank performance, in particular, the following factors in the following order of priority: (1) improving shareholder value; (ii) profitability; (iii) asset quality; and (iv) growth in loans and deposits. The Committee also evaluates Mr. Kum’s actions taken during the year to achieve the Bank’s longer term strategic goals.

     The Committee believes that the Bank’s compensation program and compensation levels are effective in attracting, motivating and retaining outstanding executive and senior officers and that they are consistent with the Bank’s immediate and long-term goals.

PERSONNEL COMMITTEE

Syble Roberts (Chair)

James O. Birchfield

John W. Birchfield

C. G. Kum

Related Party Transactions

     There are no existing or proposed material transactions between the Bank and any of its directors, executive officers or beneficial owners of 5% or more of the Bank’s common stock, or the immediate family or associates of any of the foregoing persons, except as indicated below.

     Some of the Bank’s directors and executive officers and their immediate families, as well as the companies with which they are associated, are customers of, and have had banking transactions with, the Bank in the ordinary course of our business, and the Bank expects to have banking transactions with such persons in the future. In the Bank’s

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opinion, all loans and commitments to lend made in 2004 included in such transactions were made in compliance with applicable laws, on substantially the same terms, including interest rates and collateral, as those prevailing for comparable contemporaneous transactions with other persons of similar creditworthiness, and did not involve more than a normal risk of collectability or present other unfavorable features. As of June 30, 2005, there were no outstanding loans or commitments to lend to any of the Bank’s directors, officers or principal shareholders, or their associates.

     Tenisha M. Fitzgerald, who serves as a director of First California Bank and FCB Bancorp, is the daughter of Richard D. Aldridge. For her service as a director of First California Bank, Ms. Fitzgerald received aggregate fees of $23,200 during 2004.

     Richard D. Aldridge, who serves as a director of First California Bank and FCB Bancorp, is the father of Tenisha M. Fitzgerald. For his service as a director of First California Bank, Mr. Aldridge received aggregate fees of $23,200 during 2004.

     John W. Birchfield, who serves as the Vice Chairman of First California Bank and FCB Bancorp, is the son of James O. Birchfield. For his service as a director of First California Bank, John W. Birchfield received aggregate fees of $23,200 during 2004.

     James O. Birchfield, who serves as the Chairman of First California Bank and FCB Bancorp, is the father of John W. Birchfield. For his service as a director of First California Bank, James O. Birchfield received aggregate fees of $34,800 during 2004.

     The Bank’s Articles of Incorporation and Bylaws provide, among other things, for the indemnification of the Bank’s directors, officers and agents, and authorize the Bank to pay expenses incurred by, or to satisfy a judgment or fine rendered or levied against, such agents in connection with any personal legal liability incurred by that individual while acting for us within the scope of his or her employment. The provisions of the Bank’s Articles of Incorporation and Bylaws are subject to certain limitations imposed under California and federal law. For example, under California law, directors remain personally liable for acts or omissions that involve intentional misconduct or a knowing and culpable violation of law or for any transaction from which the director derived an improper personal benefit. Under the federal Comprehensive Thrift and Bank Fraud Prosecution and Taxpayer Recovery Act of 1990, indemnification payments may be prohibited by the regulatory authorities if the Bank is insolvent, is in conservatorship or receivership, is in troubled condition, or has a CAMELS rating of 4 or 5, and if the regulatory authority believes that the party who is to receive the indemnification payment has violated banking laws or regulations, breached a fiduciary duty, or is otherwise responsible for substantial loss to the Bank. It is the Bank’s policy that our directors and executive officers shall be indemnified to the maximum extent permitted under applicable law and the Bank’s Articles of Incorporation and Bylaws. The Bank has purchased liability insurance covering all of its directors and officers; however, no assurance can be given that the proceeds of the policy would be adequate to protect the Bank in all circumstances.

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PROPOSAL 2

APPROVAL OF 2005 STOCK OPTION PLAN

Introduction

     As described under “COMPENSATION AND OTHER TRANSACTIONS WITH MANAGEMENT AND OTHERS — Stock Options” herein, the Bank has adopted a stock option plan (the “2003 Plan”), pursuant to which stock options have been granted to various persons associated with the Bank. In contemplation of the holding company formation, the Board of Directors of the Holding Company has adopted the FCB Bancorp 2005 Stock Option Plan (the “Plan”), described below, pursuant to which: (i) stock options under the Holding Company’s Plan would be issued by the Holding Company to holders of unexercised, unexpired Bank stock options (“Bank Stock Options”) at the effective date of the merger in exchange for and in substantially the same amounts, prices and terms as the Bank Stock Options held at the effective date; and (ii) the Holding Company would be permitted to grant additional stock options, including non-qualified stock options, to eligible persons, as more fully described below.

     On May 19, 2005, the Board of Directors of the Holding Company adopted, subject to approval by the Bank’s shareholders as prospective shareholders of FCB Bancorp, the FCB Bancorp 2005 Stock Option Plan. The Plan is intended to replace the 2003 Plan effective upon consummation of the holding company formation. The Plan provides for the grant of “incentive stock options” as permitted under Section 422 of the Internal Revenue Code of 1986 (the “Code”), as well as for the grant of non-qualified stock options. The Plan is not subject to any of the provisions of the Employee Retirement Income Security Act of 1974, as amended.

     The Plan provides for the issuance of up to 200,000 shares of the Holding Company’s Common Stock to directors, officers, and key employees of the Holding Company or any subsidiary, including the Bank, subject to adjustment in the event of certain changes in the capital structure of the Holding Company. As of ___, 2005, no new grants of options had been made by the Holding Company under the Plan. It is anticipated that all outstanding Bank Stock Options will be exchanged for Holding Company stock options at the consummation of the merger.

     The Bank’s Board of Directors believes it is advisable for the shareholders to approve the adoption of the Plan in order to continue to have options available to encourage directors, officers, key employees and consultants to remain with the Holding Company and the Bank and to attract new, qualified officers, employees and directors in today’s competitive market.

Summary of the Plan

     The following description of the Plan is intended to highlight and summarize the principal terms of the Plan, and is qualified in its entirety by the text of the Plan, a copy of which is available for inspection at the Holding Company’s Main Office.

     Administration. The Plan will be administered by the Holding Company’s Board of Directors (the “Board”), one or more of whom may also be executive officers and therefore may not be deemed to be “independent,” as that term is defined in the listing standards of the Nasdaq Stock Market, Inc. Each director will abstain from approving the grant of any options to himself or herself. Options may be granted only to directors, officers and key employees of the Holding Company and any subsidiary, including the Bank. Subject to the express provisions of the Plan, the Board is authorized to construe and interpret the Plan, and make all the determinations necessary or advisable for administration of the Plan.

     Eligible Participants. The Plan provides that all directors, officers, and key employees of the Holding Company and any subsidiary of the Holding Company are eligible to receive grants of stock options. The Plan provides that if options are granted to officers or key employees who own, directly or indirectly, 10% or more of the Holding Company’s outstanding shares, and the options are intended to qualify as “incentive stock options,” then the minimum option price must be at least 110% of the stock’s fair market value on the date of grant, and the term of the option grant may not exceed five years. Subject to the foregoing limitations, the Board is empowered to determine which eligible participants, if any, should receive options, the number of shares subject to each option, and the terms and provisions of the option agreements.

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     Shares Subject to the Plan. 200,000 shares are covered by the Plan, which constitutes approximately 9.2% of the shares which will be outstanding upon consummation of the merger. Options will be granted at no less than the fair market value of the Holding Company’s Common Stock as of the date of grant; provided, however, options to 10% shareholders must be at least 110% of fair market value.

     Incentive and Non-Qualified Stock Options. The Plan provides for the grant of both incentive stock options and non-qualified options. Incentive stock options are available only to persons who are employees of the Holding Company or any subsidiary, and are subject to limitations imposed by applicable sections of the Code, including a $100,000 limit on the aggregate fair market value (determined on the date the options are granted) of shares of the Holding Company’s Common Stock with respect to which incentive stock options are exercisable for the first time by an optionee during any calendar year (under the Plan and all other “incentive stock option” plans of the Holding Company and its subsidiaries. Any options granted under the Plan which do not meet the limitations for incentive stock options, or which are otherwise not deemed to be incentive stock options, shall be deemed “non-qualified.” Subject to the foregoing and other limitations set forth in the Plan, the exercise price, permissible time or times of exercise, and the remaining terms pertaining to any option are determined by the Board; however, the per share exercise price under any option may not be less than 100% of the fair market value of the Holding Company’s Common Stock on the date of grant of the option.

     Terms and Conditions of Options. Subject to the limitations set forth in the Plan, options granted thereunder may be exercised in such increments, which need not be equal, and upon such contingencies as the Board may determine. If an optionee does not exercise an increment of an option in any period during which such increment becomes exercisable, the unexercised increment may be exercised at any time prior to expiration of the option unless the respective stock option agreement provides otherwise.

     Subject to earlier termination as may be provided in any optionee’s stock option agreement, options granted under the Plan will expire not later than ten years from the date of grant. Under the terms of the Plan, the date of grant is deemed to be either: (i) the date fixed by the Board to be the date of grant; or (ii) if no such date is fixed, the date on which the Board made its final determination to grant a stock option.

     Options granted under the Plan may not be transferred otherwise than by will or by the laws of descent and distribution, and during his or her lifetime, only the optionee or, in the event of the disability of the optionee, his or her guardian or the conservator of his or her estate may exercise the option.

     Exercise of Options. Subject to the restrictions set forth in the Plan, an option may be exercised in accordance with the terms of the individual stock option agreement. Full payment by the optionee for all shares as to which the option is being exercised is due and payable at the time of exercise of the option. Payment must be in cash.

     An option may be exercised with respect to whole shares only, although fractional share interests may be accumulated and exercised from time to time as whole shares during the term of the option. Options may only be exercised with respect to a minimum of ten whole shares, unless the option agreement requires that a larger number of shares be exercised at any one time and unless fewer than ten shares remain subject to the option at the time of exercise. Any shares subject to an option which expires or terminates without being exercised become available again for issuance under the Plan.

     Neither an eligible participant nor an optionee has any rights as a shareholder with respect to the shares of Common Stock covered by any option which may be or has been granted to such person, and which is thereafter exercised, until date of issuance of the stock certificate by the Holding Company to such person.

     Stock Option Agreement. Every grant of an option will be evidenced by a written stock option agreement executed by the Holding Company and the optionee. Subject to the terms and conditions of the Plan, the stock option agreement will contain the terms and provisions pertaining to each option so granted, such as exercise price, permissible date or dates of exercise, termination date, and such other terms and conditions as the Board deems desirable and not inconsistent with the Plan.

     Termination of Employment or Affiliation. In the event an optionee ceases to be affiliated with the Holding Company or a subsidiary for any reason other than disability, death or termination for cause, the stock options granted to such optionee shall expire at the earlier of the expiration dates specified for the options, or ninety days

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after the optionee ceases to be so affiliated. During such period after cessation of affiliation, the optionee may exercise the option to the extent that it was exercisable as of the date of such termination, and thereafter the option expires in its entirety.

     If an optionee’s stock option agreement so provides, and if an optionee’s status as an eligible participant is terminated for cause, the option held by such person will expire thirty days after termination, although the Board may, in its sole discretion, within thirty days of such termination, reinstate the option. If the option is reinstated, the optionee will be permitted to exercise the option only to the extent, for such time, and upon such terms and conditions as if the optionee’s status as an eligible participant had been terminated for a reason other than cause, disability or death, as described above.

     The Plan, and all stock options previously granted under the Plan, shall terminate upon the dissolution or liquidation of the Holding Company, upon a consolidation, reorganization, or merger as a result of which the Holding Company is not the surviving corporation, or upon a sale of all or substantially all of the assets of the Holding Company. However, all options theretofore granted shall become immediately exercisable in their entirety upon the occurrence of any of the foregoing, and any options not exercised immediately upon the occurrence of any of the foregoing events will terminate unless provision is made for the assumption or substitution thereof. As a result of this acceleration provisions, even if an outstanding option were not fully vested as to all increments at the time of the event, that option will become fully vested and exercisable.

     Amendment and Termination of the Plan. The Board may at any time suspend, amend or terminate the Plan, and may, with the consent of the respective optionee, make such modifications to the terms and conditions of outstanding options as it shall deem advisable. Shareholder approval of the Plan is required to qualify incentive stock options pursuant to the code. Certain amendments to the Plan may also require shareholder approval to maintain incentive stock option qualifications. The amendment, suspension or termination of the Plan will not, without the consent of the Optionee, alter or impair any rights or obligations under any outstanding option under the Plan.

     Adjustments Upon Changes in Capitalization. The total number of shares covered by the Plan and the price, kind and number of shares subject to outstanding options thereunder, will be appropriately and proportionately adjusted if the outstanding shares of Common Stock of the Holding Company are increased, decreased, changed into or exchanged for a different number or kind of shares or securities of the Holding Company through reorganization, merger, recapitalization, reclassification, stock split, stock dividend, stock consolidation or otherwise, without consideration to the Holding Company as provided in the Plan. Fractional share interests of such adjustments may be accumulated, although no fractional shares of stock will be issued under the Plan.

Federal Income Tax Consequences

     Certain stock options granted under the Plan are intended to be “incentive stock options” as defined in Section 422 of the Code. No income will be recognized by the optionee, and no deduction will be allowed to the Holding Company, by reason of the grant or exercise of an incentive stock option. However, the excess of the fair market value of the shares at the time of exercise over the option exercise price will be treated as a preference item for purposes of the alternative minimum tax. If the optionee does not dispose of the shares of the Holding Company’s Common Stock received upon exercise of an incentive stock option by payment in cash within two years from the date of the grant of the option or within one year after the transfer of the shares to the optionee, any gain realized by the optionee upon such disposition of the shares will be long-term capital gain. No deduction will be available to the Holding Company upon such disposition by the optionee. However, if the optionee disposes of such shares within the two year period from the date of the grant of the option or within the one year period from the transfer of the shares, gain realized by the optionee upon such disposition will be ordinary income to the extent that the value of the shares received at the date of exercise of the option exceeds the price paid for such shares by the optionee. Such ordinary income will be recognized by the optionee for the tax year in which the optionee disposes of the shares, and the Holding Company will be entitled to a deduction in an amount equal to the ordinary income recognized by the optionee for the tax year of the Holding Company in which the optionee recognizes such ordinary income, provided that applicable income tax withholding requirements are satisfied. Gain realized in excess of such ordinary income will be capital gain. Such capital gain will be long-term or short-term depending upon whether the shares are held for more than 12 months prior to the date of disposition. If the optionee disposes of the shares within either the two year period from the date of grant of the option, or within one year after the transfer of the shares, any ordinary

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income recognized by the optionee will not exceed the gain realized on such disposition by the optionee. If the optionee disposes of shares of Common Stock received upon exercise of an option at a loss, such loss will be a capital loss, long-term or short-term depending upon whether the shares are held for more than one year prior to the date of disposition.

     The optionee’s basis in shares of the Holding Company’s Common Stock acquired upon the exercise of an incentive stock option by the transfer to the Holding Company of the Holding Company’s Common Stock already owned by the optionee is determined by substituting the optionee’s basis in the shares of the Holding Company’s Common Stock transferred to the Holding Company to exercise the option to an equivalent number of shares of the Holding Company’s Common Stock acquired upon the exercise of the option (the “Substituted Common Stock”). The basis of the remainder, if any, of the shares of the Holding Company’s Common Stock received upon exercise of the option (the “Non-Substituted Common Stock”) will be zero. The Substituted Common Stock will have a holding period which, for purposes of computing whether capital gain or loss is long or short term, includes the holding period of the shares of previously owned Common Stock. The Non-Substituted Common Stock will have a holding period which begins on the date such shares are received. If the optionee does not dispose of the shares of the Holding Company’s Common Stock received upon exercise of an incentive stock option within two years from the date of the grant of the option or within one year after the transfer of the shares to the optionee, any gain realized by the optionee upon the disposition of the shares will be long-term capital gain. No deduction will be available to the Holding Company upon such disposition by the optionee. However, if the optionee disposes of such shares within the two year period from the date of the grant of the option or within the one year period from the transfer of the shares, the optionee will be treated as disposing of the shares having the lowest basis. Any gain realized by the optionee upon such disposition will be ordinary income to the extent that the value of the shares received at the date of exercise of the option exceeds the amount paid for such shares. The amount paid for Substituted Common Stock will be its fair market value on the date of exercise. The amount paid for Non-Substituted Common Stock will be its basis. Such ordinary income will be recognized by the optionee for the tax year in which the optionee disposes of the shares and the Holding Company will be entitled to a deduction in an amount equal to the ordinary income recognized by the optionee for the tax year of the Holding Company in which the optionee recognizes such ordinary income, provided that applicable income tax withholding requirements are satisfied. Gain realized in excess of such ordinary income will be capital gain. Such capital gain will be long-term or short-term depending upon whether the shares disposed of were held for more than 12 months prior to the date of disposition taking into account the substituted holding period of any Substituted Common Stock. If the optionee disposes of the shares within either the two-year period from the date of grant of the option, or within one year after the transfer of the shares, any ordinary income recognized by the optionee will not exceed the gain realized on such disposition by the optionee. If the optionee disposes of shares of the Holding Company’s Common Stock received upon exercise of an option at a loss, such loss will be a capital loss, long-term or short-term depending upon whether the shares are held for more than one year prior to the date of disposition, taking into account the substituted holding period of any Substituted Common Stock.

     The aggregate fair market value (determined at the time the options are granted) of the stock with respect to which incentive stock options are exercisable by an individual for the first time in any calendar year may not exceed $100,000. The Plan provides that outstanding options may become fully vested and exercisable in the event of a merger or consolidation of the Holding Company as a result of which the Holding Company is not the surviving corporation or upon the sale of all or substantially all of the property of the Holding Company, unless the Plan is continued and the outstanding options are neither assumed nor replaced with new options. If, as a result of this provision of the Plan, the amount of options granted after 1986 which become exercisable by an optionee for the first time in any year exceeds the $100,000 limit, the amount of options exceeding the $100,000 limit will not be treated as incentive stock options.

     If options cease to be treated as incentive stock options, such options will be treated as non-qualified stock options. If such options, or any stock options originally intended to be non-qualified stock options, are exercised, the excess of the fair market value of the acquired shares at the time of exercise over the option exercise price will be treated as ordinary income to the optionee in the year of exercise.

     Upon exercise of a stock option other than an incentive stock option by a cash payment, the optionee’s basis in the shares of the Holding Company’s Common Stock received will be the sum of the option exercise price and the amount of ordinary income recognized by the optionee from the exercise of the stock option. The optionee’s holding period in the shares of the Holding Company’s Common Stock received will begin on the date received. Upon

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exercise of such a stock option by transfer of shares of the Holding Company’s Common Stock already owned by the optionee, under Internal Revenue Service Ruling 80-244, the optionee will be deemed to have received an equivalent number of shares of the Holding Company’s Common Stock in a non-taxable exchange (the “Substituted Common Stock”) and the remainder, if any, of the shares of the Holding Company’s Common Stock will be deemed to have been received in a taxable transaction (the “Non-Substituted Common Stock”). The optionee’s basis in the Substituted Common Stock will be the same as his basis in the previously owned shares, and his holding period will include the holding period of the previously owned shares. The optionee’s basis in the Non-Substituted Common Stock will be the same as the amount of ordinary income recognized by the optionee. The Non-Substituted Common Stock will have a holding period which begins on the date when it is received.

     On the disposition of shares of the Holding Company’s Common Stock received upon exercise of a stock option other than an incentive stock option, the difference between the amount realized and the optionee’s basis in the shares will be a long-term or short-term capital gain (or loss) depending on whether the optionee’s holding period for the shares is more than 12 months prior to their disposition.

     The Holding Company will be entitled to claim a deduction at the same time and in the same amount as income is recognized by the optionee exercising a stock option other than an incentive stock option. No income will be recognized by the optionee, and no deduction shall be allowable to the Holding Company, by reason of the grant of non-qualified stock options.

Certain Information Concerning All Options

     In addition to the foregoing, federal tax law provides for an excise tax of 20% and the disallowance of a deduction to a corporation for compensation to its employees, officers, shareholders and others that results in an “excess parachute payment” within the meaning of Code Section 280G(b). If such a person is granted an incentive stock option and there is a change of control, the incentive stock option may be considered in the determination of whether an excess parachute payment has been made.

     Long-term capital gains and losses are derived from the sales and exchanges of capital assets held for more than twelve months. Under The Jobs and Growth Tax Relief Reconciliation Act of 2003, for taxable years beginning before January 1, 2009, generally the maximum rate of tax on net capital gain of a non-corporate taxpayer is 15 percent. In addition, any net capital gain which otherwise would have been taxed at a 10- or 15-percent rate generally is taxed at a five-percent rate (zero for taxable years beginning after 2007). For taxable years beginning after December 31, 2008, generally the rates on net capital gain are scheduled to revert to 20-percent and 10-percent, respectively. Any gain from the sale or exchange of property held more than five years that would otherwise be taxed at the 10-percent rate is taxed at an 8-percent rate. Any gain from the sale or exchange of property held more than five years and the holding period for which began after December 31, 2000, which would otherwise be taxed at a 20-percent rate will be taxed at an 18-percent rate. If the capital asset was held for less than twelve months, any resulting gain will be taxed at ordinary income rates.

     The specific state tax consequences to each optionee under the Plan may vary, depending upon the laws of the various states and the individual circumstances of each optionee. It is suggested that each optionee consult his or her personal tax advisor regarding both the federal and state tax consequences of the grant and exercise of options.

Exchange of Options in Reorganization

     Pursuant to the Merger Agreement, upon consummation of the merger, the Holding Company will issue Holding Company options in exchange for the then outstanding Bank Stock Options on a share-for-share basis. Those Bank Stock Options which qualify as incentive stock options under the Code will be exchanged for incentive stock options under the Plan upon consummation of the merger. The following table shows the name or group of individuals who are anticipated will receive exchange options and the number of options, based on the number of shares of Bank Stock Options outstanding on June 30, 2005:

Name or Identification Group	Number of Shares
C. G. Kum		29,000
Thomas E. Anthony		14,500
Romolo Santarosa		10,500

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Name or Identification Group	Number of Shares
All Executive Officers as a Group (3 in number)		54,000
All Non-Officer Directors as a Group (5 in number)		30,000
All Directors (6 in number)		59,000
All Other Optionees (18 in number)		35,500
All Optionees as a Group (26 in number)		119,500

Vote Required

     The Plan will become effective upon approval by a majority of the shares of the Bank’s Common Stock, as prospective shareholders of the Holding Company, represented and voting at the Meeting and will terminate on May 19, 2015.

THE BOARD OF DIRECTORS RECOMMENDS A VOTE OF “FOR” ON THIS PROPOSAL.

VALIDITY OF COMMON STOCK

     The validity of the shares of FCB Bancorp common stock to be issued in connection with the merger will be passed upon for FCB Bancorp by Horgan, Rosen, Beckham & Coren, L.L.P., Calabasas, California.

EXPERTS

     The financial statements of First California Bank as of December 31, 2004 and 2003 and for each of the years in the three-year period ended December 31, 2004, have been audited by Moss Adams LLP, independent registered public accounting firm, as set forth in their report thereon and included herein. Such financial statements are incorporated herein in reliance upon such report given on the authority of such firm as experts in accounting and auditing.

     The consolidated financial statements of South Coast Bancorp, Inc. and Subsidiary as of December 31, 2004 and 2003, and for the years then ended, have been included in this proxy statement prospectus in reliance on the report of Grant Thornton LLP, independent certified public accountants, included herein, and upon the authority of said firm as experts in accounting and auditing.

OTHER MATTERS

     The Board of Directors does not know of any other matters to be presented at the Meeting. However, if other matters properly come before the Meeting, it is the intention of the Proxyholders to vote each Proxy in accordance with the recommendations of the Bank’s Board of Directors on such matters, and discretionary authority to do so is included in the Proxy.

Dated: ___, 2005	FIRST CALIFORNIA BANK
	Thomas E. Anthony,
	Secretary

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Exhibit A

PLAN OF REORGANIZATION
AND
MERGER AGREEMENT

     This Plan of Reorganization and Merger Agreement (this “Merger Agreement”) is entered into as of May 19, 2005, by and between First California Bank (“Bank”) and FCB Merger Corp. (“Subsidiary”), to which FCB Bancorp (“Holding Company”) is a party, with reference to the following:

RECITALS

     A. Bank is a California banking corporation with its principal office in the City of Camarillo, County of Ventura, State of California. Subsidiary and Holding Company are each corporations duly organized and existing under the laws of the State of California with their principal offices in the City of Camarillo, County of Los Angeles, State of California.

     B. As of the date hereof, Bank has 2,500,000 shares of no par value common stock authorized, of which 2,162,807 shares are outstanding.

     C. As of the date hereof, Subsidiary has 10,000,000 shares of no par value common stock authorized, and at the time of the merger referred to herein 100 of such shares will be outstanding, all of which outstanding shares will be owned by Holding Company.

     D. As of the date hereof, Holding Company has 10,000,000 shares of preferred stock authorized, none of which are outstanding, and 10,000,000 shares of no par value common stock authorized, 100 shares of which will be outstanding at the time of the merger referred to herein.

     E. The Boards of Directors of Bank and Subsidiary have approved this Merger Agreement and authorized its execution, and the Board of Directors of Holding Company has approved this Merger Agreement, undertaken that Holding Company shall join in and be bound by it, and authorized the undertakings hereinafter made by Holding Company.

     For good and valuable consideration, receipt of which is hereby acknowledged Bank, Subsidiary and Holding Company hereby agree as follows:

AGREEMENT

Section 1. General

     1.1 The Merger. On the Effective Date, Subsidiary shall be merged into Bank, with the Bank surviving the merger (the “Surviving Corporation”) and becoming a wholly-owned subsidiary of Holding Company, and its name shall continue to be “First California Bank.”

     1.2 Effective Date. This Merger Agreement shall become effective at the close of business on the day (the “Effective Date”) on which an executed counterpart of this Merger Agreement shall have been filed with the Secretary of State of the State of California in accordance with Section 1103 of the General Corporation Law.

     1.3 Articles of Incorporation, Bylaws and Charter. On the Effective Date, the Articles of Incorporation of Bank, as in effect immediately prior to the Effective Date, shall be and remain the Articles of Incorporation of the Surviving Corporation; the Bylaws of Bank shall be and remain the Bylaws of the Surviving Corporation until altered, amended or repealed; the banking charter and certificate of authority of Bank issued by the Commissioner of the California Department of Financial Institutions (the “Commissioner”) shall be and remain the charter and certificate of authority of the Surviving Corporation; and the insurance of deposits coverage by the Federal Deposit Insurance Corporation (the “FDIC”) shall be and remain the deposit insurance of the Surviving Corporation.

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     1.4 Directors and Officers of the Surviving Corporation. On the Effective Date, the directors and officers of Bank immediately prior to the Effective Date shall become the directors and officers of the Surviving Corporation. The directors of the Surviving Corporation shall serve until the next annual meeting of shareholders of the Surviving Corporation or until such time as their successors are elected and have qualified.

     1.5 Effect of the Merger.

          (a) Assets and Rights. All rights, privileges, franchises and property of Bank or Subsidiary, and all debts and liabilities due or to become due to Bank or Subsidiary, including things in action and every interest or asset of conceivable value or benefit, shall be deemed fully and finally and without any right of reversion transferred to and vested in the Surviving Corporation without further act or deed, and the Surviving Corporation shall have and hold the same in its own right as fully as the same was possessed and held by Bank or Subsidiary.

          (b) Liabilities. All debts, liabilities, and obligations due or to become due of, and all claims or demands for any cause existing against, Bank or Subsidiary shall be and become the debts, liabilities, obligations or, and the claims and demands against, the Surviving Corporation in the same manner as if the Surviving Corporation had itself incurred or become liable for them.

          (c) Creditor’s Rights and Liens. All rights of creditors of Bank or Subsidiary, and all liens upon the property of Bank or Subsidiary, shall be preserved unimpaired, limited in lien to the property affected by the liens immediately prior to the time of the merger.

          (d) Pending Actions. Any action or proceeding pending by or against Bank or Subsidiary shall not be deemed to have abated or been discontinued, but may be prosecuted to judgment with the right to appeal or review as in other cases as if the merger had not taken place or the Surviving Corporation may be substituted for Bank or Subsidiary, as the case may be.

     1.6 Further Assistance. Bank and Subsidiary each agree that at any time, or from time to time, as and when requested by the Surviving Corporation, or by its successors and assigns, it will execute and deliver, or cause to be executed and delivered in its name by its last acting officers, or by the corresponding officers of the Surviving Corporation, all such conveyances, assignments, transfers, deeds or other instruments, and will take or cause to be taken such further or other action as the Surviving Corporation, its successors or assigns may deem necessary or desirable in order to evidence the transfer, vesting or devolution of any property right, privilege or franchise or to vest or perfect in or confirm to the Surviving Corporation, its successors and assigns, title to and possession of all the property, rights, privileges, powers, immunities, franchises and interests referred to in this Section 1 and otherwise to carry out the intent and purposes thereof.

Section 2. Capital Stock of the Surviving Corporation.

     2.1 Stock of Subsidiary. The shares of common stock of Subsidiary issued and outstanding immediately prior to the Effective Date shall thereupon be converted into and exchanged by Holding Company for shares of fully paid common stock of Bank as the Surviving Corporation.

     2.2 Stock of First California Bank. All shares of common stock of Bank issued and outstanding immediately prior to the Effective Date shall upon the Effective Date, by virtue of the merger and without any action on the part of the holders thereof, be exchanged for and converted into an equal number of shares of fully paid and non-assessable common stock of Holding Company.

     2.3 Exchange of Stock. Upon the merger becoming effective:

          (a) The shareholders of Bank of record at the time the merger becomes effective, for each share of common stock of Bank then held by them, shall be allocated and entitled to receive one share of the common stock of Holding Company;

          (b) Holding Company shall issue the shares of its common stock which the shareholders of Bank shall be entitled to receive; and

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          (c) Outstanding certificates representing shares of the common stock of Bank shall thereafter represent shares of the common stock of Holding Company, and such certificates may, but need not, be exchanged by the holders thereof, after the merger becomes effective, for new certificates for the appropriate number of shares bearing the name of Holding Company.

     2.4 Other Rights to Stock. Upon and by reason of the merger becoming effective:

          (a) The options to purchase shares of common stock of Bank which have been granted by Bank pursuant to its Stock Option Plan shall be deemed to be options granted by Holding Company with the same terms and conditions and for the same number of shares of common stock of Holding Company. Holding Company shall issue replacement stock options for shares of its common stock so that appropriate adjustments to reflect this merger may be made to (i) the class and number of shares of common stock available for options under the Stock Option Plan and (ii) the class and number of shares and the price per share of the common stock subject to options outstanding under Bank’s Stock Option Plan.

          (b) From time to time, as and when required by the provisions of any agreement to which Bank or Holding Company shall become a party after the date hereof providing for the issuance of shares of common stock or other equity securities of Bank or Holding Company in connection with a merger into Bank or any other banking institution or other corporation, Holding Company will issue in accordance with the terms of any such agreement shares of its common stock or other equity securities as required by such agreement or in substitution for the shares of common stock or other equity securities of Bank required to be issued by such agreement, as the case may be, which the shareholders of any other such banking institution or other corporation shall be entitled to receive by virtue of any such agreement.

Section 3. Approvals

     3.1 Shareholder Approval. This Merger Agreement shall be submitted to the shareholders of Bank and Subsidiary for approval in accordance with the applicable provisions of the law.

     3.2 Dissenters’ Rights. The provisions of Chapter 13, Section 1300 et seq. of the General Corporation Law of California (dissenters’ rights) shall not apply to the shareholders of the Bank.

     3.3 Regulatory Approvals. The parties shall proceed expeditiously and cooperate fully in the procurement of any other consents and approvals and in the taking of any other action, and the satisfaction of all other requirements prescribed by law or otherwise, necessary or desirable for consummation of this merger and plan of reorganization on the terms herein provided, including, without being limited to, those consents and approvals referred to in Section 4.1(b).

Section 4. Conditions Precedent, Termination and Payment of Expenses

     4.1 Conditions Precedent to the Merger. Consummation of the merger is conditional upon:

          (a) Approval of this Merger Agreement by the shareholders of Bank and Subsidiary, as required by law;

          (b) Obtaining all other consents and approvals, and the satisfaction of all other requirements prescribed by law which are necessary for consummation of the merger, including, but not limited to, approval of the FDIC, the Commissioner and the Board of Governors of the Federal Reserve System;

          (c) Obtaining all consents or approvals, governmental or otherwise, which are, or in the opinion of counsel for Bank may be, necessary to permit or enable the Surviving Corporation, upon and after the merger, to conduct all or any part of the business and activities of Bank up to the time of the merger, in the manner in which such activities and business are then conducted;

107

          (d) Bank’s obtaining for Holding Company, prior to the Effective Date, a letter, in form and substance satisfactory to Holding Company’s counsel, signed by each person who is an “affiliate” of Bank for purposes of Rule 145 of the Securities and Exchange Commission to the effect that: (i) such person will not dispose of any shares of Holding Company’s common stock to be received pursuant to the merger, in violation of the Securities Act or the rules and regulations of the SEC promulgated thereunder, or in any event prior to such time as financial results covering at least 30 days of post-merger combined operations have been published; and (ii) such person consents to the placing of a legend on the certificate(s) evidencing such shares referring to the issuance of such shares in a transaction to which Rule 145 is applicable and to giving of stop-transfer instructions to Holding Company’s transfer agent with respect to such certificate(s); and

          (e) Performance by each party hereto of all of its obligations hereunder to be performed prior to the merger becoming effective.

     4.2 Termination of the Merger. If any condition in Section 4.1 has not been fulfilled, or, in the opinion of a majority of the Board of Directors of any of the parties:

          (a) any action, suit, proceeding or claim has been instituted, made or threatened relating to the proposed merger which makes consummation of the merger inadvisable; or

          (b) for any other reason consummation of the merger is deemed inadvisable; then this Merger Agreement may be terminated at any time before the merger becomes effective. Upon termination, this Merger Agreement shall be void and of no further effect, and there shall be no liability by reason of this Merger Agreement or the termination thereof on the part of the parties or their respective directors, officers, employees, agents or stockholders.

     4.3 Expenses of the Merger. All of the expenses of the merger, including filing fees, printing costs, mailing costs, accountant’s fees and legal fees shall be borne by the Surviving Corporation. In the event the merger is abandoned for any reason, the expenses shall be paid by the Bank.

[Remainder of page left intentionally blank.]

108

     IN WITNESS WHEREOF, the parties hereto have caused this Plan of Reorganization and Merger Agreement to be executed by their duly organized officers as of the day and year first above written.

FIRST CALIFORNIA BANK
By /s/ C. G. Kum
	C. G. Kum, President and Chief Executive Officer
By /s/ Thomas E. Anthony
	Thomas E. Anthony, Secretary
FCB MERGER CORP.
By /s/ C. G. Kum
	C. G. Kum, President and Chief Executive Officer
By /s/ Thomas E. Anthony
	Thomas E. Anthony, Secretary
FCB BANCORP
By /s/ C. G. Kum
	C. G. Kum, President and Chief Executive Officer
By /s/ Thomas E. Anthony
	Thomas E. Anthony, Secretary

109

INDEX TO FINANCIAL STATEMENTS

	Page
Unaudited Financial Statements of First California Bank
Balance Sheets at June 30, 2005 and December 31, 2004	F-4
Statements of Income for the Three and Six Months Ended June 30, 2005 and 2004	F-5
Statement of Comprehensive Income for the Three and Six Months Ended June 30, 2005 and 2004	F-7
Statements of Changes in Shareholders’ Equity for the Six Months Ended June 30, 2005 and 2004	F-8
Statements of Cash Flows for the Six Months Ended June 30, 2005 and 2004	F-8
Notes to Financial Statements	F-9
Audited Financial Statements of First California Bank
Report of Independent Registered Public Accounting Firm	F-19
Balance Sheets at December 31, 2004 and 2003	F-20
Statements of Income for the Years Ended December 31, 2004, 2003 and 2002	F-21
Statements of Comprehensive Income for the Years Ended December 31, 2004, 2003, and 2002	F-23
Statements of Changes in Shareholders’ Equity for the Years Ended December 2004, 2003 and 2002	F-24
Statements of Cash Flows for the Years Ended December 31, 2004, 2003 and 2002	F-25
Notes to Financial Statements	F-27
Unaudited Financial Statements of South Coast Bancorp, Inc.
Consolidated Balance Sheets at June 30, 2005 and December 31, 2004	F-52
Consolidated Statements of Earnings for the Three and Six Months Ended June 30, 2005 and 2004	F-53
Consolidated Statements of Changes in Stockholders’ Equity for the Six Months Ended June 30, 2005 and 2004	F-54
Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2005 and 2004	F-55
Notes to Unaudited Consolidated Financial Statements	F-57
Audited Financial Statements of South Coast Bancorp, Inc.
Report of Independent Certified Public Accountants	F-60
Consolidated Balance Sheets at December 31, 2004 and 2003	F-61
Consolidated Statements of Earnings for the Years Ended December 31, 2004 and 2003	F-63
Consolidated Statement of Changes in Stockholders’ Equity for the Years Ended December 31, 2004 and 2003	F-64
Consolidated Statements of Cash Flows for the Years Ended December 31, 2004 and 2003	F-65
Notes to Consolidated Financial Statements	F-67

F-1

FIRST CALIFORNIA BANK

UNAUDITED FINANCIAL STATEMENTS

JUNE 30, 2005

F-2

CONTENTS

	PAGE
UNAUDITED FINANCIAL STATEMENTS
Balance sheets		1
Statements of income		2–3
Statements of comprehensive income		4
Statements of changes in shareholders’ equity		5
Statements of cash flows		6–7
Notes to financial statements		8–10

Note: These financial statements have not been reviewed, or confirmed for accuracy or relevance by the Federal Deposit Insurance Corporation.

F-3

FIRST CALIFORNIA BANK
BALANCE SHEETS

	June 30, 2005			December 31, 2004
	(in thousands, except per share data)
ASSETS
Cash and due from banks	$	9,155		$	7,194
Federal funds sold		3,715			4,055
Securities available-for-sale		73,934			77,345
Federal Home Loan Bank stock		1,886			1,992
Loans, net		197,037			180,527
Premises and equipment, net		4,981			4,696
Cash surrender value of life insurance		5,075			4,982
Accrued interest receivable and other assets		2,511			2,954
Total assets	$	298,294		$	283,745
LIABILITIES
Checking	$	96,407		$	84,699
Interest checking		20,262			21,424
Regular savings		14,425			14,639
Money market savings		51,753			52,900
Certificates of deposit, under $100,000		24,378			21,277
Certificates of deposit, $100,000 and over		31,243			32,251
Total deposits		238,468			227,190
Federal Home Loan Bank advances		34,940			32,850
Accrued interest payable and other liabilities		1,222			1,160
Total liabilities		274,630			261,200
SHAREHOLDERS’ EQUITY
Common stock, no par value, 2,500,000 authorized; 2,162,807 shares issued and outstanding at June 30, 2005 and at December 31, 2004.		11,965			11,965
Retained earnings		12,045			10,839
Accumulated other comprehensive loss		(346	)		(259	)
Total shareholders’ equity		23,664			22,545
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$	298,294		$	283,745

See accompanying notes.

F-4

FIRST CALIFORNIA BANK
STATEMENT OF INCOME

	Three Months Ended June 30,				Six Months Ended June 30,
	2005		2004		2005		2004
	(in thousands, except per share data)
INTEREST INCOME
Interest and fees on loans	$	3,323	$	2,697	$	6,325	$	5,579
Taxable interest on securities		573		445		1,168		871
Nontaxable interest on securities		77		76		148		152
Interest on federal funds sold		40		27		68		44
Total interest income		4,013		3,245		7,709		6,646
INTEREST EXPENSE
Interest on deposits		458		313		857		609
Interest on borrowings		196		104		391		200
Total interest expense		654		417		1,248		809
NET INTEREST INCOME		3,359		2,828		6,461		5,837
PROVISION FOR LOAN LOSSES		122		104		244		208
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES		3,237		2,724		6,217		5,629
NONINTEREST INCOME
Service charges on deposit accounts		256		238		549		487
Earnings on cash surrender value of life insurance		56		55		111		111
Commissions on brokered loans		35		61		90		14
Net gain on sales of loans		31		10		78		75
Net servicing fees		11		9		21		20
Net gain (loss) on sales of securities		2		0		2		12
Other income		36		99		92		165
Total noninterest income		427		472		943		884
See accompanying notes.	2

F-5

FIRST CALIFORNIA BANK
STATEMENT OF INCOME

	Three Months Ended June 30,				Six Months Ended June 30,
	2005		2004		2005		2004
	(in thousands, except per share data)
NONINTEREST EXPENSE
Salaries and employee benefits	$	1,491	$	1,161	$	3,020	$	2,701
Premises and equipment		389		305		775		592
Data processing		138		215		273		410
Legal, audit, and other professional services		153		73		261		160
Printing, stationary, and supplies		48		42		94		64
Telephone		36		35		72		73
Directors’ fees		33		33		66		62
Advertising and marketing		122		106		209		169
Postage		10		26		28		45
Other expenses		230		294		417		430
Total noninterest expense		2,650		2,290		5,215		4,706
INCOME BEFORE PROVISION FOR INCOME TAXES		1,014		906		1,945		1,807
PROVISION FOR INCOME TAXES		385		317		739		641
NET INCOME	$	629	$	589	$	1,206	$	1,166
EARNINGS PER SHARE
Basic	$	0.29	$	0.29	$	0.56	$	0.58
Diluted	$	0.29	$	0.28	$	0.55	$	0.56

See accompanying notes. 3

F-6

FIRST CALIFORNIA BANK
STATEMENTS OF COMPREHENSIVE INCOME

	Three Months Ended June 30,						Six Months Ended June 30,
	2005			2004			2005			2004
	(in thousands)						(in thousands)
Unrealized holding gains (losses) on securities available-for-sale arising during the period	$	761		$	1,102		$	(149	)	$	1,866
Reclassification adjustments for (gains) losses included in net income		(2	)		—			(2	)		(12	)
OTHER COMPREHENSIVE INCOME (LOSS), BEFORE TAX		759			1,102			(147	)		1,854
Income tax (expense) benefit related to items of other comprehensive income		(311	)		(452	)		60			(760	)
OTHER COMPREHENSIVE INCOME (LOSS), NET OF TAX		448			650			(87	)		1,094
NET INCOME		629			589			1,206			1,166
COMPREHENSIVE INCOME	$	1,077		$	1,239		$	1,119		$	2,260
See accompanying notes.

See accompanying notes. 5

F-7

FIRST CALIFORNIA BANK
STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY

							Accumulated
	Common Stock						Other			Total
	Shares				Retained		Comprehensive			Shareholders’
(dollars in thousands, except share data)	Outstanding		Amount		Earnings		Income (Loss)			Equity
BALANCE, December 31, 2004		2,162,807	$	11,965	$	10,839	$	(259	)	$	22,545
Comprehensive income		—		—		1,206		(87	)		1,119
BALANCE, June 30, 2005		2,162,807	$	11,965	$	12,045	$	(346	)	$	23,664
BALANCE, December 31, 2003		1,983,508	$	10,262	$	8,404	$	(301	)	$	18,365
Comprehensive income		—		—		1,166		1,094			2,260
Exercise of warrants		26,120		1,703		—		—			—
BALANCE, June 30, 2004		2,009,628	$	11,965	$	9,570	$	793		$	20,625

See accompanying notes. 5

F-8

FIRST CALIFORNIA BANK
STATEMENTS OF CASH FLOWS

	Six Months Ended June 30,
	2005			2004
	(in thousands)
CASH FLOWS FROM OPERATING ACTIVITIES
Net income	$	1,206		$	1,166
Adjustments to reconcile net income to net cash from operating activities:
Realized gains on sale of securities, loans, and premises and equipment		(78	)		(12	)
Net amortization of premiums on securities available-for-sale		201			302
Federal Home Loan Bank stock dividends		(21	)		(45	)
Provision for loan losses		244			208
Deferred income taxes		(4	)		1
Depreciation and amortization		240			204
Net appreciation in cash surrender value of life insurance		(93	)		(96	)
Change in accrued interest receivable and other assets		508			(396	)
Change in accrued interest payable and other liabilities		62			(37	)
Net cash from operating activities		2,265			1,295
CASH FLOWS FROM INVESTING ACTIVITIES
Net change in federal funds sold		340			15,540
Proceeds from maturities, calls, and paydowns of securities available-for-sale		7,786			7,038
Proceeds from sales of securities available-for-sale		(776	)		537
Purchases of securities available-for-sale		(3,947	)		(26,822	)
Purchase of Federal Home Loan Bank stock		127			(259	)
Net increase in loans		(16,676	)		(13,561	)
Purchases of premises and equipment, net		(525	)		(339	)
Net cash from investing activities		(13,671	)		(17,866	)
CASH FLOW FROM FINANCING ACTIVITIES
Net increase in deposits		11,278			4,222
Increase in Federal Home Loan Bank advances		2,090			13,000
Proceeds from exercise of warrants		—			1,703
Net cash from financing activities		13,368			18,925

See accompanying notes. 6

F-9

FIRST CALIFORNIA BANK
STATEMENTS OF CASH FLOWS

	Six Months Ended June 30,
	2005			2004
	(in thousands)
CHANGE IN CASH AND DUE FROM BANKS	$	1,961		$	2,354
CASH AND DUE FROM BANKS, beginning of period		7,194			7,770
CASH AND DUE FROM BANKS, end of period	$	9,155		$	10,124
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
Cash paid during the period for:
Interest	$	1,028		$	287
Income taxes	$	708		$	324
SUPPLEMENTAL DISCLOSURE OF NONCASH INVESTING ACTIVITIES
Change in fair value of securities available-for- sale, net of taxes	$	(87	)	$	1,094

See accompanying notes. 7

F-10

FIRST CALIFORNIA BANK
NOTES TO FINANCIAL STATEMENTS

NOTE A — BASIS OF PRESENTATION AND MANAGEMENT REPRESENTATION

The accompanying financial statements for First California Bank should be read in conjunction with our audited financial statements for the year ended December 31, 2004. A summary of our significant accounting policies is set forth in the Notes to the Financial Statements contained therein.

These financial statements have been prepared in accordance with accounting principles generally accepted in the United States on a basis consistent with the accounting policies reflected in the audited financial statements for the year ended December 31, 2004. They do not, however, include all of the information and footnotes required by accounting principles generally accepted in the United States for complete financial statements. In the opinion of management, all adjustments including normal recurring accruals considered necessary for a fair presentation have been included. Operating results for the interim periods presented are not necessarily indicative of the results that may be expected for any other interim period or for the year as a whole.

NOTE B — EARNINGS PER SHARE

The following is a reconciliation of net income and shares outstanding to the income and number of shares used to compute earnings per share. Figures are in thousands, except earnings per share data.

Net income

	Three months ended June 30, 2005				Six month ended June 30,
	2005		2004		2005		2004
	(in thousands, except per share)
Net income	$	629	$	589	$	1,206	$	1,166
Basic earnings per share	$	0.29	$	0.29	$	0.56	$	0.58
Diluted earnings per share	$	0.29	$	0.28	$	0.55	$	0.56
Basic weighted average shares		2,163		2,010		2,163		1,997
Diluted weighted average shares		2,178		2,102		2,184		2,093

8

F-11

FIRST CALIFORNIA BANK
NOTES TO FINANCIAL STATEMENTS

NOTE C — SECURITIES

The amortized cost and estimated fair values of securities available-for-sale at June 30, 2005 and December 31, 2004 are summarized as follows:

June 30, 2005:

			Gross		Gross			Estimated
	Amortized		Unrealized		Unrealized			Fair
	Cost		Gains		Losses			Value
	(in thousands)
Mortgage-backed securities	$	51,878	$	51	$	(642	)	$	51,287
Collateralized mortgage obligations		3,617		47		(37	)		3,627
U.S. Treasury securities		2,995		0		(21	)		2,974
Municipal securities		8,217		128		(11	)		8,334
U.S. agency securities		7,795		1		(84	)		7,712
	$	74,502	$	227	$	(795	)	$	73,934

December 31, 2004:

			Gross		Gross			Estimated
	Amortized		Unrealized		Unrealized			Fair
	Cost		Gains		Losses			Value
	(in thousands)
Mortgage-backed securities	$	56,348	$	126	$	(622	)	$	55,852
Collateralized mortgage obligations		4,915		57		(8	)		4,964
U.S. Treasury securities		2,993		—		(10	)		2,983
Municipal securities		6,733		90		(16	)		6,807
U.S. agency securities		6,796		—		(57	)		6,739
Securities available-for-sale	$	77,785	$	273	$	(713	)	$	77,345

Management has evaluated the unrealized losses on securities and determined that the decline in value at June 30, 2005 and December 31, 2004 is temporary and is related to the fluctuation in market prices since purchase.

 9

F-12

FIRST CALIFORNIA BANK
NOTES TO FINANCIAL STATEMENTS

NOTE D — LOANS AND ALLOWANCE FOR LOAN LOSSES

The loan portfolio consists of the following:

	June 30,			December 31,
(in thousands)	2005			2004
Commercial real estate	$	104,057		$	83,457
Commercial loans and lines		52,380			68,996
Construction		20,464			12,330
Home equity loans and lines		7,053			2,114
Home mortgage		11,528			11,558
Installment and credit card		4,149			4,418
Total loans		199,631			182,873
Allowance for loan losses		(2,593	)		(2,346	)
Loans, net	$	197,038		$	180,527

Changes in the allowance for loan losses are as follows:

	Six Months Ended June 30,
(in thousands)	2005			2004
Beginning balance	$	2,346		$	2,325
Provision for loan losses		244			208
Loans charged-off		(74	)		(36	)
Recoveries on loans charged-off		77			36
Ending balance	$	2,593		$	2,533

10

F-13

FIRST CALIFORNIA BANK
NOTES TO FINANCIAL STATEMENTS

NOTE E – STOCK-BASED COMPENSATION

     The Bank applies Accounting Principles Board Opinion No. 25, “Accounting for Stock Issued to Employees,” and related interpretations in accounting for its 2003 Stock Option Plan using the intrinsic value-based method. Accordingly. Compensation costs are recognized as the difference between the exercise price of each option and the market price of the Bank’s stock at the date of each grant. Had compensation cost for the grants under the 2003 Stock Option Plan been determined consistent with the fair value-based method defined in Statement of Financial Accounting Standards (SFAS) No. 123, :Accounting for Stock-Based Compensation,” net income and earnings per common share for the six months ending June 30, 2005 and 2004 would approximate the pro forma amounts shown below (in thousands, except per share data).

	2005			2004
Net income, as reported	$	1,206		$	1,166
Total stock-based employee compensation expense determined under fair value-based methods for all awards, net of related tax effects		(8	)		(2	)
Pro forma net income	$	1,198		$	1,164
Earnings per share:
Diluted – as reported	$	0.55		$	0.56
Diluted – pro forma	$	0.55		$	0.56
Basic – as reported	$	0.56		$	0.58
Basic- pro forma	$	0.56		$	0.58

The fair value of each option granted was estimated on the date of grant using the Black-Scholes option pricing model with the following assumptions for the six months ending June 30, 2005 and 2004.

	2005			2004
Dividend yield	None			None
Expected life	5 years			6 years
Expected volatility	Nil			Nil
Risk-free rate		3.95	%		2.87	%

11

F-14

FIRST CALIFORNIA BANK
NOTES TO FINANCIAL STATEMENTS

NOTE F – RECENTLY ISSUED ACCOUNTING STANDARDS

     In May 2005, Financial Accounting Standards Board (“FASB”) issued Financial Accounting Standard (“FAS”) No. 154, Accounting Changes and Error Corrections—a replacement of APB Opinion No. 20 and FASB Statement No. 3. This Statement replaces APB Opinion No. 20, Accounting Changes, and FASB Statement No. 3, Reporting Accounting Changes in Interim Financial Statements, and changes the requirements for the accounting for and reporting of a change in accounting principle. This Statement applies to all voluntary changes in accounting principle. It also applies to changes required by an accounting pronouncement in the unusual instance that the pronouncement does not include specific transition provisions. When a pronouncement includes specific transition provisions, those provisions should be followed. The Company is required to adopt this statement for accounting changes and corrections of errors made in fiscal years beginning after December 15, 2005, and does not expect the adoption to have a material affect on its financial statements.

     In December 2004, the FASB issued FAS No. 153, Exchanges of Nonmonetary Assets, an amendment of APB Opinion No. 29. This Standard modifies the accounting for nonmonetary exchanges of similar productive assets. The Company is required to adopt the Standard on July 1, 2005, and does not expect the adoption to have a material affect on its financial statements.

     In November 2004, the FASB issued FAS No. 151, Inventory Costs, an amendment of ARB No. 43, Chapter 4. This Standard requires that items such as idle facility expense and excess spoilage be recognized as current period charges. Under ARB No. 43, such costs were considered inventoriable costs unless they were considered so abnormal as to require immediate expensing. The Company is required to adopt the Standard on January 1, 2006, and does not expect the adoption to have a material affect on its financial statements.

     In March 2005, the FASB issued FIN 47 which clarifies that the term “conditional asset retirement obligation” as used in SFAS No. 143, “Accounting for Asset Retirement Obligations” (SFAS 143), refers to a legal obligation to perform an asset retirement activity in which the timing and/or method of settlement are conditional on a future event that may or may not be within the control of the entity. The obligation to perform the asset retirement activity is unconditional even though uncertainty exists about the timing and/or method of settlement.

12

F-15

FIRST CALIFORNIA BANK
NOTES TO FINANCIAL STATEMENTS

     Accordingly, an entity is required to recognize a liability for the fair value of a conditional asset retirement obligation if the fair value of the liability can be reasonably estimated. The fair value of a liability for the conditional asset retirement obligation should be recognized when occurred — generally upon acquisition, construction, or development and/or through the normal operation of the asset. Uncertainty about the timing and/or method of settlement of a conditional asset retirement obligation should be factored into the measurement of the liability when sufficient information exists. FIN 47 also clarifies when an entity would have sufficient information to reasonably estimate the fair value of an asset retirement obligation. FIN 47 is effective no later than the end of fiscal years ending after December 15, 2005 (December 31, 2005 for the Company). The Company has not yet determined the full impact of implementing FIN 47, but it is not expected to have a material impact on the Company’s financial position, results of operations or cash flows. The Company plans to implement FIN 47 by December 31, 2005.

13

F-16

FIRST CALIFORNIA BANK

REPORT OF INDEPENDENT REGISTERED PUBIC ACCOUNTING FIRM
AND
FINANCIAL STATEMENTS

DECEMBER 31, 2004 AND 2003

F-17

CONTENTS

	PAGE
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM		1
FINANCIAL STATEMENTS
Balance sheets		2
Statements of income		3 – 4
Statements of comprehensive income		5
Statements of changes in shareholders’ equity		6
Statements of cash flows		7 – 8
Notes to financial statements		9 – 30

Note: These financial statements have not been reviewed, or confirmed for accuracy or relevance by the Federal Deposit Insurance Corporation.

F-18

Report of Independent Registered Public Accounting Firm

To the Board of Directors and Shareholders
First California Bank

We have audited the accompanying balance sheets of First California Bank as of December 31, 2004 and 2003, and the related statements of income, comprehensive income, changes in shareholders’ equity, and cash flows for each of the three years in the period ended December 31, 2004. These financial statements are the responsibility of First California Bank’s management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with auditing standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of First California Bank as of December 31, 2004 and 2003, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2004, in conformity with accounting principles generally accepted in the United States of America.

/s/ Moss Adams LLP

Portland, Oregon
February 11, 2005

1

F-19

FIRST CALIFORNIA BANK
BALANCE SHEETS

	December 31,
	2004			2003
	(dollars in thousands)
ASSETS
Cash and due from banks	$	7,194		$	7,770
Federal funds sold		4,055			15,780
Securities available-for-sale		77,345			64,774
Federal Home Loan Bank stock		1,992			1,512
Loans, net		180,527			155,627
Premises and equipment, net		4,696			3,748
Cash surrender value of life insurance		4,982			4,792
Accrued interest receivable and other assets		2,954			2,282
TOTAL ASSETS	$	283,745		$	256,285
LIABILITIES
Checking	$	84,699		$	76,182
Interest checking		21,424			25,710
Regular savings		14,639			12,172
Money market savings		52,900			48,145
Certificates of deposit, under $100,000		21,277			22,223
Certificates of deposit, $100,000 and over		32,251			27,497
Total deposits		227,190			211,929
Federal Home Loan Bank advances		32,850			25,000
Accrued interest payable and other liabilities		1,160			991
Total liabilities		261,200			237,920
COMMITMENTS AND CONTINGENCIES (Notes 14 and 15)
SHAREHOLDERS’ EQUITY
Common stock, no par value, 2,500,000 authorized; 2,162,807 and 1,983,508 shares issued and outstanding at December 31, 2004 and 2003, respectively		11,965			10,262
Retained earnings		10,839			8,404
Accumulated other comprehensive loss		(259	)		(301	)
Total shareholders’ equity		22,545			18,365
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$	283,745		$	256,285

See accompanying notes. 2

F-20

FIRST CALIFORNIA BANK
STATEMENTS OF INCOME

	Years Ended December 31,
	2004		2003			2002
	(in thousands, except per share data)
INTEREST INCOME
Interest and fees on loans	$	11,209	$	10,938		$	10,126
Taxable interest on securities		1,970		1,194			643
Nontaxable interest on securities		299		212			199
Interest on federal funds sold		74		85			232
Total interest income		13,552		12,429			11,200
INTEREST EXPENSE
Interest on deposits		1,315		1,340			2,059
Interest on borrowings		581		191			—
Total interest expense		1,896		1,531			2,059
NET INTEREST INCOME		11,656		10,898			9,141
PROVISION FOR LOAN LOSSES		418		510			510
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES		11,238		10,388			8,631
NONINTEREST INCOME
Service charges on deposit accounts		1,056		965			744
Earnings on cash surrender value of life Insurance		224		260			—
Commissions on brokered loans		132		307			43
Net gain on sales of loans		87		75			119
Net servicing fees		42		34			32
Net gain (loss) on sales of securities		94		(22	)		31
Other income		290		280			271
Total noninterest income		1,925		1,899			1,240

See accompanying notes. 3

F-21

FIRST CALIFORNIA BANK
STATEMENTS OF INCOME

	Years Ended December 31,
	2004		2003		2002
	(in thousands, except per share data)
NONINTEREST EXPENSE
Salaries and employee benefits	$	5,373	$	5,220	$	4,131
Premises and equipment		1,301		972		693
Data processing		758		836		743
Legal, audit, and other professional services		418		328		326
Printing, stationary, and supplies		141		166		199
Telephone		163		161		92
Directors’ fees		128		106		103
Advertising and marketing		299		298		289
Postage		81		84		86
Other expenses		747		665		560
Total noninterest expense		9,409		8,836		7,222
INCOME BEFORE PROVISION FOR INCOME TAXES		3,754		3,451		2,649
PROVISION FOR INCOME TAXES		1,319		1,244		1,035
NET INCOME	$	2,435	$	2,207	$	1,614
EARNINGS PER SHARE
Diluted	$	1.14	$	1.10	$	0.86
Basic	$	1.17	$	1.12	$	0.91

See accompanying notes. 4

F-22

FIRST CALIFORNIA BANK
STATEMENTS OF COMPREHENSIVE INCOME

	Years Ended December 31,
	2004			2003			2002
	(in thousands)
Unrealized holding gains (losses) on securities available-for-sale arising during the period	$	165		$	(834	)	$	58
Reclassification adjustments for (gains) losses included in net income		(94	)		22			(31	)
OTHER COMPREHENSIVE INCOME (LOSS), BEFORE TAX		71			(812	)		27
Income tax (expense) benefit related to items of other comprehensive income		(29	)		330			(11	)
OTHER COMPREHENSIVE INCOME (LOSS), NET OF TAX		42			(482	)		16
NET INCOME		2,435			2,207			1,614
COMPREHENSIVE INCOME	$	2,477		$	1,725		$	1,630

See accompanying notes. 5

F-23

FIRST CALIFORNIA BANK
STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY INCOME

							Accumulated
	Common Stock						Other			Total
	Shares				Retained		Comprehensive			Shareholders’
	Outstanding		Amount		Earnings		Income (Loss)			Equity
(dollars in thousands)
BALANCE, December 31, 2001		1,562,808	$	6,500	$	4,583	$	165		$	11,248
Comprehensive income		—		—		1,614		16			1,630
Issuance of stock, net of issuance costs		400,000		3,570		—		—			3,570
BALANCE, December 31, 2002		1,962,808		10,070		6,197		181			16,448
Comprehensive income		—		—		2,207		(482	)		1,725
Exercise of warrants		20,700		192		—		—			192
BALANCE, December 31, 2003		1,983,508		10,262		8,404		(301	)		18,365
Comprehensive income		—		—		2,435		42			2,477
Exercise of warrants		179,299		1,703		—		—			1,703
BALANCE, December 31, 2004		2,162,807	$	11,965	$	10,839	$	(259	)	$	22,545

See accompanying notes. 6

F-24

FIRST CALIFORNIA BANK
STATEMENTS OF CASH FLOWS

	Years Ended December 31,
	2004			2003			2002
	(in thousands)
CASH FLOWS FROM OPERATING ACTIVITIES
Net income	$	2,435		$	2,207		$	1,614
Adjustments to reconcile net income to net cash from operating activities:
Realized gains on sale of securities, loans, and premises and equipment		(181	)		(53	)		(150	)
Net amortization of premiums on securities available-for-sale		567			327			105
Federal Home Loan Bank stock dividends		(82	)		(21	)		(7	)
Provision for loan losses		418			510			510
Deferred income taxes		188			(39	)		(89	)
Depreciation and amortization		460			383			299
Net appreciation in cash surrender value of life Insurance		(190	)		(234	)		—
Change in accrued interest receivable and other assets		(889	)		(315	)		(80	)
Change in accrued interest payable and other liabilities		169			313			(55	)
Net cash from operating activities		2,895			3,078			2,147
CASH FLOWS FROM INVESTING ACTIVITIES
Net change in federal funds sold		11,725			(4,780	)		(11,000	)
Proceeds from maturities, calls, and paydowns of securities available-for-sale		16,830			14,577			15,696
Proceeds from sales of securities available-for-sale		6,098			7,541			5,008
Purchases of securities available-for-sale		(35,901	)		(60,744	)		(32,128	)
Purchase of Federal Home Loan Bank stock		(398	)		(1,331	)		—
Net increase in loans		(25,231	)		(15,653	)		(21,280	)
Purchases of premises and equipment, net		(1,408	)		(906	)		(1,723	)
Purchase of life insurance		—			(58	)		(4,500	)
Net cash from investing activities		(28,285	)		(61,354	)		(49,927	)
CASH FLOW FROM FINANCING ACTIVITIES
Net increase in deposits		15,261			25,268			47,305
Increase in Federal Home Loan Bank advances		7,850			25,000			—
Issuance of common stock, net of issuance costs		—			—			3,570
Proceeds from exercise of warrants		1,703			192			—
Net cash from financing activities		24,814			50,460			50,875

See accompanying notes. 7

F-25

FIRST CALIFORNIA BANK
STATEMENTS OF CASH FLOWS

	Years Ended December 31,
	2004			2003			2002
	(in thousands)
CHANGE IN CASH AND DUE FROM BANKS	$	(576	)	$	(7,816	)	$	3,095
CASH AND DUE FROM BANKS, beginning of year		7,770			15,586			12,491
CASH AND DUE FROM BANKS, end of year	$	7,194		$	7,770		$	15,586
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
Cash paid during the year for:
Interest	$	1,519		$	1,603		$	2,123
Income taxes	$	1,154		$	1,177		$	1,073
SUPPLEMENTAL DISCLOSURE OF NONCASH INVESTING ACTIVITIES
Change in fair value of securities available-for- sale, net of taxes	$	42		$	(482	)	$	16

See accompanying notes. 8

F-26

FIRST CALIFORNIA BANK
NOTES TO FINANCIAL STATEMENTS

NOTE 1 – ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Organization and nature of operations – First California Bank (the Bank) operates under a state charter in Ventura and Los Angeles counties, and provides a full range of banking services to individual and corporate customers through six full-service branches located in Camarillo, Oxnard, Simi Valley, Thousand Oaks, Ventura, and Westlake Village, California. As a state chartered bank, the Bank is subject to regulation by the California Department of Financial Institutions and the Federal Deposit Insurance Corporation (FDIC). The accounting and reporting policies of the Bank are in accordance with generally accepted accounting principles and conform to practices within the banking industry.

Management’s estimates and assumptions – The preparation of the financial statements, in conformity with generally accepted accounting principles, requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities as of the date of the balance sheets, and revenues and expenses for the reporting period. Actual results could differ significantly from those estimates. Significant estimations made by management primarily involve the calculation of the allowance for loan losses, the valuation of real estate acquired in connection with foreclosures or in satisfaction of loans, and deferred tax assets or liabilities.

Cash and due from banks – Cash and due from banks include amounts the Bank is required to maintain to meet certain average reserve and compensating balance requirements of the Federal Reserve Bank of San Francisco. As of December 31, 2004 and 2003, the Bank had reserve requirements of $569,000 and $563,000, respectively. At December 31, 2004, the Bank had cash deposits at other financial institutions in excess of FDIC insured limits. However, as the Bank places these deposits with large, well-capitalized financial institutions, management believes the risk of loss to be minimal.

Securities available-for-sale – Securities are generally classified as available-for-sale if the instrument may be sold in response to such factors as (1) changes in market interest rates and related changes in the prepayment risk, (2) need for liquidity, (3) changes in the availability of and the yield on alternative instruments, and (4) changes in funding sources and terms. Unrealized holding gains and losses, net of taxes, on securities available-for-sale are reported as other comprehensive income and carried as accumulated comprehensive income or loss within shareholders’ equity until realized. Fair values for securities are based on quoted market prices. Realized gains and losses on the sale of securities available-for-sale are determined using the specific-identification method. Premiums and discounts are recognized in interest income using the effective interest method over the period to maturity.

1

F-27

FIRST CALIFORNIA BANK
NOTES TO FINANCIAL STATEMENTS

NOTE 1 – ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES – (continued)

     Declines in the fair value of individual securities available-for-sale below their cost that are other than temporary result in write-downs of the individual securities to their fair value. The related write-downs are included in earnings as realized losses. At each financial statement date, management assesses each investment to determine if investments are temporarily impaired or if the impairment is other-than-temporary based upon the positive and negative evidence available. Evidence evaluated includes, but is not limited to, industry analyst reports, credit market conditions, and interest rate trends.

     Loans, net of allowance for loan losses and unearned loan fee income – Loans are stated at the amount of unpaid principal, reduced by an allowance for loan losses and unearned loan fee income. Interest on loans is calculated by the simple-interest method on daily balances of the principal amount outstanding. Loan origination fees and certain direct origination costs are capitalized and recognized as an adjustment of the yield over the life of the related loan.

     The Bank does not accrue interest on loans for which payment in full of principal and interest is not expected, or which payment of principal or interest has been in default 90 days or more, unless the loan is well-secured and in the process of collection. Nonaccrual loans are considered impaired loans. Impaired loans are carried at the present value of expected future cash flows discounted at the loan’s effective interest rate, the loan’s market price, or the fair value of collateral if the loan is collateral dependent. When interest accrual is discontinued, all unpaid accrued interest is reversed. Interest income is subsequently recognized only to the extent cash payments are received or when the loan is removed from nonaccrual status. Large groups of smaller balance, homogeneous loans are collectively evaluated for impairment. Accordingly, the Bank does not separately identify individual consumer and residential loans for evaluation of impairment.

     The allowance for loan losses is established through a provision charged to expense. Loans are charged against the allowance when management believes that the collectibility of principal is unlikely. The allowance is an amount that management believes will be adequate to absorb possible losses on existing loans that may become uncollectible, based on evaluations of the collectibility of loans and prior loan loss experience. The evaluations take into consideration such factors as changes in the nature and volume of the loan portfolio, overall portfolio quality, review of specific problem loans, and current economic conditions that may affect the borrower’s ability to pay. Various regulatory agencies, as a regular part of their examination process, periodically review the Bank’s allowance for loan losses. Such agencies may require the Bank to recognize additions to the allowance based on their judgment of information available to them at the time of their examinations.

2

F-28

FIRST CALIFORNIA BANK
NOTES TO FINANCIAL STATEMENTS

NOTE 1 – ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES – (continued)

Premises and equipment – Premises and equipment are stated at cost, less accumulated depreciation. Depreciation is computed by the straight-line and accelerated methods over the estimated useful lives of the assets, which range from 3 to 7 years for furniture and equipment, and 25 to 39 years for building premises. Leasehold improvements are amortized over the estimated life of the lease. Maintenance and repairs are expensed as incurred, while major additions and improvements are capitalized. Gains and losses on dispositions are included in current operations.

Federal Home Loan Bank stock – The Bank’s equity investment in the Federal Home Loan Bank of San Francisco is carried at cost and classified as a restricted equity security since ownership of this instrument is restricted and there is no active trading market.

Other real estate owned – Other real estate owned, acquired through foreclosure or deeds in lieu of foreclosure, is carried at the lower of cost or estimated net realizable value. When property is acquired, any excess of the loan balance over its estimated net realizable value is charged to the allowance for loan losses. Subsequent write-downs to net realizable value, if any, or any disposition gains or losses are included in noninterest income and expense in the statements of income. The Bank did not possess any other real estate owned as of December 31, 2004 or 2003.

Income taxes – Deferred income tax assets and liabilities are determined based on the tax effects of the differences between the book and tax bases of the various balance sheet assets and liabilities. Deferred tax assets and liabilities are reflected at currently enacted income tax rates applicable to the period in which the deferred tax assets or liabilities are expected to be realized or settled. As changes in tax laws or rates are enacted, deferred tax assets and liabilities are adjusted through the provision for income taxes.

Advertising – Advertising costs are charged to expense during the year in which they are incurred. Advertising expenses were $92,000, $94,000, and $125,000 for the years ended December 31, 2004, 2003, and 2002, respectively.

Earnings per share – Basic earnings per share is computed by dividing net income available to shareholders by the weighted average number of common shares outstanding during the period, after giving retroactive effect to stock dividends and splits. Diluted earnings per share is computed similar to basic earnings per share, except that the denominator is increased to include the number of additional common shares that would have been outstanding if dilutive potential common shares had been issued.

3

F-29

FIRST CALIFORNIA BANK
NOTES TO FINANCIAL STATEMENTS

NOTE 1 – ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES – (continued)

Stock-based compensation – The Bank applies Accounting Principles Board Opinion No. 25, “Accounting for Stock Issued to Employees,” and related interpretations in accounting for its 2003 Stock Option Plan using the intrinsic value-based method. Accordingly, compensation costs are recognized as the difference between the exercise price of each option and the market price of the Bank’s stock at the date of each grant. Had compensation cost for the grants under the 2003 Stock Option Plan been determined consistent with the fair value-based method defined in Statement of Financial Accounting Standards (SFAS) No. 123, “Accounting for Stock-Based Compensation,” net income and earnings per common share for the years ending December 31, 2004 and 2003, would approximate the pro forma amounts shown below (in thousands, except per share data).

	2004			2003
Net income, as reported	$	2,435		$	2,207
Total stock-based employee compensation
Expense determined under fair value- based methods for all awards, net of related tax effects		(14	)		(3	)
Pro forma net income	$	2,421		$	2,204
Earnings per share:
Diluted – as reported	$	1.14		$	1.10
Diluted – pro forma	$	1.13		$	1.10
Basic – as reported	$	1.17		$	1.12
Basic – pro forma	$	1.16		$	1.12

The fair value of each option granted was estimated on the date of grant using the Black-Scholes option pricing model with the following assumptions for the years ending December 31, 2004 and 2003:

4

F-30

FIRST CALIFORNIA BANK
NOTES TO FINANCIAL STATEMENTS

	2004			2003
Dividend yield	None			None
Expected life	6 years			6 years
Expected volatility	Nil			Nil
Risk-free rate		3.95	%		2.87	%

     The effects of applying SFAS No. 123 in this pro forma disclosure are not indicative of future amounts.

5

F-31

FIRST CALIFORNIA BANK
NOTES TO FINANCIAL STATEMENTS

NOTE 1 – ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING
                  POLICIES – (continued)

Off-balance sheet financial instruments – In the ordinary course of business, the Bank enters into off-balance sheet financial instruments consisting of commitments to extend credit, commitments under credit card arrangements, commercial letters of credit, and standby letters of credit. These financial instruments are recorded in the financial statements when they are funded or related fees are incurred or received. The Bank maintains an allowance for off-balance sheet items, established as an accrued liability. The allowance is an amount that management believes will be adequate to absorb possible losses associated with off-balance sheet credit risk. The evaluations take into consideration such factors as changes in the nature and volume of the commitments to extend credit and undisbursed balances of existing lines of credit and letters of credit.

Fair value of financial instruments – The following methods and assumptions were used by the Bank in estimating fair values of financial instruments as disclosed herein:

Cash and cash equivalents – The carrying amounts of cash and short-term instruments approximate their fair value.

Available-for-sale and restricted equity securities – Fair values for securities, excluding restricted equity securities, are based on quoted market prices. The carrying values of restricted equity securities, including Federal Home Loan Bank stock, approximate fair values.

Loans – For variable rate loans that reprice frequently and have no significant change in credit risk, fair values are based on carrying values. Fair values for certain mortgage loans (for example, one-to-four family residential), credit card loans, and other consumer loans are based on quoted market prices of similar loans sold in conjunction with securitization transactions, adjusted for differences in loan characteristics. Fair values for commercial real estate and commercial loans are estimated using discounted cash flow analyses, using interest rates currently being offered for loans with similar terms to borrowers of similar credit quality. Fair values for impaired loans are estimated using a discounted cash flow analysis or underlying collateral values, where applicable.

Deposits – The fair values disclosed for demand deposits are, by definition, equal to the amount payable on demand at the reporting date (that is, their carrying amounts). The carrying amounts of variable-rate money market accounts and fixed-term certificates of deposit (CDs) approximate their fair values at the reporting date. Fair values for fixed-rate CDs are estimated using a discounted cash flow calculation that applies interest rates currently being offered on certificates to a schedule of aggregated expected monthly maturities on time deposits.

6

F-32

FIRST CALIFORNIA BANK
NOTES TO FINANCIAL STATEMENTS

Federal Home Loan Bank (FHLB) advances – The fair value of the Bank’s FHLB advances is estimated using a discounted cash flow analysis based on the Bank’s current incremental borrowing rates for similar types of borrowing arrangements.

7

F-33

FIRST CALIFORNIA BANK
NOTES TO FINANCIAL STATEMENTS

NOTE 1– ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES – (continued)

Off-balance sheet instruments – The Bank’s off-balance sheet instruments include unfunded commitments to extend credit and standby letters of credit. The fair value of these instruments is not considered practicable to estimate because of the lack of quoted market prices and the inability to estimate fair value without incurring excessive costs.

     Recently issued accounting standards – In December 2004, the Financial Accounting Standards Board (FASB) issued SFAS No. 123(R) “Share-Based Payment.” This statement replaces existing requirements under SFAS No. 123, “Accounting for Stock-Based Compensation,” and eliminates the ability to account for share-based compensation transactions under APB Opinion No. 25, “Accounting for Stock Issued to Employees.” SFAS No. 123(R) requires stock-based transactions to be recognized as compensation expense in the statement of income based on their fair values at the date of grant. The fair value should be estimated using option pricing models such as the Black-Scholes model or a binomial model. This statement is effective in 2006. At this time, the Bank does not believe the future impact on earnings to be significantly different from what has historically been reported as the pro forma effect to income in Note 1. The impact to operating and financing cash flows is not considered to be material to the financial statements.

     In December 2003, the Accounting Standards Executive Committee of the American Institute of Certified Public Accountants issued Statement of Position 03-3 (SOP 03-3), “Accounting for Certain Loans or Debt Securities Acquired in a Transfer,” which addresses the accounting for certain loans acquired in a transfer when it is probable, at acquisition, that the investor will be unable to collect all contractually required payments receivable. SOP 03-3 is to be applied prospectively, effective for loans acquired in years beginning after December 15, 2004. SOP 03-3 requires acquired loans with evidence of credit deterioration to be recorded at fair value and prohibits recording any valuation allowance related to such loans at the time of purchase. This SOP limits the yield that may be accreted on such loans to the excess of the investor’s estimated cash flows over its initial investment in the loan. The excess of contractual cash flows over cash flows expected to be collected is not to be recognized as an adjustment of yield. Subsequent increases in cash flows expected to be collected are recognized prospectively through adjustment of the loan’s yield over its remaining life. Decreases in cash flows expected to be collected are recognized as impairment. Loans carried at fair value, mortgage loans held-for-sale, and loans to borrowers in good standing under revolving credit agreements are excluded from the scope of SOP 03-3. The Bank’s management does not expect the application of the provisions of this statement of position to have a material impact on the Bank’s financial statements.

     At its November 2003 meeting, the Emerging Issues Task Force (EITF) reached a consensus on Issue 03-01, “The Meaning of Other-Than-Temporary Impairment and Its Application to Certain Investments,” that certain quantitative and qualitative disclosures should be required for debt and

8

F-34

FIRST CALIFORNIA BANK
NOTES TO FINANCIAL STATEMENTS

NOTE 1 – ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES – (continued)

marketable equity securities classified as available-for-sale or held-to-maturity under SFAS No. 115 and 124 that are impaired at the balance sheet date but for which an other-than-temporary impairment has not been recognized. The Bank adopted the disclosure requirements in fiscal year 2003. At the March 2004 meeting, the EITF reached a consensus which approved an impairment model for debt and equity securities. In FASB Staff Position (FSP) 03-01-01, issued in September 2004, the effective date for the measurement and recognition guidance contained in paragraphs 10 through 20 of Issue 03-01 was delayed. The disclosure guidance in paragraphs 21 and 22 of Issue 30-01 remains effective. The Bank has adopted the applicable disclosure provisions of Issue 03-01.

In January 2003, the FASB issued Interpretation No. 46 (FIN 46), “Consolidation of Variable Interest Entities.” This interpretation clarifies the application of Accounting Research Bulletin No. 51, “Consolidated Financial Statements,” and requires existing unconsolidated variable interest entities (VIEs) to be consolidated by their primary beneficiaries if the entities do not effectively disperse risks among parties involved. This interpretation explains how to identify VIEs and how an enterprise assesses its interest in a VIE to decide whether to consolidate that entity. In December 2003, the FASB made revisions and delayed implementation of certain provisions of FIN 46. As a nonpublic entity, the Bank is now required to apply FIN 46 immediately to all unconsolidated VIEs created after December 31, 2003, and to all remaining VIEs no later than the first annual period beginning after December 15, 2004. The Bank’s management does not expect the application of the provisions of this statement to have a material impact on the Bank’s financial statements.

Reclassifications – Certain reclassifications have been made to the 2003 and 2002 financial statements to conform to current year presentations.

9

F-35

FIRST CALIFORNIA BANK
NOTES TO FINANCIAL STATEMENTS

NOTE 2 – SECURITIES

The amortized cost and estimated fair values of securities available-for-sale at December 31, 2004 and 2003, are summarized as follows:

			Gross		Gross			Estimated
	Amortized		Unrealized		Unrealized			Fair
	Cost		Gains		Losses			Value
	(in thousands)
December 31, 2004:
Mortgage-backed securities	$	56,348	$	126	$	(622	)	$	55,852
Collateralized mortgage Obligations		4,915		57		(8	)		4,964
U.S. Treasury securities		2,993		—		(10	)		2,983
Municipal securities		6,733		90		(16	)		6,807
U.S. agency securities		6,796		—		(57	)		6,739
Securities available- for-sale	$	77,785	$	273	$	(713	)	$	77,345
December 31, 2003:
Mortgage-backed securities	$	50,066	$	140	$	(866	)	$	49,340
Municipal securities		7,195		240		(11	)		7,424
U.S. agency securities		8,025		34		(49	)		8,010
Securities available- for-sale	$	65,286	$	414	$	(926	)	$	64,774

The securities in the table below had gross unrealized losses at December 31, 2004. Five securities have had gross unrealized losses for 12 months or more. The Bank has evaluated the unrealized losses for these mortgage-backed securities and municipal securities and determined that the decline in value at December 31, 2004, is temporary and is related to the fluctuation in market interest rates since purchase.

10

F-36

FIRST CALIFORNIA BANK
NOTES TO FINANCIAL STATEMENTS

	Less Than 12 Months					Greater Than 12 Months
			Unrealized					Unrealized
	Fair Value		Losses			Fair Value		Losses
			(in thousands)
Mortgage-backed securities	$	7,362	$	(69	)	$	24,048	$	(553	)
Municipal securities		1,338		(8	)		294		(8	)
Collateralized mortgage Obligations		1,004		(8	)		—		—
U.S. Treasury securities		2,983		(10	)		—		—
U.S. agency securities		5,688		(57	)		—		—
	$	18,375	$	(152	)	$	24,342	$	(561	)

The amortized cost and estimated fair value of securities at December 31, 2004, by contractual maturity, are shown below. Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.

	Amortized		Fair
	Cost		Value
	(in thousands)
Due in one year or less	$	8,065	$	8,039
Due after one year through five years		40,193		39,692
Due after five years through ten years		14,605		14,724
Due after ten years		14,922		14,890
	$	77,785	$	77,345

For the purpose of the maturity table, mortgage-backed securities, which are not due at a single maturity date, have been allocated over maturity groupings based on the weighted average contractual maturities of underlying collateral. Mortgage-backed securities may mature earlier than their weighted average contractual maturities because of principal prepayments.

As of December 31, 2004 and 2003, securities with an amortized cost of $54.0 million and $47.4 million, respectively, have been pledged to secure public and other deposits, as required by law, and to secure borrowing facilities with the Federal Home Loan Bank of San Francisco and the Federal Reserve Bank of San Francisco.

11

F-37

FIRST CALIFORNIA BANK
NOTES TO FINANCIAL STATEMENTS

NOTE 3 – LOANS AND ALLOWANCE FOR LOAN LOSSES

The loan portfolio consists of the following:

	2004			2003
	(in thousands)
Commercial real estate	$	83,457		$	87,638
Commercial loans and lines		68,996			42,076
Construction		12,330			16,540
Home equity loans and lines		2,114			5,808
Home mortgage		11,558			2,898
Installment and credit card		4,418			2,992
Total loans		182,873			157,952
Less allowance for loan losses		(2,346	)		(2,325	)
Loans, net	$	180,527		$	155,627

Nonaccrual loans had a recorded investment of $2.2 million and $2.8 million at December 31, 2004 and 2003, respectively. The Bank’s average investment in impaired loans was $2.4 million and $2.1 million during 2004 and 2003, respectively. The allowance for loan losses related to these loans at December 31, 2004 and 2003, was $436,000 and $560,000, respectively. Had the impaired loans performed according to their original terms, additional interest income of $197,000, $254,000, and $47,000 would have been recognized in 2004, 2003 and 2002, respectively. No interest income has been recognized on impaired loans during the period of impairment.

Changes in the allowance for loan losses were as follows:

	2004			2003			2002
	(in thousands)
BALANCE, beginning of year	$	2,325		$	1,970		$	1,680
Provision for loan losses charged to expense		418			510			510
Loans charged off		(359	)		(124	)		(336	)
Transfer to undisbursed commitment liability		(50	)		(100	)		—
Recoveries on loans previously charged off		12			69			116
BALANCE, end of year	$	2,346		$	2,325		$	1,970

12

F-38

FIRST CALIFORNIA BANK
NOTES TO FINANCIAL STATEMENTS

NOTE 4 – PREMISES AND EQUIPMENT

The major classifications of premises and equipment are summarized as follows:

	2004			2003
	(in thousands)
Land	$	894		$	894
Building		1,419			1,415
Furniture and equipment		3,300			2,422
Leasehold improvements		1,668			1,345
Work in progress		228			25
Total premises and equipment		7,509			6,101
Less accumulated depreciation and amortization		(2,813	)		(2,353	)
Premises and equipment, net	$	4,696		$	3,748

NOTE 5 – CERTIFICATES OF DEPOSIT

At December 31, 2004, the scheduled maturities for all certificates of deposit are as follows (in thousands):

		Under		$100,000
		$100,000		and Over		Total
Years ending December 31,	2005	$	15,217	$	27,051	$	42,268
	2006		4,664		4,283		8,947
	2007		1,257		917		2,174
	2008		52		—		52
	2009		87		—		87
		$	21,277	$	32,251	$	53,528

13

F-39

FIRST CALIFORNIA BANK
NOTES TO FINANCIAL STATEMENTS

NOTE 6 – LINES OF CREDIT AND BORROWED FUNDS

The Bank has lines of credit with two financial institutions providing for federal funds facilities up to a maximum of $7.0 million. The lines of credit support short-term liquidity and cannot be used for more than 1 to 15 consecutive business days, depending on the lending institution. These lines are unsecured, have no formal maturity date, and can be revoked at any time by the granting institution. At December 31, 2004 and 2003, there were no borrowings outstanding under these agreements. As a state nonmember bank, the Federal Reserve Bank of San Francisco also provides a secured borrowing facility of $800,000.

The Bank, as a member of the Federal Home Loan Bank of San Francisco (FHLB), has entered into credit arrangements with the FHLB, with maximum available borrowings of approximately $71.0 million. Borrowings under the credit arrangements are collateralized by the Bank’s FHLB stock as well as loans or other instruments which may be pledged. As of December 31, 2004, the Bank had borrowings outstanding with the FHLB as follow (in thousands):

	Maturity		Weighted Average
Amount	Year		Interest Rate
$16,050		2005		1.95	%
11,550		2006		2.49	%
5,250		2007		3.51	%
$32,850				2.39	%

NOTE 7 – INCOME TAXES

The provision for income taxes consists of the following:

	2004		2003			2002
	(in thousands)
Current:
Federal	$	796	$	924		$	860
State		335		359			264
		1,131		1,283			1,124
Deferred:
Federal		143		(30	)		(55	)
State		45		(9	)		(34	)
		188		(39	)		(89	)
Provision for income taxes	$	1,319	$	1,244		$	1,035

14

F-40

FIRST CALIFORNIA BANK
NOTES TO FINANCIAL STATEMENTS

The net deferred tax assets, included in accrued interest receivable and other assets in the accompanying balance sheets, consists of the following:

	2004			2003
	(in thousands)
Deferred tax assets:
Allowance for loan losses	$	864		$	867
Net benefit for state taxes		115			123
		979			990
Deferred tax liabilities:
Depreciation and amortization		(293	)		(203	)
Certain prepaid assets		(170	)		(136	)
Other		(68	)		(15	)
		(531	)		(354	)
Net deferred tax assets	$	448		$	636

Management believes, based upon the Bank’s historical performance, that the deferred tax assets will be realized in the normal course of operations and, accordingly, management has not reduced deferred tax assets by a valuation allowance.

A reconciliation between the statutory federal income tax rate and the effective tax rate is as follows:

	2004			2003			2002
Tax provision at federal statutory rate		34.0	%		34.0	%		34.0	%
State franchise tax, net of federal income tax benefit		6.9			6.6			7.2
Tax-exempt interest		(3.3	)		(2.0	)		(2.4	)
Increase in cash surrender value of life insurance		(1.7	)		(2.6	)		—
Other		(0.8	)		—			0.3
Effective tax rate		35.1	%		36.0	%		39.1	%

15

F-41

FIRST CALIFORNIA BANK
NOTES TO FINANCIAL STATEMENTS

NOTE 8 – SHAREHOLDER TRANSACTIONS

On June 30, 2002, the Bank issued 400,000 shares of common stock, at an offering price of $9.00 per share, for cash consideration of $3.6 million, net of issuance costs of $30,000. For every two shares of common stock acquired, the purchaser received one warrant to purchase one additional share of common stock. Each warrant entitled the purchaser to acquire one share of common stock, either at a price of $9.25 per share from April 1, 2003, to June 30, 2003, or at a price of $9.50 per share from April 1, 2004, to June 30, 2004. In June 2003, warrants for 20,700 shares of common stock were exercised. From April to June 2004, the remaining 179,299 warrants were exercised. The shares in this private placement offering were sold primarily to directors and executive officers of the Bank, who represented a controlling interest in the Bank prior to the offering.

NOTE 9 – EARNINGS PER SHARE

Basic earnings per share excludes dilution and is computed by dividing income available to common shareholders by the weighted average number of common shares outstanding for the year. Diluted earnings per share reflect the potential dilution that could occur if common shares were issued pursuant to the exercise of common stock options under the 2003 Stock Option Plan, or exercise of warrants under the June 30, 2002, private placement offering. The following table illustrates the computations of basic and diluted earnings per share for the years ended December 31, 2004, 2003, and 2002:

	2004				2003				2002
(dollars in thousands, except per share data)	Diluted		Basic		Diluted		Basic		Diluted		Basic
Income available to common shareholders	$	2,435	$	2,435	$	2,207	$	2,207	$	1,614	$	1,614
Weighted average common shares outstanding		2,080,142		2,080,142		1,974,286		1,974,286		1,765,548		1,765,548
Net effect of dilutive warrants and options – based on the treasury stock method using average market price		55,492		—		37,682		—		101,370		—
		2,135,634		2,080,142		2,011,968		1,974,286		1,866,918		1,765,548
Earnings per share	$	1.14	$	1.17	$	1.10	$	1.12	$	0.86	$	0.91

16

F-42

FIRST CALIFORNIA BANK
NOTES TO FINANCIAL STATEMENTS

NOTE 10 – STOCK OPTION PLAN

The Bank adopted the 2003 Stock Option Plan that allows for the granting of both incentive and nonstatutory stock options. The option price for incentive stock options cannot be less than 100% of the fair market value of the shares on the date of grant. The stock options expire eight years from the date of grant. The option price, number of shares granted to recipients, and duration for the plan stock options are determined and approved by the Board of Directors.

The following summarizes options available and outstanding under this plan:

									Weighted		Weighted
							Non-		Average		Average
	Total			Incentive			statutory		Exercise		Fair
	Options			Options			Options		Price		Value
Options granted in 2003:
Incentive stock options		34,250			34,250			—	$	11.25	$	1.77
Nonstatutory stock options		10,000			—			10,000	$	11.25	$	1.77
Options under grant – December 31, 2003		44,250			34,250			10,000
Options granted in 2004:
Incentive stock options		28,400			28,400			—	$	20.25	$	4.24
Nonstatutory stock options		10,000			—			10,000	$	20.25	$	4.24
Options forfeited		(4,400	)		(4,400	)		—	$	13.09
Options under grant – December 31, 2004		78,250			58,250			20,000	$	16.56
Options under grant and exercisable – December 31, 2004		—			—			—	$	—
Options reserved and available for grant – December 31, 2004		121,750

17

F-43

FIRST CALIFORNIA BANK
NOTES TO FINANCIAL STATEMENTS

NOTE 10 – STOCK OPTION PLAN – (continued)

As of December 31, 2004, all options outstanding vest five years and expire eight years after the date of grant. The following table summarizes information regarding stock options outstanding at December 31, 2004:

Incentive Stock Options						Nonstatutory Stock Options
				Weighted						Weighted
				Average						Average
				Remaining						Remaining
				Contractual						Contractual
Exercise		Number		Life		Exercise		Number		Life
Price		Outstanding		(in years)		Price		Outstanding		(in years)
$	11.25		31,750		6.47	$	11.25		10,000		6.47
$	20.25		26,500		7.31	$	20.25		10,000		7.31
			58,250						20,000

Under the plan, an aggregate of no more than 200,000 shares of the Bank’s common stock are available for grant.

NOTE 11 – EMPLOYEE BENEFITS

     The Bank has adopted a 401(k) savings investment plan which allows employees to defer certain amounts of compensation for income tax purposes under Section 401(k) of the Internal Revenue Code. Essentially, all eligible employees may elect to defer and contribute up to statutory limits. The Bank may, at its discretion, make matching contributions, the total of which may not exceed 15% of eligible compensation. For the years ending December 31, 2004, 2003, and 2002, the Bank made matching contributions of approximately $89,000, $59,000, and $67,000, respectively, to the plan.

The Bank has established an employee incentive compensation program which provides eligible participants additional compensation based upon the achievement of certain Bank goals. For the years ending December 31, 2004, 2003 and 2002, additional compensation expense of approximately $270,000, $350,000, and $260,000, respectively, was recognized and paid subsequent to each year-end to eligible employees, pursuant to this program.

On December 30, 2002, the Bank purchased life insurance to support life insurance benefits for several key employees and salary continuation benefits for certain executives. As of December 31, 2004 and 2003, the cash surrender value of the life insurance was $5.0 million and $4.8 million, respectively. As of December 31, 2004, the Bank recognized a liability for salary continuation benefits of $180,000. Payments under the salary continuation plan commence when the respective executive reaches the age of 65 and continue for a period of 20 years.

18

F-44

FIRST CALIFORNIA BANK
NOTES TO FINANCIAL STATEMENTS

NOTE 12 – TRANSACTIONS WITH RELATED PARTIES

Certain directors, executive officers, and principal shareholders are customers of and have had banking transactions with the Bank, and the Bank expects to have such transactions in the future. All loans and commitments to loan included in such transactions were made in compliance with applicable laws on substantially the same terms, including interest rates and collateral, as those prevailing at the time for comparable transactions with other persons and do not involve more than the normal risk of collectibility or present any other unfavorable features. Loans outstanding to directors, executive officers, principal shareholders, and companies with which they are associated totaled $510,000 at December 31, 2003. Payments on these loans totaled $510,000 and $35,000 for 2004 and 2003, respectively. There were no new advances to related parties in 2004 or 2003.

Deposits of related parties held by the Bank at December 31, 2004 and 2003, amounted to approximately $61,000 and $71,000, respectively.

NOTE 13 – CONCENTRATIONS OF CREDIT RISK

Substantially all of the Bank’s loans, commitments, and commercial and standby letters of credit have been granted to customers in the Bank’s market areas, primarily Ventura County, California. The majority of such customers are also depositors of the Bank. The concentrations of credit by type of loan are set forth in Note 3. The distribution of commitments to extend credit approximates the distribution of loans outstanding. Commercial and standby letters of credit were granted primarily to commercial borrowers as of December 31, 2004. The Bank’s loan policies do not allow the extension of credit to any single borrower or group of related borrowers in excess of $400,000 without approval from the Bank’s loan committee.

The Bank’s investment in state and municipal securities represent general obligations and revenue bonds of agencies located in the state of California.

NOTE 14 – FINANCIAL INSTRUMENTS WITH OFF-BALANCE SHEET RISK

In the normal course of business to meet the financing needs of its customers, the Bank is a party to financial instruments with off-balance sheet risk. These financial instruments include commitments to extend credit and the issuance of letters of credit. These instruments involve, to varying degrees, elements of credit and interest rate risk in excess of the amounts recognized in the balance sheets. The contract amounts of those instruments reflect the extent of involvement the Bank has in particular classes of financial instruments.

19

F-45

FIRST CALIFORNIA BANK
NOTES TO FINANCIAL STATEMENTS

NOTE 14 – FINANCIAL INSTRUMENTS WITH OFF-BALANCE SHEET RISK – (continued)

The Bank’s exposure to credit loss, in the event of nonperformance by the other party to the financial instrument for commitments to extend credit and letters of credit written, is represented by the contractual amount of those instruments. The Bank uses the same credit policies in making commitments and conditional obligations as it does for on-balance sheet instruments. The Bank may or may not require collateral or other security to support financial instruments with credit risk, depending on its loan underwriting guidelines.

The following summarizes the Bank’s outstanding commitments as of December 31, 2004 and 2003:

	2004		2003
	(in thousands)
Financial instruments whose contract amounts contain credit risk:
Commitments to extend credit	$	63,604	$	45,291
Commercial and standby letters of credit		914		1,337
	$	64,518	$	46,628

Commitments to extend credit are agreements to lend to a customer as long as there is no violation of any condition established in the contract. Commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee. Since many of the commitments are expected to expire without being drawn upon, total commitment amounts do not necessarily represent future cash requirements. The amount of collateral obtained, if deemed necessary by the Bank upon an extension of credit, is based on management’s credit evaluation of the counterparty. Collateral held varies but may include accounts receivable, inventory, property and equipment, and income-producing properties.

Letters of credit written are conditional commitments issued by the Bank to guarantee the performance of a customer to a third party. Those guarantees are primarily issued to support public and private borrowing arrangements, including commercial paper, bond financing, and similar transactions. The credit risk involved in issuing letters of credit is essentially the same as that involved in extending loan facilities to customers. The Bank holds cash, marketable securities, or real estate as collateral supporting those commitments for which collateral is deemed necessary.

20

F-46

FIRST CALIFORNIA BANK
NOTES TO FINANCIAL STATEMENTS

NOTE 14 – FINANCIAL INSTRUMENTS WITH OFF-BALANCE SHEET RISK – (continued)

As of December 31, 2004 and 2003, the Bank maintained a reserve for undisbursed commitments of $150,000 and $100,000, respectively. The reserve is included in accrued interest payable and other liabilities on the balance sheet.

NOTE 15 – COMMITMENTS AND CONTINGENCIES

Operating lease commitments – As of December 31, 2004, the Bank leased certain properties. Future minimum lease commitments are as follows (in thousands):

Years ending December 31,	2005	$	332
	2006		314
	2007		261
	2008		271
	2009		276
	Thereafter		960
		$	2,414

Rental expense for all operating leases was $416,000, $268,000, and $167,000 for the years ended December 31, 2004, 2003, and 2002, respectively.

Legal contingencies – The Bank may become a defendant in certain claims and legal actions arising in the ordinary course of business. In the opinion of management, after consultation with legal counsel, there are no matters presently known to the Bank that are expected to have a material adverse effect on the financial condition of the Bank.

NOTE 16 – REGULATORY MATTERS

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

21

F-47

FIRST CALIFORNIA BANK
NOTES TO FINANCIAL STATEMENTS

NOTE 16 – REGULATORY MATTERS — (continued)

Quantitative measures established by regulation to ensure capital adequacy require the Bank to maintain minimum amounts and ratios (set forth in the following table) of Total and Tier 1 capital (as defined in the regulations) to risk-weighted assets (as defined), and of Tier 1 capital to average assets (as defined). Management believes, as of December 31, 2004, that the Bank meets all capital adequacy requirements to which it is subject.

As of the most recent notification from its regulatory agencies, the Bank was categorized as well-capitalized under the regulatory framework for prompt corrective action. To be categorized as well-capitalized, the Bank must maintain minimum Total risk-based capital, Tier 1 risk-based capital, and Tier 1 leverage capital ratios as set forth in the table below. There are no conditions or events since that notification that management believes may have changed the Bank’s category.

											To Be Well-
						For Capital					Capitalized Under
						Adequacy					Prompt Corrective
	Actual					Purposes					Action Provisions
	Amount		Ratio			Amount		Ratio			Amount		Ratio
(dollars in thousands)
December 31, 2004:
Total capital to risk-weighted Assets	$	25,300		12.25	%	$	16,518		³8.00	%	$	20,647		³10.00	%
Tier 1 capital to risk-weighted Assets	$	22,804		11.04	%	$	8,259		³4.00	%	$	12,388		³6.00	%
Tier 1 capital to average Assets	$	22,804		8.61	%	$	10,974		³4.00	%	$	13,718		³5.00	%
December 31, 2003:
Total capital to risk-weighted Assets	$	20,927		11.57	%	$	14,467		³8.00	%	$	18,084		³10.00	%
Tier 1 capital to risk-weighted Assets	$	18,666		10.32	%	$	7,234		³4.00	%	$	10,850		³6.00	%
Tier 1 capital to average Assets	$	18,666		7.54	%	$	9,898		³4.00	%	$	12,372		³5.00	%

22

F-48

FIRST CALIFORNIA BANK
NOTES TO FINANCIAL STATEMENTS

NOTE 17 – FAIR VALUES OF FINANCIAL INSTRUMENTS

The following table estimates fair values and the related carrying amounts of the Bank’s financial instruments:

	2004				2003
	Carrying		Estimated		Carrying		Estimated
	Amount		Fair Value		Amount		Fair Value
			(in thousands)
Financial assets:
Cash and due from banks	$	7,194	$	7,194	$	7,770	$	7,770
Federal funds sold	$	4,055	$	4,055	$	15,780	$	15,780
Securities available-for-sale	$	77,345	$	77,345	$	64,774	$	64,774
Loans	$	182,873	$	182,492	$	157,952	$	160,367
FHLB stock	$	1,992	$	1,992	$	1,512	$	1,512
Financial liabilities:
Deposits	$	227,190	$	227,065	$	211,929	$	211,847
FHLB advances	$	32,850	$	33,301	$	25,000	$	24,949

     While estimates of fair value are based on management’s judgment of the most appropriate factors, there is no assurance that, were the Bank to dispose of such items at December 31, 2004, the estimated fair values would necessarily be achieved at that date, since market values may differ depending on various circumstances. The estimated fair values at December 31, 2004, should not necessarily be relied upon at subsequent dates.

In addition, other assets and liabilities of the Bank, such as property and equipment, are not defined as financial instruments and are not included in the above disclosures. Also, nonfinancial instruments typically not recognized in the financial statements, nevertheless, may have value but are not included in the above disclosures. These include, among other items, the estimated earnings power of core deposit accounts, the earnings potential of loan servicing rights, the trained work force, customer goodwill, and similar items.

23

F-49

FIRST CALIFORNIA BANK
NOTES TO FINANCIAL STATEMENTS

NOTE 18 – SUBSEQUENT EVENTS

On February 2, 2005, the Bank entered into an Agreement of Merger with South Coast Bancorp, Inc. (SCB), pursuant to which SCB would merge with and into a newly formed holding company. SCB is the holding company for South Coast Commercial Bank, a community bank headquartered in Orange County, California, with two branches in the southern California communities of Irvine and Anaheim Hills. The merger is pending approval by both parties’ shareholders and regulators. SCB shareholders will receive approximately $36.0 million in cash. The Bank intends on forming a holding company and raising debt and equity capital. The Bank will be a wholly-owned subsidiary of the newly formed holding company. The transaction will be accounted for as a purchase; accordingly, the results of operations from the acquisition will be included in the consolidated financial statements of the newly formed holding company from the date of acquisition forward.

24

F-50

SOUTH COAST BANCORP, INC.

UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

JUNE 30, 2005

F-51

South Coast Bancorp, Inc.
Consolidated Balance Sheet — Unaudited

	June 30, 2005			December 31, 2004
Cash and due from banks	$	1,251,000		$	1,285,000
Federal funds sold		11,000,000			7,000,000
Cash and cash equivalents		12,251,000			8,285,000
Interest earning deposits		7,920,000			12,006,000
Investment securities held to maturity		4,509,000			4,528,000
		24,680,000			24,819,000
Loans receivable		121,691,000			120,763,000
Deferred loan fees		—			(44,000	)
Allowance for loan losses		(1,174,000	)		(1,183,000	)
Net loans receivable		120,517,000			119,536,000
Accrued interest receivable		557,000			481,000
Property and equipment, net		1,685,000			1,774,000
Other assets		93,000			115,000
Total Assets	$	147,532,000		$	146,725,000
Demand deposits	$	3,671,000		$	2,811,000
Statement savings		24,928,000			28,572,000
Certificates of deposits		100,874,000			97,416,000
Total deposits		129,473,000			128,799,000
Accounts payable and accrued expenses		550,000			1,035,000
Deferred income taxes		2,000			2,000
Dividends payable		79,000			122,000
Total liabilities		130,104,000			129,958,000
Stockholders’ equity
Common stock, no par value-authorized, 8,000,000 shares		2,265,000			2,265,000
Retained earnings		15,163,000			14,502,000
Total stockholders’ equity		17,428,000			16,767,000
Total liabilities and stockholders’ equity	$	147,532,000		$	146,725,000

  2

The accompanying notes are an integral part of these statements.

F-52

South Coast Bancorp, Inc.
Consolidated Statements of Earnings — Unaudited

	Three Months Ended June 30,					Six Months Ended June 30,
	2005		2004			2005			2004
Interest income
Loans	$	2,414,000	$	2,271,000		$	4,736,000		$	4,594,000
Interest earning deposits		69,000		76,000			152,000			138,000
Investment securities		31,000		23,000			59,000			48,000
Federal funds sold		56,000		17,000			92,000			40,000
Total interest income		2,570,000		2,387,000			5,039,000			4,820,000
Interest expense
Demand deposits		8,000		6,000			14,000			12,000
Statement savings		213,000		185,000			415,000			362,000
Certificates of deposit		858,000		703,000			1,683,000			1,419,000
Total interest expense		1,079,000		894,000			2,112,000			1,793,000
Net interest income		1,491,000		1,493,000			2,927,000			3,027,000
Provision (credit) for loan losses		1,000		(6,000	)		(9,000	)		(50,000	)
Net interest income after credit for loan losses		1,490,000		1,499,000			2,936,000			3,077,000
Noninterest income
Delinquency charges		3,000		6,000			8,000			17,000
Rental income		55,000		35,000			107,000			99,000
Fee income		80,000		85,000			172,000			262,000
Other		2,000		4,000			4,000			6,000
Total noninterest income		140,000		130,000			291,000			384,000
Noninterest expense
Salaries and wages		530,000		605,000			1,107,000			1,272,000
General and administrative		206,000		213,000			474,000			420,000
Occupancy		100,000		85,000			199,000			167,000
Total noninterest expense		836,000		903,000			1,780,000			1,859,000
Earnings before income taxes		794,000		726,000			1,447,000			1,602,000
Income taxes		28,000		25,000			51,000			56,000
NET EARNINGS	$	766,000	$	701,000		$	1,396,000		$	1,546,000

  3

The accompanying notes are an integral part of these statements.

F-53

South Coast Bancorp, Inc.
Consolidated Statements of Stockholder’s Equity — Unaudited

			Common		Retained
	Shares		stock		earnings			Total
Balance at December 31, 2004		3,049,504	$	2,265,000	$	14,502,000		$	16,767,000
Net earnings						1,396,000			1,396,000
Dividend paid						(476,000	)		(476,000	)
Distribution						(259,000	)		(259,000	)
Balance a June 30, 2005		3,049,504	$	2,265,000	$	15,163,000		$	17,428,000
Balance at December 31, 2003		3,043,650		2,181,000		13,600,000			15,781,000
Net earnings						1,546,000			1,546,000
Stock Grant				4,000					4,000
Dividend paid						(986,000	)		(986,000	)
Balance at June 30, 2004		3,043,650		2,185,000		14,160,000			16,345,000

  4

The accompanying notes are an integral part of these statements.

F-54

South Coast Bancorp
Statement of Cash Flows

	6/30/2005			6/30/2004
Cash flows from operating activities
Net earnings	$	1,396,000		$	1,546,000
Adjustments to reconcile net earnings to net cash provided by operating activities
Depreciation		89,000			63,000
Credit for loan losses		(9,000	)		(22,000	)
Amortization of premiums and discount investments		19,000			(40,000	)
Stock compensation expense		—			4,000
Decrease in unearned finance charges		(44,000	)		6,000
(Increase) Decrease in accrued interest receivable		(76,000	)		36,000
Increase in other assets		22,000			(8,000	)
Decrease in accounts payable and accrued expenses		(528,000	)		(327,000	)
Net cash provided by operating activities		869,000			1,258,000
Cash flows from investing activities
Redemption of U. S. Treasury Notes		—			—
(Increase) decrease in interest deposits		4,086,000			(2,871,000	)
Loan originations and principal collections, net		(928,000	)		(235,000	)
Increase (Decrease) in property and equipment		—			(169,000	)
Net cash used in investing activities		3,158,000			(3,275,000	)
Cash flows from financing activities
Decrease (Increase) in demand deposits	$	860,000		$	(1,166,000	)
(Decrease) increase in statement savings		(3,644,000	)		1,001,000
Increase in certificates of deposit		3,458,000			(2,402,000	)
Stock Buy Out Transactions		—			—
Distribution		(259,000	)		—
Dividends paid		(476,000	)		(986,000	)
Net cash provided by financing activities		(61,000	)		(3,553,000	)
Net (decrease) increase in cash and cash equivalents		3,966,000			(5,570,000	)
Cash and cash equivalents at beginning of year		8,285,000			12,672,000
Cash and cash equivalents at end of year	$	12,251,000		$	7,102,000

  5

The accompanying notes are an integral part of these statements.

F-55

SOUTH COAST BANCORP, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS — UNAUDITED

	Six Months Ended June 30,
	2005		2004
Supplemental disclosures of cash flow information
Cash paid during the period
Interest	$	2,112,000	$	1,793,000
Taxes		58,000		80,000
Supplemental schedule of noncash investing And financing activities
Dividends declared and not paid	$	72,000	$	172,000

  6

The accompanying notes are an integral part of these statements.

F-56

SOUTH COAST BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

BASIS OF PRESENTATION

The accompanying unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States for interim financial information. Accordingly, they do not include all information and footnotes required by accounting principles generally accepted in the United States for complete financial statements.

In management’s opinion, the information and amount furnished in this report reflect all adjustments which are necessary for the fair presentation of the financial position and results of operations for the periods presented. All adjustments are of a normal and recurring nature. These financial statements should read in conjunction with the Company’s audited financial statements for the fiscal year ended December 31, 2004.

LOANS RECEIVABLE

At June 30, 2005 and December 31, 2004, real estate loans amounted to $121,691,000 and 120,763,000, respectively.

Accrued interest on loans amounted to $486,000 and $426,000 at June 30, 2005 and December 31, 2004, respectively. There were no non-accrual loans for these periods.

The following is a summary of transactions affecting the allowance for loan losses:

(in thousands)	June 30, 2005			December 31, 2004
Beginning balance	$	1,183		$	1,211
Credit for loan losses		(9	)		(55	)
Loans charged-off		—			—
Recoveries on loans charged-off		—			27
Ending balance	$	1,174		$	1,183

The allowance for loan losses, as a percentage of total loans, was 0.96% at June 30, 2005 compared with 0.98% at December 31, 2004.

 7

F-57

Consolidated Financial Statements and
Report of Independent Certified Public Accountants

SOUTH COAST BANCORP, INC.

December 31, 2004 and 2003

F-58

CONTENTS

	Page
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS	3
CONSOLIDATED FINANCIAL STATEMENTS
CONSOLIDATED BALANCE SHEETS	4
CONSOLIDATED STATEMENTS OF EARNINGS	6
CONSOLIDATED STATEMENT OF STOCKHOLDERS’ EQUITY	7
CONSOLIDATED STATEMENTS OF CASH FLOWS	8
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS	10

F-59

REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS

Board of Directors
South Coast Bancorp, Inc.

     We have audited the accompanying consolidated balance sheets of South Coast Bancorp, Inc. and subsidiaries (the “Company”) as of December 31, 2004 and 2003, and the related consolidated statements of earnings, stockholders’ equity, and cash flows for the years then ended. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with auditing standards generally accepted in the United States of America as established by the Auditing Standards Board of the American Institute of Certified Public Accountants. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated position of South Coast Bancorp, Inc. and subsidiaries as of December 31, 2004 and 2003, and the consolidated results of its operations and its cash flows for the years then ended, in conformity with accounting principles generally accepted in the United States of America.

/s/ Grant Thornton LLP

Los Angeles, California
March 31, 2005

 3

F-60

SOUTH COAST BANCORP, INC.

CONSOLIDATED BALANCE SHEETS

December 31,

ASSETS

	2004			2003
Cash and due from banks	$	1,285,000		$	2,672,000
Federal funds sold		7,000,000			10,000,000
Cash and cash equivalents		8,285,000			12,672,000
Interest earning deposits		12,006,000			9,226,000
Investment securities held to maturity		4,528,000			4,005,000
		24,819,000			25,903,000
Loans receivable		120,763,000			115,968,000
Deferred loan fees		(44,000	)		(322,000	)
Allowance for loan losses		(1,183,000	)		(1,211,000	)
Net loans receivable		119,536,000			114,435,000
Accrued interest receivable		481,000			498,000
Property and equipment, net		1,774,000			1,726,000
Other assets		115,000			117,000
Total assets	$	146,725,000		$	142,679,000

The accompanying notes are an integral part of these statements. 4

F-61

SOUTH COAST BANCORP, INC.

CONSOLIDATED BALANCE SHEETS

December 31,

	2004		2003
Demand deposits	$	2,811,000	$	4,018,000
Statement savings		28,572,000		31,769,000
Certificates of deposits		97,416,000		89,698,000
Total deposits		128,799,000		125,485,000
Accounts payable and accrued expenses		1,035,000		1,224,000
Deferred income taxes		2,000		25,000
Dividends payable		122,000		164,000
Total liabilities		129,958,000		126,898,000
Commitments and contingencies		—		—
Stockholders’ equity
Common stock, no par value — authorized, 8,000,000 shares; issued and outstanding, 3,049,504 and 3,043,650 shares at December 31, 2004 and 2003, respectively		2,265,000		2,181,000
Retained earnings		14,502,000		13,600,000
Total stockholders’ equity		16,767,000		15,781,000
Total liabilities and stockholders’ equity	$	146,725,000	$	142,679,000

The accompanying notes are an integral part of these statements. 5

F-62

SOUTH COAST BANCORP, INC.

CONSOLIDATED STATEMENTS OF EARNINGS

Year ended December 31,

	2004			2003
Interest income
Loans	$	9,075,000		$	9,445,000
Interest earning deposits		308,000			308,000
Investment securities		94,000			123,000
Federal funds sold		105,000			92,000
Total interest income		9,582,000			9,968,000
Interest expense
Demand deposits		24,000			52,000
Statement savings		773,000			793,000
Certificates of deposit		2,976,000			2,868,000
Total interest expense		3,773,000			3,713,000
Net interest income		5,809,000			6,255,000
Credit for loan losses		(55,000	)		(4,000	)
Net interest income after credit for loan losses		5,864,000			6,259,000
Noninterest income
Delinquency charges		37,000			34,000
Rental income		194,000			264,000
Fee income		481,000			409,000
(Loss) gain on sale of assets		(9,000	)		38,000
Net gain on sales of loans held for sale		—			516,000
Other		12,000			10,000
Total noninterest income		715,000			1,271,000
Noninterest expense
Salaries and wages		2,394,000			2,582,000
General and administrative		792,000			926,000
Occupancy		372,000			380,000
Total noninterest expense		3,558,000			3,888,000
Earnings before income taxes		3,021,000			3,642,000
Income taxes		106,000			127,000
NET EARNINGS	$	2,915,000		$	3,515,000

The accompanying notes are an integral part of these statements.

F-63

SOUTH COAST BANCORP, INC.

CONSOLIDATED STATEMENT OF STOCKHOLDERS’ EQUITY

For the two years ended December 31, 2004

				Common			Retained
	Shares			stock			Earnings			Total
Balance at December 31, 2002		3,166,400		$	2,234,000		$	12,803,000		$	15,037,000
Net earnings		—			—			3,515,000			3,515,000
Stock grants		2,250			11,000			—			11,000
Stock buyout		(125,000	)		(64,000	)		(592,000	)		(656,000	)
Dividend paid		—			—			(2,126,000	)		(2,126,000	)
Balance at December 31, 2003		3,043,650			2,181,000			13,600,000			15,781,000
Net earnings		—			—			2,915,000			2,915,000
Stock grants		15,854			89,000			—			89,000
Stock buyout		(10,000	)		(5,000	)		(80,000	)		(85,000	)
Dividend paid		—			—			(1,933,000	)		(1,933,000	)
Balance at December 31, 2004		3,049,504		$	2,265,000		$	14,502,000		$	16,767,000

The accompanying notes are an integral part of these statements.

F-64

SOUTH COAST BANCORP, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

Year ended December 31,

	2004			2003
Cash flows from operating activities
Net earnings	$	2,915,000		$	3,515,000
Adjustments to reconcile net earnings to net cash provided by operating activities
Depreciation		151,000			162,000
Credit for loan losses		(55,000	)		(4,000	)
Amortization of premiums and discount investments		(13,000	)		3,000
Loss (gain) on sale of property and equipment		9,000			(38,000	)
Stock compensation expense		89,000			11,000
Loans held for sale, net		—			2,536,000
Decrease in unearned finance charges		(278,000	)		(16,000	)
Provision (credit) for deferred income taxes		(23,000	)		(89,000	)
Decrease in accrued interest receivable		17,000			26,000
Decrease in other assets		2,000			15,000
Decrease in accounts payable and accrued expenses		(189,000	)		(5,000	)
Net cash provided by operating activities		2,625,000			6,116,000
Cash flows from investing activities
Redemption of U.S. Treasury Notes		2,500,000			2,000,000
Purchase of U.S. Treasury Notes		(3,010,000	)		(2,000,000	)
(Increase) decrease in interest deposits		(2,780,000	)		2,597,000
Loan originations and principal collections, net		(4,768,000	)		(10,900,000	)
Purchase of property and equipment		(222,000	)		(96,000	)
Proceeds from sale of property and equipment		14,000			84,000
Net cash used in investing activities		8,266,000	)		(8,315,000	)

F-65

SOUTH COAST BANCORP, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS — CONTINUED

Year ended December 31,

	2004			2003
Cash flows from financing activities
Decrease in demand deposits	$	(1,207,000	)	$	(782,000	)
(Decrease) increase in statement savings		(3,197,000	)		(1,305,000	)
Increase in certificates of deposit		7,718,000			10,312,000
Stock buyouts		(85,000	)		(656,000	)
Dividends paid		(1,975,000	)		(2,127,000	)
Net cash provided by financing activities		1,254,000			5,442,000
Net (decrease) increase in cash and cash equivalents		(4,387,000	)		3,243,000
Cash and cash equivalents at beginning of year		12,672,000			9,429,000
Cash and cash equivalents at end of year	$	8,285,000		$	12,672,000
Supplemental disclosures of cash flow information
Cash paid during the year
Interest	$	3,768,000		$	3,731,000
Income taxes	$	108,000		$	104,000
Supplemental schedule of noncash investing and finance activities
Dividends declared and not paid	$	122,000		$	164,000

F-66

SOUTH COAST BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2004 and 2003

NOTE 1 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

A. General

     South Coast Bancorp, Inc. (“Bancorp”) was incorporated on February 22, 1978. The Bancorp’s only active subsidiary is South Coast Commercial Bank (“Bank”). The Bank was incorporated on February 22, 1978 and was certificated by the State of California Department of Corporations on March 20, 1980, at which time it commenced operations as an industrial loan company. On March 11, 1985, the Bank obtained insurance of its customer deposit accounts by the Federal Deposit Insurance Corporation (“FDIC”). Effective January 1, 1997, the Bank converted its charter from a thrift and loan association to a commercial bank.

     The Bank conducts a commercial banking business in the State of California. The Bank issues demand deposit accounts, passbook savings and certificates of deposit. In addition, the Bank is subject to the regulatory requirements of the FDIC and the California Department of Financial Institutions.

     The consolidated financial statements include the accounts of South Coast Bancorp, Inc. and its wholly-owned subsidiaries, South Coast Commercial Bank and SC Financial (collectively, the “Company”). All significant intercompany balances and transactions have been eliminated.

B. Use of Estimates

     The financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America applicable to depository institutions. In preparing the financial statements, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities as of the balance sheet date, and revenues and expenses for the periods presented. Actual results could differ from those estimates. Material estimates that are particularly susceptible to significant change in the near term relate to the determination of the allowance for loan losses.

C. Investments

     The Company classifies investment securities as held to maturity at time of purchase.

     Investment securities held to maturity are those securities management has the positive intent and ability to hold to maturity. These securities are reported at amortized cost and any premium or discount is amortized using the interest method over the life of the security.

F-67

SOUTH COAST BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2004 and 2003

NOTE 1 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES — Continued

D. Cash Equivalents

     The Company considers all highly liquid investments with original maturities of three months or less to be cash equivalents.

E. Loans Receivable

     Loans receivable consist primarily of commercial real estate loans.

     The Company’s loan portfolio is collateralized primarily by commercial, retail and industrial properties located throughout Southern California. Although the Company has a diversified portfolio, a substantial portion of its debtors’ ability to honor their contracts is dependent upon the economy of Southern California.

     Loans receivable are recorded at amortized cost. All origination fees and direct costs associated with lending are netted, deferred and amortized to operations as an adjustment to yield over the respective lives of the loans using the interest method. Amortization of net origination fees and direct costs associated with a loan ceases once that loan is placed on nonaccrual status. Loans originated and intended for sale in the secondary market are recorded at the lower of cost or estimated fair value in the aggregate. Net unrealized losses, if any, are recognized through a valuation allowance by charges to income.

     Income reported for interest earning real estate loans is recorded on the accrual basis in accordance with the terms of the loans.

     Loans whose payments are 90 days or more past due cease to accrue interest and uncollected interest on such loans is reversed. Subsequent payments are either recognized, in part, as interest income or credited to the loan principal based on management’s determination of the ultimate collectibility of the loan.

F. Allowance for Loan Losses

     The Company considers a loan to be impaired when, based upon current information and events, it believes it is probable the Company will be unable to collect all amounts due according to the contractual terms of the loan agreement. The Company ceases to accrue interest on impaired loans when full payment of principal and interest is not expected and such loans are not performing or are greater than 90 days delinquent and therefore meet the criteria for nonaccrual status.

F-68

SOUTH COAST BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2004 and 2003

NOTE 1 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES — Continued

G. Allowance for Loan Losses (continued)

     The Company bases the measurement of loan impairment on the fair value of the loans’ collateral. Impairment losses are included in the allowance for loan losses through a charge to provision for loan losses. Adjustments to impairment losses due to changes in the fair value of impaired loans’ collateral are included in the provision for loan losses.

     The allowance for loan losses is maintained by additions charged to operations as provisions for loan losses and by loan recoveries, with actual losses charged as reductions to the allowance. There are three basic elements to the Company’s process for evaluating the adequacy of the allowance for loan losses: first, the identification of impaired loans; second, the establishment of appropriate loan loss allowances once individual specific impaired loans are identified; and third, a methodology for estimating loan losses based on the inherent risk in the remainder of the loan portfolio. Loss allowances are established for specifically identified impaired loans based on the fair value of the underlying collateral property.

     Management believes that the allowance for loan losses is adequate. While management uses available information to recognize losses on loans receivable which are deemed probable and can be reasonably estimated, future additions to the allowance may be necessary based on changes in economic conditions. In addition, various regulatory agencies, as an integral part of their examination process, periodically review the Company’s allowance for loan losses. Such agencies may require the Company to recognize additions to the allowance based on their judgments of information available to them at the time of their examination.

H. Property and Equipment

     Property and equipment are recorded at cost. The Company’s building is depreciated on a straight-line basis over an estimated useful life of thirty years. Furniture and fixtures is depreciated on a straight-line basis over an estimated useful life of five years. Leasehold improvements are depreciated on a straight-line basis over the shorter of the lease term or the useful life of the improvements. For income tax purposes, property and equipment is depreciated on the Modified Accelerated Recovery Cost System.

I. Stock Grants

     Stock grants are valued at fair market value at the time of grant as estimated by management and treated as compensation expense. In 2004, there were 25,000 stocks granted to be fully vested over 5 years at 5,000 shares per year starting in 2004. As of December 31, 2004, the Bank had 20,000 grants outstanding and unvested.

F-69

SOUTH COAST BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2004 and 2003

NOTE 1 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES — Continued

J. Income Taxes

Effective January 1, 2002, the Company, with the consent of its shareholders, elected to be taxed as an S Corporation under sections of the Internal Revenue Code and state income tax laws.

The Company uses the asset and liability method of accounting for income taxes. Under the asset and liability method, deferred income taxes are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred taxes of a change in tax rates is recognized in the statement of earnings in the period that includes the enactment date.

K. Related Party Transactions

The Company has a policy of not granting loans to principal officers, directors and their affiliates.

L. Recent Accounting Pronouncements

In December 2003, the “Financial Accounting Standards Board (“FASB”) issued Interpretation No. 46, “Consolidation of Variable Interest Entities”—an interpretation of Accounting Research Bulletin (“ARB”) No. 51. This Interpretation defines a variable interest entity and provides that if a business enterprise has a controlling financial interest in a variable interest entity, the assets, liabilities and results of the activities of the variable interest entity should be included in consolidated financial statements with those of the business enterprise. Furthermore, the FASB indicated that the voting interest approach of ARB No. 51 is not effective in identifying controlling financial interests in entities that are not controllable through voting interests or in which the equity investors do not bear the residual economic risk. This Interpretation became applicable immediately to variable interest entities created or in which an interest was acquired after January 31, 2004, and beginning after June 15, 2004, in the case of variable interest entities in which an enterprise holds a variable interest that it acquired before February 1, 2004.

In January 2004, subsequent to the issuance of FIN 46, the FASB issued a revised interpretation, the provisions of which were required to be applied to certain variable interest entities by March 31, 2004. However, the adoption of FIN 46 and its revisions did not have a material impact on the Company’s financial statements.

F-70

SOUTH COAST BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2004 and 2003

NOTE 1 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES — Continued

M. Recent Accounting Pronouncements

In December 2004, the FASB issued Statement of Financial Accounting Standards (“SFAS”) No. 123, (revised 2004), “Share-Based Payment”. SFAS No. 123R, which supersedes Accounting Principle Board (“APB”) Opinion No. 25, “Accounting for Stock Issued to Employees”, requires entities that grant stock options and shares to employees to recognize the fair value of those options and shares as compensation over the service (vesting) period in their financial statements; pro forma disclosure will no longer be permitted. The cost of the equity instruments is to be measured based on the fair value of the instruments on the date they are granted and is required to be recognized over the period during which the employees are required to provide services in exchange for the equity instruments. No compensation cost is recognized for equity instruments for which employees do not render the requisite service. The adoption of SFAS No. 123R is not expected to have a material impact on the Company’s financial statements.

In December 2004, the FASB issued SFAS No. 153, “Exchanges of Nonmonetary Assets — An Amendment of APB Opinion No. 29”. SFAS No. 153 amends APB Opinion No. 29 to eliminate the exception for nonmonetary exchanges of similar productive assets and replaces it with a general exception for exchanges of nonmonetary assets that do not have commercial substance. SFAS No. 153 is to be applied prospectively for nonmonetary exchanges occurring in fiscal periods beginning after June 15, 2005. The adoption of the provisions of SFAS No. 153 is not expected to have a material impact on the Company’s financial statements.

N. Reclassifications

Certain reclassifications have been made to prior year’s balances to conform to the December 31, 2004 presentation.

NOTE 2 — INVESTMENT SECURITIES

     The following table summarizes the amortized cost, gross unrealized gains and losses, and fair value on investment securities held to maturity at December 31:

	2004
			Gross		Gross
	Amortized		unrealized		unrealized
	Cost		gain		loss		Fair value
U.S. Treasury Notes	$	4,528,000	$	1,000	$	24,000	$	4,505,000

F-71

SOUTH COAST BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2004 and 2003

NOTE 2 — INVESTMENT SECURITIES — Continued

	2003
			Gross		Gross
	Amortized		unrealized		unrealized
	Cost		gain		loss		Fair value
U.S. Treasury Notes	$	4,005,000	$	28,000	$	1,000	$	4,032,000

     At December 31, 2004, U.S. Treasury Notes have scheduled maturities as follows:

	Amortized
	Cost		Fair value
One year or less	$	1,500,000	$	1,494,000
One to five years		3,028,000		3,011,000
	$	4,528,000	$	4,505,000

     Despite the unrealized loss position of these securities, the Bank has concluded, as of December 31, 2004, that these investments are not other-than-temporarily impaired. This assessment was based on the following factors: i) the length of time and the extent to which the market value has been less than cost; ii) the financial condition and near-term prospects of the issuer; iii) the intent and ability of the Bank to retain its investment in a security for a period of time sufficient to allow for any anticipated recovery in market value; and iv) general market conditions which reflect prospects for the economy as a whole, including interest rates and sector credit spreads.

     Accrued interest on investment securities and interest earning deposits amounted to $55,000 and $39,000 at December 31, 2004 and 2003, respectively.

NOTE 3 — LOANS RECEIVABLE

     At December 31, 2004 and 2003, real estate loans amounted to $120,763,000 and $115,968,000, respectively.

     Accrued interest on loans amounted to $426,000 and $459,000 at December 31, 2004 and 2003, respectively. There were no non-accrual loans as of December 31, 2004. Non-accrual loans as of December 31, 2003 were $78,000.

     The aggregate recorded investment in impaired loans at December 31, 2004 and 2003 was $0 and $78,000, respectively, with specific reserves of $0 and $4,000, respectively. The average net recorded investment in impaired loans was $13,000 and $77,000 during 2004 and 2003, respectively. Interest income recorded on impaired loans amounted to $0 and $33,000 for the years ended December 31, 2004 and 2003. There were no amounts charged off during December 31, 2004 and 2003 in connection with impaired loans.

F-72

SOUTH COAST BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2004 and 2003

NOTE 3 — LOANS RECEIVABLE – Continued

     The following is a summary of transactions affecting the allowance for loan losses:

	2004			2003
Balance at beginning of year	$	1,211,000		$	1,199,000
Credit for loan losses		(55,000	)		(4,000	)
Recoveries on amounts charged off		27,000			16,000
Balance at end of year	$	1,183,000		$	1,211,000

NOTE 4 — PROPERTY AND EQUIPMENT

     Property and equipment at December 31, is summarized as follows:

	2004			2003
Land	$	637,000		$	637,000
Building		1,288,000			1,277,000
Furniture and fixtures		1,040,000			1,065,000
Leasehold improvements		341,000			180,000
		3,306,000			3,159,000
Less accumulated depreciation		(1,532,000	)		(1,433,000	)
Balance at end of year	$	1,774,000		$	1,726,000

     Depreciation expense was $151,000 and $162,000 for the years ended December 31, 2004 and 2003, respectively.

NOTE 5 — DEPOSITS

     Deposits at December 31 are summarized as follows:

	2004		2003
Certificates of deposit
Consumer	$	77,718,000	$	69,789,000
IRA		9,069,000		8,420,000
Business		10,629,000		11,489,000
	$	97,416,000	$	89,698,000

F - 73

SOUTH COAST BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2004 and 2003

NOTE 5 — DEPOSITS

     Certificates of deposit have scheduled maturities as follows:

Year ending December 31:
2005	$	59,686,000
2006		9,572,000
2007		12,823,000
2008		6,468,000
2009		8,867,000
	$	97,416,000

     The aggregate amount of statement savings and certificates of deposit denominated in amounts of $100,000 or more was $44,408,000 and $27,671,000 at December 31, 2004 and 2003, respectively. Certificates of deposit denominated in amounts of $100,000 or more was $36,859,000 and $19,410,000 as of December 31, 2004 and 2003, respectively. Interest expense for certificates of deposit denominated in amounts of $100,000 or more was approximately $1,191,000 and $1,091,000 for the years ended December 31, 2004 and 2003, respectively.

     In the ordinary course of business, the Bank has deposits from related parties and affiliates with which they are associated. These deposits are accepted under terms that are consistent with the Bank’s normal policies. Deposits from related parties were approximately $701,000 and $702,000 at December 31, 2004 and 2003, respectively.

NOTE 6 — INCOME TAXES

     Effective January 1, 2002, the Bank elected to be taxed as an S Corporation under sections of the Internal Revenue Code and state income tax laws. These laws provide that, in lieu of corporation income taxes, the shareholder separately accounts for its share of the Bank’s income, deductions, losses and credits. As a result, no corporate income taxes have been provided in the accompanying 2004 and 2003 financial statements except for certain state income taxes and federal taxes on built-in-gains.

     Built-in-gains taxes apply to sales or realization of assets, during the first 10 years of the S Corporation election that had a fair value greater than their tax basis at the time of the election. The tax is computed at the maximum corporate tax rate, currently 35% of the difference between the fair value of the asset over the income tax basis of the asset.

F - 74

SOUTH COAST BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2004 and 2003

NOTE 6 — INCOME TAXES

     The components of the income tax provision for the years ended December 31, are as follows:

	2004
	Current		Deferred			Total
Federal	$	—	$	—		$	—
State		129,000		(23,000	)		106,000
	$	129,000	$	(23,000	)	$	106,000

	2003
	Current		Deferred			Total
Federal	$	60,000	$	(65,000	)	$	(5,000	)
State		156,000		(24,000	)		132,000
	$	216,000	$	(89,000	)	$	127,000

     Income taxes (payable) receivable was ($9,000) and $(30,000) as of December 31, 2004 and 2003, respectively.

     The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and deferred tax liabilities at December 31 are as follows:

	2004		2003
Deferred tax assets:
Allowance for loan losses	$	41,000	$	42,000
Property and equipment		—		1,000
Total gross deferred tax assets		41,000		43,000
Deferred tax liabilities:
Property and equipment		1,000		—
Bad debt recapture		23,000		22,000
Deferred loan origination fees and costs		19,000		46,000
Total gross deferred tax liabilities		43,000		68,000
Net deferred tax liabilities	$	2,000	$	25,000

F - 75

SOUTH COAST BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2004 and 2003

NOTE 7 — STOCKHOLDERS’ EQUITY

     A. Stock Grants

     The Bancorp granted 15,854 and 2,250 shares of common stock during the years ended 2004 and 2003, respectively. These stock grants were valued at $89,000 and $11,000 which, was charged to salaries and wages to officers.

     B. Dividends Paid

     During 2004 and 2003, the Bancorp declared dividends to its stockholders of approximately $0.74 and $0.68 per share, totaling $1,933,000 and $2,126,000, respectively, which includes $122,000 and $164,000, respectively, of dividends payable to stockholders as of December 31, 2004 and 2003, respectively.

NOTE 8 — COMMITMENTS AND CONTINGENCIES

     The Company leases certain office space under operating leases with terms of three years. Repairs, maintenance and property taxes related to lease assets are paid by the Company. Rental expense relating to these agreements totaled $111,000 and $103,000 in 2004 and 2003, respectively. These leases call for minimum annual rental payments:

Year ending December 31:
2005	$	92,000
2006		49,000
2007		32,000
2008		8,000
	$	181,000

     The Company leases certain office space to third parties with terms from three to four years. Rental income relating to these agreements totaled $194,000 and $264,000 in 2004 and 2003, respectively. These leases call for minimum annual rental receipts:

Year ending December 31:
2005	$	196,000
2006		82,000
	$	278,000

F - 76

SOUTH COAST BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2004 and 2003

NOTE 8 — COMMITMENTS AND CONTINGENCIES — Continued

     The Company has a $4,000,000 line of credit agreement, which expires in June 2005. The Company pledges all U.S. Treasury Notes as collateral for amounts borrowed on the repurchase line. At December 31, 2004 and 2003, the Company had no borrowings on the line of credit or the repurchase line and was in compliance with all covenants.

     There are no commitments to originate loans as of December 31, 2004 or 2003.

NOTE 9 — CAPITAL RESTRICTION AND REGULATORY MATTERS

     The Company and the Bank are subject to various regulatory capital requirements administered by the federal and state banking agencies. Failure to meet minimum capital requirements can initiate certain mandatory and possibly additional discretionary actions by regulators that, if undertaken, could have a direct material effect on the Company’s financial statements. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Bank must meet specific capital guidelines that involve quantitative measures of the Bank’s assets, liabilities and certain off-balance sheet items as calculated under regulatory accounting practices. The Bank’s capital amounts and classification are also subject to qualitative judgments by the regulators about components, risk-weightings and other factors. The Company is subject to certain restrictions on the amount of dividends that it may declare without prior regulatory approval.

     Management believes, as of December 31, 2004 and 2003, that the Bank met all capital adequacy requirements to which it is subject. Quantitative measures established by regulation to ensure capital adequacy require the Bank to maintain minimum amounts and ratios (set forth in the table below) of total and Tier I capital (as defined in the regulations) to risk-weighted assets (as defined), and of Tier I capital (as defined) to average assets (as defined).

     As of December 31, 2004 and 2003, the most recent notification from the FDIC categorized the Bank as “well capitalized” under the regulatory framework for prompt corrective action. To be categorized as “well capitalized” the Bank must maintain minimum total risk-based, Tier 1 risk based and Tier 1 Leverage ratios as set forth in the table. There are no conditions or events since that notification that management believes have changed the Bank’s category.

F - 77

SOUTH COAST BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2004 and 2003

NOTE 9 — CAPITAL RESTRICTION AND REGULATORY MATTERS — Continued

     The Bank’s actual capital amounts and ratios are presented in the table (dollar amounts in thousands).

											To be Well
											Capitalized Under
						For Capital					Prompt Corrective
	Actual					Adequacy Purposes					Action Provision
	Amount		Ratio			Amount		Ratio			Amount		Ratio
December 31, 2004:
Total capital (to risk weighted assets)	$	17,691		14.01	%	$	10,100		8.00	%	$	12,625		10.00	%
Tier I capital (to risk weighted assets)		16,508		13.07	%		5,051		4.00	%		7,577		6.00	%
Tier I capital (to average assets)		16,508		11.24	%		5,874		4.00	%		7,342		5.00	%

											To be Well
											Capitalized Under
						For Capital					Prompt Corrective
	Actual					Adequacy Purposes					Action Provision
	Amount		Ratio			Amount		Ratio			Amount		Ratio
December 31, 2003:
Total capital (to risk weighted assets)	$	16,741		15.23	%	$	8,794		8.00	%	$	10,992		10.00	%
Tier I capital (to risk weighted assets)		15,530		14.13	%		4,396		4.00	%		6,594		6.00	%
Tier I capital (to average assets)		15,530		11.25	%		5,522		4.00	%		6,902		5.00	%

NOTE 10 — 401(k) PLAN

The Company’s employees are eligible to participate in the Company’s 401(k) plan, which allows participants to contribute from 1% to 15% of their annual salary. The Company matches 50% of these contributions up to 6% of the employees’ annual salary. The Company’s contributions become fully vested after five years. Employees become eligible on January 1 or July 1 following the end of their probationary period and may change their contribution elections semiannually. Plan expenses were $49,000 and $46,000 for the years ended December 31, 2004 and 2003, respectively.

F - 78

SOUTH COAST BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2004 and 2003

NOTE 11 — GENERAL AND ADMINISTRATIVE EXPENSES

     General and administrative expenses for the year ended December 31, are comprised of the following:

	2004		2003
Postage and supplies	$	94,000	$	119,000
FDIC assessment		18,000		19,000
Data processing		83,000		73,000
Insurance and fidelity bonds		97,000		87,000
Accounting and audit services		69,000		88,000
State supervision and examination		31,000		26,000
Appraisal costs		30,000		31,000
Equipment maintenance		44,000		36,000
Automobile		22,000		18,000
Board meetings and directors’ fees		48,000		49,000
Dues and subscriptions		24,000		29,000
Promotion and advertising		120,000		174,000
Credit reports		15,000		13,000
Other		97,000		164,000
	$	792,000	$	926,000

NOTE 12 — DISCLOSURES ABOUT THE FAIR VALUE OF FINANCIAL INSTRUMENTS

     The following disclosure of the estimated fair value of financial instruments is made in accordance with the requirements of SFAS No. 107, Disclosures about Fair Value of Financial Instruments. The estimated fair value amounts have been determined using available market information and appropriate valuation methodologies. However, considerable judgment is necessarily required to interpret market data to develop the estimates of fair value. Accordingly, the estimates presented herein are not necessarily indicative of the amounts that could be realized in a current market exchange. The use of different market assumptions or estimation methodologies may have a material impact on the estimated fair value amounts.

F - 79

SOUTH COAST BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2004 and 2003

NOTE 12 — DISCLOSURES ABOUT THE FAIR VALUE OF FINANCIAL INSTRUMENTS - Continued

     Fair value information related to financial instruments is as follows at December 31:

	2004				2003
	Book		Fair		Book		Fair
	value		value		value		Value
Cash and cash equivalents	$	8,285,000	$	8,285,000	$	12,672,000	$	12,672,000
Interest earning deposits		12,006,000		12,006,000		9,226,000		9,226,000
Investment securities held to maturity		4,528,000		4,505,000		4,005,000		4,032,000
Loans receivable		120,763,000		125,755,000		115,968,000		124,718,000
Accrued interest receivable		481,000		481,000		498,000		498,000
Demand deposits		17,112,000		17,112,000		19,409,000		19,409,000
Statement savings		14,271,000		14,271,000		16,378,000		16,378,000
Certificates of deposit		97,416,000		98,765,000		89,698,000		91,636,000
Accrued interest payable		152,000		152,000		147,000		147,000

     A. Cash and Cash Equivalents

     The carrying amount for cash and cash equivalents approximates fair value because these instruments are demand deposits and do not present unanticipated interest rate or credit concerns. The carrying amount of federal funds included in cash and cash equivalents sold approximates fair value because these are overnight deposits and do not present unanticipated interest rate or credit concerns.

     B. Interest Earning Deposits

     The carrying amount approximates fair value because these certificates have maturities of one year or less and do not present unanticipated interest rate or credit concerns.

     C. Investment Securities

     The fair value of investment securities is estimated based on an average between bid and ask prices published in financial journals.

F - 80

SOUTH COAST BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2004 and 2003

NOTE 12 — DISCLOSURES ABOUT THE FAIR VALUE OF FINANCIAL INSTRUMENTS - Continued

     D. Loans Receivable

     The fair value of loans receivable is estimated by a method that discounts the future cash flows using the current rates at which similar loans would be made to borrowers with similar credit ratings and maturities. Most of the Bank’s loans receivable contain terms, which include variable interest rates with “floors” and “ceilings” as to the range of interest rate change.

     E. Accrued Interest

     The carrying amounts of accrued interest approximate their fair values.

     F. Deposits

     For statement savings and demand deposits, fair value is the amount reported as payable in the financial statements as such amounts are payable on demand. For certificates of deposit, fair value is estimated using the rates currently offered for deposits of similar remaining maturities.

NOTE 13 — PARENT ONLY FINANCIAL INFORMATION

     The following is condensed information as to the financial condition, results of operations and cash flows of the Bancorp:

Condensed Balance Sheets

	December 31,
	2004		2003
Assets
Cash	$	31,000	$	16,000
Certificates of deposit		225,000		225,000
Investment in subsidiaries		16,511,000		15,530,000
Dividends receivable from Bank		122,000		174,000
Total assets	$	16,889,000	$	15,945,000

F - 81

SOUTH COAST BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2004 and 2003

NOTE 13 — PARENT ONLY FINANCIAL INFORMATION — Continued

Condensed Balance Sheets

	2004		2003
Liabilities and Stockholders’ Equity
Liabilities	$	122,000	$	164,000
Stockholders’ equity:
Common stock		2,265,000		2,181,000
Retained earnings		14,502,000		13,600,000
Total liabilities and stockholders’ equity	$	16,889,000	$	15,945,000

Condensed Statements of Earnings

	Year ended December 31,
	2004		2003
Earnings
Equity in undistributed earnings of subsidiaries	$	892,000	$	752,000
Dividend income		2,018,000		2,756,000
Interest income		5,000		7,000
Net earnings	$	2,915,000	$	3,515,000

F - 82

SOUTH COAST BANCORP, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

December 31, 2004 and 2003

NOTE 13 — PARENT ONLY FINANCIAL INFORMATION — Continued

Condensed Statements of Cash Flows

	Year ended December 31,
	2004			2003
Cash flows from operating activities:
Net earnings	$	2,915,000		$	3,515,000
Adjustments to reconcile net earnings to net Cash provided by operating activities:
Equity in undistributed earnings of subsidiaries		(892,000	)		(752,000	)
Net decrease (increase) in dividends receivable		52,000			(3,000	)
Net cash provided by operating activities		2,033,000			2,760,000
Cash flows from investing activities:
Purchase of investment		—			(75,000	)
Net cash used in investing activities		—			(75,000	)
Cash flows from financing activities:
Stock buyout		(85,000	)		(656,000	)
Dividends paid		(1,975,000	)		(2,127,000	)
Net cash used in financing activities		(2,060,000	)		(2,783,000	)
Net increase (decrease) in cash		15,000			(98,000	)
Cash and cash equivalents at beginning of year		16,000			114,000
Cash and cash equivalents at end of year	$	31,000		$	16,000

NOTE 14 — SUBSEQUENT EVENTS

     In February 2005, the Company signed a definitive agreement with First California Bank to acquire all the outstanding common stock of the Company in a cash transaction valued at approximately $36 million. The Boards of both companies have approved the transaction, which is subject to regulatory and shareholder approvals, as well as other customary conditions of closing. First California Bank is expected to form a holding company, First California Bancorp, in connection with this transaction. The transaction is expected to be completed in the second quarter of 2005.

F - 83

Part II — Information Not Required in Prospectus

Item 20. Indemnification of Officers and Directors

     The Registrant’s Bylaws provide that the Registrant shall, to the maximum extent and in the manner permitted by the California Corporations Code (the “Code”), indemnify each of its directors against expenses, judgments, fines, settlements, and other amounts actually and reasonably incurred in connection with any proceeding arising by reason of the fact that such person is or was a director of the Registrant. Furthermore, pursuant to Registrant’s Articles of Incorporation and Bylaws, the Registrant has power to, to the maximum extent and in the manner permitted by the Code, indemnify its employees, officers and agents (other than directors) against expenses, judgments, fines, settlements, and other amounts actually and reasonably incurred in connection with any proceeding arising by reason of the fact that such person is or was an employee, officer or agent of Registrant.

     Under Section 317 of the Code, a corporation may indemnify a director, officer, employee or agent of the corporation against expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by him or her if he or she acted in good faith and in a manner he or she reasonably believed to be in or not opposed to the best interests of the corporation and, with respect to any criminal action or proceeding, had no reasonable cause to believe his or her conduct was unlawful. In the case of an action brought by or in the right of a corporation, the corporation may indemnify a director, officer, employee or agent of the corporation against expenses (including attorneys’ fees) actually and reasonably incurred by him or her if he or she acted in good faith and in a manner he or she acted in good faith and in a manner he or she reasonably believed to be in the best interests of the corporation, except that no indemnification shall be made: (1) in respect of any claim, issue or matter as to which such person shall have been adjudged to be liable to the corporation unless a court finds that, in view of all the circumstances of the case, such person is fairly and reasonably entitled to indemnify for such expenses as the court shall deem proper, (2) of amounts paid in settling or otherwise disposing of a pending action without court approval, and (3) of expenses incurred in defending a pending action which is settled or otherwise disposed of without court approval.

     The Registrant’s Articles of Incorporation provides that to the fullest extent permitted by the Code as the same exists or may hereafter be amended, a director of the Registrant shall not be liable to the Registrant or its shareholders for monetary damages for breach of fiduciary duty as a director. The Code permits California corporations to include in their articles of incorporation a provision eliminating or limiting director liability for monetary damages arising from breaches of their fiduciary duty. The only imitations imposed under the statute are that the provision may not eliminate or limit a director’s liability (i) for acts or omissions that involve intentional misconduct or a knowing and culpable violation of law, (ii) for acts or omissions that a director believes to be contrary to the best interests of the corporation or its shareholders or that involve the absence of good faith on the part of the director, (iii) for any transaction from which a director derived an improper personal benefit, (iv) for acts or omissions that show a reckless disregard for the director’s duty to the corporation or its shareholders in circumstances in which the director was aware, or should have been aware, in the ordinary course of performing a director’s duties, of a risk of serious injury to the corporation or its shareholders, (v) for acts or omissions that constitute an unexcused pattern of inattention that amounts to an abdication of the director’s duty to the corporation or its shareholders, (vi) under a contract or transaction between the corporation and a director or between the corporation and any corporation in which one more of its directors has a material financial interest, or (vii) for approving any of the following corporate actions: (1) the making of any distribution to its shareholders that would cause the corporation to be unable to meet its liabilities, (2) the making of any distribution to the corporation’s shareholders on any shares of its stock of any class or series that are junior to outstanding shares of any other class or series with respect to distribution of assets on liquidation if, after giving effect thereto, the excess of its assets (exclusive of goodwill, capitalized research and development expenses and deferred charges) over its liabilities (not including deferred taxes, deferred income and other deferred credits) would be less than the liquidation preference of all shares having a preference on liquidation over the class or series to which the distribution is made; provided, however, that for the purpose of applying the aforementioned to a distribution by a corporation of cash or property

II-1

in payment by the corporation in connection with the purchase of its shares, there shall be deducted from liabilities all amounts that had been previously added thereto with respect to obligations incurred in connection with the corporation’s repurchase of its shares and reflected on the corporation’s balance sheet, but not in excess of the principal of the obligations that will remain unpaid after the distribution; provided, further, that no deduction from liabilities shall occur on account of any obligation that is a distribution to the corporation’s shareholders at the time the obligation is incurred, (3)the distribution of assets to shareholders after institution of dissolution proceeding of the corporation, without paying or adequately providing for all known liabilities of the corporation, excluding any claims not filed by creditors within the time limit set by the court in a notice given to creditors under Chapters 18, 19 and 20, (4) the making of any loan to or guarantee the obligation of any director or officer, unless the transaction is approved by a majority of the shareholders to act thereon, or (5) the making of any loan to or guarantee the obligation of, any person upon the security of shares of the corporation or of its parent if the corporation’s recourse in the event of default is limited to the security for the loan or guaranty y, unless the loan or guarantee is adequately secured without considering these shares, or the loan or guaranty is approved by a majority of the shareholders entitled to act thereon.

     Registrant is insured against liabilities which it may incur by reason of its indemnification of officers and directors in accordance with its Bylaws and it is anticipated that the Registrant will assume that policy on its and Registrant’s behalf.

     In___200___, Registrant entered into Indemnification Agreements with each of its executive officers and directors pursuant to which Registrant agreed to indemnify each executive officer and director for expenses, judgments, fines, settlements and other amounts incurred in connection with any proceeding arising by reason of the fact that such director was an “agent” of Registrant to the fullest extent permissible under California law, subject to the terms and conditions of the Indemnification Agreements. The indemnification provisions also apply to liability under the Federal Securities Laws. Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers or persons controlling Registrant pursuant to the foregoing provisions, Registrant has been informed that in the opinion of the SEC such indemnification is against public policy as expressed in the Securities Act and is therefore unenforceable.

     At present, Registrant is not aware of any pending or threatened litigation or proceeding involving its directors, officers, employees or agents in which indemnification would be required or permitted. Registrant believes that its Articles of Incorporation and Bylaw provisions and indemnification agreements with its directors are necessary to attract and retain qualified persons as directors and officers.

     The foregoing summaries are necessarily subject to the complete text of the statute, Articles of Incorporation, Bylaws and agreements referred to above and are qualified in their entirety by reference thereto.

Item 21. Exhibits and Financial Statement Schedules

     (a) Exhibit Index

Designation	Exhibit
2*	Plan of Reorganization and Merger Agreement, dated May 19, 2005, by and between First California Bank, FCB Merger Corp. and FCB Bancorp, filed as Exhibit A to the Proxy Statement/Prospectus included in this Registration Statement.
3.1**	Articles of Incorporation, as amended, of FCB Bancorp
3.2**	Bylaws of FCB Bancorp
5*	Opinion of Horgan, Rosen, Beckham & Coren, L.L.P., regarding the legality the securities being registered and consent

II-2

Designation	Exhibit
8**	Tax Opinion of Horgan, Rosen, Beckham & Coren, L.L.P.
10.1**	FCB Bancorp 2005 Stock Option Plan
10.2**	Form of FCB Bancorp Stock Option Agreement
10.3**	Form of FCB Bancorp Indemnity Agreement
10.4**	Salary Continuation Agreement dated March 27, 2003 with C. G. Kum
10.5**	Split Dollar Life Agreement dated March 27, 2003 with C. G. Kum
10.6**	Salary Continuation Agreement dated March 27, 2003 with Thomas E. Anthony
10.7**	Split Dollar Life Agreement dated March 27, 2003 with Thomas E. Anthony
10.8**	Agreement and Plan of Reorganization by and among FCB Bancorp, SCB Merger Corp., First California Bank, South Coast Bancorp, Inc. and South Coast Commercial Bank dated February 2, 2005, as amended
10.9**	Form of Subscription Agreement
10.10**	Private Placement Agency Agreement
10.11**	Form of Registration Rights Agreement
23.1*	Consent of Horgan, Rosen, Beckham & Coren, L.L.P. (included as part of Exhibit 5)
23.2*	Consent of Moss Adams, LLP
23.3*	Consent of Grant Thornton LLP
23.4**	Consent of Horgan, Rosen, Beckham & Coren, L.L.P. (included as part of Exhibit 8)
24	Power of Attorney (included with Signatures)
99*	Form of Proxy of First California Bank

*	This document was previously filed as an exhibit to the Form S-4.
**	Filed herewith as part of this Pre-Effective Amendment No. 2 to Registration Statement on Form S-4.

Item 22. Undertakings

     (a) Item 512 of Regulation S-K.

     (1) The undersigned Registrant hereby undertakes as follows: that prior to any public reoffering of the securities registered hereunder through use of a prospectus which is a part of this Registration Statement, by any person or party who is deemed to be an underwriter within the meaning of Rule 145(c), the issuer undertakes that such reoffering prospectus will contain the information called for by the applicable registration form with respect to reofferings by persons who may be deemed underwriters, in addition to the information called for by the other items of the applicable form.

     (2) The Registrant undertakes that every prospectus: (i) that is filed pursuant to paragraph (1) immediately preceding, or (ii) that purports to meet the requirements of Section 10(a)(3) of the Act and is used in connection with an offering of securities subject to Rule 415, will be filed as a part of an amendment to the Registration Statement and will not be used until such amendment is effective, and that, for purposes of determining liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new Registration Statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

     (b) The undersigned Registrant hereby undertakes to respond to requests for information that is incorporated by reference into the prospectus pursuant to Item 4, 10(b), 11, 13 of this form, within one business day of receipt of

II-3

such request, and to send the incorporated documents by first class mail or other equally prompt means. This includes information contained in documents filed subsequent to the effective date of the Registration Statement through the date of responding to the request.

     (c) The undersigned Registrant hereby undertakes to supply by means of a post-effective amendment all information concerning a transaction, and the company being acquired involved therein, that was not the subject of and included in the Registration Statement when it became effective.

     (h) Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue.

II-4

SIGNATURES

     Pursuant to the requirements of the Securities Act of 1933, the registrant has duly caused this Pre-Effective Amendment No. 2 to Registration Statement on Form S-4 to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Camarillo, State of California, on August 31, 2005.

FCB BANCORP
By:	/s/ C. G. Kum *
	C. G. Kum
	President and Chief Executive Officer

     Pursuant to the requirements of the Securities Act of 1933, this Pre-Effective Amendment No. 2 to Registration Statement on Form S-4 has been signed by the following persons in the capacities and on the dates indicated.

Signature	Title	Date
/s/ Richard D. Aldridge*	Director	August 31, 2005
/s/ Thomas E. Anthony*	Executive Vice President and Chief Credit Officer	August 31, 2005
/s/ James O. Birchfield*	Chairman of the Board	August 31, 2005
/s/ John W. Birchfield*	Vice Chairman	August 31, 2005
/s/ Tenisha M. Fitzgerald*	Director	August 31, 2005
/s/ C. G. Kum*	Director, President and Chief Executive Officer	August 31, 2005
	(Principal Executive Officer)
/s/ Syble R. Roberts*	Director	August 31, 2005
/s/ Romolo Santarosa*	Executive Vice President and Chief Financial Officer	August 31, 2005
	(Principal Financial Officer and Principal Accounting Officer)
*By Gary M. Horgan, Attorney in fact.

EXHIBIT INDEX

Designation	Exhibit
2*	Plan of Reorganization and Merger Agreement, dated May 19, 2005, by and between First California Bank, FCB Merger Corp. and FCB Bancorp, filed as Exhibit A to the Proxy Statement/Prospectus included in this Registration Statement.
3.1**	Articles of Incorporation, as amended, of FCB Bancorp
3.2**	Bylaws of FCB Bancorp
5*	Opinion of Horgan, Rosen, Beckham & Coren, L.L.P., regarding the legality the securities being registered and consent
8**	Tax Opinion of Horgan, Rosen, Beckham & Coren, L.L.P.
10.1**	FCB Bancorp 2005 Stock Option Plan
10.2**	Form of FCB Bancorp Stock Option Agreement
10.3**	Form of FCB Bancorp Indemnity Agreement
10.4**	Salary Continuation Agreement dated March 27, 2003 with C. G. Kum
10.5**	Split Dollar Life Agreement dated March 27, 2003 with C. G. Kum
10.6**	Salary Continuation Agreement dated March 27, 2003 with Thomas E. Anthony
10.7**	Split Dollar Life Agreement dated March 27, 2003 with Thomas E. Anthony
10.8**	Agreement and Plan of Reorganization by and among FCB Bancorp, SCB Merger Corp., First California Bank, South Coast Bancorp, Inc. and South Coast Commercial Bank dated February 2, 2005, as amended
10.9**	Form of Subscription Agreement
10.10**	Private Placement Agency Agreement
10.11**	Form of Registration Rights Agreement
23.1*	Consent of Horgan, Rosen, Beckham & Coren, L.L.P. (included as part of Exhibit 5)
23.2*	Consent of Moss Adams, LLP
23.3*	Consent of Grant Thornton LLP
23.4**	Consent of Horgan, Rosen, Beckham & Coren, L.L.P. (included as part of Exhibit 8)
24	Power of Attorney (included with Signatures)
99*	Form of Proxy of First California Bank

*	This document was previously filed as an exhibit to the Form S-4.
**	Filed herewith as part of this Pre-Effective Amendment No. 2 to Registration Statement on Form S-4.

EX-3.1

  Exhibit 3.1

ARTICLES OF INCORPORATION
OF
FCB BANCORP

[As amended March 15, 2005; Restated for filing pursuant to S-K Item 601(b)(3)]

     ARTICLE ONE. NAME: The name of this Corporation is:

FCB Bancorp

     ARTICLE TWO. PURPOSE: The purpose of this Corporation is to engage in any lawful act or activity for which a corporation may be organized under the General Corporation Law of California other than the banking business, the trust business or the practice of a profession permitted to be incorporated by the California Corporations Code.

     ARTICLE THREE. INITIAL AGENT: The name and address in this state of this Corporation’s initial agent for service of process is:

Gary M. Horgan, Esq.
Horgan, Rosen, Beckham & Coren, L.L.P.
23975 Park Sorrento, Suite 200
Calabasas, California 91302

     ARTICLE FOUR. AUTHORIZED STOCK: This Corporation is authorized to issue two (2) classes of shares of stock: one class of shares to be called “Common Stock”; the second class of shares to be called “Serial Preferred Stock.” The total number of shares of stock which this Corporation shall have authority to issue is twenty million (20,000,000), of which ten million (10,000,000) shall be Common Stock and ten million (10,000,000) shall be Serial Preferred Stock.

     The designations and the powers, preferences, and rights and the qualifications, limitations or restrictions thereof, of each class of stock of this Corporation shall be as follows:

     (a) Serial Preferred Stock. The Serial Preferred Stock may be issued from time to time in one or more series. The Board of Directors is hereby authorized to fix or alter the rights, preferences, privileges and restrictions granted to or imposed upon any wholly unissued series of preferred shares, and the number of shares constituting any such series and a designation thererof, or any of them; and to increase or decrease the number of shares of any series subsequent to the issue of shares of that series, but not below the number of shares of such series then outstanding. In case the number of shares of any series shall be so decreased, the shares constituting such decrease shall resume the status which they had prior to the adoption of the resolution originally fixing the number of shares of such series.

     (b) Common Stock.

(1) After the requirements with respect to preferential dividends upon all classes and series of stock entitled thereto shall have been paid or declared and set apart for payment and after this Corporation shall have complied with all requirements, if any, with respect to the setting aside of sums as a sinking fund or for a redemption account on any class of stock, then and not otherwise, the holders of Common Stock shall be entitled to receive, subject to the applicable provisions of the Corporations Code of the State

	of California, such dividends as may be declared from time to time by the Board of Directors.
(2)	After distribution in full of the preferential amounts to be distributed to the holders of all classes and series of stock entitled thereto in the event of a voluntary or involuntary liquidations, dissolution, or winding up of this Corporation, the holders of the Common Stock shall be entitled to receive all the remaining assets of the Corporation.
(3)	Each holder of Common Stock shall have one (1) vote in respect of each share of such stock held by him, subject, however, to such special voting rights by class as are or may be granted to holders of Serial Preferred Stock.

     ARTICLE FIVE. DIRECTOR LIABILITY: The liability of directors of this Corporation for monetary damages shall be eliminated to the fullest extent permissible under California law. Any amendment, repeal or modification of the provisions of this Article shall not adversely affect any right or protection of a director of the Corporation existing at the time of such amendment, repeal or modification.

     ARTICLE SIX. INDEMNIFICATION OF AGENTS: This Corporation is authorized to provide indemnification of agents (as defined in Section 317 of the General Corporation Law of the State of California) for breach of duty to this Corporation and its shareholders through bylaw provision, agreements with the agents, or otherwise, in excess of the indemnification otherwise permitted by Section 317 of the General Corporation Law of the State of California, subject to the limits on such excess indemnification set forth in Section 204 of the General Corporation Law of the State of California. Any amendment, repeal or modification of the provisions of this Article shall not adversely affect any right or protection of an agent of this Corporation existing at the time of such amendment, repeal or modification.

     IN WITNESS WHEREOF, for the purpose of forming this Corporation under the laws of the State of California, the undersigned, constituting the incorporator of this Corporation, has executed these Articles of Incorporation.

Dated: January 24, 2005

Gary M. Horgan 

     I hereby declare that I am the person who executed the foregoing Articles of Incorporation, which execution is my act and deed.

Gary M. Horgan 

2

EX-3.2

Exhibit 3.2

BYLAWS

OF

FCB BANCORP

BYLAWS OF
FCB BANCORP

TABLE OF CONTENTS

			Page
ARTICLE I — CORPORATE OFFICES				1
	1.1	PRINCIPAL OFFICE		1
	1.2	OTHER OFFICES		1
ARTICLE II — MEETINGS OF SHAREHOLDERS				1
	2.1	PLACE OF MEETINGS		1
	2.2	ANNUAL MEETING		1
	2.3	SPECIAL MEETING		1
	2.4	NOTICE OF SHAREHOLDERS’ MEETINGS		2
	2.5	MANNER OF GIVING NOTICE; AFFIDAVIT OF NOTICE		2
	2.6	QUORUM		3
	2.7	ADJOURNED MEETING; NOTICE		3
	2.8	VOTING		4
	2.9	VALIDATION OF MEETINGS; WAIVER OF NOTICE; CONSENT		4
	2.10	SHAREHOLDER ACTION BY WRITTEN CONSENT WITHOUT A MEETING		4
	2.11	RECORD DATE FOR SHAREHOLDER NOTICE; VOTING; GIVING CONSENTS		5
	2.12	PROXIES		6
	2.13	INSPECTORS OF ELECTION		7
	2.14	NOMINATION OF DIRECTORS		7
ARTICLE III — DIRECTORS				8
	3.1	POWERS		8
	3.2	NUMBER OF DIRECTORS		8
	3.3	ELECTION AND TERM OF OFFICE OF DIRECTORS		8
	3.4	REMOVAL		8
	3.5	RESIGNATION AND VACANCIES		9
	3.6	PLACE OF MEETINGS; MEETINGS BY TELEPHONE		9
	3.7	REGULAR MEETINGS		10
	3.8	SPECIAL MEETINGS; NOTICE		10
	3.9	QUORUM		10
	3.10	WAIVER OF NOTICE		11
	3.11	ADJOURNMENT		11
	3.12	NOTICE OF ADJOURNMENT		11
	3.13	BOARD ACTION BY WRITTEN CONSENT WITHOUT A MEETING		11
	3.14	FEES AND COMPENSATION OF DIRECTORS		11
ARTICLE IV — COMMITTEES				11
	4.1	COMMITTEES OF DIRECTORS		11
	4.2	REQUIRED COMMITTEES		12
	4.3	MEETINGS AND ACTION OF COMMITTEES		13
ARTICLE V — OFFICERS				13
	5.1	OFFICERS		13

i

			Page
	5.2	APPOINTMENT OF OFFICERS		13
	5.3	SUBORDINATE OFFICERS		14
	5.4	REMOVAL AND RESIGNATION OF OFFICERS		14
	5.5	VACANCIES IN OFFICES		14
	5.6	CHAIRMAN OF THE BOARD		14
	5.8	PRESIDENT		14
	5.9	VICE PRESIDENTS		15
	5.10	SECRETARY		15
	5.11	CHIEF FINANCIAL OFFICER		15
	5.12	CHIEF CREDIT OFFICER		16
ARTICLE VI — INDEMNIFICATION OF DIRECTORS, OFFICERS, EMPLOYEES, AND OTHER AGENTS				16
	6.1	INDEMNIFICATION OF DIRECTORS		16
	6.2	INDEMNIFICATION OF OTHERS		16
	6.3	PAYMENT OF EXPENSES IN ADVANCE		17
	6.4	INDEMNITY NOT EXCLUSIVE		17
	6.5	INSURANCE INDEMNIFICATION		17
	6.6	CONFLICTS		17
	6.7	RIGHT TO BRING SUIT		18
	6.8	INDEMNITY AGREEMENTS		18
	6.9	AMENDMENT, REPEAL OR MODIFICATION		18
ARTICLE VII — RECORDS AND REPORTS				18
	7.1	MAINTENANCE AND INSPECTION OF SHARE REGISTER		18
	7.2	MAINTENANCE AND INSPECTION OF BYLAWS		19
	7.3	MAINTENANCE AND INSPECTION OF OTHER CORPORATE RECORDS		19
	7.4	INSPECTION BY DIRECTORS		20
	7.5	ANNUAL REPORT TO SHAREHOLDERS; WAIVER		20
	7.6	FINANCIAL STATEMENTS		20
	7.7	REPRESENTATION OF SHARES OF OTHER CORPORATIONS		21
ARTICLE VIII — GENERAL MATTERS				21
	8.1	RECORD DATE FOR PURPOSES OTHER THAN NOTICE AND VOTING		21
	8.2	CHECKS; DRAFTS; EVIDENCES OF INDEBTEDNESS		21
	8.3	CORPORATE CONTRACTS AND INSTRUMENTS: HOW EXECUTED		21
	8.4	CERTIFICATES FOR SHARES		22
	8.5	LOST CERTIFICATES		22
	8.6	CONSTRUCTION; DEFINITIONS		22
ARTICLE IX — AMENDMENTS				22
	9.1	AMENDMENT BY SHAREHOLDERS		22
	9.2	AMENDMENT BY DIRECTORS		23
	9.3	RECORD OF AMENDMENTS		23
ARTICLE X — INTERPRETATION				23

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BYLAWS

OF

FCB BANCORP

ARTICLE I

CORPORATE OFFICES

     1.1 PRINCIPAL OFFICE

     The Board of Directors shall fix the location of the principal executive office of the corporation at any place within the State of California.

     1.2 OTHER OFFICES

     The Board of Directors may at any time establish branch or subordinate offices at any place or places.

ARTICLE II

MEETINGS OF SHAREHOLDERS

     2.1 PLACE OF MEETINGS

     Meetings of shareholders shall be held at any place within the State of California designated by the Board of Directors. In the absence of any such designation, shareholders’ meetings shall be held at the principal executive office of the corporation or at any place consented to in writing by all persons entitled to vote at such meeting, given before or after the meeting and filed with the Secretary of the corporation.

     2.2 ANNUAL MEETING

     An annual meeting of shareholders shall be held each year on a date and at a time designated by the Board of Directors. At that meeting, directors shall be elected. Any other proper business may be transacted at the annual meeting of shareholders.

     2.3 SPECIAL MEETINGS

     Special meetings of the shareholders may be called at any time, subject to the provisions of Sections 2.4 and 2.5 of these Bylaws, by the Board of Directors, the Chairman of the Board, the President or the holders of shares entitled to cast not less than ten percent (10%) of the votes at that meeting.

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     If a special meeting is called by anyone other than the Board of Directors or the President or the Chairman of the Board, then the request shall be in writing, specifying the time of such meeting and the general nature of the business proposed to be transacted, and shall be delivered personally or sent by registered mail or by other written communication to the Chairman of the Board, the President, any Vice President or the Secretary of the corporation. The officer receiving the request forthwith shall cause notice to be given to the shareholders entitled to vote, in accordance with the provisions of Sections 2.4 and 2.5 of these Bylaws, that a meeting will be held at the time requested by the person or persons calling the meeting, so long as that time is not less than thirty-five (35) nor more than sixty (60) days after the receipt of the request. If the notice is not given within twenty (20) days after receipt of the request, then the person or persons requesting the meeting may give the notice. Nothing contained in this paragraph of this Section 2.3 shall be construed as limiting, fixing or affecting the time when a meeting of shareholders called by action of the Board of Directors may be held.

     2.4 NOTICE OF SHAREHOLDERS’ MEETINGS

     All notices of meetings of shareholders shall be sent or otherwise given in accordance with Section 2.5 of these Bylaws not less than ten (10) (or, if sent by third-class mail pursuant to Section 2.5 of these Bylaws, not less than thirty (30)) nor more than sixty (60) days before the date of the meeting to each shareholder entitled to vote thereat. Such notice shall state the place, date, and hour of the meeting and (i) in the case of a special meeting, the general nature of the business to be transacted, and no business other than that specified in the notice may be transacted, or (ii) in the case of the annual meeting, those matters which the Board of Directors, at the time of the mailing of the notice, intends to present for action by the shareholders, but, subject to the provisions of the next paragraph of this Section 2.4, any proper matter may be presented at the meeting for such action. The notice of any meeting at which Directors are to be elected shall include the names of nominees intended at the time of the notice to be presented by the Board for election.

     If action is proposed to be taken at any meeting for approval of (i) a contract or transaction in which a director has a direct or indirect financial interest, pursuant to Section 310 of the California Corporations Code (the ACode@), (ii) an amendment of the Articles of Incorporation, pursuant to Section 902 of the Code, (iii) a reorganization of the corporation, pursuant to Section 1201 of the Code, (iv) a voluntary dissolution of the corporation, pursuant to Section 1900 of the Code, or (v) a distribution in dissolution other than in accordance with the rights of any outstanding preferred shares, pursuant to Section 2007 of the Code, then the notice shall also state the general nature of that proposal.

     2.5 MANNER OF GIVING NOTICE; AFFIDAVIT OF NOTICE

     Notice of a shareholders’ meeting shall be given either personally or by first-class mail, or, if the corporation has outstanding shares held of record by five hundred (500) or more persons (determined as provided in Section 605 of the Code) on the record date for the shareholders’ meeting, notice may be sent by third-class mail, or other means of written communication, addressed to the shareholder at the address of the shareholder appearing on the books of the corporation or given by

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the shareholder to the corporation for the purpose of notice; or if no such address appears or is given, at the place where the principal executive office of the corporation is located or by publication at least once in a newspaper of general circulation in the county in which the principal executive office is located. The notice shall be deemed to have been given at the time when delivered personally or deposited in the mail or sent by other means of written communication.

     If any notice (or any report referenced in Article VII of these Bylaws) addressed to a shareholder at the address of such shareholder appearing on the books of the corporation is returned to the corporation by the United States Postal Service marked to indicate that the United States Postal Service is unable to deliver the notice to the shareholder at that address, all future notices or reports shall be deemed to have been duly given without further mailing if the same shall be available to the shareholder upon written demand of the shareholder at the principal executive office of the corporation for a period of one (1) year from the date of the giving of the notice.

     An affidavit of mailing of any notice or report in accordance with the provisions of this Section 2.5, executed by the Secretary, Assistant Secretary or any transfer agent, shall be prima facie evidence of the giving of the notice or report.

     2.6 QUORUM

     Unless otherwise provided in the Articles of Incorporation of the corporation, a majority of the shares entitled to vote, represented in person or by proxy, shall constitute a quorum at a meeting of the shareholders. The shareholders present at a duly called or held meeting at which a quorum is present may continue to transact business until adjournment notwithstanding the withdrawal of enough shareholders to leave less than a quorum, if any action taken (other than adjournment) is approved by at least a majority of the shares required to constitute a quorum.

     In the absence of a quorum, any meeting of shareholders may be adjourned from time to time by the vote of a majority of the shares represented either in person or by proxy, but no other business may be transacted, except as provided in the last sentence of the preceding paragraph.

     2.7 ADJOURNED MEETING; NOTICE

     Any shareholders’ meeting, annual or special, whether or not a quorum is present, may be adjourned from time to time by the vote of the majority of the shares represented at that meeting, either in person or by proxy.

     When any meeting of shareholders, either annual or special, is adjourned to another time or place, notice need not be given of the adjourned meeting if its time and place are announced at the meeting at which the adjournment is taken. However, if the adjournment is for more than forty-five (45) days from the date set for the original meeting or if a new record date for the adjourned meeting is fixed, a notice of the adjourned meeting shall be given to each shareholder of record entitled to vote at the adjourned meeting in accordance with the provisions of Sections 2.4 and 2.5 of these Bylaws. At any adjourned meeting the corporation may transact any business which might have been transacted at the original meeting.

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     2.8 VOTING

     The shareholders entitled to vote at any meeting of shareholders shall be determined in accordance with the provisions of Section 2.11 of these Bylaws, subject to the provisions of Sections 702 through 704 of the Code (relating to voting shares held by a fiduciary, in the name of a corporation, or in joint ownership).

     Elections for directors and voting on any other matter at a shareholders’ meeting need not be by ballot unless a shareholder demands election by ballot at the meeting and before the voting begins.

     Except as provided in the last paragraph of this Section 2.8, or as may be otherwise provided in the Articles of Incorporation of the corporation, each outstanding share, regardless of class, shall be entitled to one vote on each matter submitted to a vote of the shareholders. Any holder of shares entitled to vote on any matter may vote part of the shares in favor of the proposal and refrain from voting the remaining shares or may vote them against the proposal other than elections to office, but, if the shareholder fails to specify the number of shares such shareholder is voting affirmatively, it will be conclusively presumed that the shareholder’s approving vote is with respect to all shares which the shareholder is entitled to vote.

     The affirmative vote of the majority of the shares represented and voting at a duly held meeting at which a quorum is present (which shares voting affirmatively also constitute at least a majority of the required quorum) shall be the act of the shareholders, unless the vote of a greater number or voting by classes is required by the Code or by the Articles of Incorporation of the corporation.

     At a shareholders’ meeting at which directors are to be elected, a shareholder shall be entitled to cumulate votes either (i) by giving one candidate a number of votes equal to the number of directors to be elected multiplied by the number of votes to which that shareholder’s shares are normally entitled or (ii) by distributing the shareholder’s votes on the same principle among as many candidates as the shareholder thinks fit, if the candidate or candidates’ names have been placed in nomination prior to the voting and the shareholder has given notice prior to the voting of the shareholder’s intention to cumulate the shareholder’s votes. If any one shareholder has given such a notice, then every shareholder entitled to vote may cumulate votes for candidates in nomination. The candidates receiving the highest number of affirmative votes, up to the number of directors to be elected, shall be elected; votes against any candidate and votes withheld shall have no legal effect.

     2.9 VALIDATION OF MEETINGS; WAIVER OF NOTICE; CONSENT

     The transactions taken at any meeting of shareholders, either annual or special, however called and noticed, and wherever held, are as valid as though they had been taken at a meeting duly held after regular call and notice, if a quorum be present either in person or by proxy, and if, either before or after the meeting, each of the persons entitled to vote, whether present in person or by proxy, signs a written waiver of notice or a consent to the holding of the meeting or an approval of the minutes thereof. Neither the business to be transacted at nor the purpose of any annual or special

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meeting of shareholders need be specified in any written waiver of notice or consent to the holding of the meeting or approval of the minutes thereof, except that if action is taken or proposed to be taken for approval of any of those matters specified in the second paragraph of Section 2.4 of these Bylaws, the waiver of notice or consent or approval shall state the general nature of the proposal. All such waivers, consents, and approvals shall be filed with the corporate records or made a part of the minutes of the meeting.

     The attendance of a person at a meeting shall constitute a waiver of notice of and presence at that meeting, except when the person objects, at the beginning of the meeting, to the transaction of any business because the meeting is not lawfully called or convened and except that attendance at a meeting is not a waiver of any right to object to the consideration of matters required by the Code to be included in the notice of such meeting but not so included, if such objection is expressly made at the meeting.

     2.10 SHAREHOLDER ACTION BY WRITTEN CONSENT WITHOUT A MEETING

     Any action which may be taken at any annual or special meeting of shareholders may be taken without a meeting and without prior notice, if a consent in writing, setting forth the action so taken, shall be signed by the holders of outstanding shares having not less than the minimum number of votes that would be necessary to authorize or take such action at a meeting at which all shares entitled to vote thereon were present and voted.

     Directors may not be elected by written consent except by unanimous written consent of all shares entitled to vote for the election of directors. However, a director may be elected at any time to fill any vacancy on the Board of Directors, provided that it was not created by removal of a director and that it has not been filled by the directors, by the written consent of the holders of a majority of the outstanding shares entitled to vote for the election of directors.

     All such consents shall be maintained in the corporate records. Any shareholder giving a written consent, or the shareholder’s proxy holders, or a transferee of the shares, or a personal representative of the shareholder, or their respective proxy holders, may revoke the consent by delivering a writing to the corporation stating that the consent is revoked; provided, however, that such writing is received by the Secretary of the corporation before the written consents of the number of shares required to authorize the proposed action have been filed with the Secretary.

     If the consents of all shareholders entitled to vote have not been solicited in writing, the Secretary shall give prompt notice of any corporate action approved by the shareholders without a meeting by less than unanimous written consent to those shareholders entitled to vote who have not consented in writing. Such notice shall be given in the manner specified in Section 2.5 of these Bylaws. In the case of approval of (i) a contract or transaction in which a director has a direct or indirect financial interest, pursuant to Section 310 of the Code, (ii) indemnification of a corporate Aagent,@ pursuant to Section 317 of the Code, (iii) a reorganization of the corporation, pursuant to Section 1201 of the Code, and (iv) a distribution in dissolution other than in accordance with the rights of outstanding preferred shares, pursuant to Section 2007 of the Code, the notice shall be given

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at least ten (10) days before the consummation of any action authorized by that approval, unless the consents of all shareholders entitled to vote have been solicited in writing.

     2.11 RECORD DATE FOR SHAREHOLDER NOTICE; VOTING; GIVING CONSENTS

     In order that the corporation may determine the shareholders entitled to notice of any meeting or to vote, the Board of Directors may fix, in advance, a record date, which shall not be more than sixty (60) days nor less than ten (10) days prior to the date of such meeting nor more than sixty (60) days before any other action. Shareholders at the close of business on the record date are entitled to notice and to vote, as the case may be, notwithstanding any transfer of any shares on the books of the corporation after the record date, except as otherwise provided in the Articles of Incorporation of the corporation or the Code.

     A determination of shareholders of record entitled to notice of or to vote at a meeting of shareholders, annual or special, shall apply to any adjournment of the meeting unless the Board of Directors fixes a new record date for the adjourned meeting, but the Board of Directors shall fix a new record date if the meeting is adjourned for more than forty-five (45) days from the date set for the original meeting.

     If the Board of Directors does not so fix a record date:

          (a) The record date for determining shareholders entitled to notice of or to vote at a meeting of shareholders shall be at the close of business on the business day next preceding the day on which notice is given or, if notice is waived, at the close of business on the business day next preceding the day on which the meeting is held; and

          (b) The record date for determining shareholders entitled to give consent to corporate action in writing without a meeting, (i) when no prior action by the Board has been taken, shall be the day on which the first written consent is given, or (ii) when prior action by the Board has been taken, shall be at the close of business on the day on which the Board adopts the resolution relating thereto, or the sixtieth (60th) day prior to the date of such other action, whichever is later.

     The record date for any other purpose shall be as provided in Section 8.1 of these Bylaws.

     2.12 PROXIES

     Every person entitled to vote for directors, or on any other matter, shall have the right to do so either in person or by one or more agents authorized by a written proxy signed by the person and filed with the Secretary of the corporation. A proxy shall be deemed signed if the shareholder’s name or other authorization is placed on the proxy (whether by manual signature, typewriting, telegraphic or electronic transmission or otherwise) by the shareholder or the shareholder’s attorney-in-fact. A validly executed proxy which does not state that it is irrevocable shall continue in full force and effect unless (i) the person who executed the proxy revokes it prior to the time of voting by delivering a writing to the corporation stating that the proxy is revoked or by executing a subsequent

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proxy and presenting it to the meeting or by attendance at such meeting and voting in person, or (ii) written notice of the death or incapacity of the maker of that proxy is received by the corporation before the vote pursuant to that proxy is counted; provided, however, that no proxy shall be valid after the expiration of eleven (11) months from the date thereof, unless otherwise provided in the proxy. The dates contained on the forms of proxy presumptively determine the order of execution, regardless of the postmark dates on the envelopes in which they are mailed. The revocability of a proxy that states on its face that it is irrevocable shall be governed by the provisions of Sections 705(e) and 705(f) of the Code.

     2.13 INSPECTORS OF ELECTION

     In advance of any meeting of shareholders, the Board of Directors may appoint inspectors of election to act at the meeting and any adjournment thereof. If inspectors of election are not so appointed or designated or if any persons so appointed fail to appear or refuse to act, then the Chairman of the meeting may, and on the request of any shareholder or a shareholder’s proxy shall, appoint inspectors of election (or persons to replace those who so fail to appear) at the meeting. The number of inspectors shall be either one (1) or three (3). If appointed at a meeting on the request of one (1) or more shareholders or proxies, the majority of shares represented in person or by proxy shall determine whether one (1) or three (3) inspectors are to be appointed.

     The inspectors of election shall determine the number of shares outstanding and the voting power of each, the shares represented at the meeting, the existence of a quorum, and the authenticity, validity, and effect of proxies, receive votes, ballots or consents, hear and determine all challenges and questions in any way arising in connection with the right to vote, count and tabulate all votes or consents, determine when the polls shall close, determine the result and do any other acts that may be proper to conduct the election or vote with fairness to all shareholders.

     2.14 NOMINATION OF DIRECTORS

     Nominations for election of members of the Board of Directors may be made by the Board of Directors or by any shareholder of any outstanding class of capital stock of the corporation entitled to vote for the election of directors. Notice of intention to make any nominations (other than for persons named in the notice of the meeting at which such nomination is to be made) shall be made in writing and shall be delivered to the President of the corporation by the later of the close of business twenty-one (21) days prior to any meeting of shareholders called for the election of directors or seven (7) days after the date of mailing of notice of the meeting to shareholders. Such notification should be signed by the nominating shareholder and by the proposed nominee and shall contain the following information: (a) the name and address of each proposed nominee; (b) the principal occupation of each proposed nominee; (c) the number of shares of capital stock of the corporation owned by each proposed nominee; (d) the name and residence address of the notifying shareholder; (e) the number of shares of capital stock of the corporation owned by the notifying shareholder; and (f) the Written Consent to such nomination by the proposed nominee and a statement as to whether the proposed nominee has ever been convicted of or pleaded nolo contendere to any criminal offense involving dishonesty or breach of trust, filed a petition in bankruptcy, or been adjudged bankrupt. Nominations not made in accordance herewith shall be disregarded by the chairman of the meeting,

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and upon his instructions, the inspectors of election shall disregard all votes cast for each such nominee. The restrictions set forth in this paragraph shall not apply to nomination of a person to replace a proposed nominee who has died or otherwise become incapacitated to serve as a director between the last day for giving notice hereunder and the date of election of directors if the procedure called for in this paragraph was followed with respect to the nomination of the proposed nominee.

     A copy of the preceding paragraph shall be set forth in the notice to shareholders of any meeting at which directors are to be elected.

ARTICLE III

DIRECTORS

     3.1 POWERS

     Subject to the provisions of the Code and any limitations in the Articles of Incorporation of the corporation and these Bylaws relating to action required to be approved by the shareholders or by the outstanding shares, the business and affairs of the corporation shall be managed and all corporate powers shall be exercised by or under the direction of the Board of Directors.

     3.2 NUMBER OF DIRECTORS

     The authorized number of directors of the corporation shall be not less than five (5) nor more than seven (7) (which in no case shall be greater than two times the stated minimum minus one), and the exact number of directors shall be six (6) until changed, within the limits specified above, by a resolution amending such exact number, duly adopted by the Board of Directors or by the shareholders. The minimum and maximum number of directors may be changed, or a definite number may be fixed without provision for an indefinite number, by a duly adopted amendment to the Articles of Incorporation of the corporation or by an amendment to this Bylaw duly adopted by the vote or written consent of holders of a majority of the outstanding shares entitled to vote; provided, however, that an amendment reducing the fixed number or the minimum number of directors to a number less than five (5) cannot be adopted if the votes cast against its adoption at a meeting, or the shares not consenting in the case of an action by written consent, are equal to more than sixteen and two-thirds percent (16-2/3%) of the outstanding shares entitled to vote thereon.

     No reduction of the authorized number of directors shall have the effect of removing any director before that director’s term of office expires.

     3.3 ELECTION AND TERM OF OFFICE OF DIRECTORS

     At each annual meeting of shareholders, directors shall be elected to hold office until the next annual meeting. Each director, including a director elected to fill a vacancy, shall hold office until the expiration of the term for which elected and until a successor has been elected and qualified, except in the case of the death, resignation, or removal of such a director.

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     3.4 REMOVAL

     The entire Board of Directors or any individual director may be removed from office without cause by the affirmative vote of a majority of the outstanding shares entitled to vote on such removal; provided, however, that unless the entire Board is removed, no individual director may be removed when the votes cast against such director’s removal, or not consenting in writing to such removal, would be sufficient to elect that director if voted cumulatively at an election at which the same total number of votes cast were cast (or, if such action is taken by written consent, all shares entitled to vote were voted) and the entire number of directors authorized at the time of such director’s most recent election were then being elected.

     3.5 RESIGNATION AND VACANCIES

     Any director may resign effective upon giving written notice to the Chairman of the Board, the President, the Secretary or the Board of Directors, unless the notice specifies a later time for the effectiveness of such resignation. If the resignation of a director is effective at a future time, the Board of Directors may elect a successor to take office when the resignation becomes effective.

     Vacancies on the Board of Directors may be filled by a majority of the remaining directors, or if the number of directors then in office is less than a quorum by (i) unanimous written consent of the directors then in office, (ii) the affirmative vote of a majority of the directors then in office at a meeting held pursuant to notice or waivers of notice, or (iii) a sole remaining director; however, a vacancy created by the removal of a director by the vote or written consent of the shareholders or by court order may be filled only by the affirmative vote of a majority of the shares represented and voting at a duly held meeting at which a quorum is present (which shares voting affirmatively also constitute at least a majority of the required quorum), or by the unanimous written consent of all shares entitled to vote thereon. Each director so elected shall hold office until the next annual meeting of the shareholders and until a successor has been elected and qualified, or until his or her death, resignation or removal.

     A vacancy or vacancies in the Board of Directors shall be deemed to exist (i) in the event of the death, resignation or removal of any director, (ii) if the Board of Directors by resolution declares vacant the office of a director who has been declared of unsound mind by an order of court or convicted of a felony, (iii) if the authorized number of directors is increased, or (iv) if the shareholders fail, at any meeting of shareholders at which any director or directors are elected, to elect the full authorized number of directors to be elected at that meeting.

     The shareholders may elect a director or directors at any time to fill any vacancy or vacancies not filled by the directors, but any such election by written consent, other than to fill a vacancy created by removal, shall require the consent of the holders of a majority of the outstanding shares entitled to vote thereon. A director may not be elected by written consent to fill a vacancy created by removal except by unanimous consent of all shares entitled to vote for the election of directors.

     3.6 PLACE OF MEETINGS; MEETINGS BY TELEPHONE

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     Regular meetings of the Board of Directors may be held at any place within the State of California that has been designated from time to time by resolution of the Board. In the absence of such a designation, regular meetings shall be held at the principal executive office of the corporation. Special meetings of the Board may be held at any place within or outside the State of California that has been designated in the notice of the meeting or, if not stated in the notice or if there is no notice, at the principal executive office of the corporation.

     Members of the Board may participate in a meeting through the use of conference telephone or similar communications equipment, so long as all directors participating in such meeting can hear one another. Participation in a meeting pursuant to this paragraph constitutes presence in person at such meeting.

     3.7 REGULAR MEETINGS

     Regular meetings of the Board of Directors may be held without notice if the time and place of such meetings are fixed by the Board of Directors.

     3.8 SPECIAL MEETINGS; NOTICE

     Subject to the provisions of the following paragraph, special meetings of the Board of Directors for any purpose or purposes may be called at any time by the Chairman of the Board, the President, the Secretary or any two (2) directors.

     Notice of the time and place of special meetings shall be delivered personally or by telephone to each director or sent by first-class mail, telegram, charges prepaid, or by facsimile, telecopier or e-mail, addressed to each director at that director’s address as it is shown on the records of the corporation. If the notice is mailed, it shall be deposited in the United States mail at least four (4) days before the time of the holding of the meeting. If the notice is delivered personally or by telephone or by telecopier, facsimile, e-mail or telegram, it shall be delivered personally or by telephone, by facsimile, by e-mail or by telecopier or to the telegraph company at least forty-eight (48) hours before the time of the holding of the meeting. Any oral notice given personally or by telephone may be communicated either to the director or to a person at the office of the director who the person giving the notice has reason to believe will promptly communicate it to the director. The notice need not specify the purpose of the meeting.

     3.9 QUORUM

     A majority of the authorized number of directors shall constitute a quorum for the transaction of business, except to adjourn as provided in Section 3.11 of these Bylaws. Every act or decision done or made by a majority of the directors present at a meeting duly held at which a quorum is present is the act of the Board of Directors, subject to the provisions of Section 310 of the Code (as to approval of contracts or transactions in which a director has a direct or indirect material financial interest), Section 311 of the Code (as to appointment of committees), Section 317(e) of the Code (as

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to indemnification of directors), the Articles of Incorporation of the corporation, and other applicable law.

     A meeting at which a quorum is initially present may continue to transact business notwithstanding the withdrawal of directors, if any action taken is approved by at least a majority of the required quorum for such meeting.

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     3.10 WAIVER OF NOTICE

     Notice of a meeting need not be given to any director who signs a waiver of notice or a consent to holding the meeting or an approval of the minutes thereof, whether before or after the meeting, or who attends the meeting without protesting, prior thereto or at its commencement, the lack of notice to such director. All such waivers, consents, and approvals shall be filed with the corporate records or made a part of the minutes of the meeting. A waiver of notice need not specify the purpose of any regular or special meeting of the Board of Directors.

     3.11 ADJOURNMENT

     A majority of the directors present, whether or not a quorum is present, may adjourn any meeting to another time and place.

     3.12 NOTICE OF ADJOURNMENT

     If the meeting is adjourned for more than twenty-four (24) hours, notice of any adjournment to another time and place shall be given prior to the time of the adjourned meeting to the directors who were not present at the time of the adjournment.

     3.13 BOARD ACTION BY WRITTEN CONSENT WITHOUT A MEETING

     Any action required or permitted to be taken by the Board of Directors may be taken without a meeting, if all members of the Board individually or collectively consent in writing to such action. Such written consent or consents shall be filed with the minutes of the proceedings of the Board. Such action by written consent shall have the same force and effect as a unanimous vote of the Board of Directors.

     3.14 FEES AND COMPENSATION OF DIRECTORS

     Directors and members of committees may receive such compensation, if any, for their services and such reimbursement of expenses as may be fixed or determined by resolution of the Board of Directors. This Section 3.14 shall not be construed to preclude any director from serving the corporation in any other capacity as an officer, agent, employee or otherwise and receiving compensation for those services.

ARTICLE IV

COMMITTEES

     4.1 COMMITTEES OF DIRECTORS

     The Board of Directors may, by resolution adopted by a majority of the authorized number of directors, designate one or more committees, each consisting of two (2) or more directors, to serve at the pleasure of the Board. The Board may designate one or more directors as alternate members of

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any committee, who may replace any absent member at any meeting of the committee. The appointment of members or alternate members of a committee requires the vote of a majority of the authorized number of directors. Any such committee shall have authority to act in the manner and to the extent provided in the resolution of the Board and may have all the authority of the Board, except with respect to:

          (a) The approval of any action which, under the Code, also requires shareholders’ approval or approval of the outstanding shares.

          (b) The filling of vacancies on the Board of Directors or in any committee.

          (c) The fixing of compensation of the directors for serving on the Board or on any committee.

          (d) The amendment or repeal of these Bylaws or the adoption of new Bylaws.

          (e) The amendment or repeal of any resolution of the Board of Directors which by its express terms is not so amendable or repealable.

          (f) A distribution to the shareholders of the corporation, except at a rate, in a periodic amount or within a price range set forth in the Articles of Incorporation of the corporation or determined by the Board of Directors.

          (g) The appointment of any other committees of the Board of Directors or the members thereof.

     4.2 REQUIRED COMMITTEES

     The Board of Directors shall establish the following committees which shall be constituted as described:

          (a) Loan Committee. There shall be a Loan Committee composed of at least four (4) directors, a majority of whom shall not be officers of the corporation. The Loan Committee shall have power to discount and purchase bills, notes and other evidences of debt, to buy and sell bills of exchange, to examine and approve loans and discounts, to exercise authority regarding loans and discounts, and to exercise, when the Board is not in session, all other powers that have been delegated to it by the Board.

          (b) Audit Committee. There shall be an Audit Committee composed of at least two (2) directors, none of whom shall be officers. The Audit Committee shall have the power to oversee the internal audit functions, to retain and interface with the corporation’s independent certified public accountants and to investigate any and all areas of the corporation’s operations as it deems necessary to ensure the safe and sound operation of the corporation.

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          (c) Risk Management Committee. There shall be a Risk Management Committee composed of at least four (4) directors, one (1) of whom shall be the President/CEO and a majority of whom shall not be officers of the corporation. The Risk Management Committee shall have the power to oversee the investment portfolio, the asset/liability management of the corporation, and all other matters regarding the identification and reduction of risks to the corporation=s safe and sound operations.

          (d) Personnel Committee. There shall be a Personnel Committee composed of at least three (3) directors, a majority of whom shall not be officers of the corporation. The Personnel Committee shall have the power to review all personnel matters and to make recommendations to the Board regarding compensation, including salaries, bonuses, deferred compensation, and stock option grants. The Personnel Committee shall serve as the corporation=s Stock Option Plan Committee, if a Stock Option Plan shall be adopted, and shall also oversee all other compensation plans and programs which the corporation may adopt.

     4.3 MEETINGS AND ACTION OF COMMITTEES

     Meetings and actions of committees shall be governed by, and held and taken in accordance with, the provisions of Article III of these Bylaws, Section 3.6 (place of meetings), Section 3.7 (regular meetings), Section 3.8 (special meetings and notice), Section 3.9 (quorum), Section 3.10 (waiver of notice), Section 3.11 (adjournment), Section 3.12 (notice of adjournment), and Section 3.13 (action without meeting), with such changes in the context of those Bylaws as are necessary to substitute the committee and its members for the Board of Directors and its members; provided, however, that the time of regular meetings of committees may be determined either by resolution of the Board of Directors or by resolution of the committee, that special meetings of committees may also be called by resolution of the Board of Directors, and that notice of special meetings of committees shall also be given to all alternate members, who shall have the right to attend all meetings of the committee. The Board of Directors may adopt rules for the government of any committee not inconsistent with the provisions of these Bylaws.

ARTICLE V

OFFICERS

     5.1 OFFICERS

     The officers of the corporation shall be a President, a Secretary, and a Chief Financial Officer. The corporation may also have, at the discretion of the Board of Directors, a Chairman of the Board, a Vice Chairman of the Board, one or more Vice Presidents, one or more Assistant Secretaries, one or more Assistant Treasurers, and such other officers as may be appointed in accordance with the provisions of Section 5.3 of these Bylaws. Any number of offices may be held by the same person.

     5.2 APPOINTMENT OF OFFICERS

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     The officers of the corporation, except such officers as may be appointed in accordance with the provisions of Section 5.3 or Section 5.5 of these Bylaws, shall be chosen by the Board and serve at the pleasure of the Board, subject to the rights, if any, of an officer under any contract of employment.

     5.3 SUBORDINATE OFFICERS

     The Board of Directors may appoint, or may empower the President to appoint, such other officers as the business of the corporation may require, each of whom shall hold office for such period, have such authority, and perform such duties as are provided in these Bylaws or as the Board of Directors may from time to time determine.

     5.4 REMOVAL AND RESIGNATION OF OFFICERS

     Subject to the rights, if any, of an officer under any contract of employment, all officers serve at the pleasure of the Board of Directors and any officer may be removed, either with or without cause, by the Board of Directors at any regular or special meeting of the Board or, except in case of an officer chosen by the Board of Directors, by any officer upon whom such power of removal may be conferred by the Board of Directors.

     Any officer may resign at any time by giving written notice to the corporation. Any resignation shall take effect at the date of the receipt of that notice or at any later time specified in that notice; and, unless otherwise specified in that notice, the acceptance of the resignation shall not be necessary to make it effective. Any resignation is without prejudice to the rights, if any, of the corporation under any contract to which the resigning officer is a party.

     5.5 VACANCIES IN OFFICES

     A vacancy in any office because of death, resignation, removal, disqualification or any other cause shall be filled in the manner prescribed in these Bylaws for regular appointments to that office.

     5.6 CHAIRMAN OF THE BOARD

     The Chairman of the Board, if such an officer be elected, shall, if present, preside at meetings of the Board of Directors and shareholders and exercise and perform such other powers and duties as may from time to time be assigned by the Board of Directors or as may be prescribed by these Bylaws.

     5.7 VICE CHAIRMAN OF THE BOARD

     The Vice Chairman of the Board, if such an officer be elected, shall exercise and perform such powers and duties as may from time to time be assigned by the Board of Directors, the Chairman of the Board, or as may be prescribed by these Bylaws. If there is no Chairman of the Board or if the Chairman of the Board is unable to serve, the Vice Chairman of the Board shall also preside at meetings of the Board of Directors and shareholders.

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     5.8 PRESIDENT

     Subject to such supervisory powers, if any, as may be given by the Board of Directors to the Chairman of the Board and the Vice Chairman of the Board, if there be such officers, the President shall be the chief executive officer of the corporation and shall, subject to the control of the Board of Directors, have general supervision, direction, and control of the business and the officers of the corporation. The President shall have the general powers and duties of management usually vested in the office of President of a corporation, and shall have such other powers and duties as may be prescribed by the Board of Directors or these Bylaws.

     5.9 VICE PRESIDENTS

     In the absence or disability of the President, the Vice Presidents, if any, in order of their rank as fixed by the Board of Directors or, if not ranked, a Vice President designated by the Board of Directors, shall perform all the duties of the President and when so acting shall have all the powers of, and be subject to all the restrictions upon, the President. The Vice Presidents shall have such other powers and perform such other duties as from time to time may be prescribed for them respectively by the Board of Directors, these Bylaws, or the President.

     5.10 SECRETARY

     The Secretary shall keep or cause to be kept, at the principal executive office of the corporation or such other place as the Board of Directors may direct, a book of minutes of all meetings and actions of Directors, committees of directors and shareholders. The minutes shall show the time and place of each meeting, whether regular or special (and, if special, how authorized and the notice given), the names of those present at directors’ meetings or committee meetings, the number of shares present or represented at shareholders’ meetings, and the proceedings thereof.

     The Secretary shall keep, or cause to be kept, at the principal executive office of the corporation or at the office of the corporation’s transfer agent or registrar, as determined by resolution of the Board of Directors, a share register, or a duplicate share register, showing the names of all shareholders and their addresses, the number and classes of shares held by each, the number and date of certificates evidencing such shares, and the number and date of cancellation of every certificate surrendered for cancellation.

     The Secretary shall give, or cause to be given, notice of all meetings of the shareholders and of the Board of Directors required to be given by law or by these Bylaws. The Secretary shall keep the seal of the corporation, if one be adopted, in safe custody and shall have such other powers and perform such other duties as may be prescribed by the Board of Directors or by these Bylaws.

     5.11 CHIEF FINANCIAL OFFICER

     The Chief Financial Officer shall keep and maintain, or cause to be kept and maintained, adequate and correct books and records of accounts of the properties and business transactions of the

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corporation, including accounts of its assets, liabilities, receipts, disbursements, gains, losses, capital, retained earnings, and shares. The books of account shall at all reasonable times be open to inspection by any director.

     The Chief Financial Officer shall deposit all money and other valuables in the name and to the credit of the corporation with such depositaries as may be designated by the Board of Directors or the President. The Chief Financial Officer shall disburse the funds of the corporation as may be ordered by the Board of Directors or President, shall render to the President and directors, whenever they request it, an account of all of his or her transactions as Chief Financial Officer and of the financial condition of the corporation, and shall have such other powers and perform such other duties as may be prescribed by the Board of Directors, these Bylaws, or the President.

     5.12 CHIEF CREDIT OFFICER

     The Chief Credit Officer shall be directly responsible for the safety and soundness of the loan portfolio, as well as the adequacy of the loan loss reserve. The Chief Credit Officer shall maintain current and relevant lending policies, provide for on-going training of lending and credit administration personnel and develop and operate appropriate systems and procedures to properly manage the loan portfolio. The Chief Credit Officer shall render reports as requested by the Board of Directors and the President. The Chief Credit Officer shall perform such other assignments as the President or the Board of Directors may prescribe.

ARTICLE VI

INDEMNIFICATION OF DIRECTORS, OFFICERS, EMPLOYEES,
AND OTHER AGENTS

     6.1 INDEMNIFICATION OF DIRECTORS

     The corporation shall, to the maximum extent and in the manner permitted by the Code, indemnify each of its directors against expenses (as defined in Section 317(a) of the Code), judgments, fines, settlements, and other amounts actually and reasonably incurred in connection with any proceeding (as defined in Section 317(a) of the Code), arising by reason of the fact that such person is or was a director of the corporation. For purposes of this Article VI, a Adirector@ of the corporation includes any person (i) who is or was a director of the corporation, (ii) who is or was serving at the request of the corporation as a director of another foreign or domestic corporation, partnership, joint venture, trust or other enterprise, or (iii) who was a director of a corporation which was a predecessor corporation of the corporation or of another enterprise at the request of such predecessor corporation.

     6.2 INDEMNIFICATION OF OTHERS

     The corporation shall have the power, to the extent and in the manner permitted by the Code, to indemnify each of its employees, officers, and agents (other than directors) against expenses (as defined in Section 317(a) of the Code), judgments, fines, settlements, and other amounts actually and

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reasonably incurred in connection with any proceeding (as defined in Section 317(a) of the Code), arising by reason of the fact that such person is or was an employee, officer, or agent of the corporation. For purposes of this Article VI, an Aemployee@ or Aofficer@ or Aagent@ of the corporation (other than a director) includes any person (i) who is or was an employee, officer, or agent of the corporation, (ii) who is or was serving at the request of the corporation as an employee, officer, or agent of another foreign or domestic corporation, partnership, joint venture, trust or other enterprise, or (iii) who was an employee, officer, or agent of a corporation which was a predecessor corporation of the corporation or of another enterprise at the request of such predecessor corporation.

     6.3 PAYMENT OF EXPENSES IN ADVANCE

     Expenses and attorneys’ fees incurred in defending any civil or criminal action or proceeding for which indemnification is required pursuant to Section 6.1, or if otherwise authorized by the Board of Directors, shall be paid by the corporation in advance of the final disposition of such action or proceeding upon receipt of an undertaking by or on behalf of the indemnified party to repay such amount if it shall ultimately be determined that the indemnified party is not entitled to be indemnified as authorized in this Article VI.

     6.4 INDEMNITY NOT EXCLUSIVE

     The indemnification provided by this Article VI shall not be deemed exclusive of any other rights to which those seeking indemnification may be entitled under any Bylaw, agreement, vote of shareholders or directors or otherwise, both as to action in an official capacity and as to action in another capacity while holding such office. The rights to indemnity hereunder shall continue as to a person who has ceased to be a director, officer, employee, or agent and shall inure to the benefit of the heirs, executors, and administrators of the person.

     6.5 INSURANCE INDEMNIFICATION

     The corporation shall have the power to purchase and maintain insurance on behalf of any person who is or was a director, officer, employee or agent of the corporation against any liability asserted against or incurred by such person in such capacity or arising out of that person’s status as such, whether or not the corporation would have the power to indemnify that person against such liability under the provisions of this Article VI.

     6.6 CONFLICTS

     No indemnification or advance shall be made under this Article VI, except where such indemnification or advance is mandated by law or the order, judgment or decree of any court of competent jurisdiction, in any circumstance where it appears:

          (1) That it would be inconsistent with a provision of the Articles of Incorporation of the corporation, these Bylaws, a resolution of the shareholders or an agreement in effect at the time of the accrual of the alleged cause of the action asserted in the proceeding in which the expenses were incurred or other amounts were paid, which prohibits or otherwise limits indemnification; or

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          (2) That it would be inconsistent with any condition expressly imposed by a court in approving a settlement.

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     6.7 RIGHT TO BRING SUIT

     If a claim under this Article VI is not paid in full by the corporation within 90 days after a written claim has been received by the corporation (either because the claim is denied or because no determination is made), the claimant may at any time thereafter bring suit against the corporation to recover the unpaid amount of the claim and, if successful in whole or in part, the claimant shall also be entitled to be paid the expenses of prosecuting such claim. The corporation shall be entitled to raise as a defense to any such action that the claimant has not met the standards of conduct that make it permissible under the Code for the corporation to indemnify the claimant for the claim. Neither the failure of the corporation (including its Board of Directors, independent legal counsel, or its shareholders) to have made a determination prior to the commencement of such action that indemnification of the claimant is permissible in the circumstances because he or she has met the applicable standard of conduct, if any, nor an actual determination by the corporation (including its Board of Directors, independent legal counsel, or its shareholders) that the claimant has not met the applicable standard of conduct, shall be a defense to such action or create a presumption for the purposes of such action that the claimant has not met the applicable standard of conduct.

     6.8 INDEMNITY AGREEMENTS

     The Board of Directors is authorized to enter into a contract with any director, officer, employee or agent of the corporation, or any person who is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, including employee benefit plans, or any person who was a director, officer, employee or agent of a corporation which was a predecessor corporation of the corporation or of another enterprise at the request of such predecessor corporation, providing for indemnification rights equivalent to or, if the Board of Directors so determines and to the extent permitted by applicable law, greater than, those provided for in this Article VI.

     6.9 AMENDMENT, REPEAL OR MODIFICATION

     Any amendment, repeal or modification of any provision of this Article VI shall not adversely affect any right or protection of a director or agent of the corporation existing at the time of such amendment, repeal or modification.

ARTICLE VII

RECORDS AND REPORTS

     7.1 MAINTENANCE AND INSPECTION OF SHARE REGISTER

     The corporation shall keep either at its principal executive office or at the office of its transfer agent or registrar (if either be appointed), as determined by resolution of the Board of Directors, a record of its shareholders listing the names and addresses of all shareholders and the number and class of shares held by each shareholder.

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     A shareholder or shareholders of the corporation holding at least five percent (5%) in the aggregate of the outstanding voting shares of the corporation or who hold at least one percent (1%) of such voting shares and have filed a Schedule 14B with the United States Securities and Exchange Commission relating to the election of directors, shall have an absolute right to do either or both of the following (i) inspect and copy the record of shareholders’ names, addresses, and shareholdings during usual business hours upon five (5) days’ prior written demand upon the corporation, or (ii) obtain from the transfer agent for the corporation, upon written demand and upon the tender of such transfer agent’s usual charges for such list (the amount of which charges shall be stated to the shareholder by the transfer agent upon request), a list of the shareholders’ names and addresses who are entitled to vote for the election of directors, and their shareholdings, as of the most recent record date for which it has been compiled or as of a date specified by the shareholder subsequent to the date of demand. The list shall be made available on or before the later of five (5) business days after the demand is received or the date specified therein as the date as of which the list is to be compiled.

     The record of shareholders shall also be open to inspection and copying by any shareholder or holder of a voting trust certificate at any time during usual business hours upon written demand on the corporation, for a purpose reasonably related to the holder’s interests as a shareholder or holder of a voting trust certificate.

     Any inspection and copying under this Section 7.1 may be made in person or by an agent or attorney of the shareholder or holder of a voting trust certificate making the demand.

     7.2 MAINTENANCE AND INSPECTION OF BYLAWS

     The corporation shall keep at its principal executive office or, if its principal executive office is not in the State of California, at its principal business office in California, the original or a copy of these Bylaws as amended to date, which shall be open to inspection by the shareholders at all reasonable times during office hours. If the principal executive office of the corporation is outside the State of California and the corporation has no principal business office in such state, then it shall, upon the written request of any shareholder, furnish to such shareholder a copy of these Bylaws as amended to date.

     7.3 MAINTENANCE AND INSPECTION OF OTHER CORPORATE RECORDS

     The accounting books and records and the minutes of proceedings of the shareholders and the Board of Directors, and committees of the Board of Directors shall be kept at such place or places as are designated by the Board of Directors or, in absence of such designation, at the principal executive office of the corporation. The minutes shall be kept in written form, and the accounting books and records shall be kept either in written form or in any other form capable of being converted into written form.

     The minutes and accounting books and records shall be open to inspection upon the written demand on the corporation of any shareholder or holder of a voting trust certificate at any reasonable time during usual business hours, for a purpose reasonably related to such holder’s interests as a shareholder or as the holder of a voting trust certificate. Such inspection by a shareholder or holder

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of a voting trust certificate may be made in person or by an agent or attorney and the right of inspection includes the right to copy and make extracts. Such rights of inspection shall extend to the records of each subsidiary corporation of the corporation.

     7.4 INSPECTION BY DIRECTORS

     Every director shall have the absolute right at any reasonable time to inspect and copy all books, records, and documents of every kind and to inspect the physical properties of the corporation and each of its subsidiary corporations, domestic or foreign. Such inspection by a director may be made in person or by an agent or attorney and the right of inspection includes the right to copy and make extracts.

     7.5 ANNUAL REPORT TO SHAREHOLDERS; WAIVER

     The Board of Directors shall cause an annual report to be sent to the shareholders not later than one hundred twenty (120) days after the close of the fiscal year adopted by the corporation. Such report shall be sent to the shareholders at least fifteen (15) (or, if sent by third-class mail, thirty-five (35)) days prior to the annual meeting of shareholders to be held during the next fiscal year and in the manner specified in Section 2.5 of these Bylaws for giving notice to shareholders of the corporation.

     The annual report shall contain a balance sheet as of the end of the fiscal year and an income statement and statement of changes in financial position for the fiscal year, accompanied by any report thereon of independent accountants or, if there is no such report, the certificate of an authorized officer of the corporation that the statements were prepared without audit from the books and records of the corporation.

     The foregoing requirement of an annual report shall be waived so long as the shares of the corporation are held by fewer than one hundred (100) holders of record.

     7.6 FINANCIAL STATEMENTS

     A shareholder or shareholders holding at least five percent (5%) of the outstanding shares of any class of the corporation may make a written request to the corporation for an income statement of the corporation for the three-month, six-month or nine-month period of the current fiscal year ended more than thirty (30) days prior to the date of the request and a balance sheet of the corporation as of the end of that period. The statements shall be delivered or mailed to the person making the request within thirty (30) days thereafter. A copy of the statements shall be kept on file in the principal office of the corporation for twelve (12) months and it shall be exhibited at all reasonable times to any shareholder demanding an examination of the statements or a copy shall be mailed to the shareholder. If the corporation has not sent to the shareholders its annual report for the last fiscal year, the statements referred to in the first paragraph of this Section 7.6 shall likewise be delivered or mailed to the shareholder or shareholders within thirty (30) days after the request.

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     The quarterly income statements and balance sheets referred to in this section shall be accompanied by the report thereon, if any, of any independent accountants engaged by the corporation or the certificate of an authorized officer of the corporation that the financial statements were prepared without audit from the books and records of the corporation.

     7.7 REPRESENTATION OF SHARES OF OTHER CORPORATIONS

     The Chairman of the Board, the President, the Executive Vice President, or any other person authorized by the Board of Directors or the President or the Executive Vice President, is authorized to vote, represent, and exercise on behalf of this corporation all rights incident to any and all shares of any other corporation or corporations standing in the name of this corporation. The authority herein granted may be exercised either by such person directly or by any other person authorized to do so by proxy or power of attorney duly executed by such person having the authority.

ARTICLE VIII

GENERAL MATTERS

     8.1 RECORD DATE FOR PURPOSES OTHER THAN NOTICE AND VOTING

     For purposes of determining the shareholders entitled to receive payment of any dividend or other distribution or allotment of any rights or entitled to exercise any rights in respect of any other lawful action (other than with respect to notice or voting at a shareholders meeting or action by shareholders by written consent without a meeting), the Board of Directors may fix, in advance, a record date, which shall not be more than sixty (60) days prior to any such action. Only shareholders of record at the close of business on the record date are entitled to receive the dividend, distribution or allotment of rights, or to exercise the rights, as the case may be, notwithstanding any transfer of any shares on the books of the corporation after the record date, except as otherwise provided in the Articles of Incorporation of the corporation or the Code.

     If the Board of Directors does not so fix a record date, then the record date for determining shareholders for any such purpose shall be at the close of business on the day on which the Board adopts the resolution relating thereto or the sixtieth (60th) day prior to the date of that action, whichever is later.

     8.2 CHECKS; DRAFTS; EVIDENCES OF INDEBTEDNESS

     From time to time, the Board of Directors shall determine by resolution which person or persons may sign or endorse all checks, drafts, other orders for payment of money, notes or other evidences of indebtedness that are issued in the name of or payable to the corporation, and only the persons so authorized shall sign or endorse those instruments.

     8.3 CORPORATE CONTRACTS AND INSTRUMENTS: HOW EXECUTED

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     The Board of Directors, except as otherwise provided in these Bylaws, may authorize any officer or officers, or agent or agents, to enter into any contract or execute any instrument in the name of and on behalf of the corporation; such authority may be general or confined to specific instances. Unless so authorized or ratified by the Board of Directors or within the agency power of an officer, no officer, agent or employee shall have any power or authority to bind the corporation by any contract or engagement or to pledge its credit or to render it liable for any purpose or for any amount.

     8.4 CERTIFICATES FOR SHARES

     A certificate or certificates for shares of the corporation shall be issued to each shareholder when any of such shares are fully paid. All certificates shall be signed in the name of the corporation by the Chairman of the Board or the Vice Chairman of the Board or the President or a Vice President and by the Chief Financial Officer or an Assistant Treasurer or the Secretary or an Assistant Secretary, certifying the number of shares and the class or series of shares owned by the shareholder. Any or all of the signatures on the certificate may be by facsimile.

     In case any officer, transfer agent or registrar who has signed or whose facsimile signature has been placed on a certificate has ceased to be such officer, transfer agent or registrar before such certificate is issued, it may be issued by the corporation with the same effect as if that person were an officer, transfer agent or registrar at the date of issue.

     8.5 LOST CERTIFICATES

     Except as provided in this Section 8.5, no new certificates for shares shall be issued to replace a previously issued certificate unless the latter is surrendered to the corporation or its transfer agent or registrar and cancelled at the same time. The Board of Directors may, in case any share certificate or certificate for any other security is lost, stolen or destroyed (as evidenced by a written affidavit or affirmation of such fact), authorize the issuance of replacement certificates on such terms and conditions as the Board may require; the Board may require indemnification of the corporation secured by a bond or other adequate security sufficient to protect the corporation against any claim that may be made against it, including any expense or liability, on account of the alleged loss, theft or destruction of the certificate or the issuance of the replacement certificate.

     8.6 CONSTRUCTION; DEFINITIONS

     Unless the context requires otherwise, the general provisions, rules of construction, and definitions in the Code shall govern the construction of these Bylaws. Without limiting the generality of this provision, the singular number includes the plural, the plural number includes the singular, and the term Aperson@ includes both a corporation and a natural person.

ARTICLE IX

AMENDMENTS

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     9.1 AMENDMENT BY SHAREHOLDERS

     New Bylaws may be adopted or these Bylaws may be amended or repealed by the vote or written consent of holders of a majority of the outstanding shares entitled to vote; provided, however, that if the Articles of Incorporation of the corporation set forth the number of authorized Directors of the corporation, then the authorized number of Directors may be changed only by an amendment of the Articles of Incorporation.

     9.2 AMENDMENT BY DIRECTORS

     Subject to the rights of the shareholders as provided in Section 9.1 of these Bylaws, Bylaws, other than a Bylaw or an amendment of a Bylaw changing the authorized number of directors (except to fix the authorized number of directors pursuant to a Bylaw providing for a variable number of directors), may be adopted, amended or repealed by the Board of Directors.

     9.3 RECORD OF AMENDMENTS

     Whenever an amendment or new Bylaw is adopted, it shall be copied in the book of minutes with the original Bylaws. If any Bylaw is repealed, the fact of repeal, with the date of the meeting at which the repeal was enacted or written consent was filed, shall be stated in said book.

ARTICLE X

INTERPRETATION

     Reference in these Bylaws to any provision of the California Corporations Code shall be deemed to include all amendments thereof.

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SECRETARY’S CERTIFICATE OF ADOPTION OF BYLAWS
OF
FCB BANCORP

     I, the undersigned, do hereby certify:

     1. That I am the duly elected and acting Secretary of FCB Bancorp, a California corporation.

     2. That the foregoing Bylaws, comprising 19 pages, including this page, constitute the Bylaws of said corporation as adopted by the directors of said corporation at a duly called and held meeting of the Board of Directors on ___, 2005.

     IN WITNESS WHEREOF, I have hereunto subscribed my name this ___day of ___, 2005.

                                                            
                                        , Secretary

EX-8

EXHIBIT 8

[Horgan, Rosen, Beckham & Coren, L.L.P. Letterhead]

August 31, 2005

FCB Bancorp
1100 Paseo Camarillo
Camarillo, California 93010

Dear Sirs and Mesdames:

     You have requested our opinion regarding certain federal income tax consequences of the proposed merger of FCB Merger Corp. into First California Bank, pursuant to which First California Bank will become a wholly-owned subsidiary of FCB Bancorp (the “Merger”).

FACTS

     FCB Bancorp (“Holding Company”) was incorporated under the laws of the State of California on January 25, 2005, at the direction of the Board of Directors of First California Bank (“Bank”), for the purpose of acquiring all of the outstanding shares of Bank’s common stock. The formation of a holding company will provide business alternatives for Bank that are desirable to compete with other major banks and larger regional banks, many of which have been similarly reorganized. The formation of the holding company will also facilitate the proposed acquisition of South Coast Bancorp, Inc.

     FCB Merger Corp. (“Subsidiary’), a wholly-owned subsidiary of Holding Company, is a transitory corporation that engages and will engage in no substantial business activity other than to effect the Merger.

     No party to the Merger is an investment company as defined in section 368(a)(2)(F) (iii) and (iv) of the Internal Revenue Code of 1986, as amended (the “Code”). No inter-corporate debt exists between any of Holding Company, Bank, and Subsidiary that was issued, acquired, or will be settled at a discount in connection with the Merger. No party to the Merger is under the jurisdiction of a court in a Title 11 or similar case within the meaning of 368(a)(3)(A) of the Code.

     The terms of the Merger are contained in the Plan of Reorganization and Merger Agreement dated as of May 19, 2005 (“Plan of Reorganization”) among Bank, Subsidiary, and Holding Company.

     After consummation of the holding company formation, the Holding Company, through its wholly-owned subsidiary, SCB Merger Corp., intends to acquire South Coast Bancorp, Inc. (the “South Coast Transaction”). The term of the South Coast Transaction are contained in the Agreement and Plan of Reorganization by and among the Holding Company, the Bank, SCB Merger Corp., South Coast Bancorp, Inc. and South Coast Commercial Bank dated February 2, 2005.

OPINION

     In our opinion, the merger transaction as structured is a reverse triangular merger that meets the requirements of a “reorganization” as defined in section 368(a)(1)(A) of the Code as augmented by the provisions of Code section 368(a)(2)(E). Assuming that the Merger is consummated in accordance with the terms, conditions and other provisions of the Plan of Reorganization and that all of the factual information, descriptions, representations and assumptions set forth in the Plan of Reorganization, in your Registration Statement on Form S-4 filed with the United States Securities and Exchange Commission (“SEC”) on July 6, 2005, as amended on August 15, 2005, and further amended on September 1, 2005, and in the Proxy Statement/Prospectus contained therein are accurate and complete in all relevant respects, and will be accurate and complete in all relevant respects at the time the Merger becomes effective, it is our opinion that for federal income tax purposes:

1.	The Merger will constitute a “reorganization” within the meaning of section 368(a) of the Code, and Bank, Subsidiary, and Holding Company will each be a party to the reorganization within the meaning of section 368 (b) of the Code.
2.	Neither Subsidiary nor Holding Company will recognize any gain or loss as a result of the Merger.
3.	Bank will not recognize any gain or loss as a result of the Merger.
4.	Holders of Bank Common Stock exchanged in the Merger for Holding Company Common Stock will not recognize any gain or loss as a result of the Merger.
5.	The adjusted basis of the assets of Bank after the Merger will be the same as the adjusted basis of the assets held by Bank and (if any) by Subsidiary immediately before the Merger.

6.	With regard to shareholders who held their shares of Bank’s Common Stock as capital assets, the period for which they have held such Common Stock will be included in their holding period for the Holding Company’s Common Stock received in the exchange.
7.	The tax basis of the shares of Holding Company Common Stock received by a shareholder of Bank will equal the tax basis of such shareholder’s shares of Bank Common Stock exchanged in the Merger.

     Our opinion is limited to the foregoing federal income tax consequences of the Merger, which are the only matters as to which you have requested our opinion, and you must judge whether the matters addressed herein are sufficient for your purposes. We do not address any other federal income tax consequences of the Merger or other matters of federal law and have not considered matters (including state or local tax consequences) arising under the laws of any jurisdiction other than matters of federal tax law arising under the laws of the United States.

     This opinion not intended or written by our firm to be used, and it cannot be used by any taxpayer, for the purpose of avoiding penalties that may be imposed on the taxpayer.

     Our opinion is based on the understanding that the relevant facts are, and will be on the Effective Date of the Merger, as set forth in the Plan of Reorganization. Our opinion is also based on the Code, Treasury Regulations, case law, and Internal Revenue Service rulings as they now exist. These authorities are all subject to change and such changes may be made with retroactive effect. We can give no assurance that after any such change, our opinion would not be different.

     We undertake no responsibility to update or supplement my opinion. Only Holding Company and Bank may rely on this opinion, and only with respect to the proposed Merger described herein.

     We hereby consent to the filing of this opinion letter with the SEC as Exhibit 8 to the Registration Statement.

Very truly yours,
 

/s/ Horgan, Rosen, Beckham & Coren, L.L.P.  

Horgan, Rosen, Beckham & Coren, L.L.P.  

EX-10.1

EXHIBIT 10.1

FCB BANCORP
2005 STOCK OPTION PLAN

Adopted May 19, 2005

     1. Purpose

     The purpose of the FCB Bancorp 2005 Stock Option Plan (the “Plan”) is to strengthen FCB Bancorp (the “Company”) and those banks and corporations which are or hereafter become subsidiary corporations (the “Subsidiary” or “Subsidiaries”) by providing additional means of attracting and retaining competent managerial personnel and by providing to participating directors, officers and key employees added incentive for high levels of performance and for unusual efforts to increase the earnings of the Company and any Subsidiaries. The Plan seeks to accomplish these purposes and achieve these results by providing a means whereby such directors, officers and key employees may purchase shares of the Common Stock of the Company pursuant to Stock Options granted in accordance with this Plan.

     Stock Options granted pursuant to this Plan are intended to be Incentive Stock Options or Non-Qualified Stock Options, as shall be determined and designated by the Stock Option Committee upon the grant of each Stock Option hereunder.

     2. Definitions

     For the purposes of this Plan, the following terms shall have the following meanings:

     (a) “Common Stock.” This term shall mean shares of the Company’s common stock, subject to adjustment pursuant to Section 15 (Adjustment Upon Changes in Capitalization) hereunder.

     (b) “Company.” This term shall mean FCB Bancorp, a California corporation.

     (c) “Eligible Participants.” This term shall mean: (i) all directors of the Company or any Subsidiary; (ii) all officers (whether or not they are also directors) of the Company or any Subsidiary; and (iii) all key employees (as such persons may be determined by the Stock Option Committee from time to time) of the Company or any Subsidiary, provided that such officers and key employees have a customary work week of at least forty hours in the employ of the Company or a Subsidiary.

     (d) “Fair Market Value.” This term shall mean the fair market value of the Common Stock as determined in accordance with any reasonable valuation method selected by the Stock Option Committee, including the valuation methods described in Treasury Regulations Section 20.2031-2.

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     (e) “Incentive Stock Option.” This term shall mean a Stock Option which is an “incentive stock option” within the meaning of Section 422 of the Internal Revenue Code of 1986, as amended.

     (f) “Non-Qualified Stock Option.” This term shall mean a Stock Option which is not an Incentive Stock Option.

     (g) “Option Shares.” This term shall mean Common Stock covered by and subject to any outstanding unexercised Stock Option granted pursuant to this Plan.

     (h) “Optionee.” This term shall mean any Eligible Participant to whom a Stock Option has been granted pursuant to this Plan, provided that at least part of the Stock Option is outstanding and unexercised.

     (i) “Plan.” This term shall mean the FCB Bancorp 2005 Stock Option Plan as embodied herein and as may be amended from time to time in accordance with the terms hereof and applicable law.

     (j) “Stock Option.” This term shall mean the right to purchase Common Stock under this Plan in a specified number of shares, at a price and upon the terms and conditions determined by the Stock Option Committee.

     (k) “Stock Option Committee.” The Board of Directors of the Company may select and designate a Stock Option Committee consisting of three or more directors of the Company, having full authority to act in the matter. Regardless of whether a Stock Option Committee is selected, the Board of Directors of the Company may act as the Stock Option Committee and any action taken by said Board as such shall be deemed to be action taken by the Stock Option Committee. All references in the Plan to the “Stock Option Committee” shall be deemed to refer to the Board of Directors of the Company acting as the Stock Option Committee and to a duly appointed Stock Option Committee, if there be one. In the event of any conflict between action taken by the Board acting as a Stock Option Committee and action taken by a duly appointed Stock Option Committee, the action taken by the Board shall be controlling and the action taken by the duly appointed Stock Option Committee shall be disregarded.

     (l) “Subsidiary.” This term shall mean each “subsidiary corporation” (treating the Company as the employer corporation) as defined in Section 424(f) of the Internal Revenue Code of 1986, as amended.

3. Administration

     (a) Stock Option Committee. This Plan shall be administered by the Stock Option Committee. The Board of Directors of the Company shall have the right, in its sole and absolute discretion, to remove or replace any person from or on the Stock Option Committee at any time for any reason whatsoever.

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     (b) Administration of the Plan. Any action of the Stock Option Committee with respect to the administration of the Plan shall be taken pursuant to a majority vote, or pursuant to the unanimous written consent, of its members. Any such action taken by the Stock Option Committee in the administration of this Plan shall be valid and binding, so long as the same is not inconsistent with the terms and conditions of this Plan. Subject to compliance with the terms, conditions and restrictions set forth in this Plan, the Stock Option Committee shall have the exclusive right, in its sole and absolute discretion (consistent, nevertheless, in the case of Incentive Stock Options, with all rules established by the Internal Revenue Code of 1986, as amended, and the regulations promulgated pursuant thereto applicable to incentive stock options), to establish the terms and conditions of all Stock Options granted under the Plan, including, without meaning any limitation, the power to: (i) establish the number of Stock Options, if any, to be granted hereunder, in the aggregate and with regard to each Eligible Participant; (ii) determine the time or times when such Stock Options, or parts thereof, may be exercised; (iii) determine and designate which Stock Options granted under the Plan shall be Incentive Stock Options and which shall be Non-Qualified Stock Options; (iv) determine the Eligible Participants, if any, to whom Stock Options are granted; (v) determine the duration and purposes, if any, of leaves of absence which may be permitted to holders of unexercised, unexpired Stock Options without such constituting a termination of employment under the Plan; and (vi) prescribe and amend the terms, provisions and form of each instrument and agreement setting forth the terms and conditions of every Stock Option granted hereunder.

     (c) Decisions and Determinations. Subject to the express provisions of the Plan, the Stock Option Committee shall have the authority to construe and interpret this Plan, to define the terms used herein, to prescribe, amend, and rescind rules and regulations relating to the administration of the Plan, and to make all other determinations necessary or advisable for administration of the Plan. Determinations of the Stock Option Committee on matters referred to in this Section 3 shall be final and conclusive so long as the same are not inconsistent with the terms of this Plan.

     4. Shares Subject to the Plan

     Subject to adjustments as provided in Section 15 hereof, the maximum number of shares of Common Stock which may be issued upon exercise of all Stock Options granted under this Plan is limited to Two Hundred Thousand (200,000) in the aggregate. If any Stock Option shall be canceled, surrendered, or expire for any reason without having been exercised in full, the unpurchased Option Shares represented thereby shall again be available for grants of Stock Options under this Plan.

     5. Eligibility

     Only Eligible Participants shall be eligible to receive grants of Stock Options under this Plan.

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     6. Grants of Stock Options

     (a) Grant. Subject to the express provisions of the Plan, the Stock Option Committee, in its sole and absolute discretion, may grant Stock Options:

     (i) In the case of grants to Eligible Participants who are officers or key employees of the Company or any Subsidiary, for a number of Option Shares, at the price(s) and time(s), and on the terms and conditions as it deems advisable and specifies in the respective grants; and

     (ii) In the case of grants to Eligible Participants who are directors and who are not officers or key employees of the Company or any Subsidiary, for a number of Option Shares, at the price(s) and time(s), and on the terms and conditions as it deems advisable and specifies in the respective grants; provided, that such grants may not exceed a maximum of                            (                  ) Option Shares to all directors who are not officers or key employees of the Company or any Subsidiary. The foregoing maximum numbers of Option Shares which may be granted to all directors of the Company at any time shall be adjusted in accordance with the provisions of Section 15 hereof.

     The terms upon which and the times at which, or the periods within which, the Option Shares subject to such Stock Options may become acquired or such Stock Options may be acquired and exercised shall be as set forth in the Plan and the related Stock Option Agreements.

     Subject to the limitations and restrictions set forth in the Plan, an Eligible Participant who has been granted a Stock Option may, if otherwise eligible, be granted additional Stock Options if the Stock Option Committee shall so determine. The Stock Option Committee shall designate in each grant of a Stock Option whether the Stock Option is an Incentive Stock Option or a Non-Qualified Stock Option.

     (b) Date of Grant and Rights of Optionee. The determination of the Stock Option Committee to grant a Stock Option shall not in any way constitute or be deemed to constitute an obligation of the Company, or a right of the Eligible Participant who is the proposed subject of the grant, and shall not constitute or be deemed to constitute the grant of a Stock Option hereunder unless and until both the Company and the Eligible Participant have executed and delivered to the other a Stock Option Agreement in the form then required by the Stock Option Committee as evidencing the grant of the Stock Option, together with such other instrument or instruments as may be required by the Stock Option Committee pursuant to this Plan; provided, however, that the Stock Option Committee may fix the date of grant as any date on or after the date of its final determination to grant the Stock Option (or if no such date is fixed, then the date of grant shall be the date on which the determination was finally made by the Stock Option Committee to grant the Stock Option), and such date shall be set forth in the Stock

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Option Agreement. The date of grant as so determined shall be deemed the date of grant of the Stock Option for purposes of this Plan.

     (c) Shareholder-Employees. A Stock Option granted hereunder to an Eligible Participant who is also an officer or key employee of the Company or any Subsidiary, who owns, directly or indirectly, at the date of the grant of the Stock Option, more than ten percent (10%) of the total combined voting power of all classes of capital stock of the Company or a Subsidiary (if permitted in accordance with the provisions of Section 5 herein) shall not qualify as an Incentive Stock Option unless: (i) the purchase price of the Option Shares subject to said Stock Option is at least one hundred and ten percent (110%) of the Fair Market Value of the Option Shares, determined as of the date said Stock Option is granted; and (ii) the Stock Option by its terms is not exercisable after five (5) years from the date that it is granted. The attribution rules of Section 424(d) of the Internal Revenue Code of 1986, as amended, shall apply in the determination of indirect ownership of stock.

     (d) Maximum Value of Stock Options. No grant of Incentive Stock Options hereunder may be made when the aggregate Fair Market Value of Option Shares with respect to which Incentive Stock Options (pursuant to this Plan or any other Incentive Stock Option Plan of the Company or any Subsidiary) are exercisable for the first time by the Eligible Participant during any calendar year exceeds $100,000.

     (e) Substituted Stock Options. If all of the outstanding shares of common stock of another corporation are changed into or exchanged solely for Common Stock in a transaction to which Section 424(a) of the Internal Revenue Code of 1986, as amended, applies, then, subject to the approval of the Board of Directors of the Company, Stock Options under the Plan may be substituted (“Substituted Options”) in exchange for valid, unexercised and unexpired stock options of such other corporation. Substituted Options shall qualify as Incentive Stock Options under the Plan, provided that (and to the extent) the stock options exchanged for the Substituted Options were Incentive Stock Options within the meaning of Section 422 of the Internal Revenue Code of 1986, as amended.

     (f) Non-Qualified Stock Options. Stock Options and Substituted Options granted by the Stock Option Committee shall be deemed Non-Qualified Stock Options under this Plan if they: (i) are designated at the time of grant as Incentive Stock Options but do not so qualify under the provisions of Section 422 of the Code or any regulations or rulings issued by the Internal Revenue Service for any reason; (ii) are not granted in accordance with the provisions of Section 6(c); (iii) are in excess of the fair market value limitations set forth in Section 6(d); (iv) are granted to an Eligible Participant who is not an officer or key employee of the Company or any Subsidiary; or (v) are designated at the time of grant as Non-Qualified Stock Options. Non-Qualified Stock Options granted or substituted hereunder shall be so designated in the Stock Option Agreement entered into between the Company and the Optionee.

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     7. Stock Option Exercise Price

     (a) Minimum Price. The exercise price of any Option Shares shall be determined by the Stock Option Committee, in its sole and absolute discretion, upon the grant of a Stock Option. Except as provided elsewhere herein, said exercise price shall not be less than one hundred percent (100%) of the Fair Market Value of the Common Stock represented by the Option Shares on the date of grant of the related Stock Option.

     (b) Substituted Options. The exercise price of the Option Shares subject to each Substituted Option may be fixed at a price less than one hundred percent (100%) of the Fair Market Value of the Common Stock at the time such Substituted Option is granted if said exercise price has been computed to be not less than the exercise price set forth in the stock option of the other corporation for which it was exchanged immediately before substitution, with appropriate adjustment to reflect the exchange ratio of the shares of stock of the other corporation into the shares of Common Stock.

     8. Exercise of Stock Options

     (a) Exercise. Except as otherwise provided elsewhere herein, each Stock Option shall be exercisable in such increments, which need not be equal, and upon such contingencies as the Stock Option Committee shall determine at the time of grant of the Stock Option; provided, however, that if an Optionee shall not in any given period exercise any part of a Stock Option which has become exercisable during that period, the Optionee’s right to exercise such part of the Stock Option shall continue until expiration of the Stock Option or any part thereof as may be provided in the related Stock Option Agreement. No Stock Option or part thereof shall be exercisable except with respect to whole shares of Common Stock, and fractional share interests shall be disregarded except that they may be accumulated.

     (b) Prior Outstanding Incentive Stock Options. Incentive Stock Options granted (or substituted) to an Optionee under the Plan may be exercisable while such Optionee has outstanding and unexercised any Incentive Stock Option previously granted (or substituted) to him or her pursuant to this Plan or any other Incentive Stock Option Plan of the Company or any Subsidiary. An Incentive Stock Option shall be treated as outstanding until it is exercised in full or expires by reason of lapse of time.

     (c) Notice and Payment. Stock Options granted hereunder shall be exercised by written notice delivered to the Company specifying the number of Option Shares with respect to which the Stock Option is being exercised, together with concurrent payment in full of the exercise price as hereinafter provided. If the Stock Option is being exercised by any person or persons other than the Optionee, said notice shall be accompanied by proof, satisfactory to the counsel for the Company, of the right of such person or persons to exercise the Stock Option. The Company’s receipt of a notice of exercise without concurrent receipt of the full amount of the exercise price shall not be deemed an exercise of a Stock Option by an Optionee, and the Company shall have no

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obligation to an Optionee for any Option Shares unless and until full payment of the exercise price is received by the Company and all of the terms and provisions of the Plan and the related Stock Option agreement have been fully complied with.

     (d) Payment of Exercise Price. The exercise price of any Option Shares purchased upon the proper exercise of a Stock Option shall be paid in full at the time of each exercise of a Stock Option in cash (or bank, cashier’s or certified check). Payment by an Optionee as provided herein shall be made in full concurrently with the Optionee’s notification to the Company of his intention to exercise all or part of a Stock Option.

     (e) Minimum Exercise. Not less than ten (10) Option Shares may be purchased at any one time upon exercise of a Stock Option unless the number of shares purchased is the total number which remains to be purchased under the Stock Option.

     (f) Compliance With Law. No shares of Common Stock shall be issued upon exercise of any Stock Option, and an Optionee shall have no right or claim to such shares, unless and until: (i) payment in full as provided hereinabove has been received by the Company; (ii) in the opinion of the counsel for the Company, all applicable requirements of law and of regulatory bodies having jurisdiction over such issuance and delivery have been fully complied with; and (iii) if required by federal or state law or regulation, the Optionee shall have paid to the Company the amount, if any, required to be withheld on the amount deemed to be compensation to the Optionee as a result of the exercise of his or her Stock Option, or made other arrangements satisfactory to the Company, in its sole discretion, to satisfy applicable income tax withholding requirements.

     (g) Reorganization. Notwithstanding any provision in any Stock Option Agreement pertaining to the time of exercise of a Stock Option, or part thereof, upon adoption by the requisite holders of the outstanding shares of Common Stock of any plan of dissolution, liquidation, reorganization, merger, consolidation or sale of all or substantially all of the assets of the Company to another corporation which would, upon consummation, result in termination of a Stock Option in accordance with Section 16 hereof, all Stock Options previously granted shall become immediately exercisable, whether or not vested under the Plan or Agreement, as to all unexercised Option Shares for such period of time as may be determined by the Stock Option Committee, but in any event not less than 30 days, on the condition that the terminating event described in Section 16 hereof is consummated. If such terminating event is not consummated or if the surviving entity (successor entity) assumes such obligation or gives appropriate substitution thereof, Stock Options granted pursuant to the Plan shall be exercisable in accordance with the terms of their respective Stock Option Agreements.

     9. Nontransferability of Stock Options

     Each Stock Option shall, by its terms, be non- transferable by the Optionee other than by will or the laws of descent and distribution, and shall be exercisable during the Optionee’s lifetime only by the Optionee.

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     10. Continuation of Affiliation

     Nothing contained in this Plan (or in any Stock Option Agreement) shall obligate the Company or any Subsidiary to employ or continue to employ or remain affiliated with any Optionee or any Eligible Participant for any period of time or interfere in any way with the right of the Company or a Subsidiary to reduce or increase the Optionee’s or Eligible Participant’s compensation.

     11. Cessation of Affiliation

     Except as provided in Section 12 hereof, if, for any reason other than disability or death, an Optionee ceases to be affiliated with the Company or a Subsidiary, the Stock Options granted to such Optionee shall expire on the expiration dates specified for said Stock Options at the time of their grant, or ninety (90) days after the Optionee ceases to be so affiliated, whichever is earlier. During such period after cessation of affiliation, such Stock Options shall be exercisable only as to those increments, if any, which had become exercisable as of the date on which such Optionee ceased to be affiliated with the Company or the Subsidiary, and any Stock Options or increments which had not become exercisable as of such date shall expire automatically on such date.

     In the case of Incentive Stock Options, the employment affiliation will be treated as continuing intact while an Optionee is on military, sick leave or other bonafide leave of absence (such as temporary employment by the government) if the period of such leave does not exceed 90 days, or, if longer, so long as the Optionee’s right to re-employment with the Company or a Subsidiary (or the surviving (or successor) entity which has assumed the obligation or substituted options as provided in Section 8(g) hereof) is guaranteed either by statute or by contract. Where the period of leave exceeds 90 days and the Optionee’s re-employment is not guaranteed by either statute or contract, the Optionee will be deemed to have ceased to be affiliated on the 91st day of such leave.

     12. Termination for Cause

     If the Stock Option Agreement so provides and if an Optionee’s employment by or affiliation with the Company or a Subsidiary is terminated for cause, the Stock Options granted to such Optionee shall automatically expire and terminate in their entirety immediately upon such termination; provided, however, that the Stock Option Committee may, in its sole discretion, within thirty (30) days of such termination, reinstate such Stock Options by giving written notice of such reinstatement to the Optionee. In the event of such reinstatement, the Optionee may exercise the Stock Options only to such extent, for such time, and upon such terms and conditions as if the Optionee had ceased to be employed by or affiliated with the Company or a Subsidiary upon the date of such termination for a reason other than cause, disability or death. Termination for cause shall include, but shall not be limited to, termination for malfeasance or gross misfeasance in the performance of duties or conviction of illegal activity in connection therewith and, in any event, the determination of the Stock Option Committee with respect thereto shall be final and conclusive.

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     13. Death of Optionee

     If an Optionee dies while employed by or affiliated with the Company or a Subsidiary, or during the ninety-day period referred to in Section 11 hereof, the Stock Options granted to such Optionee shall expire on the expiration dates specified for said Stock Options at the time of their grant, or one (1) year after the date of such death, whichever is earlier. After such death, but before such expiration, subject to the terms and provisions of the Plan and the related Stock Option Agreements, the person or persons to whom such Optionee’s rights under the Stock Options shall have passed by will or by the applicable laws of descent and distribution, or the executor or administrator of the Optionee’s estate, shall have the right to exercise such Stock Options to the extent that increments, if any, had become exercisable as of the date on which the Optionee died.

     14. Disability of Optionee

     If an Optionee is disabled while employed by or affiliated with the Company or a Subsidiary or during the three-month period referred to in Section 11 hereof, the Stock Options granted to such Optionee shall expire on the expiration dates specified for said Stock Options at the time of their grant, or one (1) year after the date such disability occurred, whichever is earlier. After such disability occurs, but before such expiration, the Optionee or the guardian or conservator of the Optionee’s estate, as duly appointed by a court of competent jurisdiction, shall have the right to exercise such Stock Options to the extent that increments, if any, had become exercisable as of the date on which the Optionee became disabled or ceased to be employed by or affiliated with the Company or a Subsidiary as a result of the disability. An Optionee shall be deemed to be “disabled” if it shall appear to the Stock Option Committee, upon written certification delivered to the Company of a qualified licensed physician, that the Optionee has become permanently and totally unable to engage in any substantial gainful activity by reason of a medically determinable physical or mental impairment which can be expected to result in the Optionee’s death, or which has lasted or can be expected to last for a continuous period of not less than 12 months.

     15. Adjustment Upon Changes in Capitalization

     If the outstanding shares of Common Stock of the Company are increased, decreased, or changed into or exchanged for a different number or kind of shares or securities of the Company, through a reorganization, merger, recapitalization, reclassification, stock split, stock dividend, stock consolidation, or otherwise, without consideration to the Company, an appropriate and proportionate adjustment shall be made in the number and kind of shares as to which Stock Options may be granted. A corresponding adjustment changing the number or kind of Option Shares and the exercise prices per share allocated to unexercised Stock Options, or portions thereof, which shall have been granted prior to any such change, shall likewise be made. Such adjustments shall be made without change in the total price applicable to the unexercised portion of the Stock Option, but with a corresponding adjustment in the price for each Option Share

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subject to the Stock Option. Adjustments under this Section shall be made by the Stock Option Committee, whose determination as to what adjustments shall be made, and the extent thereof, shall be final and conclusive. No fractional shares of stock shall be issued or made available under the Plan on account of such adjustments, and fractional share interests shall be disregarded, except that they may be accumulated.

     16. Terminating Events

     Upon consummation of a plan of dissolution or liquidation of the Company, or upon consummation of a plan of reorganization, merger or consolidation of the Company with one or more corporations as a result of which the Company is not the surviving entity, or upon the sale of all or substantially all the assets of the Company to another corporation, the Plan shall automatically terminate and all Stock Options theretofore granted shall be terminated, unless provision is made in connection with such transaction for assumption of Stock Options theretofore granted (in which case such Stock Options shall be converted into Stock Options for a like number and kind for shares of the surviving entity), or substitution for such Stock Options with new stock options covering stock of a successor employer corporation, or a parent or subsidiary corporation thereof, solely at the discretion of such successor corporation, or parent or subsidiary corporation, with appropriate adjustments as to number and kind of shares and prices.

     17. Amendment and Termination

     The Board of Directors of the Company may at any time and from time to time suspend, amend, or terminate the Plan, with the consent of an Optionee, make such modifications of the terms and conditions of that Optionee’s Stock Option as it shall deem advisable; provided that, except as permitted under the provisions of Section 15 hereof, no amendment or modification may be adopted without the Company having first obtained the approval of the holders of a majority of the Company’s outstanding shares of Common Stock present, or represented, and entitled to vote at a duly held meeting of shareholders of the Company, or by written consent, if the amendment or modification would:

     (a) materially increase the number of securities which may be issued under the Plan;

     (b) materially increase the number of securities which may be issued at any time under the Plan to all directors who are not also officers or key employees of the Company or any Subsidiary;

     (c) materially modify the requirements as to eligibility for participation in the Plan;

     (d) increase or decrease the exercise price of any Stock Option granted under the Plan;

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     (e) increase the maximum term of Stock Options provided for herein;

     (f) permit Stock Options to be granted to any person who is not an Eligible Participant; or

     (g) change any provision of the Plan which would affect the qualification as an Incentive Stock Option under the internal revenue laws then applicable of any Stock Option granted as an Incentive Stock Option under the Plan.

     No Stock Option may be granted during any suspension of the Plan or after termination of the Plan. Amendment, suspension, or termination of the Plan shall not (except as otherwise provided in Section 15 hereof), without the consent of the Optionee, alter or impair any rights or obligations under any Stock Option theretofore granted.

     18. Rights of Eligible Participants and Optionees

     No Eligible Participant, Optionee or other person shall have any claim or right to be granted a Stock Option under this Plan, and neither this Plan nor any action taken hereunder shall be deemed to give or be construed as giving any Eligible Participant, Optionee or other person any right to be retained in the employ of the Company or any Subsidiary. Without limiting the generality of the foregoing, no person shall have any rights as a result of his or her classification as an Eligible Participant or Optionee, such classifications being made solely to describe, define and limit those persons who are eligible for consideration for privileges under the Plan.

     19. Privileges of Stock Ownership; Regulatory Law Compliance; Notice of Sale

     No Optionee shall be entitled to the privileges of stock ownership as to any Option Shares not actually issued and delivered. No Option Shares may be purchased upon the exercise of a Stock Option unless and until all then applicable requirements of all regulatory agencies having jurisdiction and all applicable requirements of the securities exchanges upon which securities of the Company are listed (if any) shall have been fully complied with. The Optionee shall, not more than five (5) days after each sale or other disposition of shares of Common Stock acquired pursuant to the exercise of Stock Options, give the Company notice in writing of such sale or other disposition.

     20. Effective Date of the Plan

     The Plan shall be deemed adopted as of May 19, 2005, the date the Board of Directors of Company duly adopted the Plan and shall be effective immediately, subject to approval of the Plan by the holders of at least a majority of the Company’s outstanding shares of Common Stock.

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     21. Termination

     Unless previously terminated as aforesaid, the Plan shall terminate on May 19, 2015. No Stock Options shall be granted under the Plan thereafter, but such termination shall not affect any Stock Option theretofore granted.

     22. Option Agreement

     Each Stock Option granted under the Plan shall be evidenced by a written Stock Option Agreement executed by the Company and the Optionee, and shall contain each of the provisions and agreements herein specifically required to be contained therein, and such other terms and conditions as are deemed desirable by the Stock Option Committee and are not inconsistent with this Plan.

     23. Stock Option Period

     Each Stock Option and all rights and obligations thereunder shall expire on such date as the Stock Option Committee may determine, but not later than ten (10) years from the date such Stock Option is granted, and shall be subject to earlier termination as provided elsewhere in this Plan.

     24. Exculpation and Indemnification of Stock Option Committee

     The present, former and future members of the Stock Option Committee, and each of them, who is or was a director, officer or employee of the Company shall be indemnified by the Company to the extent authorized in and permitted by the Company’s Articles of Incorporation, and/or Bylaws in connection with all actions, suits and proceedings to which they or any of them may be a party by reason of any act or omission of any member of the Stock Option Committee under or in connection with the Plan or any Stock Option granted thereunder.

     25. Notices

     All notices and demands of any kind which the Stock Option Committee, any Optionee, Eligible Participant, or other person may be required or desires to give under the terms of this Plan shall be in writing and shall be delivered in hand to the person or persons to whom addressed (in the case of the Stock Option Committee, with the Chief Executive Officer, Cashier or Secretary of the Company), by leaving a copy of such notice or demand at the address of such person or persons as may be reflected in the records of the Company, or by mailing a copy thereof, properly addressed as above, by certified or registered mail, postage prepaid, with return receipt requested. Delivery by mail shall be deemed made upon receipt by the notifying party of the return receipt request acknowledging receipt of the notice or demand.

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     26. Limitation on Obligations of the Company

     All obligations of the Company arising under or as a result of this Plan or Stock Options granted hereunder shall constitute the general unsecured obligations of the Company, and not of the Board of Directors of the Company, any member thereof, the Stock Option Committee, any member thereof, any officer of the Company, or any other person or any Subsidiary, and none of the foregoing, except the Company, shall be liable for any debt, obligation, cost or expense hereunder.

     27. Limitation of Rights

     The Stock Option Committee, in its sole and absolute discretion, is entitled to determine who, if anyone, is an Eligible Participant under this Plan, and which, if any, Eligible Participant shall receive any grant of a Stock Option. No oral or written agreement by any person on behalf of the Company relating to this Plan or any Stock Option granted hereunder is authorized, and such may not bind the Company or the Stock Option Committee to grant any Stock Option to any person.

     28. Severability

     If any provision of this Plan as applied to any person or to any circumstance shall be adjudged by a court of competent jurisdiction to be void, invalid, or unenforceable, the same shall in no way affect any other provision hereof, the application of any such provision in any other circumstances, or the validity or enforceability hereof.

     29. Construction

     Where the context or construction requires, all words applied in the plural herein shall be deemed to have been used in the singular and vice versa, and the masculine gender shall include the feminine and the neuter and vice versa.

     30. Headings

     The headings of the several sections herein are inserted solely for convenience of reference and are not intended to form a part of and are not intended to govern, limit or aid in the construction of any term or provision hereof.

     31. Successors

     This Plan shall be binding upon the respective successors, assigns, heirs, executors, administrators, guardians and personal representatives of the Company and Optionees.

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     32. Governing Law

     This Plan shall be governed by and construed in accordance with the laws of the State of California.

     33. Conflict

     In the event of any conflict between the terms and provisions of this Plan, and any other document, agreement or instrument, including, without meaning any limitation, any Stock Option Agreement, the terms and provisions of this Plan shall control.

* * * * * * * *

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SECRETARY’S CERTIFICATE OF ADOPTION

     I, the undersigned, do hereby certify:

     1. That I am the duly elected or appointed and acting Secretary of FCB Bancorp; and

     2. That the FCB Bancorp 2005 Stock Option Plan was duly adopted by the Board of Directors of FCB Bancorp as the 2005 Stock Option Plan for the Company at a meeting duly called as required by law and convened on the 19^th day of May, 2005.

     IN WITNESS WHEREOF, I have hereunto subscribed my name this                      day of                     , 2005.

Secretary 

SECRETARY’S CERTIFICATE
OF SHAREHOLDER APPROVAL

I, the undersigned, do hereby certify that:

     1. I am the duly elected or appointed and acting Secretary of FCB Bancorp; and

     2. The FCB Bancorp 2005 Stock Option Plan was duly adopted by the affirmative vote of the holders of at least a majority of the outstanding shares of the Company’s Common Stock at a meeting of the shareholders duly called and noticed as required by law and convened on ___, 2005 (the “Meeting”).

     IN WITNESS WHEREOF, I have hereunto subscribed my name this                      day of                     , 2005.

Secretary 

EX-10.2

EXHIBIT 10.2

OPTIONEES TO WHOM INCENTIVE STOCK OPTIONS ARE GRANTED MUST MEET CERTAIN HOLDING PERIOD AND EMPLOYMENT REQUIREMENTS FOR FAVORABLE TAX TREATMENT.

UNLESS OTHERWISE STATED, ALL TERMS DEFINED IN THE PLAN SHALL HAVE THE SAME MEANING HEREIN AS SET FORTH IN THE PLAN.

FCB BANCORP
STOCK OPTION AGREEMENT
2005 STOCK OPTION PLAN

o Incentive Stock Option

o Non-Qualified Stock Option

     THIS AGREEMENT, dated the                      day of                                         , 200    , is entered into by and between FCB Bancorp, a California corporation (the “Company”), and                                                             (“Optionee”);

     WHEREAS, pursuant to the Company’s 2005 Stock Option Plan (the “Plan”), the Board of Directors has authorized the grant to Optionee of a Stock Option to purchase all or any part of                                                              (                                        ) authorized but unissued shares of the Company’s Common Stock at the price of                                                             ($                                        ) per share, such Stock Option to be for the term and upon the terms and conditions hereinafter stated;

     NOW, THEREFORE, it is hereby agreed:

     1. Grant of Stock Option. Pursuant to said action of the Board of Directors and subject to authorizations granted by all appropriate regulatory and governmental agencies, the Company hereby grants to Optionee the option to purchase, upon and subject to the terms and conditions of the Plan, which is incorporated in full herein by this reference, all or any part of                                                              (                                        ) shares of the Company’s Common Stock at the price of

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                                                            ($                                        ) per share. For purposes of this Agreement and the Plan, the date of grant shall be                                         , 200    .

     The Stock Option granted hereunder is [is/not] intended to qualify as an Incentive Stock Option within the meaning of Section 422A of the Internal Revenue Code of 1986, as amended.

     2. Exercisability. This Stock Option shall be exercisable as to                                                             (                                        ) Option Shares on                                                           &nb sp; ,                                         or immediately upon the occurrence of a “change of control” as defined herein. Once exercisable, this Stock Option shall remain exercisable as to all of such Option Shares until                                                             ,                                         , at which time it shall expire in its entirety, unless this Stock Option has expired or terminated earlier in accordance with the provisions hereof or of the Plan. Option Shares as to which this Stock Option become exercisable may be purchased at any time prior to expiration of this Stock Option. For the purpose of this Stock Option Agreement a “change of control” shall be deemed to occur if more than seventy-five percent (75%) of the Company’s outstanding common stock is transferred in one, or a series of related, transaction(s) to any person, group of persons acting in concert, firm, partnership, limited liability company or corporation other than to a person, or to an entity controlled by a person, serving on the Board of Directors of the Company on the date of this stock option grant.

     3. Exercise of Stock Option. This Stock Option may be exercised by written notice substantially in the form of Exhibit “A” hereto delivered to the Company stating the number of Option Shares with respect to which this Stock Option is being exercised, together with cash (or bank, cashier’s or certified check). Not less than ten (10) Option Shares may be purchased at any one time unless the number purchased is the total number which remains to be purchased under this Stock Option and in no event may the Stock Option be exercised with respect to fractional shares. Upon exercise, Optionee shall make appropriate arrangements and shall be responsible for the withholding of all federal and state income taxes then due, if any.

     4. Prior Outstanding Stock Options. Pursuant to Section 8(b) of the Plan, an Incentive Stock Option held by Optionee may be exercisable while the Optionee has outstanding and

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unexercised any Incentive Stock Option previously granted to him or her by the Company, or a bank or corporation which (at the time of grant) is a parent or Subsidiary of the Company, or a predecessor corporation of any such entity.

     5. Cessation of Affiliation. Except as provided in Paragraph 6 hereof, if, for any reason other than Optionee’s disability or death, Optionee ceases to be employed by or affiliated with the Company or a Subsidiary, this Stock Option shall expire ninety (90) days thereafter or on the date specified in Paragraph 2 hereof, whichever is earlier. During such period after cessation of employment or affiliation, this Stock Option shall be exercisable only as to those increments, if any, which had become exercisable as of the date on which the Optionee ceased to be employed by or affiliated with the Company or Subsidiary, and any Stock Options or increments which had not become exercisable as of such date shall expire and terminate automatically on such date.

     6. Termination for Cause. If Optionee’s employment by, or affiliation with, the Company or a Subsidiary is terminated for cause, this Stock Option shall automatically expire unless reinstated by the Board of Directors within thirty (30) days of such termination by giving written notice of such reinstatement to Optionee. In the event of such reinstatement, Optionee may exercise this Stock Option only to such extent, for such time, and upon such terms and conditions as if Optionee had ceased to be employed by, or affiliated with, the Company or a Subsidiary upon the date of such termination for a reason other than cause, disability or death. Termination for cause shall include, but shall not be limited to, termination for malfeasance or gross misfeasance in the performance of duties or conviction of illegal activity in connection therewith, or any conduct detrimental to the interests of the Company or a Subsidiary, and, in any event, the determination of the Board of Directors with respect thereto shall be final and conclusive.

     7. Disability or Death of Optionee. If Optionee becomes disabled or dies while employed by, or affiliated with, the Company or a Subsidiary, or during the ninety (90)-day period referred to in Paragraph 5 hereof, this Stock Option shall automatically expire and terminate one (1) year after the date of Optionee’s disability or death or on the day specified in Paragraph 2 hereof,

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whichever is earlier. After Optionee’s disability or death but before such expiration, the person or persons to whom Optionee’s rights under this Stock Option shall have passed by order of a court of competent jurisdiction or by will or the applicable laws of descent and distribution, or the executor, administrator or conservator of Optionee’s estate, subject to the provisions of Paragraph 13 hereof, shall have the right to exercise this Stock Option to the extent that increments, if any, had become exercisable as of the date on which Optionee ceased to be employed by or affiliated with the Company or a Subsidiary. For purposes hereof, “disability” shall have the same meaning as set forth in Section 14 of the Plan.

     8. Nontransferability. This Stock Option shall not be transferable except by will or by the laws of descent and distribution, and shall be exercisable during Optionee’s lifetime only by Optionee.

     9. Employment. This Agreement shall not obligate the Company or a Subsidiary to employ Optionee for any period, nor shall it interfere in any way with the right of the Company or a Subsidiary to increase or reduce Optionee’s compensation.

     10. Privileges of Stock Ownership. Optionee shall have no rights as a stockholder with respect to the Option Shares unless and until said Option Shares are issued to Optionee as provided in the Plan. Except as provided in Section 15 of the Plan, no adjustment will be made for dividends or other rights in respect of which the record date is prior to the date such stock certificates are issued.

     11. Modification and Termination by Board of Directors. The rights of Optionee are subject to modification and termination upon the occurrence of certain events as provided in Sections 16 and 17 of the Plan. Upon adoption by the requisite holders of the Company’s outstanding shares of Common Stock of any plan of dissolution, liquidation, reorganization, merger, consolidation or sale of all or substantially all of the assets of the Company to another corporation which would, upon consummation, result in termination of this Stock Option in accordance with Section 16 of the Plan, this Stock Option shall become immediately exercisable as to all

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unexercised Option Shares notwithstanding the incremental exercise provisions of Paragraph 2 of this Agreement, for a period then specified by the Board of Directors, but in any event not less than thirty (30) days, in accordance with Section 8(g) of the Plan, on the condition that the terminating event described in Section 16 of the Plan is consummated. If such terminating event is not consummated, this Stock Option shall be exercisable in accordance with the terms of the Agreement, excepting this Paragraph 11.

     12. Notification of Sale. Optionee agrees that Optionee, or any person acquiring Option Shares upon exercise of this Stock Option, will notify the Company in writing not more than five (5) days after any sale or other disposition of such Shares.

     13. Approvals. This Agreement and the issuance of Option Shares hereunder are expressly subject to the approval of the Plan and the form of this Agreement by the holders of not less than a majority of the voting stock of the Company. This Stock Option may not be exercised unless and until all applicable requirements of all regulatory agencies having jurisdiction with respect thereto, and of the securities exchanges upon which securities of the Company are listed, if any, have been complied with.

     14. Notices. All notices to the Company provided for in this Agreement shall be addressed to it in care of its Chief Executive Officer, Chief Financial Officer or Secretary at its main office and all notices to Optionee shall be addressed to Optionee’s address on file with the Company or a Subsidiary, or to such other address as either may designate to the other in writing, all in compliance with the notice provisions set forth in Section 25 of the Plan.

     15. Incorporation of Plan. All of the provisions of the Plan are incorporation herein by reference as if set forth in full in this Agreement. In the event of any conflict between the terms of the Plan and any provision contained herein, the terms of the Plan shall be controlling and the conflicting provisions contained herein shall be disregarded.

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

FCB BANCORP
 

By:  

By:  

OPTIONEE




 

ACKNOWLEDGMENT:

     I hereby acknowledge receipt of a copy of this Agreement as well as a copy of the Stock Option Plan.

OPTIONEE

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EX-10.3

Exhibit 10.3

FCB BANCORP

INDEMNIFICATION AGREEMENT

     THIS INDEMNIFICATION AGREEMENT (the “Agreement”) is made as of the ___day of ___, ___ by and between FCB Bancorp, a California corporation (the “Company”), and ______(the “Indemnitee”), a director or officer of the Company with reference to the following facts:

RECITALS

     A. The Company and the Indemnitee recognize that interpretations of ambiguous statutes, regulations, court opinions, and the Company’s Articles of Incorporation and Bylaws are too uncertain to provide the Company’s officers and directors with adequate or reliable advance knowledge or guidance with respect to the legal risks and potential liabilities to which they may become personally exposed as a result of performing their duties in good faith for the Company;

     B. The Company and the Indemnitee are aware of the substantial growth in the number of lawsuits filed against corporate officers and directors in connection with their activities in such capacities and by reason of their status as such;

     C. The Company and the Indemnitee recognize that the cost of defending against such lawsuits, whether or not meritorious, is typically beyond the financial resources of most officers and directors of the Company;

     D. The Company and the Indemnitee recognize that legal risks and potential officer or director liabilities, or the threat thereof, and the resultant substantial time and expense endured in defending against such lawsuits, bear no reasonable logical relationship to the amount of compensation received by the Company’s officers or directors. These factors pose a significant deterrent to, and induce increased reluctance on the part of, experienced and capable individuals to serve as officers or directors of the Company;

     E. The Company has investigated the availability and deficiency of liability insurance to provide its officers and directors with adequate protection against the foregoing legal risks and potential liabilities. The Company has concluded that such insurance provides only limited protection to its officers and directors, and that it is in the best interests of the Company and its shareholders to contract with its officers and directors, including the Indemnitee, to indemnify them to the fullest extent permitted by law against personal liability for actions taken in the good faith performance of their duties to the Company;

     F. Section 317 of the General Corporation Law of the State of California, which sets forth certain provisions relating to mandatory and permissive indemnification of officers and directors of a California corporation by such corporation, requires indemnification in certain circumstances, permits it in other circumstances, and prohibits it in some circumstances;

     G. The Board of Directors of the Company has determined, after due consideration and investigation of this Agreement and various other options available in lieu hereof, that the following Agreement is reasonable, prudent and necessary to promote and ensure the best interests of the Company and its shareholders in that this Agreement is intended to: (i) induce and encourage highly experienced and capable persons such as the Indemnitee to serve as

officers and/or directors of the Company; (ii) encourage such persons to defend what they consider unjustifiable suits and claims made against them in connection with the good faith performance of their duties to the Company, secure in the knowledge that certain expenses, costs and liabilities incurred by them in their defense of such litigation will be borne by the Company and that they will receive the maximum protection against such risks and liabilities as legally may be made available to them; and (iii) encourage officers and directors to exercise their best business judgment regarding matters which come before the Board of Directors without undue concern for the risk that claims may be made against them on account thereof;

     H. Article Six of the Company’s Articles of Incorporation, Article VI of the Company’s Bylaws, and California Corporations Code Section 317 authorize indemnification of persons who serve or served as officers or directors of the Company; and

     I. The Company desires to have the Indemnitee continue to serve as an officer or director of the Company free from concern for unpredictable, inappropriate or unreasonable legal risk and personal liabilities by reason of Indemnitee acting in good faith in the performance of Indemnitee’s duty to the Company. The Indemnitee desires to continue to serve as an officer or director of the Company, provided, and on the express condition, that he is furnished with the indemnity set forth herein.

     NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth below and based on the premises set forth above, the Company and the Indemnitee do hereby agree as follows:

AGREEMENT

     1. Definitions. For the purposes of this Agreement, the following definitions shall apply:

          (a) The term “Agent” shall mean any person who is or was acting in his capacity as a director or officer of the Company, or is or was serving as a director, officer, employee or agent of any other enterprise at the request of the Company, and whether or not he is serving in any such capacity at the time any liability or expense is incurred for which indemnification or reimbursement can be provided under this Agreement.

          (b) The term “Applicable Standard” means that a person acted in good faith and in a manner such person reasonably believed to be in the best interests of the Company; except that in a criminal proceeding, such person must also have had no reasonable cause to believe that such person’s conduct was unlawful. The termination of any Proceeding by judgment, order, settlement, conviction or upon a plea of nolo contendere or its equivalent shall not, of itself, create any presumption, or establish, that the person did not meet the “Applicable Standard.”

          (c) The term “Expenses” includes, without limitation, expenses of investigations, judicial or administrative proceedings or appeals, court costs, attorneys’ fees and disbursements and any expenses of establishing a right to indemnification under law or Paragraph 7 of this Agreement. “Expenses” shall not include the amount of any judgment, fines or penalties actually levied against Indemnitee or amounts paid in settlement of a Proceeding by or on behalf of Indemnitee without court approval.

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          (d) “Independent Legal Counsel” shall include any firm of attorneys selected by lot by the regular outside counsel for the Company from a list of firms which meet minimum size criteria and other reasonable criteria established by the Board of Directors of the Company, so long as such firm has not represented the Company, the Indemnitee or any entity controlled by the Indemnitee within the preceding twenty-four (24) calendar months.

          (e) References to “other enterprise” shall include employee benefit plans; references to “fines” shall include any excise tax assessed with respect to any employee benefit plan; references to “serving at the request of the Company” shall include any service as a director or officer of the Company which imposes duties on, or involves services by, such director or officer with respect to an employee benefit plan, its participants, or beneficiaries; and a person who acts in good faith and in a manner he reasonably believes to be in the interest of the participants and beneficiaries of an employee benefit plan shall be deemed to have acted in a manner “not opposed to the best interests of the Company” as referred to in this Agreement.

          (f) The term “Proceeding” shall include any threatened, pending or completed action, suit or proceeding, whether brought in the name of the Company or otherwise and whether of a civil, criminal, administrative or investigative nature, in which Indemnitee may be or may have been involved as a party or otherwise (other than as plaintiff against the Company), by reason of the fact that the Indemnitee is or was an Agent of the Company or by reason of any action taken by him or of any inaction on his part while acting as such Agent.

          (g) “Registration Statement” means any registration statement previously filed or hereafter filed by the Company under the Securities Act of 1933, as amended (the “Securities Act”) on any applicable form (including Forms S-8 and S-4) for the registration of any securities of the Company under the Securities Act, including, without limitation, debt and equity securities, guarantees, back-up undertakings, rights, warrants and options and interest in employee benefit plans, and shall include any amendment, post-effective or otherwise, thereto and any related registration statement filed pursuant to Rule 462 under the Securities Act.

     2. Agreement to Serve. The Indemnitee agrees to serve or continue to serve as a director and/or officer of the Company at the will of the Company or in accordance with the terms of any agreement with the Company, as the case may be, for so long as he is duly elected or appointed, or until such time as he tenders his resignation in writing or his service is terminated.

     3. Indemnity in Third Party Proceedings. The Company shall indemnify the Indemnitee if the Indemnitee is made a party to or threatened to be made a party to, or otherwise involved in, any Proceeding (other than a Proceeding which is an action by or in the right of the Company to procure a judgment in its favor), by reason of the fact that the Indemnitee is or was an Agent of the Company. This indemnity shall apply, and be limited, to and against all Expenses, judgments, fines, penalties, settlements, and other amounts, actually and reasonably incurred by the Indemnitee in connection with the defense or settlement of the Proceeding, so long as it is determined pursuant to Paragraph 7 of this Agreement or by the court before which such action was brought, that the Indemnitee met the Applicable Standard.

     4. Indemnity in Proceeding By or In the Name of the Company. The Company shall indemnify the Indemnitee if the Indemnitee is made a party to, or threatened to be made a party to, or otherwise involved in, any Proceeding which is an action by or in the right of the Company to procure a judgment in its favor by reason of the fact that the Indemnitee is or was an Agent of

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the Company. This indemnity shall apply, and be limited, to and against all expenses actually and reasonably incurred by the Indemnitee in connection with the defense or settlement of such Proceeding, but only if: (a) the Indemnitee met the Applicable Standard (except that the Indemnitee’s belief regarding the best interests of the Company need not have been reasonable); (b) the Indemnitee also acted in a manner he believed to be in the best interests of the Company’s shareholders; and (c) the action is not settled or otherwise disposed of without court approval. No indemnification shall be made under this Paragraph 4 in respect of any claim, issue or matter as to which the Indemnitee shall have been adjudged to be liable to the Company in the performance of such person’s duty or the Company, unless, and only to the extent that, the court in which such proceeding is or was pending shall determine upon application that, in view of all the circumstances of the case the Indemnitee is fairly and reasonably entitled to indemnification for the expenses which such court shall determine.

     Notwithstanding the foregoing provisions of this Paragraph 4, the Company and the Indemnitee agree that insofar as indemnification for liabilities arising under the Securities Act may be permitted under this Agreement to the Indemnitee, in the event that a claim for indemnification against such liabilities is made by the Indemnitee (other than the payment by the Company of expenses incurred or paid by the Indemnitee in the successful defense of any action, suit or proceeding) in connection with a Registration Statement, the Company will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act, and the Company and the Indemnitee will be governed by the final adjudication of such question.

     5. Expenses of Successful Indemnitee. Notwithstanding any other provision of this Agreement, to the extent the Indemnitee has been successful on the merits in defense of any Proceeding referred to in Paragraphs 3 or 4 hereof, or in defense of any claim, issue or matter therein, including the dismissal of an action or portion thereof without prejudice, the Indemnitee shall be indemnified against all Expenses actually and reasonably incurred in connection therewith.

     6. Advances of Expenses. The Expenses incurred by the Indemnitee in any Proceeding shall be advanced by the Company prior to the final disposition of such proceeding at the written request of the Indemnitee, but only if the Indemnitee shall undertake to repay such advances if it is ultimately determined that the Indemnitee is not entitled to indemnification as provided for in this Agreement. Any advance required hereunder shall be deemed to have been approved by the Board of Directors of the Company to the extent this Agreement was so approved. In determining whether or not to make an advance hereunder, the ability of the Indemnitee to repay shall not be a factor. However, in a Proceeding brought by the Company directly, in its own right (as distinguished from an action brought derivatively or by any receiver or trustee), the Company shall have discretion whether or not to make the advances called for hereby if Independent Legal Counsel advises in writing that the Company has probable cause to believe, and the Company does believe, that the Indemnitee did not act in good faith with regard to the subject matter of the Proceeding or a material portion thereof.

     The Company shall be entitled to participate in the Proceeding and to assume the defense thereof, with counsel chosen by the Company reasonably satisfactory to the Indemnitee, and after notice from the Company to the Indemnitee of its election to assume the defense thereof, the Company shall not be liable to the Indemnitee under this Paragraph 6 for any Expenses of other counsel or any other Expenses, in each case, subsequently incurred by such Indemnitee, in

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connection with the defense thereof, other than reasonable costs of investigation actually incurred by the Indemnitee. In the event that after notice of such an action the Company does not assume the complete defense thereof, then the Indemnitee may, but shall not be obligated, to conduct a defense of the action with counsel of the Indemnitee’s choosing reasonably satisfactory to the Company, with reasonable attorneys’ fees and other reasonable Expenses to be paid by the Company within thirty (30) days of the delivery of each invoice therefor to the Company. In all cases, no settlement shall be entered into without the express prior written consent of the Company. The Company and the Indemnitee shall cooperate fully in the defense of any Proceeding regardless of which party assumes the defense; provided, further, the Indemnitee’s cooperation shall be without compensation.

     7. Right of Indemnitee to Indemnification Upon Application; Procedure Upon Application. Any advance under Paragraphs 5 and/or 6 hereof or indemnification shall be made no later than forty-five (45) days after receipt of a written request of the Indemnitee in accordance with Paragraph 11 hereof. In all other cases, indemnification shall be made by the Company only if authorized in the specific case, upon a determination that indemnification of the Agent is proper under the circumstances and the terms of this Agreement by: (a) a majority vote of a quorum of the Board of Directors (or a duly constituted committee thereof), consisting of directors who are not parties to such Proceeding; (b) approval of the shareholders (as defined in Section 153 of the California Corporations Code, as that Section reads at present), with the Indemnitee’s shares not being entitled to vote thereon; (c) the court in which such Proceeding is or was pending upon application made by the Company, the Indemnitee or any person rendering services in connection with the Indemnitee’s defense, whether or not the Company opposes such application; or (d) to the extent permitted by law, and only if the court refuses or is unable to rule, by Independent Legal Counsel in a written opinion.

     The right to indemnification or advances as provided by this Agreement shall be enforceable by the Indemnitee in any court of competent jurisdiction. The burden of proving that indemnification or advances are not appropriate shall be on the Company. Neither the failure of the Company (including its Board of Directors, Independent Legal Counsel, or its shareholders) to have made a determination prior to the commencement of such action that indemnification or advances are proper in the circumstances because the Indemnitee has met the Applicable Standard of Conduct, nor an actual determination by the Company (including its Board of Directors or Independent Legal Counsel) that the Indemnitee has not met such Applicable Standard of Conduct, shall be a defense to the action or create a presumption that the Indemnitee has not met the Applicable Standard of Conduct. The Indemnitee’s Expenses incurred in connection with successfully establishing his or her right to indemnification or advances in any such Proceeding shall also be indemnified by the Company; provided, however, that if the Indemnitee is only partially successful in establishing his right to indemnification or advances, only an equitably allocated portion of such Expenses, as determined by the court, shall be indemnified.

     If the Indemnitee is entitled under any provision of this Agreement or indemnification by the Company, for some or a portion of the Expenses, judgments, fines or penalties actually and reasonably incurred by the Indemnitee in the investigation, defense, appeal or settlement of any Proceeding but not, however, for the total amount thereof, the Company shall nevertheless indemnify the Indemnitee for the portion (determined on an equitable basis) of such Expenses, judgments, fines or penalties to which the Indemnitee is entitled.

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     The Company’s obligations to advance or indemnify hereunder shall be deemed satisfied to the extent of any payments made by an insurer on behalf of the Company or the Indemnitee.

     8. Indemnification Hereunder Not Exclusive. The indemnification provided by this Agreement shall not be deemed exclusive of any other rights to which the Indemnitee may be entitled under the Articles of Incorporation, the Bylaws, any agreement, any vote of shareholders or disinterested directors, the General Corporation Law of the State of California, or otherwise, both as to action in the Indemnitee’s official capacity and as to action in another capacity while holding such office. The indemnification under this Agreement shall continue as to the Indemnitee even though the Indemnitee may have ceased to be a director or officer and shall inure to the benefit of the heirs and personal representatives of the Indemnitee.

     9. Limitations. The Company shall not be liable under this Agreement to make any payment in connection with any claim made against the Indemnitee:

          (a) for which payment is actually made to or for the benefit of the Indemnitee under a valid and collectible insurance policy, provided, however, that the Company shall remain liable for any payments required by this Agreement in excess of the amount of payment under such insurance;

          (b) for which the Indemnitee is indemnified by the Company otherwise than pursuant to this Agreement;

          (c) for an accounting of profits made from the purchase or sale by the Agent of securities of the Company within the meaning of Section 16(b) of the Securities Exchange Act of 1994 and amendments thereto or similar provisions of any state statutory law or common law;

          (d) for acts or omissions that involve intentional misconduct or a knowing and culpable violation of law;

          (e) for acts or omissions that the Indemnitee believes to be contrary to the best interests of the Company or its shareholders or that involve the absence of good faith on the part of the Indemnitee;

          (f) for any transaction from which the Indemnitee derived an improper personal benefit;

          (g) for acts or omissions that show a reckless disregard for the Indemnitee’s duty to the Company or its shareholders in circumstances in which the Indemnitee was aware, or should have been aware, in the ordinary course of performing his or her duties, of a risk of serious injury to the Company or its shareholders;

          (h) for acts or omissions that constitute an unexcused pattern of inattention that amounts to an abdication of the Indemnitee’s duty to the Company or its shareholders;

          (i) under Section 310 of the General Corporation Law of the State of California, as that Section reads at present; or

          (j) under Section 316 of the General Corporation Law of the State of California, as that Section reads at present.

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     10. Savings Clause. If this Agreement or any portion hereof is invalidated on any ground by any court of competent jurisdiction, then the Company shall nevertheless indemnify the Indemnitee as to Expenses, judgments, fines and penalties with respect to any Proceeding to the full extent permitted by any applicable portion of this Agreement or by any other applicable law.

     11. Notices. The Indemnitee shall, as a condition precedent to the Indemnitee’s right to be indemnified under this Agreement, give to the Company notice in writing within thirty (30) days after he becomes aware of any claim made against him or her for which he or she believes, or should reasonably believe, indemnification will or could be sought under this Agreement. Notice to the Company shall be directed to the Company’s main office, Attention: President (or such other address as the Company shall designate in writing to the Indemnitee). Failure to so notify the Company shall not relieve the Company of any liability which it may have to the Indemnitee otherwise than under this Agreement.

     All notices, requests, demands and other communications (collectively “notices”) provided for under this Agreement shall be in writing (including communications by telephone, telex or telecommunication facilities providing facsimile transmission) and mailed (postage prepaid and return receipt requested), telegraphed, telexed, transmitted or personally served to each party at the address set forth at the end of this Agreement or at such other address as any party affected may designate in a written notice to the other parties in compliance with this section. All such notices shall be effective when received; provided, however, receipt shall be deemed to be effective within three (3) business days of any properly addressed notice having been deposited in the mail, within twenty-four (24) hours from the time electronic transmission was made, or upon actual receipt of electronic delivery, whichever occurs first.

     No costs, charges or expenses for which indemnity shall be sought hereunder shall be incurred without the Company’s consent, which consent shall not be unreasonably withheld.

     12. Choice of Law. This Agreement shall be interpreted and enforced in accordance with the laws of the State of California, including applicable statutes of limitations and other procedural statutes.

     13. Attorneys’ Fees. If any legal action is necessary to enforce the terms of this Agreement, the prevailing party shall be entitled to recover, in addition to the amounts to which the prevailing party may be entitled, actual attorneys’ fees and court costs as may be awarded by the court.

     14. Amendments. Provisions of this Agreement may be waived, altered, amended or repealed in whole or in part only by the written consent of all parties.

     15. Parties in Interest. Nothing in this Agreement, whether express or implied, is intended to confer any rights or remedies under or by reason of this Agreement to any persons other than the parties to it and their respective successors and assigns (including an estate of the Indemnitee), nor is anything in this Agreement intended to relieve or discharge the obligation or liability of any third persons to any party hereto. Furthermore, no provision of this Agreement shall give any third persons any right of subrogation or action against any party hereto.

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     16. Severability. If any portion of this Agreement shall be deemed by a court of competent jurisdiction to be unenforceable, the remaining portions shall be valid and enforceable only if, after excluding the portion deemed to be unenforceable, the remaining terms shall provide for the consummation of the transaction contemplated herein in substantially the same manner as originally set forth at the date this Agreement was executed.

     17. Successors and Assigns. All terms and conditions of this Agreement shall be binding upon and shall inure to the benefit of the parties and their respective transferees, successors and assigns; provided, however, that this Agreement and all rights, privileges, duties and obligations of the parties, may not be assigned or delegated by any party without the prior written consent of the other parties.

     18. Counterparts. This Agreement may be executed simultaneously in one or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.

     19. Entire Agreement. Except as provided in Paragraph 8 hereof, this Agreement represents and contains the entire agreement and understanding between and among the parties, and all previous statements or understandings, whether express or implied, oral or written, relating to the subject matter hereof are fully and completely extinguished and superseded by this Agreement. This Agreement shall not be altered or varied except by a writing duly signed by all of the parties.

     IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the date first above written.

FCB Bancorp

1100 Paseo Camarillo

Camarillo, California 93010

By:

Its:

“Indemnitee”

Address:

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EX-10.4

Exhibit 10.4

FIRST CALIFORNIA BANK

SALARY CONTINUATION AGREEMENT

     THIS AGREEMENT is adopted this 27^th day of March, 2003, by and between FIRST CALIFORNIA BANK located in Camarillo, California (the “Company”), and CHONG GUK KUM (the “Executive”).

INTRODUCTION

     To encourage the Executive to remain an employee of the Company, the Company is willing to provide salary continuation benefits to the Executive. The Company will pay the benefits from its general assets.

AGREEMENT

     The Company and the Executive agree as follows:

Article 1

Definitions

     Whenever used in this Agreement, the following words and phrases shall have the meanings specified:

     1.1 “Change of Control” means the transfer of shares of the Company’s voting common stock such that one entity or one person acquires (or is deemed to acquire when applying Section 318 of the Code) more than 75 percent of the Company’s outstanding voting common stock.

     1.2 “Code” means the Internal Revenue Code of 1986, as amended.

     1.3 “Disability” means the Executive’s suffering a sickness, accident or injury which has been determined by the carrier of any individual or group disability insurance policy covering the Executive, or by the Social Security Administration, to be a disability rendering the Executive totally and permanently disabled. The Executive must submit proof to the Company of the carrier’s or Social Security Administration’s determination upon the request of the Company.

     1.4 “Early Involuntary Termination” means that the Executive, prior to Normal Retirement Age, has been notified in writing, that employment with the Company is terminated for reasons other than an approved leave of absence, Termination for Cause, Disability, Change of Control or Early Voluntary Termination.

     1.5 “Early Voluntary Termination” means that the Executive, prior to Normal Retirement Age, has terminated employment with the Company for reasons other than Termination for Cause, Disability, Change of Control or Early Involuntary Termination.

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     1.6 “Effective Date” means January 1, 2003.

     1.7 “Normal Retirement Age” means the Executive attaining 65 years of age.

     1.8 “Normal Retirement Date” means the later of the Normal Retirement Age or Termination of Employment.

     1.9 “Plan Year” means a twelve-month period commencing on January 1 and ending on December 31 of each year. The initial Plan Year shall commence on the effective date of this Agreement.

     1.10 “Termination for Cause” shall be defined as set forth in Article 5.

     1.11 “Termination of Employment” means that the Executive ceases to be employed by the Company for any reason, other than by reason of a leave of absence approved by the Company.

Article 2

Lifetime Benefits

     2.1 Normal Retirement Benefit. Upon Termination of Employment on or after the Normal Retirement Age for reasons other than death, the Company shall pay to the Executive the benefit described in this Section 2.1 in lieu of any other benefit under this Agreement.

     2.1.1 Amount of Benefit. The annual benefit under this Section 2.1 is $100,000 (One Hundred Thousand Dollars). Commencing at the end of the first Plan Year and each Plan Year thereafter, the annual benefit shall be increased three percent (3%) from the previous Plan Year to a projected annual benefit of $160,471 (One Hundred Sixty Thousand Four Hundred Seventy-one Dollars) at Normal Retirement Age.

     2.1.2 Payment of Benefit. The Company shall pay the annual benefit to the Executive in 12 equal monthly installments commencing with the month following the Executive’s Normal Retirement Date, paying the annual benefit to the Executive for a period of years equal to the number of years that Executive is employed by Company between the Effective Date and Executive’s Normal Retirement Date, but not to exceed the maximum of seventeen (17) years.

     2.1.3 No Increases. Commencing with the first benefit payment, there shall be no further increases in the amount of the annual benefit.

     2.2 Early Voluntary Termination. Upon an Early Voluntary Termination, the Executive will not be eligible for a benefit under this Agreement.

     2.3 Early Involuntary Termination Benefit. Upon an Early Involuntary Termination, the

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Company shall pay to the Executive the benefit described in this Section 2.3 in lieu of any other benefit under this Agreement.

     2.3.1 Amount of Benefit. The benefit under this Section 2.3 is the Early Involuntary Lump Sum set forth on Schedule A for the Plan Year ending immediately prior to Termination of Employment, determined by vesting the Executive in the Accrual Balance for the Plan Year ending immediately prior to Termination of Employment.

     2.3.2 Payment of Benefit. The Company shall pay the benefit determined under Section 2.3.1 to the Executive in a lump sum within 30 days following Termination of Employment.

     2.4 Disability Benefit. Upon the Executive’s Termination of Employment prior to Normal Retirement Age due to Disability, the Company shall pay to the Executive the benefit described in this Section 2.4 in lieu of any other benefit under this Agreement.

     2.4.1 Amount of Benefit. The benefit under this Section 2.4 is the Disability annual installment set forth on Schedule A, determined by vesting the Executive in the annual benefit for the plan year ending immediately prior to termination of employment.

     2.4.2 Payment of Benefit. The Company shall pay the annual benefit determined in Section 2.4.1 to the Executive in 12 equal monthly installments commencing with the month following Termination of Employment, paying the annual benefit to the Executive for a period of 17 years.

     2.4.3 No Increases. As provided in Section 2.1.3. there shall be no increases in benefits once payment has commenced pursuant to this Section 2.4.

     2.5 Change of Control Benefit. Upon a Change of Control, followed within twelve (12) months by the Executive’s Termination of Employment for reasons other than death, Disability or retirement, the Company shall pay to the Executive the benefit described in this Section 2.5 in lieu of any other benefit under this Agreement.

     2.5.1 Amount of Benefit. The benefit under this Section 2.5 is the Change of Control annual Installment set forth on Schedule A, determined by vesting the Executive in the projected Normal Retirement Benefit at Normal Retirement Age as described in Section 2.1.1.

     2.5.2 Payment of Benefit. The Company shall pay the annual benefit determined in Section 2.5.1 to the Executive in 12 equal monthly installments commencing with the month following the Normal Retirement Age, paying the annual benefit to the Executive for a period of 17 years.

     2.5.3 No Increases. As provided in Section 2.1.3. there shall be no increases in benefits once payment has commenced pursuant to this Section 2.5.

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     2.6 Loss Year. Anything in this Article 2 to the contrary notwithstanding, should the Company’s operations (exclusive of extraordinary gains or expenses as determined by Generally Accepted Accounting Principles) result in a loss for any fiscal year prior to the commencement of a benefit payment, then the accrual for that year shall be omitted and all of the projected benefits as set forth on Schedule A shall be adjusted downward as a result.

Article 3

Death Benefits

     3.1 Death During Active Service. If the Executive dies while in the active service of the Company, the Company shall pay to the Executive’s beneficiary the split dollar death benefit described in the Split Dollar Agreement attached as Addendum A between the Company and the Executive in lieu of any other benefit under this Agreement.

     3.2 Death after Termination of Employment due to Retirement, Disability or Change of Control. Upon the death of the Executive after Normal Retirement Date or after Termination of Employment due to Disability or Change of Control as set forth in Article 2 of this Agreement, the Company shall cease paying the remaining benefit, if any, and shall then pay to the Executive’s beneficiary the split dollar death benefit described in the Split Dollar Agreement attached as Addendum A between the Company and the Executive.

     3.3 Death after Early Involuntary Termination or Early Voluntary Termination. No death benefit shall be paid upon the death of the Executive after an Early Involuntary Termination or an Early Voluntary Termination.

Article 4

Beneficiaries

     4.1 Beneficiary Designations. The Executive shall designate a beneficiary by filing a written designation with the Company. The Executive may revoke or modify the designation at any time by filing a new designation. However, designations will only be effective if signed by the Executive and received by the Company during the Executive’s lifetime. The Executive’s beneficiary designation shall be deemed automatically revoked if the beneficiary predeceases the Executive, or if the Executive names a spouse as beneficiary and the marriage is subsequently dissolved. If the Executive dies without a valid beneficiary designation, all payments shall be made to the Executive’s estate.

     4.2 Facility of Payment. If a benefit is payable to a minor, to a person declared incompetent, or to a person incapable of handling the disposition of his or her property, the Company may pay such benefit to the guardian, legal representative or person having the care or custody of such minor, incompetent person or incapable person. The Company may require proof of incompetence, minority or guardianship as it may deem appropriate prior to distribution of the benefit. Such distribution shall completely discharge the Company from all liability with respect to such benefit.

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Article 5

General Limitations

     5.1 Termination for Cause. Notwithstanding any provision of this Agreement to the contrary, the Company shall not pay any benefit under this Agreement if the Company terminates the Executive’s employment for:

     (a) Gross negligence or gross neglect of duties;

     (b) Commission of a felony or of a gross misdemeanor involving moral turpitude in connection with the Executive’s employment with the Company; or

     (c) Fraud, disloyalty, dishonesty or willful violation of any law or significant Company policy committed in connection with the Executive’s employment and resulting in an adverse effect on the Company.

     5.2 Suicide or Misstatement. The Company shall not pay any benefit under this Agreement if the Executive commits suicide. In addition, the Company shall not pay any benefit under this Agreement if the Executive has made any material misstatement of fact on an employment application or resume provided to the Company, or on any application for any benefits provided by the Company to the Executive.

Article 6

Claims and Review Procedure

     6.1 Claims Procedure. An Executive or beneficiary (“claimant”) who has not received benefits under the Agreement that he or she believes should be paid shall make a claim for such benefits as follows:

     6.1.1 Initiation — Written Claim. The claimant initiates a claim by submitting to the Company a written claim for the benefits.

     6.1.2 Timing of Company Response. The Company shall respond to such claimant within 90 days after receiving the claim. If the Company determines that special circumstances require additional time for processing the claim, the Company can extend the response period by an additional 90 days by notifying the claimant in writing, prior to the end of the initial 90-day period that an additional period is required. The notice of extension must set forth the special circumstances and the date by which the Company expects to render its decision.

     6.1.3 Notice of Decision. If the Company denies part or all of the claim, the Company shall notify the claimant in writing of such denial. The Company shall write the notification in a manner calculated to be understood by the claimant. The notification shall set forth:

          (a) The specific reasons for the denial;

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          (b) A reference to the specific provisions of the Agreement on which the denial is based;

          (c) A description of any additional information or material necessary for the claimant to perfect the claim and an explanation of why it is needed;

          (d) An explanation of the Agreement’s review procedures and the time limits applicable to such procedures; and

          (e) A statement of the claimant’s right to bring a civil action under ERISA Section 502(a) following an adverse benefit determination on review.

     6.2 Review Procedure. If the Company denies part or all of the claim, the claimant shall have the opportunity for a full and fair review by the Company of the denial, as follows:

     6.2.1 Initiation — Written Request. To initiate the review, the claimant, within 60 days after receiving the Company’s notice of denial, must file with the Company a written request for review.

     6.2.2 Additional Submissions — Information Access. The claimant shall then have the opportunity to submit written comments, documents, records and other information relating to the claim. The Company shall also provide the claimant, upon request and free of charge, reasonable access to, and copies of, all documents, records and other information relevant (as defined in applicable ERISA regulations) to the claimant’s claim for benefits.

     6.2.3 Considerations on Review. In considering the review, the Company shall take into account all materials and information the claimant submits relating to the claim, without regard to whether such information was submitted or considered in the initial benefit determination.

     6.2.4 Timing of Company Response. The Company shall respond in writing to such claimant within 60 days after receiving the request for review. If the Company determines that special circumstances require additional time for processing the claim, the Company can extend the response period by an additional 60 days by notifying the claimant in writing, prior to the end of the initial 60-day period that an additional period is required. The notice of extension must set forth the special circumstances and the date by which the Company expects to render its decision.

     6.2.5 Notice of Decision. The Company shall notify the claimant in writing of its decision on review. The Company shall write the notification in a manner calculated to be understood by the claimant. The notification shall set forth:

          (a) The specific reasons for the denial;

          (b) A reference to the specific provisions of the Agreement on which the denial is based;

          (c) A statement that the claimant is entitled to receive, upon request and free of charge, reasonable access to, and copies of, all documents, records and other information

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relevant (as defined in applicable ERISA regulations) to the claimant’s claim for benefits; and

          (d) A statement of the claimant’s right to bring a civil action under ERISA Section 502(a).

Article 7

Amendments and Termination

     7.1 This Agreement may be amended or terminated only by a written agreement signed by the Company and the Executive; however, this Agreement will automatically terminate if no benefit is payable to the Executive due to the Executive’s Termination for Cause, Suicide or Misstatement as set forth in Article 5 or upon an Early Voluntary Termination.

     7.2. The Company and the Executive agree to amend this Agreement in the event that there is a change to applicable tax law or regulations or to the accounting treatment for the benefits to be provided hereunder which materially increases the after-tax cost of the benefits. In the event an amendment is required under this Section 7.2, such amendment shall be limited to decreasing the benefits to be provided to the Executive only to the extent necessary so that net, after-tax impact to the Company’s earnings will be substantially the same as such earnings would have been absent the change in tax law, regulation, or accounting treatment.

Article 8

Miscellaneous

     8.1 Binding Effect. This Agreement shall bind the Executive and the Company, and their beneficiaries, survivors, executors, successors, administrators and transferees.

     8.2 No Guarantee of Employment. This Agreement is not an employment policy or contract. It does not give the Executive the right to remain an employee of the Company, nor does it interfere with the Company’s right to discharge the Executive. It also does not require the Executive to remain an employee nor interfere with the Executive’s right to terminate employment at any time.

     8.3 Non-Competition. During such time as Executive is receiving benefit payments hereunder, Executive shall not serve as an employee, officer or director of, or serve as a consultant or advisor to, any financial institution, including but not limited to any bank, savings bank or credit union, which has its headquarters or any branch office within the County of Ventura or the County of Santa Barbara.

     8.4 Non-Transferability. Benefits under this Agreement cannot be sold, transferred, assigned, pledged, attached or encumbered in any manner.

     8.5 Reorganization. The Company shall not merge or consolidate into or with another company, or reorganize, or sell substantially all of its assets to another company, firm, or person unless such succeeding or continuing company, firm, or person agrees to assume and discharge the

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obligations of the Company under this Agreement. Upon the occurrence of such event, the term “Company” as used in this Agreement shall be deemed to refer to the successor or survivor company.

     8.6 Tax Withholding. The Company shall withhold any taxes that are required to be withheld from the benefits provided under this Agreement.

     8.7 Applicable Law. The Agreement and all rights hereunder shall be governed by the laws of the State of California, except to the extent preempted by the laws of the United States of America.

     8.8 Unfunded Arrangement. The Executive and beneficiary are general unsecured creditors of the Company for the payment of benefits under this Agreement. The benefits represent the mere promise by the Company to pay such benefits. The rights to benefits are not subject in any manner to anticipation, alienation, sale, transfer, assignment, pledge, encumbrance, attachment, or garnishment by creditors. Any insurance on the Executive’s life is a general asset of the Company to which the Executive and beneficiary have no preferred or secured claim.

     8.9 Entire Agreement. This Agreement constitutes the entire agreement between the Company and the Executive as to the subject matter hereof. No rights are granted to the Executive by virtue of this Agreement other than those specifically set forth herein.

     8.9 Administration. The Company shall have powers which are necessary to administer this Agreement, including but not limited to:

     (a) Establishing and revising the method of accounting for the Agreement;

     (b) Maintaining a record of benefit payments;

     (c) Establishing rules and prescribing any forms necessary or desirable to administer the Agreement; and

     (d) Interpreting the provisions of the Agreement.

     8.10 Named Fiduciary. The Company shall be the named fiduciary and plan administrator under this Agreement. It may delegate to others certain aspects of the management and operational responsibilities including the employment of advisors and the delegation of ministerial duties to qualified individuals.

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     IN WITNESS WHEREOF, the Executive and the Company consent to this Agreement on the date above written.

EXECUTIVE:	COMPANY:
	FIRST CALIFORNIA BANK
/s/ Chong Guk Kum	By	/s/ James O. Birchfield
Chong Guk Kum		James O. Birchfield
		Chairman of the Board

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EX-10.5

EXHIBIT 10.5

FIRST CALIFORNIA BANK
SPLIT DOLLAR AGREEMENT

(ADDENDUM A TO THE FIRST CALIFORNIA BANK SALARYCONTINUATION AGREEMENT)

     THIS AGREEMENT is adopted this 27^th day of March, 2003, by and between FIRST CALIFORNIA BANK, located in Camarillo, California (the “Company”), and CHONG GUK KUM (the “Executive”). This Agreement shall append the Split Dollar Endorsement entered into on even date herewith or as subsequently amended, by and between the aforementioned parties.

INTRODUCTION

     To encourage the Executive to remain an employee of the Company, the Company is willing to divide the death proceeds of a life insurance policy on the Executive’s life. The Company will pay life insurance premiums from its general assets.

AGREEMENT

The Company and the Executive agree as follows:

Article 1
General Definitions

The following terms shall have the meanings specified:

     1.1 “Insured” means the Executive.

     1.2 “Insurer” means each life insurance carrier in which there is a Split Dollar Policy Endorsement attached to this Agreement.

     1.3 “Normal Retirement Age” means the Executive attaining 65 years of age.

     1.4 “Normal Retirement Date” means the later of the Normal Retirement Age or Termination of Employment.

     1.5 “Policy” means the specific life insurance policy or policies issued by the Insurer.

     1.6 “Salary Continuation Agreement” means that Salary Continuation Agreement between the Company and the Executive on even date herewith or as subsequently amended.

     1.7 “Termination for Cause” means the Company terminating the Executive’s employment for:

     (a) Gross negligence or gross neglect of duties to the Company;

     (b) Commission of a felony or of a gross misdemeanor involving moral turpitude in connection with the Executive’s employment with the Company; or

     (c) Fraud, disloyalty, dishonesty or willful violation of any law or significant Company policy committed in connection with the Executive’s employment and resulting in an adverse effect on the Company.

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     1.8 “Termination of Employment” means that the Executive ceases to be employed by the Company for any reason, other than by reason of a leave of absence approved by the Company.

Article 2
Policy Ownership/Interests

     2.1 Company Ownership. The Company is the sole owner of the Policy and shall have the right to exercise all incidents of ownership. The Company shall be the beneficiary of the remaining death proceeds of the Policy after the Interest of the Executive or the Executive’s transferee has been paid according to Section 2.2 below.

     2.2 Executive’s Interest. The Executive shall have the right to designate the beneficiary death proceeds in the amount of $1,500,000 upon the death of the Executive, a) prior to Norm Retirement Age while employed by the Company; or b) after Normal Retirement Date or after Termination of Employment due to Disability or Change of Control as defined in the Salary Continuation Agreement. The Executive shall also have the right to elect and change settlement options that may be permitted. Upon the termination of this Agreement according to Article 7 herein, the Executive, the Executive’s transferee or the Executive’s beneficiary shall have no rights or interests in the Policy and no death benefit shall be paid under this Section 2.2.

     2.3 Option to Purchase. The Company shall not sell, surrender or transfer ownership of the Policy while this Agreement is in effect without first giving the Executive or the Executive’s transferee the option to purchase the Policy for a period of 60 days from written notice of such intention. The purchase price shall be an amount equal to the cash surrender value of the Policy. This provision shall not impair the right of the Company to terminate this Agreement.

     2.4 Comparable Coverage. Upon execution of this Agreement, the Company shall maintain the Policy in full force and effect and in no event shall the Company amend, terminate or otherwise abrogate the Executive’s interest in the Policy, unless the Company replaces the Policy with comparable insurance policy to cover the benefit provided under this Agreement and the Company and the Executive execute a new Split Dollar Policy Endorsement for said comparable insurance policy. The Policy or any comparable policy shall be subject to the claims of the Company’s creditors.

Article 3
Premiums

     3.1 Premium Payment. The Company shall pay any premiums due on the Policy.

     3.2 Economic Benefit. The Company shall determine the economic benefit attributable to the Executive based on the amount of the current term rate for the Executive’s age multiplied by the aggregate death benefit payable to the Executive’s beneficiary. The “current term rate” is the minimum amount required to be imputed under Revenue Rulings 64-328 and 66-110, or any subsequent applicable authority.

     3.3 Reimbursement. At the end of each Plan Year, the Executive shall reimburse the Company in an amount equal to the economic benefit.

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Article 4
Assignment

     The Executive may assign without consideration all of the Executive’s interests in the Policy and in this Agreement to any person, entity or trust. In the event the Executive transfers all of the Executive’s interest in the Policy, then all of the Executive’s interest in the Policy and in the Agreement shall be vested in the Executive’s transferee, who shall be substituted as a party hereunder and the Executive shall have no further interest in the Policy or in this Agreement.

Article 5
Insurer

     The Insurer shall be bound only by the terms of the Policy. Any payments the Insurer makes or actions it takes in accordance with the Policy shall fully discharge it from all claims, suits and demands of all entities or persons. The Insurer shall not be bound by or be deemed to have notice of the provisions of this Agreement.

Article 6
Claims and Review Procedure

     6.1 Claims Procedure. Any person or entity who has not received benefits under the Plan that he or she believes should be paid (the “claimant”) shall make a claim for such benefits as follows:

          6.1.1 Initiation — Written Claim. The claimant initiates a claim by submitting to the Company a written claim for the benefits.

          6.1.2 Timing of Company Response. The Company shall respond to such claimant within 90 days after receiving the claim. If the Company determines that special circumstances require additional time for processing the claim, the Company can extend the response period by an additional 90 days by notifying the claimant in writing, prior to the end of the initial 90-day period that an additional period is required. The notice of extension must set forth the special circumstances and the date by which the Company expects to render its decision.

          6.1.3 Notice of Decision. If the Company denies part or all of the claim, the Company shall notify the claimant in writing of such denial. The Company shall write the notification a manner calculated to be understood by the claimant. The notification shall set forth:

     (a) The specific reasons for the denial,

     (b) A reference to the specific provisions of this Agreement on which the denial is based,

     (c) A description of any additional information or material necessary for the claimant to perfect the claim and an explanation of why it is needed,

     (d) An explanation of this Agreement’s review procedures and the time

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limits applicable to such procedures, and

     (e) A statement of the claimant’s right to bring a civil action under ERISA Section 502(a) following an adverse benefit determination on review.

     6.2 Review Procedure. If the Company denies part or all of the claim, the claimant shall have the opportunity for a full and fair review by the Company of the denial, as follows;

          6.2.1 Initiation — Written Request. To initiate the review, the claimant, within 60 days after receiving the Company’s notice of denial, must file with the Company a written request for review.

          6.2.2 Additional Submissions — Information Access. The claimant shall then have the opportunity to submit written comments, documents, records and other information relating to the claim. The Company shall also provide the claimant, upon request and free of charge, reasonable access to, and copies of, all documents, records and other information relevant (as defined in applicable ERISA regulations) to the claimant’s claim for benefits.

          6.2.3 Considerations on Review. In considering the review, the Company shall take into account all materials and information the claimant submits relating to the claim, without regard to whether such information was submitted or considered in the initial benefit determination.

          6.2.4 Timing of Company Response, The Company shall respond in writing to such claimant within 60 days after receiving the request for review. If the Company determines that special circumstances require additional time for processing the claim, the Company can extend the response period by an additional 60 days by notifying the claimant in writing, prior to the end of the initial 60-day period that an additional period is required. The notice of extension must set forth the special circumstances and the date by which the Company expects to render its decision.

          6.2.5 Notice of Decision. The Company shall notify the claimant in writing of it decision on review. The Company shall write the notification in a manner calculated to be understood by the claimant. The notification shall set forth:

     (a) The specific reasons for the denial,

     (b) A reference to the specific provisions of this Agreement on which the denial is based,

     (c) A statement that the claimant is entitled to receive, upon request and free of charge, reasonable access to, and copies of, all documents, records and other information relevant (as defined in applicable ERISA regulations) to the claimant’s claim for benefits, and

     (d) A statement of the claimant’s right to bring a civil action under ERISA Section 502(a).

Article 7
Amendments and Termination

     This Agreement may be amended or terminated only by a written agreement signed

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by the Company and the Executive; however, this Agreement will automatically terminate upon the Executive’s Termination for Cause, Early Involuntary Termination or Early Voluntary Termination (as defined in the Salary Continuation Agreement) or in the event the Insurer refuses to pay a death benefit according to the terms of the Policy.

Article 8
Miscellaneous

     8.1 Binding Effect. This Agreement shall bind the Executive and the Company and their beneficiaries, survivors, executors, administrators and transferees, and any Policy beneficiary.

     8.2 No Guarantee of Employment. This Agreement is not an employment policy or contract. It does not give the Executive the right to remain an employee of the Company, nor does it interfere with the Company’s right to discharge the Executive. It also does not require the Executive to remain an employee nor interfere with the Executive’s right to terminate employment at any time.

     8.3 Applicable Law. The Agreement and all rights hereunder shall be governed by and construed according to the laws of the State of California, except to the extent preempted by the laws of the United States of America.

     8.4 Reorganization. The Company shall not merge or consolidate into or with another company, or reorganize, or sell substantially all of its assets to another company, firm or person unless such succeeding or continuing company, firm or person agrees to assume and discharge the obligations of the Company.

     8.5 Notice. Any notice, consent or demand required or permitted to be given under the provisions of this Split Dollar Agreement by one party to another shall be in writing, shall be sign by the party giving or making the same, and may be given either by delivering the same to such other party personally, or by mailing the same, by United States certified mail, postage prepaid, such party, addressed to his or her last known address as shown on the records of the Company. The date of such mailing shall be deemed the date of such mailed notice, consent or demand.

     8.6 Entire Agreement. This Agreement constitutes the entire agreement between the Company and the Executive as to the subject matter hereof. No rights are granted to the Executive by virtue of this Agreement other than those specifically set forth herein.

     8.7 Administration. The Company shall have powers which are necessary to administer the Agreement, including but not limited to:

     (a) Interpreting the provisions of this Agreement;

     (b) Establishing and revising the method of accounting for this Agreement;

     (c) Maintaining a record of benefit payments; and

     (d) Establishing rules and prescribing any forms necessary or desirable to administer this Agreement.

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     8.8 Named Fiduciary. The Company shall be the named fiduciary and plan administrator under the Agreement. The named fiduciary may delegate to others certain aspects of the management and operation responsibilities of the plan including the employment of advisors and the delegation of ministerial duties to qualified individuals.

     IN WITNESS WHEREOF, the Executive and the Company consent to this Agreement on the date above written.

EXECUTIVE:	COMPANY
	FIRST CALIFORNIA BANK
/s/ Chong Guk Kum	By	/s/ James O. Birchfield
Chong Guk Kum		James O. Birchfield Chairman of the Board

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SPLIT DOLLAR POLICY ENDORSEMENT (1 of 3)
FIRST CALIFORNIA BANK SPLIT DOLLAR AGREEMENT

Insured: Chong Guk Kum
Insurer: Massachusetts Mutual Life Insurance Company
Policy No.                                         

     Pursuant to the terms of the FIRST CALIFORNIA BANK SPLIT DOLLAR AGREEMENT dated March 27, 2003, the undersigned Owner requests that the above-referenced policy issued by the Insurer provide for the following beneficiary designation and limited contract ownership rights to the Insured:

     1. Upon the death of the Insured, proceeds shall be paid in one sum to the Owner, its successors or assigns, to the extent of its interest in the policy. It is hereby provided that the Insurer may rely solely upon a statement from the Owner as to the amount of proceeds it is entitled to receive under this paragraph.

     2. Any proceeds at the death of the Insured in excess of the amount paid under the provisions of the preceding paragraph shall be paid in one sum to:

PRIMARY BENEFICIARY, RELATIONSHIP/SOCIAL SECURITY NUMBER

CONTINGENT BENEFICIARY, RELATIONSHIP/SOCIAL SECURITY NUMBER

The exclusive right to change the beneficiary for the proceeds payable under this paragraph, to elect an optional method of settlement for the proceeds paid under this paragraph which are available under the terms of the policy and to assign all rights and interests granted under this paragraph are hereby granted to the Insured. The sole signature of the Insured shall be sufficient to exercise said rights. The Owner retains all contract rights not granted to the Insured under this paragraph.

     3. It is agreed by the undersigned that this designation and limited assignment of rights shall be subject in all respects to the contractual terms of the policy.

     4. Any payment directed by the Owner under this endorsement shall be a full discharge of the Insurer and such discharge shall be binding on all parties claiming any interest under the policy.

     The undersigned for the Owner is signing in a representative capacity and warrants that he or she has the authority to bind the entity on whose behalf this document is being executed.

     Signed at Camarillo, California this 27^th day of March, 2003.

INSURED:	OWNER
	FIRST-CALIFORNIA
/s/ Chong Guk Kum	By	/s/ James O. Birchfield
Chong Guk Kum		James O. Birchfield Chairman of the Board

SPLIT DOLLAR POLICY ENDORSEMENT (2 of 3)
FIRST CALIFORNIA BANK SPLIT DOLLAR AGREEMENT

Insured: Chong Guk Kum
Insurer: New York Life Insurance Company
Policy No.                                         

     Pursuant to the terms of the FIRST CALIFORNIA BANK SPLIT DOLLAR AGREEMENT dated March 27, 2003, the undersigned Owner requests that the above-referenced policy issued by the Insurer provide for the following beneficiary designation and limited contract ownership rights to the Insured:

     1. Upon the death of the Insured, proceeds shall be paid in one sum to the Owner, its successors or assigns, to the extent of its interest in the policy. It is hereby provided that the Insurer may rely solely upon a statement from the Owner as to the amount of proceeds it is entitled to receive under this paragraph.

     2. Any proceeds at the death of the Insured in excess of the amount paid under the provisions of the preceding paragraph shall be paid in one sum to:

PRIMARY BENEFICIARY, RELATIONSHIP/SOCIAL SECURITY NUMBER

CONTINGENT BENEFICIARY, RELATIONSHIP/SOCIAL SECURITY NUMBER

The exclusive right to change the beneficiary for the proceeds payable under this paragraph, to elect an optional method of settlement for the proceeds paid under this paragraph which are available under the terms of the policy and to assign all rights and interests granted under this paragraph are hereby granted to the Insured. The sole signature of the Insured shall be sufficient to exercise said rights. The Owner retains its contract rights not granted to the Insured under this paragraph.

     3. It is agreed by the undersigned that this designation and limited assignment of rights shall be subject in all respects to the contractual terms of the policy.

     4. Any payment directed by the Owner under this endorsement shall be a full discharge of the Insurer and such discharge shall be binding on all parties claiming any interest under the policy.

The undersigned for the Owner is signing in a representative capacity and warrants that he or she has the authority to bind the entity on whose behalf this document is being executed.

Signed at Camarillo, California this 27^th day of March, 2003.

INSURED:	OWNER:
	FIRST-CALIFORNIA
/s/ Chong Guk Kum	By	/s/ James O. Birchfield
Chong Guk Kum		James O. Birchfield
		Chairman of the Board

SPLIT DOLLAR POLICY ENDORSEMENT (3 of 3)
FIRST CALIFORNIA BANK SPLIT DOLLAR AGREEMENT

Insured: Chong Guk Kum
Insurer: West Coast Life Insurance Company
Policy No.                                         

     Pursuant to the terms of the FIRST CALIFORNIA BANK SPLIT DOLLAR AGREEMENT dated March 27, 2003, the undersigned Owner requests that the above-referenced policy issued by West Coast Lift Insurance Company (“Insurer”) provide for the following beneficiary designation and limited contract ownership rights to the Insured:

     1. Upon the death of the Insured, proceeds shall be paid in one sum to the Owner, its successors or assigns, to the extent of its interest in the policy. It is hereby provided that the Insurer may rely solely upon a statement from the Owner as to the amount of proceeds it is entitled to receive under this paragraph.

     2. Any proceeds at the death of the Insured in excess of the amount paid under the provisions of the preceding paragraph shall be paid in one sum to:

PRIMARY BENEFICIARY, RELATIONSHIP/SOCIAL SECURITY NUMBER

CONTINGENT BENEFICIARY, RELATIONSHIP/SOCIAL SECURITY NUMBER

The exclusive right to change the beneficiary for the proceeds payable under this paragraph, to elect any optional method of settlement for the proceeds paid under this paragraph which are available under the terms of the policy and to assign all rights and interests granted under this paragraph are hereby granted to the Insured. The sole signature of the Insured shall be sufficient to exercise said rights. The Owner retains all contract rights not granted to the Insured under this paragraph.

     3. It is agreed by the undersigned that this designation and limited assignment of rights shall be subject in all respects to the contractual terms of the policy.

     4. Any payment directed by the Owner under this endorsement shall be a full discharge of the Insurer, and such discharge shall be binding on all parties claiming any interest under the policy.

The undersigned for the Owner is signing in a representative capacity and warrants that he or she has the authority to bind the entity on whose behalf this document is being executed.

Signed at Camarillo, California this 27^th day of March, 2003.

INSURED:	OWNER:
	FIRST-CALIFORNIA
/s/ Chong Guk Kum	By	/s/ James O. Birchfield
Chong Guk Kum		James O. Birchfield
		Chairman of the Board

BENEFICIARY DESIGNATION

FIRST CALIFORNIA BANK
SALARY CONTINUATION AGREEMENT

Chong Guk Kum

I designate the following as beneficiary of any death benefits under this Agreement:

Primary:

Contingent:

Note: To name a trust as beneficiary, please provide the name of the trustee(s) and the exact name and date of the trust agreement

I understand that I may change these beneficiary designations by filing a new written designation with the Company. I further understand that the designations will be automatically revoked if the beneficiary predeceases me, or, if I have named my spouse as beneficiary and our marriage is subsequently dissolved.

Signature	/s/ Chong Guk Kum
	Chong Guk Kum
Date	3/27/03
Received by the Company this 27th day of March, 2003.
By	/s/ James O. Birchfield
	James O. Birchfield
	Chairman of the Board

EX-10.6

Exhibit 10.6

FIRST CALIFORNIA BANK

SALARY CONTINUATION AGREEMENT

     THIS AGREEMENT is adopted this 27^th day of March, 2003, by and between FIRST CALIFORNIA BANK located in Camarillo, California (the “Company”), and THOMAS E. ANTHONY (the “Executive”).

INTRODUCTION

     To encourage the Executive to remain an employee of the Company, the Company is willing to provide salary continuation benefits to the Executive. The Company will pay the benefits from its general assets.

AGREEMENT

     The Company and the Executive agree as follows:

Article 1

Definitions

     Whenever used in this Agreement, the following words and phrases shall have the meanings specified:

     1.1 “Change of Control” means the transfer of shares of the Company’s voting common stock such that one entity or one person acquires (or is deemed to acquire when applying Section 318 of the Code) more than 75 percent of the Company’s outstanding voting common stock.

     1.2 “Code” means the Internal Revenue Code of 1986, as amended.

     1.3 “Disability” means the Executive’s suffering a sickness, accident or injury which has been determined by the carrier of any individual or group disability insurance policy covering the Executive, or by the Social Security Administration, to be a disability rendering the Executive totally and permanently disabled. The Executive must submit proof to the Company of the carrier’s or Social Security Administration’s determination upon the request of the Company.

     1.4 “Early Involuntary Termination” means that the Executive, prior to Normal Retirement Age, has been notified in writing, that employment with the Company is terminated for reasons other than an approved leave of absence, Termination for Cause, Disability, Change of Control or Early Voluntary Termination.

     1.5 “Early Voluntary Termination” means that the Executive, prior to Normal Retirement Age, has terminated employment with the Company for reasons other than Termination for Cause, Disability, Change of Control or Early Involuntary Termination.

     1.6 “Effective Date” means January 1, 2003.

     1.7 “Normal Retirement Age” means the Executive attaining 65 years of age.

     1.8 “Normal Retirement Date” means the later of the Normal Retirement Age or Termination of Employment.

     1.9 “Plan Year” means a twelve-month period commencing on January 1 and ending on December 31 of each year. The initial Plan Year shall commence on the effective date of this Agreement.

     1.10 “Termination for Cause” shall be defined as set forth in Article 5.

     1.11 “Termination of Employment” means that the Executive ceases to be employed by the Company for any reason, other than by reason of a leave of absence approved by the Company.

Article 2

Lifetime Benefits

     2.1 Normal Retirement Benefit. Upon Termination of Employment on or after the Normal Retirement Age for reasons other than death, the Company shall pay to the Executive the benefit described in this Section 2.1 in lieu of any other benefit under this Agreement.

     2.1.1 Amount of Benefit. The annual benefit under this Section 2.1 is $63,000 (Sixty-three Thousand Dollars). Commencing at the end of the first Plan Year and each Plan Year thereafter, the annual benefit shall be increased three percent (3%) from the previous Plan Year to a projected annual benefit of $84,667 (Eighty-four Thousand Six Hundred Sixty-seven Dollars) at Normal Retirement Age.

     2.1.2 Payment of Benefit. The Company shall pay the annual benefit to the Executive in 12 equal monthly installments commencing with the month following the Executive’s Normal Retirement Date, paying the annual benefit to the Executive for a period of years equal to the number of years that Executive is employed by Company between the Effective Date and Executive’s Normal Retirement Date, a maximum of 11 years, unless Executive and Company mutually agree to continue Executive’s employment beyond the Normal Retirement Date in which case the benefit payment shall be extended for one additional year for each full year of service beyond the Normal Retirement Date, but to a maximum aggregate of 15 years only.

     2.1.3 No Increases. Commencing with the first benefit payment, there shall be no further increases in the amount of the annual benefit.

     2.2 Early Voluntary Termination. Upon an Early Voluntary Termination, the Executive will

1

not be eligible for a benefit under this Agreement.

     2.3 Early Involuntary Termination Benefit. Upon an Early Involuntary Termination, the Company shall pay to the Executive the benefit described in this Section 2.3 in lieu of any other benefit under this Agreement.

     2.3.1 Amount of Benefit. The benefit under this Section 2.3 is the Early Involuntary Lump Sum set forth on Schedule A for the Plan Year ending immediately prior to Termination of Employment, determined by vesting the Executive in the Accrual Balance for the Plan Year ending immediately prior to Termination of Employment.

     2.3.2 Payment of Benefit. The Company shall pay the benefit determined under Section 2.3.1 to the Executive in a lump sum within 30 days following Termination of Employment.

     2.4 Disability Benefit. Upon the Executive’s Termination of Employment prior to Normal Retirement Age due to Disability, the Company shall pay to the Executive the benefit described in this Section 2.4 in lieu of any other benefit under this Agreement.

     2.4.1 Amount of Benefit. The benefit under this Section 2.4 is the Disability annual installment set forth on Schedule A, determined by vesting the Executive in the annual benefit for the plan year ending immediately prior to termination of employment.

     2.4.2 Payment of Benefit. The Company shall pay the annual benefit determined in Section 2.4.1 to the Executive in 12 equal monthly installments commencing with the month following Termination of Employment, paying the annual benefit to the Executive for a period of 11 years.

     2.4.3 No Increases. As provided in Section 2.1.3. there shall be no increases in benefits once payment has commenced pursuant to this Section 2.4.

     2.5 Change of Control Benefit. Upon a Change of Control, followed within twelve (12) months by the Executive’s Termination of Employment for reasons other than death, Disability or retirement, the Company shall pay to the Executive the benefit described in this Section 2.5 in lieu of any other benefit under this Agreement.

     2.5.1 Amount of Benefit. The benefit under this Section 2.5 is the Change of Control annual Installment set forth on Schedule A, determined by vesting the Executive in the projected Normal Retirement Benefit at Normal Retirement Age as described in Section 2.1.1.

     2.5.2 Payment of Benefit. The Company shall pay the annual benefit determined in Section 2.5.1 to the Executive in 12 equal monthly installments commencing with the month following the Normal Retirement Age, paying the annual benefit to the Executive for a period of 11 years.

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     2.5.3 No Increases. As provided in Section 2.1.3. there shall be no increase in benefits once payment commences pursuant to this Section 2.5.

     2.6 Loss Year. Anything in this Article 2 to the contrary notwithstanding, should the Company’s operations (exclusive of extraordinary gains or expenses as determined by Generally Accepted Accounting Principles) result in a loss for any fiscal year prior to the commencement of a benefit payment, then the accrual for that year shall be omitted and all of the projected benefits as set forth on Schedule A shall be adjusted downward as a result.

Article 3

Death Benefits

     3.1 Death During Active Service. If the Executive dies while in the active service of the Company, the Company shall pay to the Executive’s beneficiary the split dollar death benefit described in the Split Dollar Agreement attached as Addendum A between the Company and the Executive in lieu of any other benefit under this Agreement.

     3.2 Death after Termination of Employment due to Retirement, Disability or Change of Control. Upon the death of the Executive after Normal Retirement Date or after Termination of Employment due to Disability or Change of Control as set forth in Article 2 of this Agreement, the Company shall cease paying the remaining benefit, if any, and shall then pay to the Executive’s beneficiary the split dollar death benefit described in the Split Dollar Agreement attached as Addendum A between the Company and the Executive.

     3.3 Death after Early Involuntary Termination or Early Voluntary Termination. No death benefit shall be paid upon the death of the Executive after an Early Involuntary Termination or an Early Voluntary Termination.

Article 4

Beneficiaries

     4.1 Beneficiary Designations. The Executive shall designate a beneficiary by filing a written designation with the Company. The Executive may revoke or modify the designation at any time by filing a new designation. However, designations will only be effective if signed by the Executive and received by the Company during the Executive’s lifetime. The Executive’s beneficiary designation shall be deemed automatically revoked if the beneficiary predeceases the Executive, or if the Executive names a spouse as beneficiary and the marriage is subsequently dissolved. If the Executive dies without a valid beneficiary designation, all payments shall be made to the Executive’s estate.

     4.2 Facility of Payment. If a benefit is payable to a minor, to a person declared incompetent, or to a person incapable of handling the disposition of his or her property, the Company may pay such benefit to the guardian, legal representative or person having the care or custody of such minor,

3

incompetent person or incapable person. The Company may require proof of incompetence, minority or guardianship as it may deem appropriate prior to distribution of the benefit. Such distribution shall completely discharge the Company from all liability with respect to such benefit.

Article 5

General Limitations

     5.1 Termination for Cause. Notwithstanding any provision of this Agreement to the contrary, the Company shall not pay any benefit under this Agreement if the Company terminates the Executive’s employment for:

     (a) Gross negligence or gross neglect of duties;

     (b) Commission of a felony or of a gross misdemeanor involving moral turpitude in connection with the Executive’s employment with the Company; or

     (c) Fraud, disloyalty, dishonesty or willful violation of any law or significant Company policy committed in connection with the Executive’s employment and resulting in an adverse effect on the Company.

     5.2 Suicide or Misstatement. The Company shall not pay any benefit under this Agreement if the Executive commits suicide. In addition, the Company shall not pay any benefit under this Agreement if the Executive has made any material misstatement of fact on an employment application or resume provided to the Company, or on any application for any benefits provided by the Company to the Executive.

Article 6

Claims and Review Procedure

     6.1 Claims Procedure. An Executive or beneficiary (“claimant”) who has not received benefits under the Agreement that he or she believes should be paid shall make a claim for such benefits as follows:

     6.1.1 Initiation — Written Claim. The claimant initiates a claim by submitting to the Company a written claim for the benefits.

     6.1.2 Timing of Company Response. The Company shall respond to such claimant within 90 days after receiving the claim. If the Company determines that special circumstances require additional time for processing the claim, the Company can extend the response period by an additional 90 days by notifying the claimant in writing, prior to the end of the initial 90-day period that an additional period is required. The notice of extension must set forth the special circumstances and the date by which the Company expects to render its decision.

     6.1.3 Notice of Decision. If the Company denies part or all of the claim, the Company shall notify the claimant in writing of such denial. The Company shall write the notification in

4

a manner calculated to be understood by the claimant. The notification shall set forth:

     (a) The specific reasons for the denial;

     (b) A reference to the specific provisions of the Agreement on which the denial is based;

     (c) A description of any additional information or material necessary for the claimant to perfect the claim and an explanation of why it is needed;

     (d) An explanation of the Agreement’s review procedures and the time limits applicable to such procedures; and

     (e) A statement of the claimant’s right to bring a civil action under ERISA Section 502(a) following an adverse benefit determination on review.

     6.2 Review Procedure. If the Company denies part or all of the claim, the claimant shall have the opportunity for a full and fair review by the Company of the denial, as follows:

     6.2.1 Initiation — Written Request. To initiate the review, the claimant, within 60 days after receiving the Company’s notice of denial, must file with the Company a written request for review.

     6.2.2 Additional Submissions — Information Access. The claimant shall then have the opportunity to submit written comments, documents, records and other information relating to the claim. The Company shall also provide the claimant, upon request and free of charge, reasonable access to, and copies of, all documents, records and other information relevant (as defined in applicable ERISA regulations) to the claimant’s claim for benefits.

     6.2.3 Considerations on Review. In considering the review, the Company shall take into account all materials and information the claimant submits relating to the claim, without regard to whether such information was submitted or considered in the initial benefit determination.

     6.2.4 Timing of Company Response. The Company shall respond in writing to such claimant within 60 days after receiving the request for review. If the Company determines that special circumstances require additional time for processing the claim, the Company can extend the response period by an additional 60 days by notifying the claimant in writing, prior to the end of the initial 60-day period that an additional period is required. The notice of extension must set forth the special circumstances and the date by which the Company expects to render its decision.

     6.2.5 Notice of Decision. The Company shall notify the claimant in writing of its decision on review. The Company shall write the notification in a manner calculated to be understood by the claimant. The notification shall set forth:

     (a) The specific reasons for the denial;

     (b) A reference to the specific provisions of the Agreement on which the denial

5

is based;

     (c) A statement that the claimant is entitled to receive, upon request and free of charge, reasonable access to, and copies of, all documents, records and other information relevant (as defined in applicable ERISA regulations) to the claimant’s claim for benefits; and

     (d) A statement of the claimant’s right to bring a civil action under ERISA Section 502(a).

Article 7

Amendments and Termination

     7.1 This Agreement may be amended or terminated only by a written agreement signed by the Company and the Executive; however, this Agreement will automatically terminate if no benefit is payable to the Executive due to the Executive’s Termination for Cause, Suicide or Misstatement as set forth in Article 5 or upon an Early Voluntary Termination.

     7.2. The Company and the Executive agree to amend this Agreement in the event that there is a change to applicable tax law or regulations or to the accounting treatment for the benefits to be provided hereunder which materially increases the after-tax cost of the benefits. In the event an amendment is required under this Section 7.2, such amendment shall be limited to decreasing the benefits to be provided to the Executive only to the extent necessary so that net, after-tax impact to the Company’s earnings will be substantially the same as such earnings would have been absent the change in tax law, regulation, or accounting treatment.

Article 8

Miscellaneous

     8.1 Binding Effect. This Agreement shall bind the Executive and the Company, and their beneficiaries, survivors, executors, successors, administrators and transferees.

     8.2 No Guarantee of Employment. This Agreement is not an employment policy or contract. It does not give the Executive the right to remain an employee of the Company, nor does it interfere with the Company’s right to discharge the Executive. It also does not require the Executive to remain an employee nor interfere with the Executive’s right to terminate employment at any time.

     8.3 Non-Competition. During such time as Executive is receiving benefit payments hereunder, Executive shall not serve as an employee, officer or director of, or serve as a consultant or advisor to, any financial institution, including but not limited to any bank, savings bank or credit union, which has its headquarters or any branch office within the County of Ventura or the County of Santa Barbara.

     8.4 Non-Transferability. Benefits under this Agreement cannot be sold, transferred, assigned, pledged, attached or encumbered in any manner.

6

     8.5 Reorganization. The Company shall not merge or consolidate into or with another company, or reorganize, or sell substantially all of its assets to another company, firm, or person unless such succeeding or continuing company, firm, or person agrees to assume and discharge the obligations of the Company under this Agreement. Upon the occurrence of such event, the term “Company” as used in this Agreement shall be deemed to refer to the successor or survivor company.

     8.6 Tax Withholding. The Company shall withhold any taxes that are required to be withheld from the benefits provided under this Agreement.

     8.7 Applicable Law. The Agreement and all rights hereunder shall be governed by the laws of the State of California, except to the extent preempted by the laws of the United States of America.

     8.8 Unfunded Arrangement. The Executive and beneficiary are general unsecured creditors of the Company for the payment of benefits under this Agreement. The benefits represent the mere promise by the Company to pay such benefits. The rights to benefits are not subject in any manner to anticipation, alienation, sale, transfer, assignment, pledge, encumbrance, attachment, or garnishment by creditors. Any insurance on the Executive’s life is a general asset of the Company to which the Executive and beneficiary have no preferred or secured claim.

     8.9 Entire Agreement. This Agreement constitutes the entire agreement between the Company and the Executive as to the subject matter hereof. No rights are granted to the Executive by virtue of this Agreement other than those specifically set forth herein.

     8.10 Administration. The Company shall have powers which are necessary to administer this Agreement, including but not limited to:

     (a) Establishing and revising the method of accounting for the Agreement;

     (b) Maintaining a record of benefit payments;

     (c) Establishing rules and prescribing any forms necessary or desirable to administer the Agreement; and

     (d) Interpreting the provisions of the Agreement.

     8.11 Named Fiduciary. The Company shall be the named fiduciary and plan administrator under this Agreement. It may delegate to others certain aspects of the management and operational responsibilities including the employment of advisors and the delegation of ministerial duties to qualified individuals.

7

     IN WITNESS WHEREOF, the Executive and the Company consent to this Agreement on the date above written.

EXECUTIVE:		COMPANY:
		FIRST CALIFORNIA BANK
/s/ Thomas E. Anthony	By	/s/ James O. Birchfield
Thomas E. Anthony		James O. Birchfield
		Chairman of the Board

EX-10.7

EXHIBIT 10.7

FIRST CALIFORNIA BANK
SPLIT DOLLAR AGREEMENT

(ADDENDUM A TO THE FIRST CALIFORNIA BANK SALARYCONTINUATION AGREEMENT)

     THIS AGREEMENT is adopted this 27^th day of March, 2003, by and between FIRST CALIFORNIA BANK, located in Camarillo, California (the “Company”), and THOMAS E ANTHONY (the “Executive”). This Agreement shall append the Split Dollar Endorsement entered into on even date herewith or as subsequently amended, by and between the aforementioned parties.

INTRODUCTION

     To encourage the Executive to remain an employee of the Company, the Company is willing to divide the death proceeds of a life insurance policy on the Executive’s life. The Company will pay life insurance premiums from its general assets.

AGREEMENT

The Company and the Executive agree as follows:

Article 1
General Definitions

The following terms shall have the meanings specified:

     1.1 “Insured” means the Executive.

     1.2 “Insurer” means each life insurance carrier in which there is a Split Dollar Policy Endorsement attached to this Agreement.

     1.3 “Normal Retirement Age” means the Executive attaining 65 years of age.

     1.4 “Normal Retirement Date” means the later of the Normal Retirement Age or Termination of Employment.

     1.5 “Policy” means the specific life insurance policy or policies issued by the Insurer.

     1.6 “Salary Continuation Agreement” means that Salary Continuation Agreement between the Company and the Executive on even date herewith or as subsequently amended.

     1.7 “Termination for Cause” means the Company terminating the Executive’s employment for:

     (a) Gross negligence or gross neglect of duties to the Company;

     (b) Commission of a felony or of a gross misdemeanor involving moral turpitude in connection with the Executive’s employment with the Company; or

     (c) Fraud, disloyalty, dishonesty or willful violation of any law or significant Company policy committed in connection with the Executive’s employment and

1

resulting in an adverse effect on the Company.

     1.8 “Termination of Employment” means that the Executive ceases to be employed by the Company for any reason, other than by reason of a leave of absence approved by the Company.

Article 2
Policy Ownership/Interests

     2.1 Company Ownership. The Company is the sole owner of the Policy and shall have the right to exercise all incidents of ownership. The Company shall be the beneficiary of the remaining death proceeds of the Policy after the Interest of the Executive or the Executive’s transferee has been paid according to Section 2.2 below.

     2.2 Executive’s Interest. The Executive shall have the right to designate the beneficiary death proceeds in the amount of $1,050,000 upon the death of the Executive, a) prior to Norm Retirement Age while employed by the Company; or b) after Normal Retirement Date or after Termination of Employment due to Disability or Change of Control as defined in the Salary Continuation Agreement. The Executive shall also have the right to elect and change settlement options that may be permitted. Upon the termination of this Agreement according to Article 7 herein, the Executive, the Executive’s transferee or the Executive’s beneficiary shall have no rights or interests in the Policy and no death benefit shall be paid under this Section 2.2.

     2.3 Option to Purchase. The Company shall not sell, surrender or transfer ownership of the Policy while this Agreement is in effect without first giving the Executive or the Executive’s transferee the option to purchase the Policy for a period of 60 days from written notice of such intention. The purchase price shall be an amount equal to the cash surrender value of the Policy. This provision shall not impair the right of the Company to terminate this Agreement.

     2.4 Comparable Coverage. Upon execution of this Agreement, the Company shall maintain the Policy in full force and effect and in no event shall the Company amend, terminate or otherwise abrogate the Executive’s interest in the Policy, unless the Company replaces the Policy with comparable insurance policy to cover the benefit provided under this Agreement and the Company and the Executive execute a new Split Dollar Policy Endorsement for said comparable insurance policy. The Policy or any comparable policy shall be subject to the claims of the Company creditors.

Article 3
Premiums

     3.1 Premium Payment. The Company shall pay any premiums due on the Policy.

     3.2 Economic Benefit. The Company shall determine the economic benefit attributable to the Executive based on the amount of the current term rate for the Executive’s age multiplied by the aggregate death benefit payable to the Executive’s beneficiary. The “current term rate” is the minimum amount required to be imputed under Revenue Rulings 64-328 and 66-110, or any subsequent applicable authority.

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     3.3 Reimbursement. At the end of each Plan Year, the Executive shall reimburse the Company in an amount equal to the economic benefit.

Article 4
Assignment

     The Executive may assign without consideration all of the Executive’s interests in the Policy and in this Agreement to any person, entity or trust. In the event the Executive transfers all of the Executive’s interest in the Policy, then all of the Executive’s interest in the Policy and in the Agreement shall be vested in the Executive’s transferee, who shall be substituted as a party hereunder and the Executive shall have no further interest in the Policy or in this Agreement.

Article 5
Insurer

     The Insurer shall be bound only by the terms of the Policy. Any payments the Insurer makes or actions it takes in accordance with the Policy shall fully discharge it from all claims, suits and demands of all entities or persons. The Insurer shall not be bound by or be deemed to have notice of the provisions of this Agreement.

Article 6
Claims and Review Procedure

     6.1 Claims Procedure. Any person or entity who has not received benefits under the Plan that he or she believes should be paid (the “claimant”) shall make a claim for such benefits as follows:

          6.1.1 Initiation — Written Claim. The claimant initiates a claim by submitting to the Company a written claim for the benefits.

          6.1.2 Timing of Company Response. The Company shall respond to such claimant within 90 days after receiving the claim. If the Company determines that special circumstances require additional time for processing the claim, the Company can extend the response period by an additional 90 days by notifying the claimant in writing, prior to the end of the initial 90-day period that an additional period is required. The notice of extension must set forth the special circumstances and the date by which the Company expects to render its decision.

          6.1.3 Notice of Decision. If the Company denies part or all of the claim, the Company shall notify the claimant in writing of such denial. The Company shall write the notification in a manner calculated to be understood by the claimant. The notification shall set forth:

     (a) The specific reasons for the denial,

     (b) A reference to the specific provisions of this Agreement on which the denial is based,

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     (c) A description of any additional information or material necessary for the claimant to perfect the claim and an explanation of why it is needed,

     (d) An explanation of this Agreement’s review procedures and the time limits applicable to such procedures, and

     (e) A statement of the claimant’s right to bring a civil action under ERISA Section 502(a) following an adverse benefit determination on review.

     6.2 Review Procedure. If the Company denies part or all of the claim, the claimant shall have the opportunity for a full and fair review by the Company of the denial, as follows;

     6.2.1 Initiation — Written Request. To initiate the review, the claimant, within 60 days after receiving the Company’s notice of denial, must file with the Company a written request for review.

     6.2.2 Additional Submissions — Information Access. The claimant shall then have the opportunity to submit written comments, documents, records and other information relating to the claim. The Company shall also provide the claimant, upon request and free of charge, reasonable access to, and copies of, all documents, records and other information relevant (as defined in applicable ERISA regulations) to the claimant’s claim for benefits.

     6.2.3 Considerations on Review. In considering the review, the Company shall take into account all materials and information the claimant submits relating to the claim, without regard to whether such information was submitted or considered in the initial benefit determination.

     6.2.4 Timing of Company Response, The Company shall respond in writing to such claimant within 60 days after receiving the request for review. If the Company determines that special circumstances require additional time for processing the claim, the Company can extend the response period by an additional 60 days by notifying the claimant in writing, prior to the end of the initial 60-day period that an additional period is required. The notice of extension must set forth the special circumstances and the date by which the Company expects to render its decision.

     6.2.5 Notice of Decision. The Company shall notify the claimant in writing of it decision on review. The Company shall write the notification in a manner calculated to be understood by the claimant. The notification shall set forth:

     (a) The specific reasons for the denial,

     (b) A reference to the specific provisions of this Agreement on which the denial is based,

     (c) A statement that the claimant is entitled to receive, upon request and free of charge, reasonable access to, and copies of, all documents, records and other information relevant (as defined in applicable ERISA regulations) to the claimant’s claim for benefits, and

     (d) A statement of the claimant’s right to bring a civil action under ERISA Section 502(a).

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Article 7
Amendments and Termination

     This Agreement may be amended or terminated only by a written agreement signed by the Company and the Executive; however, this Agreement will automatically terminate upon the Executive’s Termination for Cause, Early Involuntary Termination or Early Voluntary Termination (as defined in the Salary Continuation Agreement) or in the event the Insurer refuses to pay a death benefit according to the terms of the Policy.

Article 8
Miscellaneous

     8.1 Binding Effect. This Agreement shall bind the Executive and the Company and their beneficiaries, survivors, executors, administrators and transferees, and any Policy beneficiary.

     8.2 No Guarantee of Employment. This Agreement is not an employment policy or contract. It does not give the Executive the right to remain an employee of the Company, nor does it interfere with the Company’s right to discharge the Executive. It also does not require the Executive to remain an employee nor interfere with the Executive’s right to terminate employment at any time.

     8.3 Applicable Law. The Agreement and all rights hereunder shall be governed by any construed according to the laws of the State of California, except to the extent preempted by the laws of the United States of America.

     8.4 Reorganization. The Company shall not merge or consolidate into or with another company, or reorganize, or sell substantially all of its assets to another company, firm or person unless such succeeding or continuing company, firm or person agrees to assume and discharge the obligations of the Company.

     8.5 Notice. Any notice, consent or demand required or permitted to be given under the provisions of this Split Dollar Agreement by one party to another shall be in writing, shall be sign by the party giving or making the same, and may be given either by delivering the same to such other party personally, or by mailing the same, by United States certified mail, postage prepaid, such party, addressed to his or her last known address as shown on the records of the Company. The date of such mailing shall be deemed the date of such mailed notice, consent or demand.

     8.6 Entire Agreement. This Agreement constitutes the entire agreement between 1 Company and the Executive as to the subject matter hereof. No rights are granted to the Executive by virtue of this Agreement other than those specifically set forth herein.

     8.7 Administration. The Company shall have powers which are necessary to administer the Agreement, including but not limited to:

     (a) Interpreting the provisions of this Agreement;

     (b) Establishing and revising the method of accounting for this Agreement;

     (c) Maintaining a record of benefit payments; and

     (d) Establishing rules and prescribing any forms necessary or desirable to administer this Agreement.

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     8.8 Named Fiduciary. The Company shall be the named fiduciary and plan administrator under the Agreement. The named fiduciary may delegate to others certain aspects of t management and operation responsibilities of the plan including the employment of advisors and t delegation of ministerial duties to qualified individuals-

     IN WITNESS WHEREOF, the Executive and the Company consent to this Agreement on t date above written.

EXECUTIVE:	COMPANY
	FIRST CALIFORNIA BANK
/s/ Thomas E. Anthony	By	/s/ James O. Birchfield
Thomas E. Anthony		James O. Birchfield
		Chairman of the Board

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SPLIT DOLLAR POLICY ENDORSEMENT (1 of 3)
FIRST CALIFORNIA BANK SPLIT DOLLAR AGREEMENT

Insured: Thomas E. Anthony
Insurer: Massachusetts Mutual Life Insurance Company
Policy No.                                         

     Pursuant to the terms of the FIRST CALIFORNIA BANK SPLIT DOLLAR AGREEMENT date March 27, 2003, the undersigned Owner requests that the above-referenced policy issued by the Insurer provide for the following beneficiary designation and limited contract ownership rights to the Insured:

     1. Upon the death of the Insured, proceeds shall be paid in one sum to the Owner, its successors or assigns, to the extent of its interest in the policy. It is hereby provided that the Insurer may rely solely upon statement from the Owner as to the amount of proceeds it is entitled to receive under this paragraph.

     2. Any proceeds at the death of the Insured in excess of the amount paid under the provisions of the preceding paragraph shall be paid in one sum to:

PRIMARY BENEFICIARY, RELATIONSHIP/SOCIAL SECURITY NUMBER

CONTINGENT BENEFICIARY, RELATIONSHIP/SOCIAL SECURITY NUMBER

The exclusive right to change the beneficiary for the proceeds payable under this paragraph, to elect an optional method of settlement for the proceeds paid under this paragraph which are available under the terms of the policy and to assign all rights and interests granted under this paragraph are hereby granted to the Insured. The sole signature of the Insured shall be sufficient to exercise said rights. The Owner retains a contract rights not granted to the Insured under this paragraph.

     3. It is agreed by the undersigned that this designation and limited assignment of rights shall be subject in all respects to the contractual terms of the policy.

     4. Any payment directed by the Owner under this endorsement shall be a full discharge of the Insure and such discharge shall be binding on all parties claiming any interest under the policy.

The undersigned for the Owner is signing in a representative capacity and warrants that he or she has the authority to bind the entity on whose behalf this document is being executed.

Signed at Camarillo, California this 27^th day of March, 2003.

INSURED:	OWNER:
	FIRST CALIFORNIA BANK
/s/ Thomas E. Anthony	By	/s/ James O. Birchfield
Thomas E. Anthony		James O. Birchfield
		Chairman of the Board

SPLIT DOLLAR POLICY ENDORSEMENT (2 of 3)
FIRST CALIFORNIA BANK SPLIT DOLLAR AGREEMENT

Insured; Thomas E. Anthony
Insurer: New York Life Insurance Company
Policy No.                                         

     Pursuant to the terms of the FIRST CALIFORNIA BANK SPLIT DOLLAR AGREEMENT dated March 27, 2003, the undersigned Owner requests that the above-referenced policy issued by the Insurer provide for the following beneficiary designation and limited contract ownership rights to the Insured:

     1. Upon the death of the Insured, proceeds shall be paid in one sum to the Owner, its successors assigns, to the extent of its interest in the policy. It is hereby provided that the Insurer may rely solely upon statement from the Owner as to the amount of proceeds it is entitled to receive under this paragraph.

     2. Any proceeds at the death of the Insured in excess of the amount paid under the provisions of the preceding paragraph shall be paid in one sum to:

PRIMARY BENEFICIARY, RELATIONSHIP/SOCIAL SECURITY NUMBER

CONTINGENT BENEFICIARY, RELATIONSHIP/SOCIAL SECURITY NUMBER

The exclusive right to change the beneficiary for the proceeds payable under this paragraph, to elect an optional method of settlement for the proceeds paid under this paragraph which are available under the terms of the policy and to assign all rights and interests granted under this paragraph are hereby granted to the Insured. The sole signature of the Insured shall be sufficient to exercise said rights. The Owner retains its contract rights not granted to the Insured under this paragraph.

     3. It is agreed by the undersigned that this designation and limited assignment of rights shall be subject in all respects to the contractual terms of the policy.

     4. Any payment directed by the Owner under this endorsement shall be a full discharge of the Insure and such discharge shall be binding on all parties claiming any interest under the policy.

The undersigned for the Owner is signing in a representative capacity and warrants that he or she has the authority to bind the entity on whose behalf this document is being executed.

Signed at Camarillo, California this 27^th day of March, 2003.

INSURED:	OWNER:
	FIRST CALIFORNIA BANK
/s/ Thomas E. Anthony	By	/s/ James O. Birchfield
Thomas E. Anthony		James O. Birchfield Chairman of the Board

SPLIT DOLLAR POLICY ENDORSEMENT (3 of 3)
FIRST CALIFORNIA BANK SPLIT DOLLAR AGREEMENT

Insured: Thomas E. Anthony
Insurer; West Coast Life Insurance Company
Policy No.                                         

     Pursuant to the terms of the FIRST CALIFORNIA BANK SPLIT DOLLAR AGREEMENT dated March 27, 2003, the undersigned Owner requests that the above-referenced policy issued by West Coast Life Insurance Company (“Insurer”) provide for the following beneficiary designation and limited contract ownership rights to the Insured:

     1. Upon the death of the Insured, proceeds shall be paid in one sum to the Owner, its successors or assigns, to the extent of its interest in the policy. It is hereby provided that the Insurer may rely solely upon a statement from the Owner as to the amount of proceeds it is entitled to receive under this paragraph.

     2. Any proceeds at the death of the Insured in excess of the amount paid under the provisions of the preceding paragraph shall be paid in one sum to:

PRIMARY BENEFICIARY, RELATIONSHIP/SOCIAL SECURITY NUMBER

CONTINGENT BENEFICIARY, RELATIONSHIP/SOCIAL SECURITY NUMBER

The exclusive right to change the beneficiary for the proceeds payable under this paragraph, to elect any optional method of settlement for the proceeds paid under this paragraph which are available under the terms of the policy and to assign all rights and interests granted under this paragraph are hereby granted to the Insured. The sole signature of the Insured shall be sufficient to exercise said rights. The Owner retains all contract rights not granted to the Insured under this paragraph.

     3. It is agreed by the undersigned that this designation and limited assignment of rights shall be subject in all respects to the contractual terms of the policy.

     4. Any payment directed by the Owner under this endorsement shall be a full discharge of the Insurer, and such discharge shall be binding on all parties claiming any interest under the policy.

The undersigned for the Owner is signing in a representative capacity and warrants that he or she has the authority to bind the entity on whose behalf this document is being executed.

Signed at Camarillo, California this 27^th day of March, 2003.

INSURED:	OWNER:
	FIRST CALIFORNIA BANK
/s/ Thomas E. Anthony	By	/s/ James O. Birchfield
Thomas E. Anthony		James O. Birchfield
		Chairman of the Board

BENEFICIARY DESIGNATION

FIRST CALIFORNIA BANK
SALARY CONTINUATION AGREEMENT

Thomas E. Anthony

I designate the following as beneficiary of any death benefits under this Agreement:

Primary:

Contingent:

Note: To name a trust as beneficiary, please provide the name of the trustee(s) and the exact name and date of the trust agreement

I understand that I may change these beneficiary designations by filing a new written designation with the Company. I further understand that the designations will be automatically revoked if the beneficiary predeceases me, or, if I have named my spouse as beneficiary and our marriage is subsequently dissolved.

Signature	/s/ Thomas E. Anthony
	Thomas E. Anthony
Date	3/27/03
Received by the Company this 27th day of March, 2003.
By	/s/ James O. Birchfield
	James O. Birchfield
	Chairman of the Board

EX-10.8

2/1/05 — Final (1)

  Exhibit 10.8

AGREEMENT AND PLAN OF REORGANIZATION

BY AND AMONG

FIRST CALIFORNIA BANCORP,

SCB MERGER CORP., FIRST CALIFORNIA BANK,

SOUTH COAST BANCORP, INC., AND SOUTH COAST COMMERCIAL BANK

February 2, 2005

2/1/05 — Final (1)

Table of Contents

	Page
AGREEMENT AND PLAN OF REORGANIZATION		1
Recitals		1
Main Text		2
ARTICLE I DEFINITIONS		2
1.01. Certain Definitions		2
ARTICLE II THE MERGER		8
2.01. The Merger		8
2.02. Effective Date and Effective Time		8
ARTICLE III CONSIDERATION; EXCHANGE PROCEDURES; CLOSING		9
3.01. Effect on Capital Stock		9
3.02. Conversion of SCB Common Stock		10
3.03. Exchange Procedures		10
3.04. Anti-Dilution Provisions		11
3.05. Dissenters’ Rights		11
3.06. Closing		12
3.07. Execution of Agreements		12
3.08. Further Assurances		12
ARTICLE IV ACTIONS PENDING ACQUISITION		12
4.01. Forbearances of SCB		12
4.02. Forbearances of FCB		16
ARTICLE V REPRESENTATIONS AND WARRANTIES		16
5.01. Disclosure Schedules		16
5.02. Standard		17
5.03. Representations and Warranties of SCB		17
5.04. Representations and Warranties of FCB		27
ARTICLE VI COVENANTS		31
6.01. Reasonable Best Efforts		31

	Page
6.02. Shareholder Approval		31
6.03. Proxy Statement		32
6.04. Press Releases		32
6.05. Access; Information		32
6.06. Acquisition Proposals		33
6.07. [Reserved]		34
6.08. [Reserved]		34
6.09. Certain Policies		34
6.10. Regulatory Applications		34
6.11. Indemnification		35
6.12. Benefit Plans		36
6.13. Non-Competition Agreements		37
6.14. Notification of Certain Matters		37
6.15. Human Resources Issues		37
6.16. Assistance with Third-Party Agreements		37
6.17. Second Merger		38
6.18. Shareholder Agreements		38
6.19. Pre-Closing Adjustments		39
6.20. Tax Treatment of the Merger		39
6.21. Non-Solicitation Agreement		40
6.22. Bank Holding Company Status		40
6.23. Capital Raising		40
6.24. Employment and Other Agreements		40
6.25. Accrual of Expenses Related to the Merger		40
ARTICLE VII CONDITIONS TO CONSUMMATION OF THE MERGER		41
7.01. Conditions to Each Party’s Obligation to Effect the Merger		41
7.02. Conditions to Obligation of SCB		42
7.03. Conditions to Obligation of FCB		42
ARTICLE VIII TERMINATION		45
8.01. Termination		45
8.02. Effect of Termination and Abandonment		46
ARTICLE IX MISCELLANEOUS		47

	Page
9.01. Survival		47
9.02. Waiver; Amendment		48
9.03. Counterparts		48
9.04. Governing Law, Jurisdiction and Venue		48
9.05. Expenses		48
9.06. Notices		49
9.07. Entire Understanding; No Third Party Beneficiaries		50
9.08. Effect		50
9.09. Severability		50
9.10. Enforcement of the Agreement		50
9.11. Interpretation		50

AGREEMENT AND PLAN OF REORGANIZATION

     THIS AGREEMENT AND PLAN OF REORGANIZATION (“Agreement”) is made and entered into as of the 2^nd day of February 2005, by and among FIRST CALIFORNIA BANCORP, a California corporation (“FCB”), SCB MERGER CORP., a California corporation (the “Merger Subsidiary”), FIRST CALIFORNIA BANK, a California banking corporation (“FC Bank”), on one hand, and SOUTH COAST BANCORP, INC., a California corporation (“SCB”), and SOUTH COAST COMMERCIAL BANK, a California banking corporation (“SCC Bank”) on the other hand.

RECITALS

     A. FCB is a California corporation, having its principal place of business in Camarillo, California. FC Bank is a California banking corporation and a wholly-owned subsidiary of FCB, having its principal place of business in Camarillo, California. Merger Subsidiary is a California corporation and a wholly-owned subsidiary of FCB, having its principal place of business in Camarillo, California.

     B. SCB is a California corporation having its principal place of business in Irvine, California. SCC Bank is a California banking corporation and a wholly-owned subsidiary of SCB, having its principal place of business in Irvine, California. SCB is an S corporation and SCC Bank is a qualified subchapter S subsidiary.

     C. The respective Boards of Directors of FCB, Merger Subsidiary, and SCB have determined that it is in the best interests of their respective companies and their shareholders to consummate the merger of Merger Subsidiary with and into SCB (the “Merger”), followed by the merger of SCB, as the surviving entity of the Merger, with and into FCB (the “Second Merger”).

     D. It is the intention of the parties to this Agreement that the Merger and Second Merger be treated as a taxable purchase of all of the outstanding stock of SCB by FCB, followed by a liquidation of SCB pursuant to Section 332 of the Internal Revenue Code of 1986, as amended (the “Code”).

     E. As a condition to, and simultaneously with, the execution of this Agreement, each Shareholder (as defined herein) is entering into an agreement, in the form of Exhibit A hereto, (collectively, the “Shareholder Agreements”) pursuant to which they have agreed, among other things, to vote their shares in favor of the principal terms of the Merger.

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     F. As a condition to, and simultaneously with, the execution of this Agreement, each director of SCB is entering into non-competition agreements with FCB in the form of Exhibit B, hereto (collectively, the “Non-Competition Agreements”).

     G. As a condition to, and simultaneously with, the execution of this Agreement, Fred Mills is entering into a non-solicitation agreement in the form of Exhibit E hereto (the “Non-Solicitation Agreement”).

     NOW, THEREFORE, in consideration of the premises and of the mutual covenants, representations, warranties and agreements contained herein the parties agree as follows:

ARTICLE I
DEFINITIONS

     1.01. Certain Definitions

     The following terms are used in this Agreement with the meanings set forth below:

     “Acquisition Proposal” has the meaning set forth in Section 6.08.

     “Adjusted Merger Consideration” has the meaning set forth in Section 3.03(b).

     “Adjusted Shareholders’ Equity” shall be determined in accordance with GAAP as of the Shareholders’ Equity Measuring Date (as set forth in Section 7.03(e) hereof) except that in any event: (i) SCB’s ALLL shall not be less than One Million One Hundred and Eighty Three Thousand Dollars ($1,183,000.00); (ii) SCB has paid all dividends that have been declared; (iii) legal and accounting fees related to the transactions contemplated by this Agreement have been paid or accrued; (iv) Four Hundred Thousand Dollars ($400,000) of severance payments shall be accrued or paid (regardless of the amount actually due or paid as of such date), and (v) all of SCB’s expenses incurred at or prior to the Closing from the transactions contemplated by this Agreement, including, but not limited to, Executive Payments, shall be accrued. In determining Adjusted Shareholders’ Equity, (A) gains or losses in SCB’s securities portfolio between the date hereof and the Shareholders’ Equity Measuring Date shall be excluded and (B) all entries or adjustments made at the request of FCB and not otherwise required by GAAP or the provisions of this definition shall be excluded. An example of the calculation of Adjusted Shareholders’ Equity is attached hereto as Exhibit 1.01.

     “Agreement” means this Agreement, as amended or modified from time to time in accordance with Section 9.02.

     “Agreement of Merger” means the agreement of merger to be filed with the California Secretary substantially in the form attached hereto as Exhibit D.

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     “ALLL” has the meaning set forth in Section 5.03(t).

     “Bank Insurance Fund” means the Bank Insurance Fund maintained by the FDIC.

     “Bank Secrecy Act” means the Currency and Foreign Transaction Reporting Act (31 U.S.C. Section 5311 et seq.), as amended.

     “Base Merger Consideration” means Thirty-Six Million Dollars ($36,000,000.00).

     “Base Shareholders’ Equity” means Sixteen Million Five Hundred Thousand Dollars ($16,500,000.00).

     “Benefit Plans” has the meaning set forth in Section 5.03(m).

     “Business Combination” has the meaning set forth in Section 3.07.

     “Business Day” means Monday through Friday of each week, except a legal holiday recognized as such by the U.S. Government or any day on which banking institutions in the State of California are authorized or obligated to close.

     “California Secretary” means the California Secretary of State.

     “CCC” means the California Corporations Code.

     “Closing” has the meaning set forth in Section 6.21.

     “Closing Financial Statements” has the meaning set forth in Section 7.03(f).

     “Code” has the meaning set forth in the Recitals to this Agreement.

     “Community Reinvestment Act” means the Community Reinvestment Act of 1977, as amended.

     “Costs” has the meaning set forth in Section 6.12(a).

     “Decline Adjustment” has the meaning set forth in Section 8.01(g).

     “Derivatives Contract” has the meaning set forth in Section 5.03(q).

     “Disclosure Schedule” has the meaning set forth in Section 5.01.

     “Dissenters’ Shares” has the meaning set forth in Section 3.01(c).

     “Dissenting Shareholder” means any holder of Dissenters’ Shares.

     “Effective Date” has the meaning set forth in Section 2.02.

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     “Effective Time” has the meaning set forth in Section 2.02.

     “Employees” has the meaning set forth in Section 5.03(m).

     “Environmental Laws” has the meaning set forth in Section 5.03(o).

     “Equal Credit Opportunity Act” means the Equal Credit Opportunity Act (15 U.S.C. Section 1691 et seq.) as amended.

     “ERISA” means the Employee Retirement Income Security Act of 1974, as amended.

     “ERISA Affiliate” has the meaning set forth in Section 5.03(m).

     “Exchange Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations thereunder.

     “Exchange Agent” has the meaning set forth in Section 3.03(a).

     “Exchange Fund” has the meaning set forth in Section 3.06(a).

     “Executive Payments” has the meaning set forth in Section 6.24.

     “Fair Housing Act” means the Fair Housing Act (420 U.S.C. Section 3601 et seq.), as amended.

     “FDIC” means the Federal Deposit Insurance Corporation.

     “Federal Reserve Act” means the Federal Reserve Act, as amended.

     “Federal Reserve Board” means the Board of Governors of the Federal Reserve System.

     “Final Index” has the meaning set forth in Section 8.01(g).

     “GAAP” means generally accepted accounting principles.

     “Governmental Authority” means any court, administrative agency or commission or other federal, state or local governmental authority or instrumentality.

     “Hazardous Substance” has the meaning set forth in Section 5.03(o).

     “Home Mortgage Disclosure Act” means the Home Mortgage Disclosure Act (12 U.S.C. Section 2801 et seq.), as amended.

     “Indemnified Party” has the meaning set forth in Section 6.12(a).

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     “Index” has the meaning set forth in Section 8.01(g).

     “Initial Index” has the meaning set forth in Section 8.01(g).

     “Insurance Amount” has the meaning set forth in Section 6.11(b).

     “Insurance Policies” has the meaning set forth in Section 5.03(s).

     “Knowledge” of FCB, the Merger Subsidiary, FC Bank, SCB or SCC Bank, as the case may be, means to the actual knowledge after reasonable investigation of any director or any officer with the title of Vice President or above of FCB, the Merger Subsidiary, FC Bank, SCB or SCC Bank, as the case may be, or any employee of FCB, the Merger Subsidiary, FC Bank, SCB or SCC Bank, as the case may be, with primary responsibility for the subject matter as to which knowledge is at issue.

     “Lien” means any charge, mortgage, pledge, security interest, restriction, claim, lien or encumbrance.

     “Mailing Date” has the meaning set forth in Section 3.03(a).

     “Material Adverse Effect” means, with respect to FCB or SCB, any effect, circumstance, occurrence or change that (i) is material and adverse to the financial position, results of operations, or business of FCB and its Subsidiaries taken as a whole or SCB and SCC Bank taken as a whole, as the case may be, or (ii) would materially impair the ability of either FCB or SCB, respectively, to perform its obligations under this Agreement or otherwise materially threaten or materially impede the consummation of the Merger and the other transactions contemplated by this Agreement; provided, however, that a Material Adverse Effect shall not be deemed to include the impact of (a) changes in banking and similar laws of general applicability or interpretations thereof by Governmental Authorities, (b) changes in GAAP or regulatory accounting requirements applicable to banks and their holding companies generally, (c) changes in general economic conditions affecting banks and their holding companies generally and (d) changes contemplated by this Agreement or otherwise agreed to in writing by FCB and SCB.

     “Merger” has the meaning set forth in the Recitals to this Agreement.

     “Minimum Percentage” has the meaning set forth in Section 3.03(d).

     “National Labor Relations Act” means the National Labor Relations Act, as amended.

     “Non-Competition Agreements” has the meaning set forth in the Recitals to this Agreement.

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     “Non-Solicitation Agreement” has the meaning set forth in the Recitals to this Agreement.

     “FCB” has the meaning set forth in the preamble to the Agreement.

     “FCB Board” means the Board of Directors of FCB.

     “FCB Common Stock” means the common stock, no par value per share, of FCB.

     “FCB Preferred Stock” means the preferred stock of FCB.

     “Pension Plan” has the meaning set forth in Section 5.03(m).

     “Person” means any individual, bank, corporation, partnership, association, joint-stock company, business trust, limited liability company or unincorporated organization.

     “Proxy Statement” has the meaning set forth in Section 6.03(a).

     “Registration Statement” has the meaning set forth in Section 6.03(a).

     “Regulatory Authorities” has the meaning set forth in Section 5.03(i).

     “Regulatory Filings” has the meaning set forth in Section 5.03(g).

     “Rights” means, with respect to any Person, the stock options, stock appreciation rights, warrants and any other securities or obligations convertible into or exercisable or exchangeable for, or giving any Person any right to subscribe for or acquire, or any options, calls or commitments relating to, or any other instrument the value of which is determined in whole or in part by reference to the market price or value of, the capital stock of such Person.

     “SCB Articles” means the Articles of Incorporation of SCB, as amended.

     “SCB Board” means the Board of Directors of SCB.

     “SCB By-Laws” means the By-Laws of SCB.

     “SCB Common Stock” means the common stock, no par value per share, of SCB.

     “SCB Loan Property” has the meaning set forth in Section 5.03(o).

     “SCB Meeting” has the meaning set forth in Section 6.02.

     “SCB Preferred Stock” means the preferred stock of SCB.

     “SCB Property” has the meaning set forth in Section 5.03(o).

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     “SC Financial” has the meaning set forth in Section 5.03(c).

     “Schedule Delivery Date” has the meaning set forth in Section 5.01.

     “SEC” means the United States Securities and Exchange Commission.

     “Second Merger” has the meaning set forth in the Recitals to this Agreement.

     “Securities Act” means the Securities Act of 1933, as amended, and the rules and regulations thereunder.

     “Shareholder” means each director and executive officer of SCB who owns any shares of SCB Common Stock or owns any options or other rights to acquire shares of SCB Common Stock.

     “Shareholder Agreements” has the meaning set forth in the Recitals to this Agreement.

     “Shareholders’ Equity Measuring Date” has the meaning set forth in Section 7.03(e).

     “Subsidiary” and “Significant Subsidiary” have the meanings ascribed to those terms in Rule 1-02 of Regulation S-X of the SEC.

     “Surviving Company” has the meaning set forth in Section 2.01(a).

     “Tax” and “Taxes” mean all federal, state, local or foreign taxes, charges, fees, levies or other assessments, however denominated, including, without limitation, all net income, gross income, gains, gross receipts, sales, use, ad valorem, goods and services, capital, production, transfer, franchise, windfall profits, license, withholding, payroll, employment, disability, employer health, excise, estimated, severance, stamp, occupation, property, environmental, unemployment or other taxes, custom duties, fees, assessments or charges of any kind whatsoever, imposed on the income, properties or operations of SCB by any taxing authority whether arising before, on or after the Effective Date, together with any interest, additions or penalties thereto and any interest in respect of such interest and penalties.

     “Tax Returns” means any return, amended return or other report (including elections, declarations, disclosures, schedules, estimates and information returns) required to be filed with any taxing authority having jurisdiction over SCB on or before the Effective Date with respect to any Taxes of SCB including, without limitation, any documentation required to be filed with any taxing authority or to be retained by the SCB in respect of information reporting requirements imposed by the Code or any similar foreign, state or local law.

     “Termination Fee” has the meaning set forth in Section 8.02(b).

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     “Treasury Shares” has the meaning set forth in Section 3.01(d).

     “Undesignated Shares” has the meaning set forth in Section 3.03(a).

     “USA Patriot Act” means the USA Patriot Act (Pub. L. No. 107 56).

ARTICLE II
THE MERGER

     2.01. The Merger

     (a) The Combination. At the Effective Time, the Merger Subsidiary shall merge with and into SCB, the separate corporate existence of Merger Subsidiary shall cease and SCB shall survive, continue to exist as a California corporation and operate under the name “South Coast Bancorp, Inc.” (the “Surviving Company”). FCB may, at any time prior to the Effective Time (including, to the extent permitted by applicable law, after SCB’s shareholders have approved the principal terms of the Merger) change the method of effecting the acquisition of SCB (including, without limitation, the provisions of this Article II) if and to the extent it deems such change to be necessary, appropriate or desirable; provided, however, that no such change shall (i) alter or change the amount or kind of consideration to be issued to holders of SCB Common Stock as provided for in this Agreement (the “Merger Consideration”), (ii) adversely affect the tax treatment of SCB’s shareholders as a result of receiving the Merger Consideration, (iii) materially impede or delay consummation of the transactions contemplated by this Agreement or (iv) otherwise be materially prejudicial to the interests of the shareholders of SCB.

     (b) Articles of Incorporation and By-Laws. On the Effective Date, the articles of incorporation and by-laws of SCB, as in effect immediately prior to the Effective Date, shall be and remain the articles of incorporation and by-laws of the Surviving Company.

     (c) Directors and Officers of the Surviving Company. On the Effective Date, the directors and officers of Merger Sub immediately prior to the Effective Date shall become the directors and officers of the Surviving Company. The directors of the Surviving Company shall serve until the next annual meeting of shareholders of the Surviving Company or until such time as their successors are elected and have qualified.

     (d) Effect of the Merger. At the Effective Time, the effect of the Merger shall be as provided in §1107 of the CCC, including any regulations or rules promulgated thereunder.

     2.02. Effective Date and Effective Time

     On such date as FCB selects (and promptly provides notice thereof to SCB) that is (a) on or after June 30, 2005, or any earlier date that is specifically agreed in writing by the parties, (b) no later than September 30, 2005, and (b) within ten days after the last to occur of the expiration of all applicable waiting periods in connection with approvals of

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Governmental Authorities and the receipt of all approvals of Governmental Authorities and all conditions to the consummation of the Merger are satisfied or waived (or, at the election of FCB, on the last business day of the month in which such tenth day occurs or, if such tenth day occurs on one of the last five business days of such month, on the last business day of the succeeding month), or such earlier or later date as may be agreed in writing by the parties, the Agreement of Merger shall be filed with the California Secretary, in accordance with all appropriate legal requirements together with such certificates or other documents executed as may be required by law, and the Merger provided for herein shall become effective upon such filing. The date of such filing is herein called the “Effective Date.” The “Effective Time” of the Merger shall be the time of such filing.

ARTICLE III
CONSIDERATION; EXCHANGE PROCEDURES; CLOSING

     3.01. Effect on Capital Stock

     Subject to the other provisions of this Article III, at the Effective Time of the Merger, by virtue of the Merger and without any additional action on the part of the holder of shares of SCB Common Stock or the Merger Subsidiary Common Stock:

     (a) The Merger Subsidiary Common Stock. On the Effective Date, the shares of common stock of the Merger Subsidiary issued and outstanding immediately prior to the Effective Date shall thereupon be converted into and exchanged by FCB for one (1) share of fully paid common stock of the Surviving Company. On the Effective Date, the 1 share of common stock of the Surviving Company shall be held by FCB, representing 100% of the issued and outstanding common stock of the Surviving Company, and shall not be deemed to represent a share of SCB Common Stock which has been converted into the right to receive the Per Share Merger Consideration as provided in Section 3.03;

     (b) SCB Common Stock. On the Effective Date, each share of SCB Common Stock, issued and outstanding immediately prior to the Effective Time of the Merger (other than Dissenters’ Shares, as defined below) shall be converted into the right to receive the Per Share Merger Consideration as provided in Section 3.03 hereof; and

     (c) Dissenters’ Shares. All shares of SCB Common Stock that are “dissenting shares” within the meaning of CCC §1300 (“Dissenters’ Shares”) shall not be converted into or represent a right to receive the Per Share Merger Consideration hereunder and shall only be entitled to such per share compensation as provided by applicable law.

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     3.02. Conversion of SCB Common Stock

     (a) Subject to the other provisions of this Article III, each share of SCB Common Stock issued and outstanding immediately prior to the Effective Time of the Merger (other than Dissenters’ Shares) shall, by virtue of the Merger on and after the Effective Time, automatically be cancelled and cease to be an issued and outstanding share of SCB Common Stock and shall be converted into the right to receive the Per Share Merger Consideration (as defined in Section 3.03 below). Certificates formerly evidencing shares of SCB Common Stock shall be surrendered for payment to the Exchange Agent in accordance with Section 3.03 below.

     (b) On and after the Effective Time of the Merger, the stock transfer books of the Surviving Company shall be closed as to holders of SCB Common Stock immediately prior to the Effective Time of the Merger and no transfer of SCB Common Stock by any such holder shall thereafter be made or recognized.

     3.03. Exchange Procedures

     (a) Exchange Agent. No later than the Effective Time of the Merger, FCB shall deposit cash with the Exchange Agent equal to the Net Total Merger Consideration (as defined in Section 3.03(b) below) (the “Exchange Fund”).

     (b) Exchange Fund and Per Share Merger Price.

     The aggregate amount payable in cash pursuant to Section 3.02 for all of the outstanding shares of SCB Common Stock shall be the Base Merger Consideration; provided that SCB’s Adjusted Shareholders’ Equity is at least equal to the Base Shareholders’ Equity. Should SCB’s Adjusted Shareholders’ Equity be less than the Base Shareholders’ Equity, then the Base Merger Consideration shall be reduced by the lesser of (i) that amount by which the Adjusted Shareholders’ Equity is less than the Base Shareholders’ Equity, or (ii) Two Million Five Hundred Thousand Dollars ($2,500,000) (the Base Merger Consideration as so reduced shall be referred to as the “Adjusted Merger Consideration.”). The amount payable pursuant to Section 3.02 for each outstanding share of SCB Common Stock (the “Per Share Merger Consideration”) shall be equal to the quotient obtained by dividing (i) the Base Merger Consideration or the Adjusted Merger Consideration, as applicable, by (ii) the total number of shares of SCB Common Stock outstanding immediately prior to the Effective Time of the Merger (including Dissenting Shares).

     (c) Delivery of Cash. After the Effective Time of the Merger, delivery to the holders of SCB Common Stock of the cash to which they are entitled will be promptly made by the Exchange Agent against delivery of share certificates formerly evidencing SCB Common Stock to the Exchange Agent in accordance with this Section 3.03 and the terms and conditions of an agreement to be entered into by and between FCB and the Exchange Agent (the “Exchange Agent Agreement”). A copy of the Exchange Agent

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Agreement will be provided to SCB and its counsel for approval prior to consummation of the Merger, which approval shall not be unreasonably withheld.

     As soon as practicable after the Effective Time of the Merger, the Exchange Agent shall send a notice and transmittal form to each holder of a certificate previously representing shares of SCB Common Stock advising such holders of the procedure for surrendering to the Exchange Agent such certificate for conversion into cash. Each holder of such certificates, upon surrender of the same to the Exchange Agent in accordance with such transmittal form, shall be entitled to receive the consideration provided for in Section 3.02 hereof, with the exception of holders of Dissenting Shares. If the consideration for shares of SCB Common Stock provided for in Section 3.02 is to be delivered to any person other than the registered holder of said shares surrendered for exchange, the amount of any stock transfer tax or similar taxes (whether imposed on the registered holder or such person) payable on account of the transfer to such person shall be paid to the Exchange Agent by such person, or the Exchange Agent may refuse to make such exchange unless satisfactory evidence of the payment of such taxes or exemption therefrom is submitted.

     (d) Unclaimed Portion of Exchange Fund. Any portion of the Exchange Fund that remains unclaimed by the shareholders of SCB for six months after the Effective Time shall be paid to FCB. Any shareholders of SCB who have not theretofore complied with this Article III shall thereafter look only to FCB for payment of the Per Share Merger Price for which such shareholder is entitled to pursuant to this Agreement, without any interest thereon.

     (g) Withholding Rights. FCB, the Surviving Company or the Exchange Agent shall be entitled to deduct and withhold from the consideration otherwise payable pursuant to this Agreement to any holder of shares of SCB Common Stock such amounts as FCB, the Surviving Company or the Exchange Agent is required to deduct and withhold with respect to the making of such payment under the Code, or any provision of state, local or foreign tax law. To the extent that amounts are so withheld by FCB, the Surviving Company or the Exchange Agent, such withheld amounts shall be treated for all purposes of this Agreement as having been paid to the holder of the shares of SCB Common Stock in respect of which such deduction and withholding was made by FCB, the Surviving Company or the Exchange Agent.

     3.04. Anti-Dilution Provisions

     In the event SCB changes (or establishes a record date for changing) the number of shares of SCB Common Stock issued and outstanding prior to the Effective Date as a result of a stock split, stock dividend, recapitalization or similar transaction with respect to the outstanding SCB Common Stock, as the case may be, and the record date therefor shall be prior to the Effective Date, the Per Share Merger Consideration shall be proportionately adjusted.

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     3.05. Dissenters’ Rights

     (a) Any Dissenting Shareholder who shall be entitled to be paid the value of such shareholder’s shares of SCB Common Stock, as provided in §1300 of the CCC, shall not be entitled to the Per Share Merger Consideration in respect thereof provided for under Section 3.02 unless and until such Dissenting Shareholder shall have failed to perfect or shall have effectively withdrawn or lost such Dissenting Shareholder’s right to dissent from the Merger under the CCC, and shall be entitled to receive only the payment provided for by §1300 of the CCC with respect to such Dissenters’ Shares.

     (b) If any Dissenting Shareholder shall fail to perfect or shall have effectively withdrawn or lost such right to dissent, each share of SCB Common Stock of such Dissenting Shareholder shall be deemed to be an Undesignated Share and shall be converted into the right to receive the Per Share Merger Consideration.

     3.06. Closing

     The Closing shall take place on the Closing Date.

     3.07. Execution of Agreements

     As soon as practicable after execution of this Agreement, the Agreement of Merger, (as amended, if necessary, to conform to any requirements of any Governmental Entity having authority over such merger(s)) together with all other agreements necessary to consummate the transactions described herein, shall be executed by the parties thereto. On the Closing Date, the Agreement of Merger, together with all requisite certificates, shall be duly filed with the California Secretary.

     3.08. Further Assurances

     At the Closing, the Parties hereto shall deliver, or cause to be delivered, such documents or certificates as may be necessary in the reasonable opinion of counsel for any of the parties, to effectuate the transactions contemplated by this Agreement. If, at any time after the Effective Time the Merger, the Surviving Company or a successor or assign shall determine that any further conveyance, assignment, or other documents or any further action is necessary or desirable to further effectuate the transactions set forth herein or contemplated hereby, the officers and directors of the Parties shall execute and deliver, or cause to be executed and delivered, all such documents as may be reasonably required to effectuate such transactions.

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ARTICLE IV
ACTIONS PENDING ACQUISITION

     4.01. Forbearances of SCB

     From the date hereof until the Effective Time, except as expressly contemplated by this Agreement, and except as set forth in the corresponding sections or subsections of the Disclosure Schedule, without the prior written consent of FCB (which consent shall not be unreasonably withheld), SCB will not, and will not permit SCC Bank to:

     (a) Ordinary Course. Conduct the business of SCB or of SCC Bank other than in the ordinary and usual course or fail to use its best efforts to preserve intact its business organizations and assets and maintain its rights, franchises and existing goodwill and relations with customers, suppliers, employees and business associates, take any action that would adversely affect or delay the ability of SCB or of SCC Bank, FCB or any Subsidiaries of FCB to perform any of their obligations on a timely basis under this Agreement, or take any action that could be expected to have a Material Adverse Effect on SCB or SCC Bank.

     (b) Capital Stock. Other than pursuant to the Rights set forth in Schedule 4.01(b) of the Disclosure Schedule and outstanding on the date hereof (i) issue, sell or otherwise permit to become outstanding, or authorize the creation of, any additional shares of stock or any Rights, (ii) enter into any agreement with respect to the foregoing or (iii) permit any additional shares of stock to become subject to grants of employee or director stock options, other Rights or similar stock-based employee rights.

     (c) Dividends; Etc. From January 2, 2005 until the Closing: (i) Make, declare, pay or set aside for payment any dividend on or in respect of, or declare or make any distribution on any shares of stock in excess of (A) Five Hundred and Eighty-Five Thousand Dollars ($585,000) plus (B) the amount of retained cash in SCB accounts as of January 2, 2005, and any interest as may be earned thereon (constituting a portion of previously taxed but undistributed income), but not to exceed Two Hundred Seventy Thousand Dollars ($270,000.00); or (ii) directly or indirectly adjust, split, combine, redeem, reclassify, purchase or otherwise acquire, any shares of its capital stock.

     (d) Compensation; Employment Agreements; Etc. Enter into, renew, make any new grants of awards under, amend or otherwise modify any employment, consulting, severance or similar agreements or arrangements with any director, officer or employee of SCB or of SCC Bank or grant any salary or wage increase or increase any employee benefit (including incentive or bonus payments), except (i) for normal individual increases in compensation to employees in the ordinary course of business consistent with past practice, provided that no such increase shall result in an annual adjustment of more than 5%, (ii) for other changes that are required by applicable law, (iii) to satisfy contractual obligations existing as of the date hereof and set forth in Schedule 4.01(d) of the Disclosure Schedule or (iv) for grants of awards to newly hired employees consistent with past practice.

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     (e) Hiring. Hire any person as an employee of SCB or of SCC Bank or promote any employee, except (i) to satisfy contractual obligations existing as of the date hereof and set forth in Schedule 4.01(e) of the Disclosure Schedule and (ii) persons hired to fill any vacancies arising after the date hereof and whose employment is terminable at the will of SCB or of SCC Bank. Subject to the foregoing limitations, SCB or SCC Bank shall not, without consent of FCB, which shall not be unreasonably withheld or delayed more than three Business Days, hire any new additional employee who would have a base salary, including any guaranteed bonus, considered on an annual basis of more than $70,000.

     (f) Benefit Plans. Enter into, establish, adopt or amend (except (i) as may be required by applicable law or (ii) to satisfy contractual obligations existing as of the date hereof and set forth in Schedule 4.01(f) of the Disclosure Schedule) any pension, retirement, stock option, stock purchase, savings, profit sharing, deferred compensation, consulting, bonus, group insurance or other employee benefit, incentive or welfare contract, plan or arrangement, or any trust agreement (or similar arrangement) related thereto, in respect of any current or former director, officer or employee of SCB or of SCC Bank or take any action to accelerate the vesting or exercisability of stock options, restricted stock or other compensation or benefits payable thereunder, as applicable.

     (g) Dispositions. Sell, transfer, mortgage, pledge, encumber or otherwise dispose of or discontinue any of its assets, deposits, business or properties except in the ordinary course of business or in a transaction that, together with all other related similar transactions, is not material to SCB or of SCC Bank.

     (h) Acquisitions. Acquire (other than by way of foreclosures or acquisitions of control in a bona fide fiduciary capacity or in satisfaction of debts previously contracted in good faith, in each case in the ordinary and usual course of business consistent with past practice) all or any portion of the assets, business, deposits or properties of any other entity except in the ordinary course of business consistent with past practice or in a transaction that, together with all other related similar transactions, is not material to SCB or of SCC Bank.

     (i) Capital Expenditures. Except as set forth in Schedule 4.01(i) of the Disclosure Schedule, make any capital expenditures other than capital expenditures in the ordinary course of business consistent with past practice in amounts not exceeding $10,000 individually or $25,000 in the aggregate.

     (j) Governing Documents. Amend SCB’s Articles or SCB’s By-Laws or the equivalent organizational documents of SCC Bank.

     (k) Accounting Methods. Implement or adopt any change in its accounting principles, practices or methods, other than as may be required by GAAP.

     (l) Contracts. Except as set forth in Schedule 4.01(l) of the Disclosure Schedule enter into, renew or terminate, or make any payment not then required under,

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any contract or agreement that calls for aggregate annual payments of $25,000 or more and which is not terminable at will or with 60 days or less notice without payment of a premium or penalty, other than loans and other transactions made in the ordinary course of the banking business.

     (m) Claims. Enter into any settlement or similar agreement with respect to, or take any other significant action with respect to the conduct of, any action, suit, proceeding, order or investigation to which SCB or of SCC Bank is or becomes a party on or after the date of this Agreement, which settlement, agreement or action involves payment by SCB or of SCC Bank of an amount, individually or for all such settlements, that exceeds $25,000 and/or would impose any material restriction on the business of SCC Bank or create precedent for claims that are reasonably likely to be material to SCB or of SCC Bank.

     (n) Adverse Actions. Knowingly take any action that is intended or is reasonably likely to result in (i) any of its representations and warranties set forth in this Agreement being or becoming untrue in any material respect at any time at or prior to the Effective Time, (ii) any of the conditions to the Merger set forth in Article VII not being satisfied or (iii) a material violation of any provision of this Agreement except as may be required by applicable law or regulation.

     (o) Risk Management. Except as required by applicable law or regulation or the Federal Reserve Board or FDIC, (i) implement or adopt any material change in its interest rate and other risk management policies, procedures or practices, (ii) fail to follow its existing policies or practices with respect to managing its exposure to interest rate and other risk or (iii) fail to use commercially reasonable means to avoid any material increase in its aggregate exposure to interest rate risk.

     (p) Indebtedness. Incur any indebtedness for borrowed money (other than deposits, Federal Funds borrowings and borrowings from the Federal Home Loan Bank of San Francisco) or assume, guarantee, endorse or otherwise as an accommodation become responsible for the obligations of any other Person.

     (q) Loans. Make any loan, loan commitment or renewal or extension thereof to any Person which would, when aggregated with all outstanding loans, commitments for loans or renewals or extensions thereof made to such Person and any affiliate or immediate family member of such Person, exceed $100,000 without submitting loan package information to the chief credit officer of FCB for review with a right of comment at least two full Business Days prior to taking such action, and with a right of subsequent review should the terms of any prospective loan, loan commitment or renewal or extension thereof change materially from the loan package information previously submitted to the chief credit officer of FCB.

     (r) Investments. Purchase or acquire securities of any type or make any investment either by contributions to capital, property transfers or purchase of any property or assets of any Person, other than (i) in the ordinary course of business

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consistent with past practice in individual amounts not to exceed $100,000, or (ii) purchases of direct obligations of the United States of America or obligations of U.S. government agencies which are entitled to the full faith and credit of the United States of America, in any case with a remaining maturity at the time of purchase of two years or less.

     (s) Taxes. Settle any material audit, make or change any material Tax election, file any amended Tax Return, take any action which would have a Material Adverse Effect on the Tax position of SCB or of SCC Bank or their respective successors after the Merger or take any other action with respect to Taxes that is outside the ordinary course of business or inconsistent with past practice.

     (t) Commitments. Agree or commit to do any of the foregoing.

     4.02. Forbearances of FCB

     From the date hereof until the Effective Time, except as expressly contemplated by this Agreement, without the prior written consent of SCB, neither FCB nor FC Bank will:

     (a) Ordinary Course. Take any action reasonably likely to have an adverse effect on FCB’s ability to perform any of its material obligations under this Agreement.

     (b) Adverse Actions. Knowingly take any action that is intended or is reasonably likely to result in (i) any of its representations and warranties set forth in this Agreement being or becoming untrue in any material respect at any time at or prior to the Effective Time, (ii) any of the conditions to the Merger set forth in Article VII not being satisfied or (iii) a material violation of any provision of this Agreement, except as may be required by applicable law or regulation.

     (c) Commitments. Agree or commit to do any of the foregoing.

ARTICLE V
REPRESENTATIONS AND WARRANTIES

     5.01. Disclosure Schedules

     Prior to the execution of this Agreement, SCB shall have delivered to FCB a draft of a schedule (the “Disclosure Schedule”) setting forth, among other things, items the disclosure of which is necessary or appropriate either in response to an express disclosure requirement contained in a provision hereof or as an exception to one or more representations or warranties contained in Section 5.03 or to one or more of its covenants contained in Article IV, and SCB shall deliver to FCB a complete Disclosure Schedule within ten (10) business days after the execution of this Agreement (“Schedule Delivery

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Date”); provided, however, that (a) no such item is required to be set forth in the Disclosure Schedule as an exception to a representation or warranty if its absence could not reasonably be expected to result in the related representation or warranty being deemed untrue or incorrect under the standard established by Section 5.02 and (b) the mere inclusion of an item in the Disclosure Schedule as an exception to a representation or warranty shall not be deemed an admission by a party that such item represents a material exception or fact, event or circumstance or that such item is reasonably likely to result in a Material Adverse Effect.

     5.02. Standard

     No representation or warranty of SCB or FCB contained in Section 5.03 or 5.04, respectively, shall be deemed untrue or incorrect, and no party hereto shall be deemed to have breached a representation or warranty, as a consequence of the existence of any fact, event or circumstance unless such fact, circumstance or event, individually or taken together with all other facts, events or circumstances inconsistent with any representation or warranty contained in Section 5.03 or 5.04, has had or is reasonably likely to have a Material Adverse Effect on the party making such representation or warranty.

     5.03. Representations and Warranties of SCB

     Subject to Sections 5.01 and 5.02 and except as set forth in the corresponding sections or subsections of the Disclosure Schedule, SCB hereby represents and warrants to FCB and FC Bank:

     (a) Organization, Standing and Authority. SCB is a corporation duly organized and validly existing under the laws of the state of California. SCC Bank is California banking corporation and its deposits are insured by the FDIC through the Bank Insurance Fund in the manner and to the fullest extent provided by law. SCB is duly qualified to do business and is in good standing in the State of California and any other foreign jurisdictions where its ownership or leasing of property or assets or the conduct of its business requires it to be so qualified. SCB has made available to FCB a complete and correct copy of SCB’s articles of incorporation and by-laws, each as amended to date. SCB and SCC Bank are both S-corporations under the Code.

     (b) SCB Capital Stock. The authorized capital stock of SCB consists of 8,000,000 shares of SCB Common Stock, of which 3,049,504 shares are issued and outstanding, and 500,000 shares of SCB Preferred Stock of which no shares are issued and outstanding. No shares of the SCB Common Stock are held in treasury by SCB or otherwise owned directly or indirectly by SCB. The outstanding shares of SCB Common Stock have been duly authorized and are validly issued and outstanding, and subject to no preemptive rights (and were not issued in violation of any preemptive rights). No more than 20,000 shares of SCB Common Stock are issuable upon exercise of any Rights. Schedule 5.03(b) of the Disclosure Schedule sets forth for each Right, the name of the grantee or holder, the date of the grant, the expiration date of such Right, the type of grant, the number of shares of SCB Common Stock subject to such Right, the number

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and type of shares subject to such Rights that are currently exercisable and the exercise price per share. Except as set forth above, there are no shares of SCB Common Stock authorized and reserved for issuance, SCB does not have any other Rights issued or outstanding with respect to SCB Common Stock, and SCB does not have any commitment to authorize, issue or sell any SCB Common Stock or Rights, except pursuant to this Agreement.

     (c) Subsidiaries. SCB’s only Subsidiaries are SCC Bank, a California banking corporation, and SC Financial, a California corporation (“SC Financial”). SCB owns all the issued and outstanding equity securities of SCC Bank and SC Financial. No equity securities of SCC Bank or SC Financial are or may become required to be issued by reason of any Right or otherwise. There are no contracts, commitments, understandings or arrangements by which SCC Bank or SC Financial is or may be bound to sell or otherwise transfer any equity securities of SCC Bank or SC Financial, respectively. There are no contracts, commitments, understandings, or arrangements relating to SCB’s rights to vote or to dispose of such securities. All the equity securities of SCC Bank and SC Financial held by SCB are fully paid, nonassessable and owned by SCB free and clear of any Liens.

     (i) Except as set forth in Schedule 5.03(c)(i), SCB does not own, directly or indirectly, any equity securities or similar interests of any Person or any interests of any Person or any interest in a partnership or joint venture of any kind, other than those of SCC Bank.

     (ii) SCC Bank has been duly organized and is validly existing in good standing under the laws of the State of California, and is duly qualified to do business and in good standing in the jurisdictions where its ownership or leasing of property or the conduct of its business requires it to be so qualified.

     (d) Corporate Power. Each of SCB and SCC Bank has all corporate power and authority to carry on its business as it is now being conducted and to own all its properties and assets; and SCB has all corporate power and authority and has taken all corporate action necessary to execute, deliver and perform its obligations under this Agreement and to consummate the transactions contemplated hereby.

     (e) Corporate Authority. SCB’s Board of Directors, by resolutions duly adopted at a meeting duly called and held, has duly (i) determined that this Agreement and the Merger are advisable and fair to and in the best interests of SCB and its shareholders, (ii) approved this Agreement and the Merger and (iii) recommended that its shareholders approve this Agreement and the Merger and that such matter be submitted for consideration by its shareholders at a meeting of such shareholders. SCB has duly executed and delivered this Agreement and this Agreement is a valid and legally binding obligation of SCB, enforceable in accordance with its terms (except as enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent transfer and similar laws of general applicability relating to or affecting creditors’ rights or by general equity principles).

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     (f) Regulatory Approvals; No Violations.

     (i) No consents or approvals of, or waivers by, or filings or registrations with, any Governmental Authority or with any third party are required to be made or obtained by SCB in connection with the execution, delivery or performance by SCB of this Agreement or to consummate the Merger except for (A) filings of applications or notices with, and approvals or waivers by, the Federal Reserve Board, the FDIC, and the DFI, (B) the approval of the principal terms of this Agreement by the holders of a majority of the outstanding shares of SCB Common Stock and (C) the filing of an executed agreement of merger substantially in the form of Exhibit D hereto (the “Agreement of Merger”) with the California Secretary pursuant to the CCC. As of the date hereof, SCB is not aware of any reason why the approvals set forth in this Section 5.03(f) and in Section 7.01(b) will not be received without the imposition of a condition, restriction or requirement of the type described in Section 7.01(b).

     (ii) Subject to receipt of the approvals referred to in the preceding paragraph, and the expiration of related waiting periods, and required filings under federal and state securities laws, the execution, delivery and performance of this Agreement by SCB and the consummation of the transactions contemplated hereby and thereby do not and will not (A) constitute a breach or violation of, or a default under, or give rise to any Lien, any acceleration of remedies or any right of termination under, any law, rule or regulation or any judgment, decree, order, governmental permit or license, or agreement, indenture or instrument of SCB to which SCB or any of its respective properties is subject or bound, (B) constitute a breach or violation of, or a default under, the articles of incorporation or by-laws (or similar governing documents) of SCB or SCC Bank or (C) require any consent or approval under any such law, rule, regulation, judgment, decree, order, governmental permit or license, agreement, indenture or instrument.

     (g) Financial Reports; Material Adverse Effect.

     (i) SCB (A) has delivered to FCB audited consolidated financial statements of SCB consisting of the consolidated balance sheets as of
December 31, 2003, 2002 and 2001, the related statements of operations, changes in shareholders’ equity and statements of cash flow for the periods then ended, and the related notes and related accountant’s opinions thereon; and (B) shall deliver to FCB audited consolidated financial statements of SCB, consisting of the consolidated balance sheets as of December 31, 2004, the related statements of operations, changes in shareholders’ equity and statements of cash flow for the periods then ended, and the related notes and related accountant’s opinions thereon, within 10 days of receipt of such financial statements from SCB’s accountants (collectively, the “SCB Financial Statements”). The SCB Financial Statements (i) present fairly the financial condition of SCB as of the respective dates indicated and the results of operations, the changes in stockholders’ equity and cash flows for the respective periods indicated; (ii) have been prepared in

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accordance with GAAP applied on a basis consistent with past practices; (iii) contain and reflect reserves for all material accrued liabilities and for all reasonably anticipated losses, including but not limited to adequate reserves for loan and lease losses; and (iv) are based on the books and records of SCB. SCB is not subject to any liability (whether accrued, absolute, contingent or otherwise), except as reflected in the SCB Financial Statements, as disclosed in Schedule 5.03(g) or as otherwise disclosed in writing to FCB prior to the execution of this Agreement, or as incurred since December 31, 2004 in the ordinary course of business. SCB does not know of any basis for the assertion against it or SCC Bank of any liability, obligation or claim (including, without limitation, that of any regulatory authority) that would be reasonably likely to result in or cause a Material Adverse Effect with respect to SCB or SCC Bank which is not fairly reflected in the SCB Financial Statements delivered to FCB or otherwise disclosed on Schedule 5.03(g).

     (ii) SCB and SCC Bank have timely filed all reports, registrations and statements, together with any amendments required to be made with respect thereto, that they were required to file since December 31, 2001 with (A) the Federal Reserve Board, (B) the FDIC, (C) the DFI and (D) any other Regulatory Authority (collectively, the “Regulatory Filings”), and all other reports and statements required to be filed by them since December 31, 2001, including, without limitation, any report or statement required to be filed pursuant to the laws of the United States or the State of California and the rules and regulations of the Federal Reserve Board, the FDIC, the DFI or any other Regulatory Authority, and have paid all fees and assessments due and payable in connection therewith. As of their respective dates, such reports, registrations and statements complied in all material respects with all the laws, rules and regulations of the applicable Regulatory Agency with which they were filed.

     (iii) Since December 31, 2003, SCB and SCC Bank have not incurred any liability other than in the ordinary course of business consistent with past practice (excluding the incurrence of liabilities related to this Agreement and the transactions contemplated hereby).

     (iv) Since December 31, 2001, (A) SCB and SCC Bank have conducted their respective businesses in the ordinary and usual course consistent with past practice (excluding the incurrence of expenses related to this Agreement and the transactions contemplated hereby) and (B) no event has occurred or circumstance arisen that, individually or taken together with all other facts, circumstances and events (described in any paragraph of this Section 5.03 or otherwise), has had or could be reasonably likely to have a Material Adverse Effect with respect to SCB or SCC Bank.

     (h) Litigation. Except as set forth in Section 5.03(h) of the Disclosure Schedule, no litigation, claim, action, suit, hearing, investigation or other proceeding before any court or Governmental Authority is pending against SCB or SCC Bank and, to SCB’s Knowledge, no such litigation, claim, action, suit, hearing, investigation or other

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proceeding has been threatened and there are no facts which could reasonably give rise to such litigation, claim or other proceeding.

     (i) Regulatory Matters.

     (i) Neither SCB, SCC Bank nor any of SCB’s or SCC Bank’s property is, directly or indirectly, party to or is subject to any order, decree, agreement, memorandum of understanding or similar arrangement with, or a commitment letter or similar submission to, or extraordinary supervisory letter from, any federal or state Governmental Authority charged with the supervision or regulation of financial institutions or issuers of securities or engaged in the insurance of deposits (including, without limitation, the FDIC) or the supervision or regulation of it (collectively, the “Regulatory Authorities”). SCB and SCC Bank have paid all assessments made or imposed by any Regulatory Authority.

     (ii) SCB and SCC Bank have not been advised by, and do not have any Knowledge of facts which could give rise to an advisory notice by, any Regulatory Authority that such Regulatory Authority is contemplating issuing or requesting (or is considering the appropriateness of issuing or requesting) any such order, decree, agreement, memorandum of understanding, commitment letter, supervisory letter or similar submission.

     (j) Compliance With Laws.

     SCB and SCC Bank:

     (i) are in compliance in all material respects with all applicable federal, state, local and foreign statutes, laws, regulations, ordinances, rules, judgments, orders or decrees applicable thereto or to the employees conducting such businesses, including, without limitation, the Equal Credit Opportunity Act, the Fair Housing Act, the Community Reinvestment Act, the Home Mortgage Disclosure Act, the Bank Secrecy Act, the customer privacy requirements under the Gramm-Leach-Bliley Act, and all fair lending laws and other laws relating to discriminatory business practices;

     (ii) have adopted such procedures and policies as are, in the reasonable judgment of SCB’s management, necessary or appropriate to comply with Title III of the USA Patriot Act and, to the Knowledge of SCB or SCC Bank, are in such compliance;

     (iii) have all permits, licenses, authorizations, orders and approvals of, and has made all filings, applications and registrations with, all Governmental Authorities that are required in order to permit them to own or lease their properties and to conduct their businesses as presently conducted; all such permits, licenses, certificates of authority, orders and approvals are in full force

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and effect and, to SCB’s or SCC Bank’s Knowledge, no suspension or cancellation of any of them is threatened; and

     (iv) have received, since December 31, 2001, no notification or communication from any Governmental Authority (A) asserting that SCB or SCC Bank is not in compliance with any of the statutes, regulations or ordinances which such Governmental Authority enforces or (B) threatening to revoke any license, franchise, permit or governmental authorization (nor, to SCB’s or SCC Bank’s knowledge, do any grounds for any of the foregoing exist).

     (k) Material Contracts; Defaults. Neither SCB nor SCC Bank is a party to, bound by or subject to any agreement, contract, arrangement, commitment or understanding (whether written or oral) (i) that is a “material contract” within the meaning of Item 601(b)(10) of the SEC’s Regulation S-K with respect to such entity or (ii) that materially restricts the conduct of business by SCB or by SCC Bank. Neither SCB nor SCC Bank is in default under any contract, agreement, commitment, arrangement, lease, insurance policy or other instrument to which it is a party, by which its assets, business, or operations may be bound or affected, or under which it or its assets, business, or operations receives benefits, and there has not occurred any event that, with the lapse of time or the giving of notice or both, would constitute such a default. No power of attorney or similar authorization given directly or indirectly by SCB or by SCC Bank is currently outstanding. Schedule 5.03(k) of the Disclosure Schedule sets forth a true and complete list of all third party consents or waivers required to be obtained so as not to be in default under any contract, agreement, commitment, arrangement, lease, insurance policy or other instrument to which SCB is a party as a result of the transactions contemplated hereby.

     (l) No Brokers. No action has been taken by SCB that would give rise to any valid claim against any party hereto for a brokerage commission, finder’s fee or other like payment with respect to the transactions contemplated by this Agreement.

     (m) Employee Benefit Plans.

     (i) All benefit and compensation plans, contracts, policies or arrangements covering current or former employees of SCB and SCC Bank (the “Employees”) and current or former directors of SCB and SCC Bank including, but not limited to, “employee benefit plans” within the meaning of Section 3(3) of ERISA, and deferred compensation, stock option, stock purchase, stock appreciation rights, stock based, incentive and bonus plans (the “Benefit Plans”), are listed in Schedule 5.03(m) to the Disclosure Schedule. True and complete copies of all Benefit Plans including, but not limited to, any trust instruments and insurance contracts forming a part of any Benefit Plans and all amendments thereto have been provided or made available to FCB.

     (ii) All Benefit Plans, to the extent subject to ERISA, are in substantial compliance with ERISA. Each Benefit Plan which is an “employee pension

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benefit plan” within the meaning of Section 3(2) of ERISA (“Pension Plan”) and which is intended to be qualified under Section 401(a) of the Code has received a favorable determination letter from the Internal Revenue Service, and neither SCB nor SCC Bank is aware of any circumstances likely to result in revocation of any such favorable determination letter or the loss of the qualification of such Pension Plan under Section 401(a) of the Code. There is no material pending or, to SCB’s or SCC Bank’s Knowledge, threatened litigation relating to the Benefit Plans. Neither SCB nor SCC Bank has engaged in a transaction with respect to any Benefit Plan or Pension Plan that, assuming the taxable period of such transaction expired as of the date hereof, could subject SCB or SCC Bank to a tax or penalty imposed by either Section 4975 of the Code or Section 502(i) of ERISA in an amount which would be material.

     (iii) No liability under Subtitle C or D of Title IV of ERISA has been or is expected (based on events occurring prior to the Closing) to be incurred by SCB with respect to any ongoing, frozen or terminated “single-employer plan”, within the meaning of Section 4001(a)(15) of ERISA, currently or formerly maintained by SCB or SCC Bank, or the single-employer plan of any entity which is considered one employer with the SCB or SCC Bank under Section 4001 of ERISA or Section 414 of the Code (an “ERISA Affiliate”). Neither SCB nor SCC Bank has incurred, nor do they expect to incur (based on events occurring prior to the Closing), any withdrawal liability with respect to a multiemployer plan under Subtitle E of Title IV of ERISA (regardless of whether based on contributions of an ERISA Affiliate). No notice of a “reportable event,” within the meaning of Section 4043 of ERISA for which the 30-day reporting requirement has not been waived, has been required to be filed for any Pension Plan or by any ERISA Affiliate within the 12-month period ending on the date hereof.

     (iv) All contributions required to be made under the terms of any Benefit Plan have been timely made. Neither any Pension Plan nor any single-employer plan of an ERISA Affiliate has an “accumulated funding deficiency” (whether or not waived) within the meaning of Section 412 of the Code or Section 302 of ERISA and no ERISA Affiliate has an outstanding funding waiver. Neither SCB nor SCC Bank has provided, nor is either of them required to provide, security to any Pension Plan or to any single-employer plan of an ERISA Affiliate pursuant to Section 401(a)(29) of the Code.

     (v) Under each Pension Plan which is a single-employer plan, as of the last day of the most recent plan year ended prior to the date hereof, the actuarially determined present value of all “benefit liabilities,” within the meaning of Section 4001(a)(16) of ERISA (as determined on the basis of the actuarial assumptions contained in the Pension Plan’s most recent actuarial valuation), did not exceed the then current value of the assets of such Pension Plan, and there has been no material change in the financial condition of such Plan since the last day

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of the most recent plan year that is reasonably expected to result in any such excess.

     (vi) Neither SCB nor SCC Bank has any obligations for retiree health and life benefits under any Benefit Plan.

     (vii) Except as set forth in Section 5.03(m) to the Disclosure Schedule none of the execution of this Agreement, shareholder approval of this Agreement or consummation of the transactions contemplated by this Agreement will (A) entitle any employees of SCB or SCC Bank to severance pay or any increase in severance pay upon any termination of employment after the date hereof, (B) accelerate the time of payment or vesting or trigger any payment or funding (through a grantor trust or otherwise) of compensation or benefits under, increase the amount payable or trigger any other material obligation pursuant to, any of the Benefit Plans or other agreements, (C) result in any breach or violation of, or a default under, any of the Benefit Plans or (D) result in any payment that would be a “parachute payment” to a “disqualified individual” as those terms are defined in Section 280G of the Code, without regard to whether such payment is reasonable compensation for personal services performed or to be performed in the future.

     (n) Labor Matters. Neither SCB nor SCC Bank is a party to or bound by any collective bargaining agreement, contract or other agreement or understanding with a labor union or labor organization, nor is either SCB or SCC Bank the subject of a proceeding asserting that it has committed an unfair labor practice (within the meaning of the National Labor Relations Act) or seeking to compel SCB or SCC Bank to bargain with any labor organization as to wages or conditions of employment, nor is there any strike or other labor dispute involving it or, to SCB’s or SCC Bank’s Knowledge, threatened, nor is the SCB or SCC Bank aware of any activity involving its employees seeking to certify a collective bargaining unit or engaging in other organizational activity.

     (o) Environmental Matters.

     Except as set forth in Section 5.03(o) of the Disclosure Schedule, to the Knowledge of SCB and SCC Bank (based only on a review of our files relating to current loans or property): (i) SCB and SCC Bank have complied at all times with applicable Environmental Laws; (ii) no real property (including buildings or other structures) currently or formerly owned or operated by SCB or SCC Bank (“SCB Property”), has been contaminated with, or has had any illegal release of, any Hazardous Substance; (iii) SCB or SCC Bank has not taken legal title to or actively operated or actively managed any property in which SCB or SCC Bank has held a security interest, Lien or a fiduciary or management role (“SCB Loan Property”) that has been contaminated with, or has had any illegal release of, any Hazardous Substance; (iv) SCB or SCC Bank has not received any notice, demand letter, claim or request for information alleging any violation of, or liability under, any Environmental Law; (v) SCB or SCC Bank is not subject to any order, decree, injunction or other agreement with any Governmental

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Authority or any third party relating to any Environmental Law; and (vi) SCB has made available to FCB copies of all environmental reports, studies, sampling data, correspondence, filings and other environmental information, in each case in its possession or reasonably available to it, relating to past or present SCB Property or past or present SCB Loan Property.

     As used herein, the term “Environmental Laws” means any federal, state or local law, regulation, order, decree, permit, authorization, opinion, common law or agency requirement relating to: (A) the protection or restoration of the environment, health, safety, or natural resources, (B) the handling, use, presence, disposal, release or threatened release of any Hazardous Substance or (C) noise, odor, wetlands, indoor air, pollution, contamination or any injury or threat of injury to persons or property in connection with any Hazardous Substance and the term “Hazardous Substance” means any substance in any concentration that is: (A) listed, classified or regulated pursuant to any Environmental Law, (B) any petroleum product or by-product, asbestos-containing material, lead-containing paint or plumbing, polychlorinated biphenyls, radioactive materials or radon or (C) any other substance which is or may be the subject of regulatory action by any Governmental Authority in connection with any Environmental Law.

     (p) Tax Matters.

     (i) (A) All Tax Returns that are required to be filed on or before the Effective Date (taking into account any extensions of time within which to file which have not expired) by SCB, have been or will be timely filed on or before the Effective Date, (B) all such Tax Returns are or will be true and complete in all material respects, (C) all Taxes shown to be due on the Tax Returns referred to in clause (A) have been or will be timely paid in full, (D) all deficiencies asserted or assessments made by the relevant taxing authority with respect to such Tax Returns have been paid in full, (E) no issues that have been raised by the relevant taxing authority in connection with the examination of any of the Tax Returns referred to in clause (A) are currently pending and (F) no waivers of statutes of limitation have been given by or requested with respect to any Taxes of SCB or SCC Bank.

     (ii) SCB has made available to FCB true and correct copies of the United States federal income Tax Returns filed by SCB for each of the three most recent fiscal years ended on or before December 31, 2003.

     (iii) Neither SCB nor SCC Bank has any liability with respect to income, franchise or similar Taxes that accrued on or before the end of the most recent period covered by the Regulatory Filings filed prior to the date hereof in excess of the amounts accrued with respect thereto that are reflected in the financial statements included in the Regulatory Filings filed on or prior to the date hereof.

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     (iv) Neither SCB nor SCC Bank is a party to any Tax allocation or sharing agreement, is not and has never been a member of an affiliated group filing consolidated or combined Tax Returns (other than a group the common parent of which is or was SCB) or otherwise has any liability for the Taxes of any Person.

     (v) No closing agreements, private letter rulings, technical advice memoranda or similar agreement or rulings have been entered into or issued by any taxing authority with respect to SCB or SCC Bank other than determination letters with respect to Benefit Plans.

     (vi) All Taxes that SCB or SCC Bank is or was required by law to withhold or collect have been duly withheld or collected and, to the extent required by applicable law, have been paid to the proper Governmental Authority or other Person.

     (q) Risk Management Instruments. Neither SCB nor SCC Bank is a party to, nor has either agreed to enter into, an exchange traded or over-the-counter equity, interest rate, foreign exchange or other swap, forward, future, option, cap, floor or collar or any other contract that is a derivatives contract (including various combinations thereof) (each, a “Derivatives Contract”); and neither SCB nor SCC Bank owns any securities that (i) are referred to generically as “structured notes,” “high risk mortgage derivatives,” “capped floating rate notes” or “capped floating rate mortgage derivatives” or (ii) are reasonably likely to have changes in value as a result of interest or exchange rate changes that significantly exceed normal changes in value attributable to interest or exchange rate changes.

     (r) Books and Records. The books and records of SCB and SCC Bank have been fully, properly and accurately maintained in all material respects, and there are no unrectified material inaccuracies or discrepancies of any kind contained or reflected therein, and they fairly present the financial position of SCB and SCC Bank.

     (s) Insurance. Schedule 5.03(s) to the Disclosure Schedule sets forth a true and complete list of all of the insurance policies, binders, or bonds maintained by SCB and SCC Bank (“Insurance Policies”). SCB and SCC Bank are insured with reputable insurers against such risks and in such amounts as the management of SCB and SCC Bank reasonably have determined to be prudent in accordance with industry practices. All the Insurance Policies are in full force and effect; SCB and SCC Bank are not in material default thereunder; and all claims thereunder have been filed in due and timely fashion.

     (t) Allowance For Loan and Lease Losses. SCC Bank’s Allowance for Loan and Lease Losses (“ALLL”) is, and shall be as of the Effective Date, in compliance with SCC Bank’s existing methodology for determining the adequacy of its ALL as well as the standards established by applicable Governmental Authorities and the Financial Accounting Standards Board and is and shall be adequate under all such standards.

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     (u) Trust Business. Neither SCB nor SCC Bank serves as a trustee, agent, custodian, personal representative, guardian, conservator or investment advisor for any fiduciary accounts.

     (v) Transactions With Affiliates. Neither SCB nor SCC Bank has transactions with Affiliates within the meaning of Sections 23A and 23B of the Federal Reserve Act.

     (w) Real Property.

     (i) Schedule 5.03(w) to the Disclosure Schedule contains a complete and correct list of (A) all real property or premises owned on the date hereof, in whole or in part by SCB and all indebtedness secured by any encumbrance thereon, and (B) all real property or premises leased or subleased in whole or in part by SCB or SCC Bank and together with a list of all applicable leases and the name of the lessor. None of such premises or properties have been condemned or otherwise taken by any public authority and no condemnation or taking is threatened or contemplated and none thereof is subject to any claim, contract or law which would be reasonably likely to affect its use or value for the purposes now made of it. None of the premises or properties of SCB is subject to any current or potential interests of third parties or other restrictions or limitations that would impair or be inconsistent in any material respect with the current use of such property by SCB.

     (ii) Each of the leases referred to in the Disclosure Schedule is valid and existing and in full force and effect, and no party thereto is in default and no notice of a claim of default by any party has been delivered to SCB or SCC Bank or is now pending, and there does not exist any event that with notice or the passing of time, or both, would constitute a default or excuse performance by any party thereto, provided that with respect to matters relating to any party other than SCB or SCC Bank the foregoing representation is based on the Knowledge of SCB and SCC Bank.

     (x) Title. SCB and SCC Bank have good title to their properties and assets (other than (i) property as to which it is lessee and (ii) real estate owned as a result of foreclosure, transfer in lieu of foreclosure or other transfer in satisfaction of a debtor’s obligation previously contracted) except (1) statutory liens not yet delinquent which are being contested in good faith by appropriate proceedings, and liens for taxes not yet due, (2) pledges of assets in the ordinary course of business to secure public deposits, (3) for those assets and properties disposed of for fair value in the ordinary course of business since the date of SCB’s call report dated as of and for the year ended December 31, 2001 and (4) defects and irregularities of title and encumbrances that do not materially impair the use thereof for the purposes for which they are held.

     5.04. Representations and Warranties of FCB

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     Subject to Section 5.02, FCB and FC Bank hereby represent and warrant to SCB as follows:

     (a) Organization, Standing and Authority. FCB is a corporation duly organized and validly existing under the laws of the state of California. FC Bank is California banking corporation and its deposits are insured by the FDIC through the Bank Insurance Fund in the manner and to the fullest extent provided by law. FCB and FC Bank are duly qualified to do business and are in good standing in the State of California and any other foreign jurisdictions where their respective ownership or leasing of property or assets or the conduct of their business require them to be so qualified. FCB and FC Bank have in effect all federal, state, local, and foreign governmental authorizations necessary for each to own or lease their respective properties and assets and to carry on their business as they are now conducted.

     (b) FCB Stock and Capitalization. As of the date hereof, the authorized capital stock of FCB consists solely of 10,000,000 shares of FCB Common Stock and 10,000,000 shares of FCB Preferred Stock, of which no shares are outstanding as of the date hereof. As of the date of this Agreement, FCB has only minimal capital and the transactions to be completed at the Closing will depend on FCB’s successfully completing its capitalization. The authorized capital stock of FC Bank consists solely of 2,500,000 shares of common stock, of which 2,162,809 shares are outstanding as of the date hereof.

     (c) Subsidiaries. The Merger Subsidiary and each of FCB’s Significant Subsidiaries has been duly organized and is validly existing in good standing under the laws of the jurisdiction of its organization, and is duly qualified to do business and in good standing in the jurisdictions where its ownership or leasing of property or the conduct of its business requires it to be so qualified and it owns, directly or indirectly, all the issued and outstanding equity securities of each of its Significant Subsidiaries. FC Bank is duly licensed by the DFI, and its deposits are insured by the Bank Insurance Fund in the manner and to the fullest extent provided by law.

     (d) Corporate Power. FCB and each of its Significant Subsidiaries has the corporate power and authority to carry on its business as it is now being conducted and to own all its properties and assets; FCB has the corporate power and authority to execute, deliver and perform its obligations under this Agreement and to consummate the transactions contemplated hereby; and FCB has the corporate power and authority to execute, deliver and perform its obligations to consummate the transactions contemplated thereby.

     (e) Corporate Authority. This Agreement and the transactions contemplated hereby have been authorized by all necessary corporate action of FCB, FC Bank, and the Merger Subsidiary and each of their respective boards. This Agreement has been duly executed and delivered by FCB, FC Bank, and the Merger Subsidiary and this Agreement is a valid and legally binding agreement of FCB, FC Bank, and the Merger Subsidiary enforceable in accordance with its terms (except as enforceability may be limited by

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applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent transfer and similar laws of general applicability relating to or affecting creditors’ rights or by general equity principles).

     (f) Regulatory Approvals; No Violations.

     (i) No consents or approvals of, or waivers by, or filings or registrations with, any Governmental Authority or with any third party are required to be made or obtained by FCB or any of its Significant Subsidiaries in connection with the execution, delivery or performance by FCB of this Agreement or to consummate the Merger except for (A) filings of applications or notices with and approvals or waivers by the Federal Reserve Board, the DFI and the FDIC, as may be required, (B) filings with the SEC and state securities authorities, and (C) the filing of the Agreement of Merger with the California Secretary pursuant to the CCC. As of the date hereof, neither FCB nor FC Bank have knowledge of any reason why the approvals set forth in Section 7.01(b) will not be received in a timely manner and without the imposition of a condition, restriction or requirement of the type described in Section 7.01(b).

     (ii) Subject to receipt, or the making, of the consents, approvals and filings referred to in the preceding paragraph and expiration of the related waiting periods, the execution, delivery and performance of this Agreement by FCB, FC Bank, and the Merger Subsidiary and the consummation of the transactions contemplated hereby do not and will not (A) constitute a breach or violation of, or a default under, or give rise to any Lien, any acceleration of remedies or any right of termination under, any material law, rule or regulation or any judgment, decree, order, governmental permit or license, or Agreement, indenture or instrument of FCB or of any of its Subsidiaries or to which FCB or any of its Subsidiaries or properties is subject or bound, (B) constitute a breach or violation of, or a default under, the articles of incorporation or by-laws (or similar governing documents) of FCB or any of its Subsidiaries or (C) require any consent or approval under any material law, rule, regulation, judgment, decree, order, governmental permit or license, agreement, indenture or instrument.

     (g) Financial Reports; Material Adverse Effect. FC Bank has delivered to SCB audited financial statements of FC Bank consisting of balance sheets as of December 31, 2003, 2002 and 2001, the related statements of operations, changes in shareholders’ equity and statements of cash flow for the periods then ended, and the related notes and related accountant’s opinions thereon (the “FC Bank Financial Statements”). The FC Bank Financial Statements (i) present fairly the financial condition of FC Bank as of the respective dates indicated and the results of operations, the changes in stockholders’ equity and cash flows for the respective periods indicated; (ii) have been prepared in accordance with GAAP applied on a basis consistent with past practices; (iii) contain and reflect reserves for all material accrued liabilities and for all reasonably anticipated losses, including but not limited to adequate reserves for loan and lease losses; and (iv) are based on the books and records of FC Bank. Since

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December 31, 2001, FC Bank has conducted its business in the ordinary and usual course consistent with past practice (excluding the incurrence of expenses related to this Agreement and the transactions contemplated hereby) and no event has occurred or circumstance arisen that, individually or taken together with all other facts, circumstances and events (described in any paragraph of this Section 5.04 or otherwise), would reasonably be expected to have a Material Adverse Effect with respect to FC Bank or FCB.

     (h) Litigation. No material litigation, claim or other proceeding before any court or governmental agency is pending against FCB or its Subsidiaries and, to FCB’s Knowledge, no such litigation, claim or other proceeding has been threatened and there are no facts which could reasonably give rise to such litigation, claim or other proceeding.

     (i) No Brokers. Except for the fees and related costs paid to Anderson & Strudwick, no action has been taken by FCB or its Subsidiaries that would give rise to any valid claim against any party hereto for a brokerage commission, finder’s fee or other like payment with respect to the transactions contemplated by this Agreement.

     (j) Regulatory Matters.

     (i) Neither FCB nor FC Bank nor any of their respective properties are, directly or indirectly, party to or are subject to any order, decree, agreement, memorandum of understanding or similar arrangement with, or a commitment letter or similar submission to, or extraordinary supervisory letter from, any Regulatory Authority. FCB and FC Bank have paid all assessments made or imposed by any Regulatory Authority.

     (ii) Neither FCB nor FC Bank have been advised by, or have any Knowledge of facts which could give rise to an advisory notice by, any Regulatory Authority that such Regulatory Authority is contemplating issuing or requesting (or is considering the appropriateness of issuing or requesting) any such order, decree, agreement, memorandum of understanding, commitment letter, supervisory letter or similar submission.

     (k) Tax Matters.

     (i) (A) All Tax Returns that are required to be filed on or before the Effective Date (taking into account any extensions of time within which to file which have not expired) by or with respect to FCB and FC Bank, have been or will be timely filed on or before the Effective Date, (B) all such Tax Returns are or will be true and complete in all material respects, (C) all Taxes shown to be due on the Tax Returns referred to in clause (A) have been or will be timely paid in full, (D) all deficiencies asserted or assessments made with respect to such Tax Returns have been paid in full, (E) no issues that have been raised by the relevant taxing authority in connection with the Tax Returns referred to in clause (A) are

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currently pending and (F) no waivers of statues of limitation have been given by or requested with respect to any Taxes of FCB or FC Bank.

     (ii) Neither FCB nor FC Bank have any liability with respect to income, franchise or similar Taxes that accrued on or before the end of the most recent period covered by the Regulatory Filings filed prior to the date hereof in excess of the amounts accrued with respect thereto that are reflected in the financial statements included in the Regulatory Filings filed on or prior to the date hereof.

ARTICLE VI
COVENANTS

     6.01. Reasonable Best Efforts

     Subject to the terms and conditions of this Agreement, each of SCB, SCC Bank, FCB, and FC Bank agrees to use its reasonable best efforts in good faith to take, or cause to be taken, all actions, and to do, or cause to be done, all things necessary, proper or desirable, or advisable under applicable laws, so as to permit consummation of the Merger and the Second Merger as promptly as practicable and otherwise to enable consummation of the transactions contemplated hereby, including the satisfaction of the conditions set forth in Article VII hereof, and shall cooperate fully with the other party hereto to that end.

     6.02. Shareholder Approval

     SCB agrees to take, in accordance with applicable law and SCB’s Articles and SCB’s By-Laws, all action necessary to convene as soon as practicable a meeting of its shareholders to consider and vote upon the approval of this Agreement and the Merger and any other matters required to be approved by SCB’s shareholders for consummation of the Merger (including any adjournment or postponement, the “SCB Meeting”). Except with the prior approval of FCB, no other matters shall be submitted for the approval of SCB shareholders. Subject to fiduciary obligations under applicable law, SCB’s Board shall at all times prior to and during such meeting recommend such approval and shall take all reasonable lawful action to solicit such approval by its shareholders.

     6.03. Proxy Statement

     The proxy statement and/or any other related materials or documents (collectively, the “Proxy Materials”), to be used in connection with the SCB Meeting required pursuant to Section 6.02 hereof, with respect to all information set forth therein relating to SCB, and the Merger and in respect to this Agreement, and the Merger Agreement, at the time of mailing to shareholders and at the time of the shareholders’ meeting, shall: (i) comply in all material respects with the provisions of all applicable laws and regulations; and (ii) except with respect to any information regarding FCB or

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FC Bank supplied to SCB by FCB or FC Bank for inclusion in the Proxy Materials, not contain any statement which, at the time and in light of the circumstances under which it is made, is false or misleading with respect to any material fact or not omit to state any material fact necessary in order to make the statements therein not false or misleading.

     6.04. Press Releases

     SCB and SCC Bank, on one hand, and FCB and FC Bank, on the other hand, shall consult with each other before issuing any press release with respect to the Merger or this Agreement and shall not issue any such press release or make any such public statements without the prior consent of the other party, which shall not be unreasonably withheld; provided, however, that a party may, without the prior consent of the other party (but after such consultation, to the extent practicable in the circumstances), issue such press release or make such public statements as may upon the advice of outside counsel be required by law or the rules or regulations of Nasdaq. SCB, SCC Bank, FCB and FC Bank shall cooperate to develop all public announcement materials and make appropriate management available at presentations related to the transactions contemplated by this Agreement as reasonably requested by the other party.

     6.05. Access; Information

     (a) Each party agrees that upon reasonable notice and subject to applicable laws relating to the exchange of information, it shall afford the other party and its officers, employees, counsel, accountants and other authorized representatives such access during normal business hours throughout the period prior to the Effective Time to the books, records (including, without limitation, Tax Returns and work papers of independent auditors), properties and personnel and to such other information as such party may reasonably request and, during such period, it shall, as promptly as is reasonably practicable, furnish to the other party all information concerning its business, properties and personnel as such party may reasonably request.

     (b) Without limiting the generality of Section 6.05(a), prior to the Effective Time, each party and its respective representatives shall have the right, subject to the notice provision set forth in Section 6.05(a), to conduct a review to determine (i) that the assets, books, records and operations of the other party are in satisfactory condition and will not in a material way adversely impact such party after consummation of the transactions contemplated hereby and (ii) the accuracy of the representations and warranties and the satisfaction of the conditions to closing as provided hereunder.

     (c) SCB agrees that, subject to applicable laws, it shall cooperate in good faith with FCB on mutually agreed operating issues which the parties agree have priority.

     (d) Each party agrees that it will not, and will cause its representatives not to, use any information obtained pursuant to this Section 6.05 (as well as any other information obtained prior to the date hereof in connection with the entering into of this Agreement) for any purpose unrelated to the consummation of the transactions

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contemplated by this Agreement. Subject to the requirements of law, each party shall keep confidential, and shall cause its representatives to keep confidential, all information and documents obtained pursuant to this Section 6.05 (as well as any other information obtained prior to the date hereof in connection with the entering into of this Agreement) unless such information (i) was already known to such party, (ii) becomes available to such party from other sources not known by such party to be bound by a confidentiality obligation, (iii) is disclosed with the prior written approval of the party to which such information pertains or (iv) is or becomes readily ascertainable from publicly available sources. In the event that this Agreement is terminated or the transactions contemplated by this Agreement shall otherwise fail to be consummated each party shall promptly cause all copies of documents or extracts thereof containing information and data as to another party hereto to be returned to the party which furnished the same. No investigation by any party of the business and affairs of any other party shall affect or be deemed to modify or waive any representation, warranty, covenant or agreement in this Agreement, or the conditions to any party’s obligation to consummate the transactions contemplated by this Agreement.

     6.06. Acquisition Proposals

     SCB agrees that its officers and directors shall not, and that it shall direct and use its best efforts to cause SCC Bank and South Coast Commercial Bank’s employees, agents and representatives not to, directly or indirectly, initiate, solicit, encourage or otherwise facilitate any inquiries or the making of any proposal or offer with respect to a merger, reorganization, share exchange, consolidation or similar transaction involving, or any purchase of all or substantially all of the assets of SCB or more than 10% of the outstanding equity securities, of SCB (any such proposal or offer being hereinafter referred to as an “Acquisition Proposal”). SCB further agrees that neither SCB nor SCC Bank nor any of their respective officers and directors shall, and that SCB shall direct and use its reasonable best efforts to cause SCC Bank and SCC Bank’s employees, agents and representatives not to, directly or indirectly, engage in any negotiations concerning, or provide any confidential information or data to, or have any discussions with, any Person relating to an Acquisition Proposal, or otherwise facilitate any effort or attempt to make or implement an Acquisition Proposal; provided, however, that nothing contained in this Agreement shall prevent SCB or SCB’s Board from (A) complying with its disclosure obligations under federal or state law; (B) providing information in response to a request therefore by a Person who has made an unsolicited bona fide written Acquisition Proposal if SCB’s Board receives from the Person so requesting such information an executed confidentiality agreement; (C) engaging in any negotiations or discussions with any Person who has made an unsolicited bona fide written Acquisition Proposal; or (D) recommending such an Acquisition Proposal to the shareholders of SCB, if and only to the extent that, (i) in each such case referred to in clause (B), (C) or (D) above, SCB’s Board determines in good faith (after consultation with outside legal counsel) that such action is, in the absence of the foregoing proscriptions, legally required in order for its directors to comply with their respective fiduciary duties under applicable law and (ii) in the case referred to in clause (D) above, SCB’s Board determines in good faith (after consultation with its financial advisor) that such Acquisition Proposal, if accepted, is

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reasonably likely to be consummated, taking into account all legal, financial and regulatory aspects of the proposal and the Person making the proposal and would, if consummated, result in a transaction more favorable to SCB’s shareholders than the Merger. SCB agrees that it will immediately cease and cause to be terminated any existing activities, discussions or negotiations with any parties conducted heretofore with respect to any Acquisition Proposals. SCB agrees that it will notify FCB within two Business Days if any such inquiries, proposals or offers are received by, any such information is requested from, or any such discussions or negotiations are sought to be initiated or continued with, any of its representatives.

     6.07. [Reserved]

     6.08. [Reserved]

     6.09. Certain Policies

     Prior to the Effective Date, SCB and SCC Bank shall, consistent with GAAP, the rules and regulations of the SEC and applicable banking laws and regulations, modify or change its loan, OREO, accrual, reserve, tax, litigation and real estate valuation policies and practices (including loan classifications and levels of reserves) so as to be applied on a basis that is consistent with past practice of SCB; provided, however, that no such action shall in itself be a breach under Section 8.01(b) of this Agreement.

     6.10. Regulatory Applications

     (a) Each of FCB, FC Bank, SCB, and SCC Bank shall cooperate and use their respective reasonable best efforts to prepare all documentation, to effect all filings and to obtain all permits, consents, approvals and authorizations of all third parties and Governmental Authorities necessary to consummate the transactions contemplated by this Agreement; and any initial filings with Governmental Authorities (other than the Registration Statement) shall be made by FCB and FC Bank, as applicable, as soon as reasonably practicable after the execution hereof but, provided that SCB has cooperated as described above, in no event later than 60 days after the date hereof. Each of FCB and SCB shall have the right to review in advance, and to the extent practicable each shall consult with the other, in each case subject to applicable laws relating to the exchange of information, with respect to all material written information submitted to any third party or any Governmental Authority in connection with the transactions contemplated by this Agreement. In exercising the foregoing right, each of such parties agrees to act reasonably and as promptly as practicable. Each party hereto agrees that it shall consult with the other parties hereto with respect to the obtaining of all material permits, consents, approvals and authorizations of all third parties and Governmental Authorities necessary or advisable to consummate the transactions contemplated by this Agreement and each party shall keep the other parties apprised of the status of material matters relating to completion of the transactions contemplated hereby.

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     (b) Each party agrees, upon request, to furnish the other parties with all information concerning itself, its Subsidiaries, directors, officers and shareholders and such other matters as may be reasonably necessary or advisable in connection with any filing, notice or application made by or on behalf of such other parties or any of their respective Subsidiaries to any third party or Governmental Authority.

     6.11. Indemnification

     (a) Following the Effective Time, FCB shall indemnify, defend and hold harmless each present and former director and officer of SCB and its Subsidiary (each, an “Indemnified Party") against all costs or expenses (including reasonable attorneys’ fees), judgments, fines, losses, claims, damages or liabilities (collectively, “Costs") incurred in connection with any claim, action, suit, proceeding or investigation, whether civil, criminal, administrative or investigative, arising out of actions or omissions occurring at or prior to the Effective Time (including, without limitation, the transactions contemplated by this Agreement, or any related agreement, but excluding any Costs arising out of any violation or alleged violation of the Exchange Act or the rules and regulations thereunder with respect to insider trading) to the fullest extent that SCB is permitted to indemnify (and advance expenses to) its directors or officers under the CCC, SCB’s Articles and SCB’s By-Laws as in effect on the date hereof; provided that any determination required to be made with respect to whether an officer’s or director’s conduct complies with the standards set forth under the CCC, SCB’s Articles and SCB’s By-Laws shall be made by independent counsel selected by FCB and reasonably acceptable to the Indemnified Party.

     (b) For a period of three (3) years from the Effective Time, FCB shall use its commercially reasonable efforts to provide that portion of director’s and officer’s liability insurance that serves to reimburse the present and former officers and directors (determined as of the Effective Time) of SCB (as opposed to the portion that serves to reimburse SCB) with respect to claims against such directors and officers arising from facts or events which occurred before the Effective Time, which insurance shall contain at least the same coverage and amounts, and contain terms and conditions no less advantageous, as that coverage currently provided by SCB; provided, however, that in no event shall FCB be required to expend on an annual basis more than 150% of the current amount expended on an annual basis by SCB (the “Insurance Amount") to maintain or procure such directors and officers insurance coverage; provided, further, that if FCB is unable to maintain or obtain the insurance called for by this Section 6.11(b), FCB shall use its commercially reasonable efforts to obtain as much comparable insurance as is available for the Insurance Amount; provided, further, that officers and directors of SCB may be required to make application and provide customary representations and warranties to FCB’s insurance carrier for the purpose of obtaining such insurance.

     (c) Any Indemnified Party wishing to claim indemnification under Section 6.11(a), upon learning of any claim, action, suit, proceeding or investigation described above, shall promptly notify FCB thereof; provided that the failure so to notify

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shall not affect the obligations of FCB under Section 6.11(a) unless and to the extent that FCB is actually prejudiced as a result of such failure.

     (d) If FCB or any of its successors or assigns shall consolidate with or merge into any other entity and shall not be the continuing or surviving entity of such consolidation or merger or shall transfer all or substantially all of its assets to any other entity, then and in each case, proper provision shall be made so that the successors and assigns of FCB shall assume the obligations set forth in this Section 6.11.

     6.12. Benefit Plans

     (a) From and after the Effective Time, FCB shall provide former employees of SCB or SCC Bank who remain as employees of FCB or any of its Subsidiaries with employee benefit plans no less favorable in the aggregate than those provided to similarly situated employees of FCB or its Subsidiaries, as the case may be. FCB shall cause each employee benefit plan, program, policy or arrangement of FCB in which employees of SCB or SCC Bank are eligible to participate to take into account for purposes of eligibility and vesting thereunder the service of such employees with SCB or SCC Bank to the same extent as such service was credited for such purpose by SCB or SCC Bank. Nothing herein shall limit the ability of FCB to amend or terminate any of the Benefit Plans in accordance with their terms at any time.

     (b) If employees of SCB or SCC Bank become eligible to participate in a medical, dental or health plan of FCB, FCB shall cause, to the extent practicable, each such plan to (i) waive any preexisting condition limitations to the extent such conditions were covered under the applicable medical, health or dental plans of SCB or SCC Bank, (ii) honor under such plans any deductible, co-payment and out-of-pocket expenses incurred by the employees and their beneficiaries during the portion of the calendar year prior to such participation and (iii) waive any waiting period limitation or evidence of insurability requirement which would otherwise be applicable to such employee on or after the Effective Time to the extent such employee had satisfied any similar limitation or requirement under an analogous plan prior to the Effective Time.

     (c) FCB shall honor, and shall continue to be obligated to perform, in accordance with their terms, all employment or severance agreements, plans or policies of SCB that are identified in Schedule 6.12 hereto.

     (d) Notwithstanding the provisions of this Section 6.12, the parties hereto agree that certain matters respecting employee benefits shall be dealt with in a letter, dated the date hereof, between the parties and hereby incorporated by reference and made a part hereof.

     6.13. Non-Competition Agreements

     Each director of SCB (other than Van Rhebeck, who shall execute and deliver to FCB a Non-Solicitation Agreement in the form attached hereto as Exhibit E), shall,

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simultaneously with the execution and delivery hereof, execute and deliver to FCB non-competition agreements substantially in the form of Exhibit B hereto.

     6.14. Notification of Certain Matters

     Each of SCB and FCB shall give prompt notice to the other of any fact, event or circumstance known to it that (i) is reasonably likely, individually or taken together with all other facts, events and circumstances known to it, to result in any Material Adverse Effect with respect to it or (ii) would cause or constitute a material breach of any of its representations, warranties, covenants or agreements contained herein.

     6.15. Human Resources Issues

     SCB agrees to cooperate with FCB with respect to any formal meetings or interviews with one or more employees called or arranged by SCB and held for the purpose of discussing the transactions contemplated by this Agreement or their effect on such employees, with FCB given the opportunity to participate in such meetings or interviews. This section is not intended to apply to casual conversations about the transaction or informal meetings initiated by employees, or to prohibit discussion in general, but rather to allow FCB a role in the formal presentation of the transaction to employees, and an opportunity to participate in the significant, formal meetings at which the transaction is explained and discussed.

     6.16. Assistance with Third-Party Agreements

     (a) SCB shall cooperate with and use all commercially reasonable efforts to assist FCB in (i) gaining access to and obtaining any required consents from all of its third-party vendors, landlords of all of SCB’s leased properties and other parties to material agreements, promptly after the date of this Agreement, and (ii) obtaining the cooperation of such third parties in a smooth transition in accordance with FCB’s timetable at or after the Effective Time of the Merger. SCB shall cooperate with FCB in minimizing the extent to which any contracts will continue in effect following the Effective Time of the Merger, in addition to complying with the prohibition of Section 4.01(l) hereof.

     (b) Without limiting Section 6.16(a), SCB shall use all reasonable efforts to provide data processing and other processing support or outside contractors to assist FCB in performing all tasks reasonably required to result in a successful conversion of their data and other files and records to FCB’s production environment, when requested by FCB and sufficient to ensure that a successful conversion can occur at such time as FCB requests on or after the Effective Time of the Merger. Among other things, SCB shall:

     (i) cooperate with FCB to establish a mutually agreeable project plan to effectuate the conversion;

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     (ii) use their commercially reasonable efforts to have SCB’s outside contractors continue to support both the conversion effort and its needs until the conversion can be established;

     (iii) provide, or use its commercially reasonable efforts to obtain from any outside contractors, all data or other files and layouts requested by FCB for use in planning the conversion, as soon as reasonably practicable;

     (iv) provide reasonable access to personnel at corporate headquarters, data and other processing centers, all branches and, with the consent of outside contractors, at outside contractors, to enable the conversion effort to be completed on schedule; and

     (v) to the extent reasonably practicable, give notice of termination, conditioned upon the completion of the transactions contemplated hereby, of the contracts of outside data and other processing contractors or other third-party vendors when directed to do so by FCB.

     (vi) FCB agrees that all actions taken pursuant to this Section 6.16 shall be taken in a manner intended to minimize disruption to the customary business activities of SCB.

     6.17. Second Merger

     Immediately after the Effective Time of the Merger, the Surviving Company shall merge with and into FCB, the separate corporate existence of the Surviving Company shall cease and FCB shall survive, continue to exist as a California corporation and operate under the name “First California Bancorp.”

     6.18. Shareholder Agreements

     Each Shareholder, as a shareholder of SCB Common Stock, shall execute and deliver to FCB simultaneously with the execution of this Agreement a Shareholder Agreement substantially in the form of Exhibit A hereto, committing each such person, among other things, to vote his or her shares of SCB Common Stock in favor of the principal terms of the Merger at the SCB Meeting and to certain representations and covenants.

     6.19. Pre-Closing Adjustments

     At or before the Effective Time of the Merger, SCB and SCC Bank shall make such accounting entries or adjustments, including additions to their ALLL and charge-offs of loans, as FCB shall direct as a result of its on-going review of SCB and SCC Bank (including its review of the information provided to it pursuant to Sections 6.05 and 6.15), in order to implement its plans following the closing of the transactions constituting the Merger and the Second Merger (the “Closing”), and to reflect expenses

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and costs related to the Merger; provided, however, that unless the adjustment would otherwise be required by applicable law, rule or regulation, or by regulatory accounting principles or GAAP applied on a basis consistent with the financial statements of SCB, (a) SCB shall not be required to take such actions more than one day prior to the Effective Time of the Merger or prior to the time FCB agrees in writing that all of the conditions to its obligation to close as set forth in Section 7.02 have been satisfied or waived and each of the approvals in Section 7.01(b) have been received, (b) no such accounting entry or adjustment shall be required or made if it would (i) violate any law, rule or regulation applicable to FCB, or (ii) constitute or be deemed to be a breach, violation of or failure to satisfy any representation, warranty, covenant, condition or other provision of this Agreement or otherwise be considered in determining whether any such breach, violation or failure to satisfy shall have occurred, and (c) Adjusted Shareholders’ Equity and Adjusted Merger Consideration shall be determined as if none of such accounting entries and adjustments had been made, other than those required by GAAP.

     6.20. Tax Treatment of the Merger and Second Merger

     FCB and SCB intend that the Merger and Second Merger will be treated for U.S. federal income tax purposes as a taxable purchase of all of the outstanding stock of SCB by FCB, followed by the liquidation of SCB pursuant to Section 332 of the Code. Each party will (and will cause each of its Subsidiaries to) both before and after the Effective Time (i) use reasonable efforts to cause the Merger and Second Merger to have such tax treatment; (ii) refrain from taking any action that would reasonably be expected to cause the Merger or Second Merger to be treated any other way for U.S. federal income tax purposes; (iii) file all Tax returns consistent with such tax treatment, and (iv) take the position for all other purposes that the Merger and Second Merger will have such tax treatment. Buyer shall not file an election under Section 338 of the Code with respect to the Merger.

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     6.21. Non-Solicitation Agreement

     Each of Van Rhebeck and Fred Mills shall execute and deliver to FCB simultaneously with the execution of this Agreement a Non-Solicitation Agreement substantially in the form of Exhibit E hereto.

     6.22. Bank Holding Company Status

     FCB shall use its best efforts to promptly obtain, at or before the Closing, all regulatory consents, approvals and authorizations from the Federal Reserve Board as are necessary for it to become a bank holding company, to acquire SCB as a wholly-owned subsidiary and then merge it into FCB, to retain SCC Bank as a wholly-owned subsidiary of FCB and to carry out and consummate the transactions contemplated herein.

     6.23. Capital Raising

     FCB shall use its best efforts to raise no less than $24.0 million from a combination of a public offering of its common stock and issuance of trust preferred securities, the proceeds of which will be used, at least in part, to capitalize FCB and consummate the transactions contemplated herein.

     6.24 Employment and Other Agreements

     At the Effective Time of the Merger, SCC Bank shall terminate the employment agreements and such other agreements between SCC Bank and each of its current executive officers, a list of which is set forth on Schedule 6.24 hereto. As a result of the proposed Merger and the termination of such employment agreements, each officer listed on Schedule 6.24 hereto shall be entitled to receive a payment in the amount set forth beside the name of such officer on Schedule 6.24 hereto (the “Executive Payments”), which payments include all severance, automobile accruals and other benefits payable to such officer upon termination of such officer’s employment agreement as well as the commission payable to Van Rhebeck in connection with the Merger. SCC Bank shall pay one-half of the total Executive Payments prior to the Closing Date, and one-half of the total Executive Payments shall remain accrued and unpaid on the Closing Date to be paid unconditionally by the Surviving Corporation or its successor within one month after the Closing Date.

     6.25 Accrual of Expenses Related to the Merger

     Prior to the Shareholders’ Equity Measuring Date (as defined in Section 7.03(e)), SCB shall accrue in accordance with GAAP for all unpaid expenses related to the Merger including, without limitation, the amount of all Executive Payments not yet paid pursuant to Section 6.24, only Sixty-Seven Thousand Five Hundred Dollars ($67,500.00) of unpaid severance benefits (in addition to the Executive Payments, and regardless of the

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actual other severance accruable or payable at such time), and all of those transaction fees and expenses which are to be paid pursuant to Section 7.03(i).

ARTICLE VII
CONDITIONS TO CONSUMMATION OF THE MERGER

     7.01. Conditions to Each Party’s Obligation to Effect the Merger

     The respective obligation of each of the parties hereto to consummate the Merger is subject to the fulfillment or written waiver by the parties hereto prior to the Effective Time of each of the following conditions:

     (a) Shareholder Approvals. The principal terms of the Merger shall have been duly approved by the affirmative vote of a majority of the outstanding shares of SCB Common Stock entitled to vote or such higher vote percentage as may be required by SCB’s Articles, SCB’s Bylaws or other binding agreement.

     (b) Regulatory Approvals. All regulatory approvals required to consummate the transactions contemplated hereby, including the Merger and the Second Merger, shall have been obtained and shall remain in full force and effect and all statutory waiting periods in respect thereof shall have expired and no such approvals shall contain any conditions, restrictions or requirements which the FCB Board reasonably determines in good faith would (i) following the Effective Time, have a Material Adverse Effect on FCB and its Subsidiaries taken as a whole or (ii) reduce the benefits of the transactions contemplated hereby to such a degree that FCB would not have entered into this Agreement had such conditions, restrictions or requirements been known at the date hereof.

     (c) No Injunction; No Litigation. No Governmental Authority of competent jurisdiction shall have enacted, issued, promulgated, enforced or entered any statute, rule, regulation, judgment, decree, injunction or other order (whether temporary, preliminary or permanent) which is in effect and prohibits consummation of the transactions contemplated by this Agreement, and no litigation or proceeding shall be pending against FCB, First California Bank, SCB or SCC Bank brought by any Governmental Authority seeking to prevent consummation of the transactions contemplated hereby.

     (d) Executive Payments. One-half of the total of all Executive Payments shall have been paid by SCC Bank prior to the Closing Date, and one-half of the total of all Executive Payments shall remain unpaid as of the Closing Date.

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     7.02. Conditions to Obligation of SCB

     The obligation of SCB to consummate the Merger is also subject to the fulfillment or written waiver prior to the Effective Time of each of the following additional conditions:

     (a) Representations and Warranties. The representations and warranties of FCB and FC Bank set forth in this Agreement shall be true and correct as of the date of this Agreement and as of the Effective Date as though made on and as of the Effective Date (except that representations and warranties that by their terms speak as of the date of this Agreement or some other date shall be true and correct as of such date). For purposes of this paragraph, such representations and warranties shall be deemed to be true and correct in all material respects unless the failure or failures of such representations and warranties to be true and correct in all material respects, either individually or in the aggregate, and without giving effect to any materiality, material adverse effect or similar qualifications set forth in such representations and warranties, will have or would reasonably be expected to have a Material Adverse Effect on FCB or FC Bank. FCB and FC Bank shall have performed, in all material respects, each of its covenants and agreements contained in this Agreement. SCB shall have received a certificate, dated the Effective Date, signed on behalf of FC Bank by the chief executive officer and the chief financial officer of FC Bank to such effect.

     (b) Performance of Obligations of FCB. FCB, the Merger Subsidiary and FC Bank shall have performed in all material respects all obligations required to be performed by them under this Agreement at or prior to the Effective Time, and SCB shall have received a certificate, dated the Effective Date, signed on behalf of FC Bank by the chief executive officer and the chief financial officer of FC Bank to such effect.

     7.03. Conditions to Obligation of FCB

     The obligation of FCB to consummate the Merger is also subject to the fulfillment or written waiver prior to the Effective Time of each of the following conditions:

     (a) Representations and Warranties. The representations and warranties of SCB set forth in this Agreement shall be true and correct as of the date of this Agreement and as of the Effective Date as though made on and as of the Effective Date (except for changes after the date of delivery of the Disclosure Schedules). For purposes of this paragraph, such representations and warranties shall be deemed to be true and correct in all material respects unless the failure or failures of such representations and warranties to be true and correct in all material respects, either individually or in the aggregate, and without giving effect to any materiality, material adverse effect or similar qualifications set forth in such representations and warranties, will have or would reasonably be expected to have a Material Adverse Effect on SCB. SCB shall have performed, in all material respects, each of its covenants and agreements contained in this Agreement.

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FCB shall have received a certificate, dated the Effective Date, signed on behalf of SCB by the chief executive officer and the chief financial officer of SCB to the foregoing effects, with any exceptions disclosed, and if there are any exceptions, such conditions shall be considered satisfied only if and when such exceptions are accepted by FCB; provided, however, Closing shall conclusively evidence such acceptance of exceptions by FCB.

     (b) Disclosure Schedule. The Disclosure Schedule shall be further updated and made current prior to the Effective Time of the Merger and a draft of the updated Disclosure Schedule shall have been delivered to FCB no later than 72 hours prior to the Effective Time of the Merger; and at the Effective Time, such updated Disclosure Schedule shall be deemed the Disclosure Schedule for purposes of closing certifications of officers as to the representations and warranties set forth in Section 5.03, the performance of covenants contained in Article IV, and the performance of any other obligations required to be performed by SCB under this Agreement. With respect to each change in the Disclosure Schedule delivered to FCB after the date of this Agreement, such change shall become effective prior to the Closing Date when either (i) such change shall be accepted by FCB in its discretion, or (ii) FCB shall not have notified SCB in writing within ten (10) Business Days after receipt of such change that such change was unacceptable to FCB.

     (c) Performance of Obligations of SCB. SCB shall have performed in all material respects all obligations required to be performed by it under this Agreement at or prior to the Effective Time, and FCB shall have received a certificate, dated the Effective Date, signed on behalf of SCB by the chief executive officer and the chief financial officer of SCB to such effect.

     (d) Performance of Obligations of the Shareholders. FCB shall have received Shareholder’s Agreements executed and delivered by each Shareholder of SCB as contemplated by Section 6.19, each of which shall remain in full force and effect. The Shareholders shall have performed in all material respects all obligations required to be performed by them under the Shareholder Agreements. If requested by FCB, FCB shall have received a certificate, dated the Effective Date, signed by each Shareholder to such effect with respect to such Shareholder.

     (e) Adjusted Shareholders’ Equity of SCB. As of four (4) Business Days prior to the Effective Date, (i) the parties shall determine the exact dollar difference between the Base Shareholders’ Equity and the Adjusted Shareholders’ Equity of SCB as of five (5) Business Days prior to the Effective Date (the “Shareholders’ Equity Measuring Date”).

     (f) Closing Financial Statements. At least five Business Days prior to the Effective Time of the Merger, SCB shall provide FCB with SCB’s financial statements presenting the financial condition of SCB as of the close of business on the last day of the last month ended prior to the Effective Time of the Merger and SCB’s results of operations for the period January 1, 2005 through the close of business on the last day of

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the last month ended prior to the Effective Time of the Merger (the “Closing Financial Statements”); provided, however, that if the Effective Time of the Merger occurs on or before the sixth Business Day of the month, SCB shall have provided consolidated financial statements as of and through the second month preceding the Effective Time of the Merger. Such financial statements shall have been prepared in all material respects in accordance with GAAP and regulatory accounting principles and other applicable legal and accounting requirements, and reflect all period-end accruals and other adjustments. Such financial statements shall be accompanied by a certificate of SCB’s chief financial officer, dated as of a date no earlier than two Business Days prior to the Effective Time of the Merger, to the effect that such financial statements continue to reflect accurately, as of the date of the certificate, the financial condition of FCB in all material respects.

     (g) Non-Competition Agreements. FCB shall have received Non-Competition Agreements executed and delivered by each director of SCB as contemplated by Section 6.14 who shall have executed and delivered to FCB a Non-Solicitation Agreement in the form attached hereto as Exhibit E, each of which shall remain in full force and effect.

     (h) Consents. SCB shall have obtained each of the material consents listed in Schedule 5.03 of the Disclosure Schedule and any material consents of the type required to be identified in Schedule 5.03 of the Disclosure Schedule but were not so identified as of the date of this Agreement. A copy of each such consent shall have been delivered to FCB.

     (i) Transaction Expenses. SCB shall exercise its commercially reasonable efforts to ensure that at least five (5) Business Days prior to the Effective Time of the Merger, all attorneys, accountants, investment bankers and other advisors and agents for SCB shall have submitted to SCB estimates of their fees and expenses for all services rendered or to be rendered in any respect in connection with the transactions contemplated hereby to the extent not already paid, and based on such estimates, SCB shall have prepared and submitted to FCB a summary of such fees and expenses for the transaction. At or prior to the Effective Time of the Merger SCB shall use its best efforts to (i) cause such advisors to submit their final bills for all material fees and expenses to SCB for services rendered, a copy of which SCB shall have caused to be delivered to FCB, and based on such summary, SCB shall have prepared and submitted to FCB a final calculation of such fees and expenses and (ii) accrue and pay the amount of such fees and expenses as calculated above, after FCB has been given an opportunity to review all such bills and calculation of such fees and expenses.

     (j) Resignations. FCB shall have received evidence satisfactory to it that all directors and executive officers of SCB and SCC Bank have resigned from such respective offices, and not resign from their employment, if any, with SCC Bank, effective immediately prior to the Effective Time of the Merger.

     (k) Net Income. From January 1, 2005 until the Shareholders’ Equity Measuring Date (as defined in Section 7.03(e)), the net income of SCB (on a consolidated

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basis and excluding payments, costs and accruals described on Schedule 7.03(k) shall not be less than One Million Three Hundred Thousand Dollars ($1,300,000); provided, however, that FCB may waive this condition.

     (l) Adjusted Shareholders Equity. The Adjusted Shareholders Equity shall not be less than Fourteen Million Dollars ($14,000,000.00); provided, however, that FCB may waive this condition.

ARTICLE VIII
TERMINATION

     8.01. Termination

     This Agreement may be terminated, and the Merger may be abandoned:

     (a) Mutual Consent. At any time prior to the Effective Time, by the mutual consent of FCB and SCB if the Board of Directors of each so determines by vote of a majority of the members of its entire Board.

     (b) Breach. At any time prior to the Effective Time, by FCB or SCB if its Board of Directors so determines by vote of a majority of the members of its entire Board, in the event of: (i) a breach by SCB or FCB, respectively, of any representation or warranty contained herein (subject to the standard set forth in Section 5.02), which breach cannot be or has not been cured within 30 days after the giving of written notice to the breaching party or parties of such breach; (ii) a breach by SCB or FCB, respectively, of any of the covenants or agreements contained herein (excluding Section 6.23), which breach cannot be or has not been cured within 30 days after the giving of written notice to the breaching party or parties of such breach or (iii) in the case of a termination by FCB, a breach by a Shareholder or Shareholders of any of the covenants or agreements contained in the Shareholder Agreements, which breach cannot be or has not been cured within 30 days after the giving of written notice to the breaching party or parties of such breach, provided that such breach (whether under (i), (ii) or (iii)) would be reasonably likely, individually or in the aggregate with other breaches, to result in a Material Adverse Effect with respect to FCB or SCB, as the case may be.

     (c) Delay. At any time prior to the Effective Time, by FCB or SCB if its Board of Directors so determines by vote of a majority of the members of its entire Board, in the event that the Merger is not consummated by September 30, 2005 except to the extent that the failure of the Merger then to be consummated arises out of or results from the knowing action or inaction of (i) such party, (ii) the Merger Subsidiary, FC Bank or SCC Bank (if FCB or SCB, respectively, is the party seeking to terminate) or (iii) any of the Shareholders (if SCB is the party seeking to terminate), which action or inaction is in violation of its obligations under this Agreement or, in the case of the Shareholders, his, her or its obligations under the relevant Shareholder Agreement.

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     (d) No Approval. By SCB or FCB, if the respective Board of Directors so determines by a vote of a majority of the members of its entire Board, in the event (i) the approval of any Governmental Authority required for consummation of the Merger, the Second Merger or the other transactions contemplated by this Agreement shall have been denied by final nonappealable action of such Governmental Authority or an application therefor shall have been permanently withdrawn at the request of a Governmental Authority or (ii) the shareholder approval referred to in Section 7.01(a) herein is not obtained at the SCB Meeting.

     (e) Acquisition Proposal. By FCB, if (i) SCB shall have exercised a right specified in the provision set forth in Section 6.08 with respect to any Acquisition Proposal and shall, directly or through agents or representatives, continue discussion with any third party concerning such Acquisition Proposal for more than 10 Business Days after the date of receipt of such Acquisition Proposal; or (ii) an Acquisition Proposal that is publicly disclosed shall have been commenced, publicly proposed or communicated to SCB which contains a proposal as to price (without regard to the specificity of such price proposal) and SCB shall not have rejected such proposal within 10 Business Days of (x) its receipt or (y) the date its existence first becomes publicly disclosed, if earlier.

     (f) Failure to Recommend. At any time prior to the SCB Meeting, by FCB if SCB shall have breached Section 6.08 or SCB’s Board shall have failed to make its recommendation referred to in Section 6.02, withdrawn such recommendation or modified or changed such recommendation in a manner adverse in any respect to the interests of FCB.

     (g) Failure to Raise Capital. By SCB upon the failure of FCB either (i) to satisfy the conditions specified in Section 6.23 within thirty (30) days of receipt of all necessary regulatory approvals to consummate the Merger or (ii) to enter into binding agreements by June 30, 2005 providing for such financing, subject only to the receipt of all necessary regulatory approvals to consummate the Merger, absence of material adverse changes and other normal and customary closing conditions.

     (h) Schedule Delivery Date. At and for three Business Days following the Schedule Delivery Date, FCB may terminate this Agreement in its discretion if FCB determines that any item in the Disclosure Schedules is unacceptable to it, after providing SCB notice and a three Business Days’ opportunity to resolve the Disclosure Schedule issues.

     8.02. Effect of Termination and Abandonment

     (a) In the event of termination of this Agreement and the abandonment of the Merger pursuant to this Article VIII, no party to this Agreement shall have any liability or further obligation to any other party hereunder except (i) as set forth in subsection (b) below and Section 9.01, (ii) that termination will not relieve a breaching party from liability for any willful breach of any covenant, agreement, representation or warranty of

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this Agreement giving rise to such termination and (iii) any other provision of this Agreement which expressly survives the termination of this Agreement.

     (b) In the event this Agreement is terminated by FCB pursuant to Section 8.01(e) or (f), SCB shall pay to FCB a termination fee, representing liquidated damages, of $2.5 million. In the event this Agreement is terminated by FCB or by SCB pursuant to Section 8.01(b), the non-terminating party shall pay a termination fee, representing liquidated damages, of $2.5 million to the terminating party. In the event this Agreement is terminated by SCB pursuant to Section 8.01(g), FCB shall pay to SCB a termination fee, representing liquidated damages, equal to $250,000 plus the actual out-of-pocket costs incurred by SCB in connection with the Merger. In the event this Agreement is terminated by FCB pursuant to Section 8.01(h), SCB shall pay FCB a termination fee of $100. The payment of any termination fees pursuant to this Section 8.02(b) shall be the sole and exclusive remedy available to a party with respect to the breach of any covenant or agreement giving rise to such a payment, and the parties agree and stipulate that the amount of the termination fees are reasonable and full liquidated damages and reasonable compensation to the other party for their involvement in the proposed transactions contemplated by this Agreement to the date of such notice of termination and is not a penalty or forfeiture.

     (c) Any Termination Fee that becomes payable to a party pursuant to this Section 8.02 shall be paid by wire transfer of immediately available funds to an account designated by such party either if this Agreement is terminated by a party and the termination meets the conditions set forth in this Section 8.02 at or prior to such termination by the party.

     (d) SCB and FCB agree that the agreements contained in paragraphs (b) and (c) above are an integral part of the transactions contemplated by this Agreement, that without such agreements FCB and SCB would not have entered into this Agreement, and that such amounts do not constitute a penalty. If a party fails to pay the other party the amounts due under paragraph (b) above within the time periods specified in paragraph (c) above, such party shall pay all costs and expenses incurred by the other party in connection with any action, including the filing of any lawsuit, taken to collect payment of such amounts, together with interest on the amount of any such unpaid amounts at the publicly announced prime rate of Bank of America, N.A. from the date such amounts were required to be paid.

ARTICLE IX
MISCELLANEOUS

     9.01. Survival

     No representations, warranties, agreements and covenants contained in this Agreement shall survive the Effective Time (other than Sections 6.10, 6.12, 6.13 and 6.17

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and this Article IX, which shall survive the Effective Time) or the termination of this Agreement if this Agreement is terminated prior to the Effective Time (other than Sections 6.05(d), 8.02 and this Article IX which shall survive any such termination).

     9.02. Waiver; Amendment

     Prior to the Effective Time, any provision of this Agreement may be (i) waived in whole or in part by the party benefited by the provision or by both parties or (ii) amended or modified at any time, by an agreement in writing between the parties hereto executed in the same manner as this Agreement, except that after the SCB Meeting, this Agreement may not be amended if it would reduce the aggregate value of the consideration to be received by SCB’s shareholders in the Merger without any subsequent approval by such shareholders or be in violation of applicable law.

     9.03. Counterparts

     This Agreement may be executed in one or more counterparts, each of which shall be deemed to constitute an original but all of which together shall constitute one and the same instrument.

     9.04. Governing Law, Jurisdiction and Venue

     This Agreement shall be governed by, and interpreted in accordance with, the laws of the State of California (however, not to the exclusion of any applicable Federal law), without regard to California statutes or judicial decisions regarding choice of law questions. The parties hereby irrevocably submit to the jurisdiction of the courts of the State of California and the federal courts of the United States of America located in the Southern District of the State of California solely in respect of the interpretation and enforcement of the provisions of this Agreement and of the documents referred to in this Agreement, and in respect of the transactions contemplated herein and therein, and hereby waive, and agree to assert, as a defense in any action, suit or proceeding for the interpretation or enforcement hereof or of any such documents, that it is not subject thereto or that such action, suit or proceeding may not be brought or is not maintainable in said courts or that the venue thereof may not be appropriate or that this Agreement or any such document may not be enforced in or by such courts, and the parties hereto irrevocably agree that all claims with respect to such action or proceeding shall be heard and determined in such California state or federal court. The parties hereby consent to and grant any such court jurisdiction over the person of such parties and over the subject matter of such dispute and agree that mailing of process or other papers in connection with any such action or proceeding in the manner provided in Section 9.06 or in such other manner as may be permitted by law, shall be valid and sufficient service thereof.

     9.05. Expenses

     Each party hereto will bear all expenses incurred by it in connection with this Agreement and the transactions contemplated hereby.

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     9.06. Notices

     All notices, requests and other communications hereunder to a party shall be in writing and shall be deemed given if personally delivered, telecopied (with confirmation) or mailed by registered or certified mail (return receipt requested) to such party at its address set forth below or such other address as such party may specify by notice to the parties hereto.

If to SCB or
SCC Bank to:	South Coast Bancorp, Inc.
	19752 MacArthur Boulevard
	Irvine, California 92612
	Attention: Van Rhebeck, President and CEO
	Phone: (949) 852-2500
	Fax: (949) 852-1555
	Email: vrhebeck@sccb.com
	digby99@aol.com
With copies to:	Yocca Patch & Yocca, LLP
	19900 MacArthur Blvd, Suite 650
	Irvine, CA 92612-8412
	Attention: Nicholas J. Yocca, Esq.
	Phone: (949) 798-0190 (direct)
	Phone: (949) 253-0800 (main)
	Fax: (949) 203-8627
	Email: nyocca@ypylaw.com
If to FCB, FC Bank
or the Merger Subsidiary
to:	First California Bancorp
	c/o First California Bank
	1100 Paseo Camarillo
	Camarillo, CA 93010
	Attention: C. G. Kum, President and CEO
	Phone: (805) 322-9308 (direct)
	Fax: (805) 445-1388 (direct)
	Email: cgkum@fcbank.com
With a copy to:	Horgan, Rosen, Beckham & Coren, L.L.P.
	23975 Park Sorrento, Suite 200
	Calabasas, California 91302
	Attention: Gary M. Horgan, Esq.
	Telephone: 818-591-2121
	Facsimile: 818-591-3838
	Email: ghorgan@horganrosen.com

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     9.07. Entire Understanding; No Third Party Beneficiaries

     This Agreement (including the Disclosure Schedule attached hereto and incorporated herein), the Shareholder Agreements and the Non-Competition Agreements represent the entire understanding of the parties hereto and thereto with reference to the transactions contemplated hereby and thereby and this Agreement, the Shareholder Agreements and the Non-Competition Agreements supersede any and all other oral or written agreements heretofore made. Except for Section 6.12, nothing in this Agreement, expressed or implied, is intended to confer upon any Person, other than the parties hereto or their respective successors, any rights, remedies, obligations or liabilities under or by reason of this Agreement.

     9.08. Effect

     No provision of this Agreement shall be construed to require SCB, FCB or any Subsidiaries, affiliates or directors of any of them to take any action or omit to take any action which action or omission would violate applicable law (whether statutory or common law), rule or regulation.

     9.09. Severability

     Except to the extent that application of this Section 9.09 would have a Material Adverse Effect on SCB or FCB, any term or provision of this Agreement which is invalid or unenforceable in any jurisdiction shall, as to that jurisdiction, be ineffective to the extent of such invalidity or unenforceability without rendering invalid or unenforceable the remaining terms and provisions of this Agreement or affecting the validity or enforceability of any of the terms or provisions of this Agreement in any other jurisdiction. If any provision of this Agreement is so broad as to be unenforceable, the provision shall be interpreted to be only so broad as is enforceable.

     9.10. Enforcement of the Agreement

     The parties hereto agree that irreparable damage would occur in the event that any of the provisions of this Agreement were not performed in accordance with their specific terms or were otherwise breached. It is accordingly agreed that the parties shall be entitled to an injunction or injunctions to prevent breaches of this Agreement and to enforce specifically the terms and provisions hereof in any court of the United States or any state having jurisdiction, this being in addition to any other remedy to which they are entitled at law or in equity.

     9.11. Interpretation

     When a reference is made in this Agreement to Sections, Exhibits or Schedules, such reference shall be to a Section of, or Exhibit or Schedule to, this Agreement unless

50

otherwise indicated. The table of contents and headings contained in this Agreement are for reference purposes only and are not part of this Agreement. Whenever the words “include”, “includes” or “including” are used in this Agreement, they shall be deemed to be followed by the words “without limitation”.

     IN WITNESS WHEREOF, the parties hereto have caused this Agreement and Plan of Reorganization to be executed in counterparts by their duly authorized officers, all as of the day and year first above written.

FIRST CALIFORNIA BANCORP		SOUTH COAST BANCORP, INC.
By:		By:
	C.G. Kum		Van Rhebeck
	President and Chief Executive Officer		President and Chief Executive Officer
SCB MERGER CORP		SOUTH COAST COMMERICAL BANK
By:		By:
	C.G. Kum		Van Rhebeck
	President and Chief Executive Officer		President and Chief Executive Officer
FIRST CALIFORNIA BANK
By:
	C.G. Kum
	President and Chief Executive Officer

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FIRST AMENDMENT TO
AGREEMENT AND PLAN OF REORGANIZATION

     This First Amendment to Agreement and Plan of Reorganization by and among FCB BANCORP (formerly “FIRST CALIFORNIA BANCORP”), SCB MERGER CORP., FIRST CALIFORNIA BANK, SOUTH COAST BANCORP, INC. and SOUTH COAST COMMERCIAL BANK is made as of this ___day of March 2005.

     WHEREAS, the parties have entered into an Agreement and Plan Reorganization dated February 2, 2005; and

     WHEREAS, the parties wish to amend that Agreement and Plan of Reorganization as set forth herein.

     NOW THEREFORE, the Agreement and Plan of Reorganization is amended as follows:

     1. All references to First California Bancorp shall be deleted and in lieu thereof reference shall be to FCB Bancorp.

     2. Following Section 7.03(l) a new Section 7.03(m) is added as follows:

     “Nguyen Loan. The Nguyen Loan shall have been repaid in full, sold to a third party, or refinanced by a third party so that it is no longer an asset of SCC Bank or SCB.”

     Except as otherwise set forth herein, the Agreement and Plan of Reorganization shall remain in full force and effect.

FIRST BANCORP		SOUTH COAST BANCORP, INC.
(formerly “FIRST CALIFORNIA BANCORP”)
By:		By:
	C.G. Kum		Van Rhebeck
	President and Chief Executive Officer		President and Chief Executive Officer
SCB MERGER CORP		SOUTH COAST COMMERICAL BANK
By:		By:
	C.G. Kum		Van Rhebeck
	President and Chief Executive Officer		President and Chief Executive Officer

FIRST CALIFORNIA BANK
By:
	C.G. Kum
	President and Chief Executive Officer

EX-10.9

EXHIBIT 10.9

COMMON STOCK SUBSCRIPTION AGREEMENT

     THIS COMMON STOCK SUBSCRIPTION AGREEMENT (this “Subscription Agreement”), dated June ___, 2005, is made between FCB Bancorp, a California corporation (the “Company”), and _____________________(the “Purchaser”).

RECITALS:

A.	The Company desires to issue and sell up to _________shares of the Company’s common stock, no par value (the “Shares”); and
B.	In consideration of the premises and the mutual representations and covenants hereinafter set forth, the parties hereto agree as follows:

1. Purchase and Sale of Shares; Escrow Account

1.1.

Upon the execution of this Subscription Agreement, the Purchaser hereby agrees to purchase from the Company _________Shares at a price per share of $_________, or an aggregate purchase price equal to $_______________(the “Purchase Price”), and the Company agrees to sell ____________Shares to the Purchaser for the Purchase Price, provided that all conditions of this Subscription Agreement and the Placement Agreement (as defined below) have been met.

1.2.

Payment of the purchase price for, and delivery of the certificate for, the Shares subscribed for hereby shall be made at the offices of Horgan, Rosen, Beckham & Coren, LLPon the date that the SCCB Acquisition (as defined in the Placement Agreement (as defined below)) is consummated (such date of payment and delivery being herein called the “Closing Date”). The Company shall notify the Purchaser at least fifteen days prior to the date on which the Company expects the closing will occur (the “Targeted Closing Date”). On or prior to the business day before the Targeted Closing Date, the Purchaser shall wire immediately available funds equal to the Purchase Price to Pacific Coast Bankers’ Bank, as escrow agent, in accordance with the terms of the Escrow Agreement, between the Company and the Placement Agent, dated as of the date hereof (the “Escrow Agreement”). In accordance with the Escrow Agreement, the Escrow Agent shall hold the Purchase Price in an escrow account for the benefit of the Purchaser (the “Escrow Account”). On the Closing Date, the Escrow Agent shall release the Purchase Price to the Company from the Escrow Account and, as promptly as possible thereafter, any interest thereon shall be returned to the Purchaser. If the Closing Date has not occurred on or prior to the third business day following the Targeted Closing Date, the Escrow Agent shall, as promptly as possible, return the Purchase Price, together with any interest thereon, to the Purchaser.

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1.3.	The Shares shall be delivered in definitive form by the Company on the Closing Date to the Purchaser or its designee, shall be registered in the name of the Purchaser and shall represent the number of Shares being purchased by the Purchaser. The Company and Purchaser shall execute and/or deliver such other documents and agreements as are customary and reasonably necessary to effectuate the purchase and sale of the Shares.
1.4.	The Placement Agency Agreement, dated May 26, 2005 (the “Placement Agreement”), by and between the Company and Keefe, Bruyette & Woods, Inc. (the “Placement Agent”) includes certain representations and warranties, covenants and conditions to closing and certain other matters governing the sale of the Shares. The Placement Agreement is hereby incorporated by reference into this Subscription Agreement and the Purchaser shall be entitled to each of the benefits of the Placement Agent under the Placement Agreement and shall be entitled to enforce the obligations of the Company under such Placement Agreement as fully as if the Purchaser were a party to such Placement Agreement. Capitalized terms not otherwise defined herein shall have their respective meanings set forth in the Placement Agreement.
1.5.	The Company’s obligation to sell the Shares to the Purchaser and the Purchaser’s obligation to purchase the Shares are subject to satisfaction of the following conditions on or prior to the Closing Date:

(a)	The Holding Company Reorganization (as defined in the Placement Agreement) shall have been consummated on terms consistent with the terms described in the Private Placement Memorandum (as defined in the Placement Agreement);
(b)	The Trust Preferred Offering (as defined in the Placement Agreement) shall have been consummated on terms consistent with the terms described in the Private Placement Memorandum; and
(c)	The SCCB Acquisition (as defined in the Placement Agreement) will be consummated on the Closing Date on terms consistent with the terms described in the Private Placement Memorandum.
(d)	Since the respective dates as of which information is given in the Private Placement Memorandum except as otherwise set forth or contemplated in the Private Placement Memorandum, there shall not have been any material adverse change, or any development involving a prospective material adverse change, in or affecting the business, condition (financial or otherwise) earnings, affairs, prospects, stockholders’ equity, results of operations of the Company and the Bank, taken as a whole, or South Coast Bancorp and SCCB, taken as a whole .

1.6. If any condition specified herein or in the Placement Agreement shall not have been fulfilled when and as required to be fulfilled by, on behalf of or in respect of

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the Company or the Shares, this Subscription Agreement will be terminated, and such termination shall be without liability of any party to any other party except as provided in Section 5 of the Placement Agreement and except that Sections 5 and 7 of the Placement Agreement shall survive any such termination and remain in full force and effect.

1.7. Notwithstanding any other provision of this Subscription Agreement, the obligations of the Purchaser hereunder are limited recourse obligations of the Purchaser. No recourse shall be had to any subscriber, officer, director, employee, administrator, shareholder, incorporator or agent of the Purchaser or their respective successors or assigns for any obligations hereunder.

2. Representations and Warranties of Purchaser

2.1.	The Purchaser understands and acknowledges that (i) none of the Shares have been registered under the Securities Act of 1933, as amended (the “Securities Act”), or any other applicable securities laws, (ii) the Shares are being offered for sale by the Company in transactions not requiring registration under the Securities Act, and (iii) the Shares may not be offered, sold, pledged or otherwise transferred by the Purchaser except in compliance with the registration requirements of the Securities Act, or any other applicable securities laws, pursuant to an exemption therefrom or in a transaction not subject thereto.
2.2.	The Purchaser understands that the Shares are being offered and sold in reliance upon an exemption from registration under the Securities Act provided by Section 4(2) of the Securities Act. Purchaser represents that it is an “Accredited Investor” as that term is defined in Rule 501(a) of the Securities Act.
2.3.	The Purchaser represents and warrants that it is purchasing the Shares for its own account, for investment and not with a view to, or for offer or sale in connection with, any distribution thereof in violation of the Securities Act or other applicable securities laws, subject to any requirement of law that the disposition of its property be at all times within its control and subject to its ability to resell such Shares pursuant to an effective registration statement under the Securities Act or pursuant to an exemption therefrom or in a transaction not subject thereto, and the Purchaser acknowledges that the Shares will bear the following legends and be subject to the following transfer restrictions:

     The securities represented by this certificate have not been registered under the Securities Act of 1933, as amended (the “Act”), or the securities laws of any jurisdiction. Such securities may not be offered, sold, transferred, pledged, assigned, encumbered, hypothecated or otherwise disposed of except pursuant to (i) a registration statement with respect to such securities that is effective under the Act or applicable state securities law, or (ii) any exemption from registration under the Act, or applicable state securities law, relating to the disposition of securities, including Rule 144, provided an opinion of counsel is furnished to the

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company, in form and substance reasonably satisfactory to the Company, to the effect that an exemption from the registration requirements of the Act and/or applicable state securities law is available.

2.4.	The Purchaser represents and warrants that neither the Company nor the Placement Agent is acting as a fiduciary or financial or investment adviser for the Purchaser.
2.5.	The Purchaser represents and warrants that it is not relying (for purposes of making any investment decision or otherwise) upon any advice, counsel or representations (whether written or oral) of the Company or of the Placement Agent (other than the representations and warranties of the Company contained in this Subscription Agreement and in the Placement Agreement).
2.6.	The Purchaser represents and warrants that (a) it has consulted with its financial advisors, legal counsel, accountants, and tax, regulatory, business, investment, and other advisers in connection herewith to the extent it has deemed necessary, (b) it has had a reasonable opportunity to ask questions of and receive answers from officers and representatives of the Company concerning their respective financial condition and results of operations and the purchase of the Shares, and any such questions have been answered to its satisfaction, and (c) it has made its own investment decisions based upon its own judgment, due diligence and advice from such advisers as it has deemed necessary and not upon any view expressed by the Company or the Placement Agent. The Purchaser acknowledges that it has received a copy of the Company’s Private Placement Memorandum, dated May 26, 2005.
2.7.	The Purchaser represents and warrants that it is acquiring the Shares as principal for its own account for investment and not for sale in connection with any distribution thereof. It was not formed solely for the purpose of investing in the Shares, and additional capital or similar contributions were not specifically solicited from any person owning a beneficial interest in it for the purpose of enabling it to purchase any Shares.
2.8.	The Purchaser represents and warrants that it has such knowledge and experience in financial and business matters that it is capable of evaluating the merits and risks of purchasing the Shares, has had the opportunity to ask questions of, and receive answers and request, review and consider additional information and documents from, the Company, and has received, reviewed and considered such additional requested information and documents, and is aware that it will be required to bear the economic risk of an investment in the Shares.
2.9.	The Purchaser represents and warrants that it is duly organized, validly existing and in good standing under the laws of the jurisdiction where it is organized, with full power and authority to execute, deliver and perform this Subscription Agreement, to make the representations and warranties specified herein, and to

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consummate the transactions contemplated herein and it has full right and power to subscribe for the Shares.

2.10.	The Purchaser represents and warrants that no filing with, or authorization, approval, consent, license, order, registration, qualification or decree of, any governmental body, agency or court having jurisdiction over the Purchaser, other than those that have been made or obtained, is necessary or required for the performance by the Purchaser of its obligations under this Subscription Agreement or to consummate the transactions contemplated herein.
2.11.	The Purchaser represents and warrants that this Subscription Agreement has been duly authorized, executed and delivered by the Purchaser.
2.12.	The Purchaser represents and warrants that the Purchaser is not in violation of or default under any term of its organizational documents, of any provision of any mortgage, indenture, contract, agreement, instrument or contract to which it is a party or by which it is bound or of any judgment, decree, order, writ or, to its knowledge, any statute, rule or regulation applicable to the Purchaser which would prevent the Purchaser from performing any material obligation set forth in this Subscription Agreement. The execution, delivery and performance of and compliance with this Subscription Agreement, and the consummation of the transactions contemplated herein, will not, with or without the passage of time or giving of notice, result in any such violation or default or the suspension, revocation, impairment, forfeiture or non-renewal of any permit, license, authorization or approval applicable to the Purchaser, its business or operations or any of its assets or properties which would prevent the Purchaser from performing any material obligations set forth in this Subscription Agreement.
2.13.	The Purchaser understands and acknowledges that the Company will rely upon the truth and accuracy of the foregoing acknowledgments, representations, warranties and agreements and agrees that if any of the foregoing acknowledgments, representations, warranties or agreements cease to be accurate, it shall promptly notify the Company.
2.14.	The Purchaser understands that no public market currently exists for the Company’s common stock and that there can be no assurance that any trading market for the common stock will develop or be sustained, or that a holder of Shares will have the ability to dispose of any of the Shares in a liquid market.
2.15.	The Purchaser understands that in accordance with the Employee Retirement Income Security Act of 1974, as amended, no employee benefit plan or a qualified institutional buyer acting on behalf of such a plan, may acquire any Shares if the acquisition would constitute a non-exempt prohibited transaction by reason of the application of statutory exemptions or any one of the administrative exemptions issued by the U.S. Department of Labor or otherwise.

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3. Company’s Obligations

3.1.	The Company shall cause the SCCB Acquisition (as defined in the Placement Agreement) to be consummated on the Closing Date on terms consistent with the terms described in the Private Placement Memorandum.
3.2.	If the SCCB Acquisition is not consummated on the Closing Date on terms consistent with the terms described in the Private Placement Memorandum, than the Company shall return to the Purchaser any funds that the Purchaser has distributed to the Company for the Shares no later than one business day after receipt of such funds.

4. Miscellaneous

4.1. Any notice or other communication given hereunder shall be deemed sufficient if in writing and sent by registered or certified mail, return receipt requested, international courier, or delivered by hand against written receipt therefor, or by facsimile transmission and confirmed by telephone, to the following addresses, or such other address as may be furnished to the other parties as herein provided:

To the Company:

FCB Bancorp
1100 Paseo Camarillo
Camarillo, California 93010
Attention: Chief Financial Officer
Telephone: (805) 484-0534
Fax: (805) 383-1826

To the Purchaser:

 
 
 
Attention:
Telephone:
Fax:

Unless otherwise expressly provided herein, notices shall be deemed to have been given when received.

4.2.	This Subscription Agreement shall not be changed, modified or amended except by a writing signed by the parties hereto.
4.3.	Upon the execution and delivery of this Subscription Agreement by the parties hereto, this Subscription Agreement shall become a binding obligation of each

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such party with respect to the matters covered herein, including those incorporated by reference from the Placement Agreement.

4.4.	This Subscription Agreement shall be governed by the laws of the State of California, without giving effect to the choice of law or conflicts of law principles thereof.
4.5.	The parties hereto agree to execute and deliver all such further documents, agreements and instruments and take such other and further action as may be necessary or appropriate to carry out the purposes and intent of this Subscription Agreement.
4.6.	Until the Company has publicly disclosed all material, non-public information contained in the Private Placement Memorandum, the Purchaser (A) shall not use any such material, non-public information other than in connection with evaluating the offering of Shares proposed by the Private Placement Memorandum, (B) shall not purchase or sell securities of the Company outside of such offering, and (C) shall abide by all applicable restrictions imposed by the United States securities laws in connection with such offering.
4.7.	The Purchaser’s and the Company’s obligations under this Subscription Agreement shall terminate if the Closing Date has not occurred on or prior to October 10, 2005, in which case, this Subscription Agreement shall terminate without any further action by either the Purchaser or the Company and such termination shall be without liability of any party to any other party.
4.8.	This Subscription Agreement may be executed in one or more counterparts each of which shall be deemed an original, but all of which shall together constitute one and the same instrument.

Signatures appear on the following page

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     IN WITNESS WHEREOF, this Subscription Agreement is agreed to and accepted as of the day and year first written above.

FCB BANCORP
By:
	Name:   Title:
as Purchaser
By:
	Name: Title:

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EX-10.10

Exhibit 10.10

FCB Bancorp

PRIVATE PLACEMENT AGENCY AGREEMENT

May 26, 2005

Keefe, Bruyette & Woods, Inc.
787 Seventh Avenue
New York, New York 10019

Ladies and Gentlemen:

     FCB Bancorp, a California corporation (the “Company”), proposes to issue and sell shares (the “Shares”) of the Company’s common stock, no par value (the “Common Stock”). The Shares are to be sold pursuant to Common Stock Subscription Agreements (the “Subscription Agreements”), by and among the Company and the purchasers of the Shares (the “Purchasers”). Keefe, Bruyette & Woods, Inc. (the “Placement Agent”) shall serve as placement agent with respect to the Company’s sale of Shares. The terms of the Shares are more fully described in the Private Placement Memorandum (as hereinafter defined).

     The Shares will be offered without being registered under the Securities Act of 1933, as amended (the “1933 Act”), (i) only pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the 1933 Act, (ii) only to persons and entities who reside in the United States of America, (iii) only to persons and entities who are institutional “accredited investors” within the meaning of Rule 501 of Regulation D under the 1933 Act, and (iv) only to persons and entities who have agreed, pending the Company’s public disclosure of all material, non-public information contained in the Private Placement Memorandum, (A) not to use any such material, non-public information other than in connection with evaluating the offering of Shares proposed by the Private Placement Memorandum, (B) not to purchase or sell securities of the Company outside of such offering, and (C) to abide by all applicable restrictions imposed by the United States securities laws in connection with such offering. The Shares shall be sold at a price to investors to be agreed upon and set forth in the Subscription Agreements (as hereinafter defined).

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     Closing of the offering of the Shares is contingent upon receipt of subscriptions for at least $22,000,000 (the “Minimum”) by September 30, 2005.

     The Company has prepared the Private Placement Memorandum with respect to the offer and sale of the Shares in conformity with applicable requirements of the 1933 Act, the Securities Exchange Act of 1934, as amended (the “1934 Act”), the rules and regulations of the Securities and Exchange Commission (the “Commission”) under the 1933 Act, including Rule 506 of Regulation D (the “1933 Act Regulations”), the rules and regulations of the Commission under the 1934 Act (the “1934 Regulations”), and applicable requirements of state securities laws.

     The Shares are being sold in connection with financing related to the Company’s acquisition (the “SCCB Acquisition”) of South Coast Bancorp, Inc. (“South Coast Bancorp”) pursuant to that certain Agreement and Plan of Reorganization, dated February 2, 2005, between the Company, First California Bank (the “Bank”), SCB Merger Corp. (“Merger Sub”, a wholly-owned subsidiary of the Company), South Coast Commercial Bank (“SCCB”, a wholly-owned subsidiary of South Coast Bancorp), and South Coast Bancorp (the “Acquisition Agreement”). Prior to the consummation of the SCCB Acquisition, the Company will be reorganized as a holding company for the Bank, as described in the Private Placement Memorandum (the “Holding Company Reorganization”). Following the SCCB Acquisition, SCCB will become a wholly-owned subsidiary of the Company and subsequently consolidate with the Bank.

     In connection with the Acquisition, the Company expects to consummate an offering of trust preferred securities, which shall provide the Company with gross proceeds of at least $10,000,000, substantially as described in the Private Placement Memorandum (the “Trust Preferred Offering”).

     The purchasers of Shares and their transferees will be entitled to the benefits of a Registration Rights Agreement dated as of the Closing Date (as defined below) among the Company and the purchasers (the “Registration Rights Agreement” and together with this Agreement, the Subscription Agreements and the Acquisition Agreement, the “Transaction Documents”).

     1. Appointment of the Placement Agent.

          1.1 Upon and subject to the terms and conditions hereinafter set forth, the Company hereby engages the Placement Agent as its exclusive agent for sale of the Shares on a “best efforts” basis for a period (the “Offering Period”) commencing on the date hereof and ending on the earlier of the Closing Date or September 30, 2005. The Placement Agent agrees to use its best efforts to sell the Shares as agent of the Company. It is understood and agreed that there is no firm commitment on the part of the Placement Agent to purchase any of the Shares.

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The Placement Agent may employ subagents who are members in good standing of the National Association of Securities Dealers, Inc. for the offer and sale of the Shares, and, if such subagents are so employed, the Placement Agent shall be solely responsible for compensating any such subagents out of the commission payable to the Placement Agent and the Company shall not be responsible for compensating such subagents.

          1.2 It is understood that the Placement Agent will have the exclusive right to seek purchasers of the Shares during the Offering Period (and after the expiration of the Offering Period if mutually agreed upon by both parties) and that, during such period, any inquiries or proposals with respect to the Shares directed to the Company from any source whatsoever will be referred to the Placement Agent for purposes of analysis and assistance in negotiation. During the Offering Period, neither the Company nor any person acting on the Company’s behalf will directly or indirectly (except through the Placement Agent) solicit any offer from any party to purchase the Shares. In the event that, during the Offering Period, the Company or any of its officers, directors, employees, or representatives are contacted by or on behalf of any third party concerning the Shares, the Company will so inform the Placement Agent promptly upon the Company’s knowledge thereof.

          1.3 The Placement Agent will offer the Shares, as the Company’s agent, at a price to investors as described in the second paragraph of this Agreement. As compensation for their services, the Placement Agent will be entitled to a commission of 6.00% of the aggregate purchase price of the Shares sold by the Company on or before October 10, 2005 to be due and payable by the Company to the Placement Agent on the Closing Date.

          1.4 It is understood and agreed that the Company, in its discretion, may reject, in whole or in part, any subscription for Shares presented to the Company by the Placement Agent. In addition, the Company, in its discretion, may withdraw, cancel or modify its offering of the Shares and reject orders in whole or in part. No commission or other compensation shall be due or owing to the Placement Agent with respect to any subscription that is rejected, withdrawn or canceled by the Company.

          1.5 Closing of the offering contemplated by this Agreement shall take place at the offices of Hogan, Rosen, Beckham & Coren, LLP, at 9 a.m., on the day the SCCB Acquisition is consummated. Such date is referred to herein as the “Closing Date.” Payments for Shares purchased pursuant to the offering shall be made to an account designated by the Company in the aggregate amount of the purchase price for the Shares being purchased by the subscribers therefor, against delivery by or on behalf of the Company of certificates for or, if uncertificated, other evidence of ownership of the Shares to be purchased by such

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subscribers. The Shares shall be represented in the form of one or more definitive certificates registered in the names of the Purchasers (as hereinafter defined). Time shall be of the essence, and delivery of the certificates for the Shares at the time and place specified pursuant to this Agreement is a further condition of the obligations of the Placement Agent hereunder. The Company shall notify the Purchasers at least two business days prior to the Closing Date that the Company expects that the Closing Date will occur on such date.

          1.6 The Placement Agent and any subagents employed by it shall not offer or solicit offers to buy and will not offer, solicit offers to buy, or sell the Shares by any form of general solicitation or general advertising within the meaning of Rule 502(c) of Regulation D under the 1933 Act, and the Placement Agent and any subagents employed by it will not offer any of the Shares for sale, or solicit any offers to subscribe for or buy any of the Shares or negotiate with any person or entity in respect to any of the Shares, other than on the basis of the Private Placement Memorandum and in compliance with Regulation D under the 1933 Act.

          1.7 The Shares shall not be offered or sold in any jurisdiction other than the United States of America without the prior written consent of the Company. The Placement Agent and any subagents employed by them will not offer the Shares for sale to, sell to, or solicit any offers to subscribe for the Shares from any offeree who resides in a state where the securities laws require offerees to meet specified qualifications unless such offeree meets such qualifications, or where securities laws require offerees to receive disclosure documents until it has delivered a Private Placement Memorandum, including attachments and any other information provided by the Company which is required to be delivered to purchasers pursuant to Regulation D under the 1933 Act, to such offeree. Within a reasonable time before the Closing Date, the Placement Agent or its subagents shall deliver all such documents to all persons and entities who are to purchase the Shares to the extent they have not theretofore received such documents.

     2. Representations and Warranties.

     Each of the Company and the Bank represents and warrants to, and agrees with, the Placement Agent that:

          2.1 Neither the Company nor the Bank or any of their affiliates or any person acting on their behalf has sold, offered for sale, solicited offers to buy, or otherwise negotiated in respect of any security (as defined in the 1933 Act) which is or will be integrated with the sale of the Shares in a manner that would require their registration under the 1933 Act. Neither the Company nor the Bank or any of their affiliates or any person acting on their behalf has offered or sold, or will offer or sell, any of the Shares by means of any general solicitation or general advertising within the meaning of Rule 502(c) of Regulation D under the

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1933 Act; provided, however, that no representation or warranty is made as to the activities of the Placement Agent or any person acting on behalf of the Placement Agent.

          2.2 A private placement memorandum dated on May 26, 2005 (together with the documents attached thereto and the documents incorporated therein by reference, the “Private Placement Memorandum”) in respect of the Shares has been prepared by the Bank and the Company in connection with the offering of the same. Copies of such Private Placement Memorandum have been delivered by the Bank and the Company to the Placement Agent. The Bank and the Company have prepared the Private Placement Memorandum in compliance in all material respects with the 1933 Act, the 1933 Act Regulations (including, without limitation, Regulation D), the 1934 Act, the 1934 Act Regulations, and applicable state securities laws. The Bank and the Company will give the Placement Agent immediate notice of any supplement to or amendment of the Private Placement Memorandum.

          2.3 The Private Placement Memorandum does not, and no supplement or amendment to the Private Placement Memorandum does or will, contain an untrue statement of a material fact or omit to state any material fact necessary in order to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading; provided, however, that this representation and warranty does not apply to statements or omissions made in reliance upon and in conformity with information furnished in writing to the Company by the Placement Agent expressly for inclusion in the Private Placement Memorandum or any amendment or supplement thereto (which consists only of the Placement Agent’s name and contact information and the information appearing beneath the heading “Plan of Distribution” (such information referred to herein as the “Placement Agent’s Information”)).

          2.4 The financial statements, and the related notes thereto, of the Bank, South Coast Bancorp and SCCB delivered together with the Private Placement Memorandum present fairly, in all material respects, the financial position of the Bank and the consolidated financial position of South Coast Bancorp and SCCB as of the dates indicated and the results of their operations and the changes in their consolidated cash flows for the periods specified; and said financial statements have been prepared in conformity with generally accepted accounting principles and practices applied on a consistent basis, except as described in the notes to such financial statements; and the supporting schedules included in the Private Placement Memorandum present fairly the information required to be stated therein; and the other financial and statistical information and any other financial data set forth in the Private Placement Memorandum present fairly, in all material respects, the information purported to

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be shown thereby at the respective dates or for the respective periods to which they apply and, to the extent that such information is set forth in or has been derived from the financial statements and accounting books and records of the Bank, South Coast Bancorp and SCCB, have been prepared on a basis consistent with such financial statements and the books and records of the Bank, South Coast Bancorp and SCCB. The pro forma financial statements included in the Private Placement Memorandum have been prepared on a basis consistent with the historical financial statements of the Bank and give effect to assumptions used in the preparation thereof on a reasonable basis and in good faith and present fairly in all material respects the historical and proposed transactions contemplated by the Private Placement Memorandum.

          2.5 Since the respective dates as of which information is given in the Private Placement Memorandum except as otherwise set forth or contemplated in the Private Placement Memorandum (a) there has not been any issuance of any options, warrants, convertible securities or rights to purchase capital stock of the Company, the Bank, South Coast Bancorp or SCCB, except for issuance of options pursuant to any of their previous or currently existing stock option plan and other similar officer, director or employee benefit plans, (b) there has not been any material adverse change, or any development involving a prospective material adverse change, in or affecting the business, condition (financial or otherwise) earnings, affairs, prospects, stockholders’ equity, results of operations of the Company and the Bank, taken as a whole, or South Coast Bancorp and SCCB, taken as a whole (in either case, a “Material Adverse Effect”), (c) there has not been any change or development affecting the ability of the Company, the Bank, South Coast Bancorp or SCCB to perform its obligations under the Transaction Documents, and (d) neither the Company nor the Bank has declared or paid any dividends or made any distribution of any kind with respect to its capital stock; and except as set forth, incorporated by reference or contemplated in the Private Placement Memorandum, (i) neither the Company nor the Bank has entered into any transaction or agreement (whether or not in the ordinary course of business) material to the Company and the Bank, taken as a whole, and (ii) neither South Coast Bancorp nor SCCB has entered into any transaction or agreement (whether or not in the ordinary course of business) material to South Coast Bancorp and SCCB, taken as a whole.

          2.6 Each of the Company, the Merger Sub and South Coast Bancorp is validly incorporated and validly existing in good standing under the laws of the State of California, with full corporate power and authority to own, lease, and operate its properties and conduct its business as described in and contemplated by the Private Placement Memorandum, as currently being conducted and after the Closing Date. South Coast Bancorp is, and at or prior to the Holding Company Reorganization, the Company will be, validly registered as

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a bank holding company under the Bank Holding Company Act of 1956, as amended (the “BHC Act”).

          2.7 Each of the Bank and SCCB is a state-chartered commercial bank validly organized, validly existing, and in active status or good standing, as applicable, with all applicable Regulators (as defined below) and under the laws of the State of California. Each of the Bank and SCCB has full corporate and other power and authority to own, lease, and operate its properties and to conduct its business as described in and contemplated by the Private Placement Memorandum and as currently being conducted. The deposit accounts of the Bank and SCCB are insured by the Bank Insurance Fund administered by the Federal Deposit Insurance Corporation (the “FDIC”) up to the maximum amount provided by law; and no proceedings for the modification, termination, or revocation of any such insurance are pending or, to the knowledge of the Company, threatened.

          2.8 Prior to the consummation of the Holding Company Reorganization, the Merger Sub and SCB Merger Corp. are the only subsidiaries of the Company. Prior to the Closing Date, SCCB is the only subsidiary of South Coast Bancorp. There are no subsidiaries, direct or indirect, of the Bank. None of the Company, the Bank or SCCB owns or controls, directly or indirectly, more than 5% of any class of equity security of any corporation, association, or other entity that conducts material ongoing operations.

          2.9 All of the issued and outstanding shares of capital stock of SCCB is owned by South Coast Bancorp. All of the issued and outstanding shares of capital stock of the Bank and SCCB (a) have been validly authorized and are validly issued, (b) are fully paid and nonassessable except to the extent such shares may be deemed assessable under 12 U.S.C. Section 1831o or under applicable state banking law, and (c) after the Closing Date, will be owned by the Company, free from liens, encumbrances and defects.

          2.10 The capital stock of the Company conforms to the descriptions thereof contained in the Private Placement Memorandum in all material respects. The outstanding shares of capital stock and equity securities of the Company have been, and after the Closing Date, will be validly authorized and validly issued and fully paid and nonassessable, and no such shares were issued in violation of the preemptive or similar rights of any security holder of the Company. All of the outstanding shares of capital stock and equity securities of the Merger Sub (a) has been validly authorized and validly issued and fully paid and nonassessable and (b) is owned by the Company. No person has any preemptive or similar right to purchase any shares of capital stock or equity securities of any of the Company, the Bank, the Merger Sub, South Coast Bancorp or SCCB. Except as disclosed in the Private Placement Memorandum,

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there are no outstanding rights, options, or warrants to acquire any securities of the Company, the Bank, South Coast Bancorp or SCCB, and there are no outstanding securities convertible into or exchangeable for any securities of the Company, the Bank, South Coast Bancorp or SCCB and no restrictions upon the voting or transfer of any capital stock of the Company, the Bank, South Coast Bancorp or SCCB pursuant to the Company’s, the Bank’s, South Coast Bancorp’s or SCCB’s corporate charter or bylaws, or any agreement or other instrument to which the Company, the Bank, South Coast Bancorp or SCCB is a party or by which it is bound. As of the date set forth therein, the Company has an authorized and outstanding capitalization as set forth in the Private Placement Memorandum.

          2.11 The Shares to be issued and sold by the Company have been validly authorized for issuance by the Company, and when the Shares are paid for, issued and delivered, the Shares will be validly issued, fully paid and non-assessable, and the issuance of the Shares will not be subject to any preemptive or similar rights. All corporate action required to be taken by the shareholders or the Board of Directors of the Company for the authorization, issuance and sale of the Shares has been validly taken or will have been validly taken on or prior to the Closing Date. The Shares conform to all statements related thereto incorporated by reference in the Private Placement Memorandum, and such description conforms in all material respects to the rights set forth in the instruments defining the same.

          2.12 The Registration Rights Agreement will have been validly authorized, and, on the Closing Date, will be executed and delivered by the Company and (assuming the due authorization, execution and delivery thereof by the Purchasers) will constitute the legal, valid and binding obligation of the Company, enforceable against it in accordance with its terms, subject to applicable bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and similar laws affecting creditors’ rights and remedies generally, and, as to enforceability, subject to and limited by general principles of equity, including principles of commercial reasonableness, good faith and fair dealing (regardless of whether enforcement is sought in a proceeding at law or in equity) and except that rights to indemnification and contribution thereunder may be limited by federal or state securities laws or public policy relating thereto; and the Registration Rights Agreement conforms in all material respects to the description thereof in the Private Placement Memorandum;

          2.13 The Company, the Bank, South Coast Bancorp and SCCB have complied with all foreign, federal, state, and local statutes, regulations, ordinances, and rules applicable to the ownership and operation of their properties or the conduct of their businesses as described in or contemplated by the Private Placement Memorandum and as currently being conducted, except where the failure to be in compliance would not have a Material Adverse Effect.

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          2.14 The Company, the Bank, South Coast Bancorp and SCCB have all permits, easements, consents, licenses, franchises, and other governmental and regulatory authorizations from all appropriate federal, state, local, or other public authorities (“Permits”) as are necessary to own and lease their properties and conduct their businesses in the manner described in and contemplated by the Private Placement Memorandum, except where the failure to have such Permits would not have a Material Adverse Effect. All Permits are in full force and effect, and each of the Company, the Bank, South Coast Bancorp and SCCB is in all respects complying therewith, and no event has occurred that allows, or after notice or lapse of time would allow, revocation or termination thereof or will result in any other impairment of the rights of the holder of any Permit. No Permit contains any restriction that would impair the ability of the Company, the Bank, South Coast Bancorp or SCCB to conduct their businesses in the manner consistent with their past practices. Neither the Company nor the Bank has received notice or otherwise has knowledge of any proceeding or action relating to the revocation or modification of any Permit.

          2.15 None of the Company, the Bank, South Coast Bancorp or SCCB is in breach or violation of its respective corporate charter, bylaws, operating agreement, or other governing documents in any respect. None of the Company, the Bank, South Coast Bancorp or SCCB is, and to the knowledge of the Company and the Bank, no other party is, in violation, breach, or default (with or without notice or lapse of time or both) in the performance or observance of any term, covenant, agreement, obligation, representation, warranty, or condition contained in (a) any contract, indenture, mortgage, deed of trust, loan or credit agreement, note, lease, franchise, license, Permit, or any other agreement or instrument to which it is a party or by which it or any of its properties may be bound, which breach, violation, or default could have a Material Adverse Effect, and to the knowledge of the Company and the Bank, no other party has asserted that the Company, the Bank, South Coast Bancorp or SCCB is in such violation, breach, or default (provided that the foregoing shall not apply to defaults by borrowers from the Bank and SCCB), or (b) except as disclosed in the Private Placement Memorandum, any order, decree, judgment, rule, or regulation of any court, arbitrator, government, or governmental agency or instrumentality, domestic or foreign, having jurisdiction over the Company, the Bank, South Coast Bancorp or SCCB or any of their respective properties the breach, violation, or default of which could have a Material Adverse Effect.

          2.16 The execution, delivery, and performance of the Transaction Documents and the consummation of the transactions contemplated by the Transaction Documents and the Private Placement Memorandum do not and will not conflict with, result in the creation or imposition of any lien, claim, charge, encumbrance, or restriction upon any property or assets of the Company,

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the Bank, South Coast Bancorp or SCCB or Shares pursuant to, constitute a breach or violation of, or constitute a default under, with or without notice or lapse of time or both, any of the terms, provisions or conditions of the charter or bylaws or operating agreement of the Company, the Bank, South Coast Bancorp or SCCB, any indenture, mortgage, deed of trust, loan or credit agreement or note, or any contract, lease, franchise, license, Permit, or other agreement or instrument to which the Company, the Bank, South Coast Bancorp or SCCB is a party or by which any of them or any of their respective properties may be bound or any order, decree, judgment, rule, or regulation of any court, arbitrator, government, or governmental agency or instrumentality, domestic or foreign, having jurisdiction over the Company, the Bank, South Coast Bancorp or SCCB or any of their respective properties which conflict, creation, imposition, breach, violation, or default would have either singly or in the aggregate a Material Adverse Effect. No authorization, approval, consent or order of or filing, registration or qualification with, any person (including, without limitation, any court, governmental body or authority) is required in connection with the transactions contemplated by the Transaction Documents and the Private Placement Memorandum, except a Form D to be filed with the Commission and except for such forms or other documents as may be required to be filed under state securities laws or foreign securities laws in connection with the purchase and distribution of the Shares and the orders of the Commission declaring the registration statement for the Holding Company Reorganization and the Shelf Registration Statement (as defined in the Registration Rights Agreement) effective.

          2.17 The Company has all requisite power and authority to enter into the Transaction Documents, and the Transaction Documents have been validly authorized, executed, and delivered by the Company and constitute the legal, valid, and binding agreement of the Company, enforceable against the Company in accordance with their terms, except as the enforcement thereof may be limited by general principles of equity and by bankruptcy or other laws relating to or affecting creditors’ rights generally and except as any indemnification or contribution provisions thereof may be limited under applicable securities laws.

          2.18 The Bank has all requisite power and authority to enter into this Agreement and the Acquisition Agreement, and this Agreement and the Acquisition Agreement have been validly authorized, executed, and delivered by the Bank and constitute the legal, valid, and binding agreement of the Bank, enforceable against the Bank in accordance with their terms, except as the enforcement thereof may be limited by general principles of equity and by bankruptcy or other laws relating to or affecting creditors’ rights generally and except as any indemnification or contribution provisions thereof may be limited under applicable securities laws.

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          2.19 Each of the Company, the Bank and Merger Sub has all requisite power and authority to enter into the Acquisition Agreement, and the Acquisition Agreement has been validly authorized, executed, and delivered by each of the Company, the Bank and Merger Sub and constitutes the legal, valid, and binding agreement of the Company, the Bank and the Merger Sub, enforceable against the Company, the Bank and he Merger Sub in accordance with its terms, except as the enforcement thereof may be limited by general principles of equity and by bankruptcy or other laws relating to or affecting creditors’ rights generally and except as any indemnification or contribution provisions thereof may be limited under applicable securities laws.

          2.20 The Company, the Bank, South Coast Bancorp and SCCB have good and marketable title in fee simple to all real property and good title to all personal property owned by them and material to their business, in each case free and clear of all security interests, liens, mortgages, pledges, encumbrances, restrictions, claims, equities, and other defects except such as are referred to in the Private Placement Memorandum or such as do not materially affect the value of such property in the aggregate and do not materially interfere with the use made or proposed to be made of such property; and all of the leases under which the Company, the Bank, South Coast Bancorp or SCCB holds real or personal property are valid, existing, and enforceable leases and in full force and effect with such exceptions as are not material and do not materially interfere with the use made or proposed to be made of such real or personal property, and none of the Company, the Bank, South Coast Bancorp or SCCB is in default in any respect of any of the terms or provisions of any real property or personal property leases. To the best knowledge of the Company and the Bank, no hazardous substances, hazardous wastes, pollutants, or contaminants have been deposited or disposed of in, on or under the properties of the Company, the Bank, South Coast Bancorp or SCCB (including properties owned, managed, or controlled by the Bank and SCCB in connection with its lending activities) during the period in which the Company, the Bank, South Coast Bancorp or SCCB has owned, occupied, managed, controlled, or operated such properties, in violation of any environmental, safety, health, or similar laws or regulations, orders, decrees, or permits relating to the protection of human health and safety, the environment or hazardous or toxic substances or wastes, pollutants, or contaminants (“Environmental Regulations”), or any order, judgment, decree, or permit which would require remedial action under any Environmental Regulation, excluding any violation or remedial action which would not have, in the aggregate, a Material Adverse Effect.

          2.21 Moss Adams LLP, who have audited the consolidated financial statements of the Bank, including the notes thereto, as of and for the year ended December 31, 2004, delivered together with the Private Placement

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Memorandum, are independent auditors with respect to the Bank, within the meaning of the 1933 Act and the 1933 Act Regulations.

          2.22 Grant Thornton LLP, who have audited the consolidated financial statements of South Coast Bancorp and its subsidiaries, including the notes thereto, as of and for the year ended December 31, 2004, delivered together with the Private Placement Memorandum, are independent auditors with respect to South Coast Bancorp and its subsidiaries, within the meaning of the 1933 Act and the 1933 Act Regulations.

          2.23 Except as set forth in the Private Placement Memorandum, no charge, investigation, action, suit, or proceeding is pending or, to the knowledge of the Company or the Bank, threatened, against or affecting the Company, the Bank, South Coast Bancorp or SCCB or any of their respective properties before or by any court or any regulatory, administrative or governmental official, commission, board, agency, or other authority or body, or any arbitrator, wherein an unfavorable decision, ruling or finding would have a Material Adverse Effect.

          2.24 There are no contracts or other documents that would be required to be summarized in the Private Placement Memorandum if it were a prospectus forming part of a registration statement filed under the 1933 Act that are not so summarized therein or in the documents attached thereto or included therewith.

          2.25 The Company has obtained, for the benefit of the Placement Agent, from each of the Company’s executive officers, directors and shareholders, a written agreement that for a period of 90 days from the Closing Date such executive officer, director or shareholder will not, without the Placement Agent’s prior written consent, offer, sell, contract to sell, pledge, grant any option to purchase, or otherwise dispose of, directly or indirectly, any shares of common stock of the Company or other instrument which by its terms is convertible into, or exercisable or exchangeable for, any shares of such common stock, except pursuant to bona fide gifts.

          2.26 The Company has not taken, directly or indirectly, any action causing or resulting in or which has constituted or which might reasonably be expected to cause or result in stabilization or manipulation of any security of the Company in connection with the sale of the Shares in violation of the Commission’s rules and regulations, including, but not limited to, Regulation D and Regulation M, nor is the Company aware of any such action having been taken or to be taken by any affiliate of the Company.

          2.27 The Company, the Bank, South Coast Bancorp and SCCB own, or possess adequate rights to use, all patents, copyrights, trademarks, service

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marks, trade names, and other rights necessary to conduct the businesses now conducted by them in all material respects or as described in the Private Placement Memorandum, and none of the Company, the Bank, South Coast Bancorp or SCCB has received any notice of infringement or conflict with asserted rights of others with respect to any patents, copyrights, trademarks, service marks, trade names, or other rights which, individually or in the aggregate, if the subject of an unfavorable decision, ruling or finding, would have a Material Adverse Effect, and neither the Company nor the Bank know of any basis for any such infringement or conflict.

          2.28 Except as disclosed in the Private Placement Memorandum, no labor dispute involving the Company, the Bank, South Coast Bancorp or SCCB exists or, to the knowledge of the Company or the Bank, is imminent which might be expected to have a Material Adverse Effect. None of the Company, the Bank, South Coast Bancorp or SCCB has received notice of any existing or threatened labor dispute by the employees of any of its principal suppliers, customers, or contractors which might be expected to have a Material Adverse Effect.

          2.29 The Company, the Bank, South Coast Bancorp and SCCB have timely and properly prepared and filed, or have timely and properly filed extensions for, all necessary federal, state, local, and foreign tax returns which are required to be filed and have paid all taxes shown as due thereon and have paid all other taxes and assessments to the extent that the same shall have become due, except such as are being contested in good faith or where the failure to so timely and properly prepare and file would not have a Material Adverse Effect. Each of the Company and the Bank has no knowledge of any tax deficiency which has been or might be assessed against the Company, the Bank, South Coast Bancorp or SCCB which, if the subject of an unfavorable decision, ruling or finding, would have a Material Adverse Effect.

          2.30 Each of the contracts, agreements, and instruments described or referred to in the Private Placement Memorandum is in full force and effect and is the legal, valid, and binding agreement of one or more of the Company, the Bank, South Coast Bancorp or SCCB, enforceable in accordance with its terms, except as the enforcement thereof may be limited by bankruptcy, insolvency, reorganization, or similar laws affecting the rights of creditors generally and subject to and limited by general principles of equity. Except as disclosed in the Private Placement Memorandum, to the knowledge of the Company or the Bank, no other party to any such agreement is (with or without notice or lapse of time or both) in breach or default in any respect thereunder.

          2.31 Except as described in the Private Placement Memorandum, no material relationship, direct or indirect, exists between or

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among the Company, the Bank, South Coast Bancorp or SCCB, on the one hand, and the directors, officers, trustees, shareholders, customers, or suppliers of the Company or Bank, on the other hand.

          2.32 Other than pursuant to the Registration Rights Agreement, no person has the right to request or require the Company, the Bank, South Coast Bancorp or SCCB to register any securities for offering and sale under the 1933 Act by reason of the Private Placement Memorandum or the issuance and sale of the Shares.

          2.33 Except as described in the Private Placement Memorandum, there are no contractual encumbrances or restrictions or legal restrictions required to be described therein, on the ability of the Bank (a) to pay dividends or make any other distributions on its capital stock or to pay any indebtedness owed to the Company, (b) to make any loans or advances to, or investments in, the Company, or (c) to transfer any of its property or assets to the Company. Upon consummation of the SCCB Acquisition, there will be no contractual encumbrances or restrictions or legal restrictions required to be described therein, on the ability of SCCB (a) to pay dividends or make any other distributions on its capital stock or to pay any indebtedness owed to the Company, (b) to make any loans or advances to, or investments in, the Company, or (c) to transfer any of its property or assets to the Company.

          2.34 None of the Company, the Bank, South Coast Bancorp or SCCB is an “investment company,” a company “controlled” by an “investment company,” or an “investment adviser” within the meaning of the Investment Company Act of 1940, as amended (the “Investment Company Act”), or the Investment Advisers Act of 1940, as amended (the “Advisers Act”).

          2.35 Each of the Bank and SCCB has properly administered all accounts for which it acts as a fiduciary, including but not limited to accounts for which it serves as a trustee, agent, custodian, personal representative, guardian, conservator, or investment advisor, in accordance with the terms of the governing documents and applicable state and federal law and regulation and common law, except where the failure to be in compliance would not have a Material Adverse Effect. None of the Bank, SCCB or any of their respective directors, officers, or employees, has committed any material breach of trust with respect to any such fiduciary account, and the accountings for each such fiduciary account are true and correct in all material respects and accurately reflect the assets of such fiduciary account in all material respects.

          2.36 Each of the Company, the Bank, South Coast Bancorp and SCCB maintains a system of internal accounting controls sufficient to provide reasonable assurance that (a) transactions are executed in accordance with management’s general or specific authorizations, (b) transactions are recorded as

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necessary to permit preparation of financial statements in conformity with U.S. generally accepted accounting principles and to maintain asset accountability, (C) access to assets is permitted only in accordance with management’s general or specific authorization, and (D) the recorded accountability for assets is compared with existing assets at reasonable intervals and appropriate action is taken with respect to any differences.

          2.37 Other than as contemplated by this Agreement and as disclosed in the Private Placement Memorandum, the Company has not incurred any liability for any finder’s or broker’s fee or agent’s commission in connection with the execution and delivery of this Agreement or the consummation of the transactions contemplated hereby.

          2.38 No report or application filed by the Company or the Bank, or to the knowledge of the Bank, South Coast Bancorp or SCCB, with the FRB, the FDIC or any other state or federal regulatory authority, as of the date it was filed or amended, contained an untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary to make the statements therein not misleading when made or failed to comply in all material respects with the applicable requirements of the FRB, the FDIC or any other state or federal regulatory authority, as the case may be.

          2.39 None of the Company, the Bank, or any other person associated with or acting on behalf of the Company or the Bank, including, without limitation, any director, officer, agent, or employee of the Company or the Bank has, directly or indirectly, while acting on behalf of the Company or the Bank, or to the knowledge of the Bank, South Coast Bancorp or SCCB, or any other person associated with or acting on behalf of South Coast Bancorp or SCCB, including, without limitation, any director, officer, agent, or employee of South Coast Bancorp or SCCB has, directly or indirectly, while acting on behalf of South Coast Bancorp or SCCB: (a) used any corporate funds for unlawful contributions, gifts, entertainment, or other unlawful expenses relating to political activity; (b) made any unlawful contribution to any candidate for foreign or domestic office, or to any foreign or domestic government officials or employees or other person charged with similar public or quasi-public duties, other than payments required or permitted by the laws of the United States or any jurisdiction thereof or to foreign or domestic political parties or campaigns from corporate funds, or failed to disclose fully any contribution in violation of law; (c) violated any provision of the Foreign Corrupt Practices Act of 1977, as amended; or (d) made any other payment of funds of either or both of the Company or the Bank or retained any funds which constitute a violation of any law, rule or regulation, or which would be required to be disclosed in the Private Placement Memorandum if it were a prospectus forming part of a registration statement filed under the 1933 Act.

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          2.40 The employee benefit plans, including employee welfare benefit plans, of the Company, the Bank, South Coast Bancorp and SCCB (the “Employee Plans”) have been operated in compliance with the applicable provisions of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), the Internal Revenue Code of 1986, as amended (the “Code”), all regulations, rulings, and announcements promulgated or issued thereunder and all other applicable governmental laws and regulations (except to the extent such noncompliance would not, in the aggregate, have a Material Adverse Effect).

          2.41 Neither of the Company nor the Bank, and, to the knowledge of the Bank, neither South Coast Bancorp nor SCCB:

     (a) is subject to any federal or state statutory disqualifications preventing them from selling the Shares pursuant to the exemption from registration afforded by Regulation D under the 1933 Act or any state exemption from registration; or

     (b) has been convicted of any crime or is engaged in any conduct that would be a basis for denial, suspension or revocation of registration of a broker-dealer under Section 15 of the 1934 Act, and to the best knowledge of the Company or the Bank, there is no basis for, or proceeding or investigation that is reasonably likely to become the basis for, any such disqualification, denial, suspension or revocation.

          2.42 Except as described in the Private Placement Memorandum, there are no material off-balance sheet transactions, arrangements, obligations (including contingent obligations), or any other relationships with unconsolidated entities or other persons, that may have a material current or future effect on the Company’s, the Bank’s, South Coast Bancorp’s or SCCB’s financial condition, changes in financial condition, results of operations, liquidity, capital expenditures, capital resources, or significant components of revenues or expenses.

     3. Use of Proceeds.

     The Company intends to apply the proceeds from the sale of the Shares to the purposes and substantially in the manner set forth in the Private Placement Memorandum.

     4. Certain Covenants of the Company.

     Until the Closing Date (or, if applicable, other specified time), each of the Company and the Bank covenants with the Placement Agent as follows:

          4.1 The Company shall promptly from time to time file appropriate forms and take such other appropriate action as the Placement Agent may reasonably request in connection with applicable state securities laws (not

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including United States federal securities laws) in connection with the offering of Shares contemplated hereby; provided, however, that in connection therewith the Company shall not be required to qualify as a foreign corporation or to file a general consent to service of process in any jurisdiction.

          4.2 The Company shall file with the Commission, to the extent required, not later than 15 days after the Closing Date, five copies of a notice on Form D (one of which will be manually signed by a person validly authorized by the Company) and will otherwise comply with the requirements of Rule 503 of Regulation D under the 1933 Act. The Company shall file with each other Regulator having jurisdiction, to the extent required, not later than 15 days after the Closing Date, at least one copy of a notice on Form D (manually signed by a person validly authorized by the Company) and shall otherwise comply with the requirements of all applicable state securities laws. The Company shall furnish promptly to the Placement Agent evidence of all filings contemplated by this paragraph.

          4.3 The Company and the Bank will furnish to the Placement Agent, as soon as available, copies of the Private Placement Memorandum and any amendments or supplements thereto, all in such quantities as the Placement Agent may from time to time reasonably request. The Company and the Bank specifically authorize the Placement Agent and any subagents to use and distribute copies of the Private Placement Memorandum in connection with the sale of the Shares.

          4.4 The Company shall comply to the best of its ability with the 1933 Act and the 1933 Act Regulations and the 1934 Act and the 1934 Act Regulations so as to permit the completion of the distribution of the Shares as contemplated herein and in the Private Placement Memorandum. If it is necessary, in the Company’s reasonable opinion or in the reasonable opinion of the Company’s or the Placement Agent’s counsel, to amend or supplement the Private Placement Memorandum in connection with the distribution of the Shares, then the Company shall forthwith amend or supplement the Private Placement Memorandum by preparing and furnishing to the Placement Agent such number of copies as they may reasonably request of an amendment or amendments of, or a supplement or supplements to, the Private Placement Memorandum (in form and substance satisfactory to the Placement Agent and counsel for the Placement Agent). If any event shall occur as a result of which it is necessary to amend or supplement the Private Placement Memorandum to correct an untrue statement of a material fact or to include a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, or if for any reason it is necessary at any time to amend or supplement the Private Placement Memorandum to comply with the 1933 Act and the 1933 Act Regulations or the 1934 Act and the 1934 Act Regulations, the Company

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shall, subject to the second sentence of this subsection, forthwith amend or supplement the Private Placement Memorandum by preparing and furnishing to the Placement Agent such number of copies as it may reasonably request of an amendment or amendments of, or a supplement or supplements to, the Private Placement Memorandum (in form and substance reasonably satisfactory to the Placement Agent and counsel for the Placement Agent) so that, as so amended or supplemented, the Private Placement Memorandum shall not contain an untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading.

          4.5 For five years from the Closing Date, the Company shall furnish to the Placement Agent copies of all reports and communications (financial or otherwise) furnished by the Company to the holders of the Shares as a class, copies of all reports and financial statements filed with or furnished to the Commission (other than portions for which confidential treatment has been obtained from the Commission), any national securities exchange, or other self-regulatory organization, if any, and such other documents, reports, and information concerning the business and financial conditions of the Company as the Placement Agent may reasonably request, other than such documents, reports, and information which the Company have the legal obligation not to reveal to the Placement Agent. Any documents filed or furnished electronically with the Commission and available on its website shall be deemed to be furnished to the Placement Agent pursuant to this Section 4.5.

          4.6 Until the Closing Date, the Company shall not, without the prior written consent of the Placement Agent, directly or indirectly, offer for sale, sell, or agree to sell, or otherwise dispose of any Shares other than as contemplated by this Agreement or any securities of the Company that are substantially similar to the Shares, including any guarantee of such beneficial interests or substantially similar securities, or securities convertible into or exchangeable for or that represent the right to receive any such beneficial interest or substantially similar securities, except for: (i) contributions to employee benefit plans in existence on the date of the execution of this Agreement; or (ii) pursuant to the exercise of any stock options outstanding on the date of the execution of this Agreement.

          4.7 After the date of this Agreement and through the Closing Date, except as described in or contemplated by the Private Placement Memorandum, neither the Company nor the Bank shall take any action (or refrain from taking any action) which will result in the Company or the Bank incurring any material liability or obligation, direct or contingent, or enter into any material transaction, except in the ordinary course of business, and there will not be any material change in the financial position, common stock, trust preferred securities,

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or minority interest in consolidated subsidiaries or any material increase in debt obligations of the Company and the Bank on a consolidated basis.

          4.8 The Company shall not take, directly or indirectly, any action designed to result in or which has constituted or which might reasonably be expected to cause or result in stabilization or manipulation of the price of any security of the Company in connection with the sale or resale of the Shares in violation of the Commission’s rules and regulations, including, but not limited to, Regulation D and Regulation M, and the Company is not aware of any such action taken or to be taken by any affiliate of the Company.

          4.9 For a period of 90 days from the Closing Date (the “Lock-Up Period”), the Company will not, without the Placement Agent’s prior written consent, directly or indirectly, sell, offer to sell, grant any option for the sale of, hypothecate, pledge, enter into any transaction which is designed to, or might reasonably be expected to, result in the disposition (whether by actual disposition or effective economic disposition due to cash settlement or otherwise) by the Company or any affiliate, or otherwise issue or dispose of, any of the Company’s Common Stock or securities convertible into or exchangeable or exercisable for Common Stock, or register or publicly announce any intent to register under the 1933 Act the offer or sale of any capital stock of the Company, except for: (i) the registration required pursuant to the Registration Rights Agreement; (ii) contributions to employee benefit plans in existence on the date of the execution of this Agreement; or (iii) pursuant to the exercise of any stock options outstanding on the date of the execution of this Agreement.

          4.10 Before the Closing Date, the Company will not issue any press release or other communication directly or indirectly or hold any press conference with respect to the Company, the Bank, or the offering of the Shares (the “Offering”) without the Placement Agent’s prior consent, which shall not be unreasonably withheld or denied, provided, however, that the Company may issue a press release or other information without the Placement Agent’s consent if, in the Company’s reasonable opinion, the Company is legally required to do so.

          4.11 To make generally available to its securityholders as soon as practicable, but in any event not later than eighteen months after the effective date of a Registration Statement (as defined in Rule 158(c) under the Act), an earning statement of the Company and its subsidiaries (which need not be audited) complying with Section 11(a) of the Act and the rules and regulations thereunder (including, at the option of the Company, Rule 158).

          4.12 Upon filing of a registration statement pursuant to the Registration Rights Agreement (a “Registration Statement”), to furnish to its stockholders, as soon as practicable after the end of each fiscal year, an annual report (including a balance sheet and statements of income, stockholders’ equity

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and cash flows of the Company and its consolidated subsidiaries certified by independent public accountants) and, as soon as practicable after the end of each of the first three quarters of each fiscal year (beginning with the fiscal quarter ending after the effective date of the Registration Statement), consolidated summary financial information of the Company and its subsidiaries for such quarter in reasonable detail.

          4.13 Upon effectiveness of a Registration Statement, to comply, and to use its best efforts to cause the Company’s directors and officers, in their capacities as such, to comply, in all material respects, with all effective applicable provisions of the Sarbanes-Oxley Act of 2002 and the rules and regulations thereunder, including, but not limited to, the establishment and maintenance of disclosure controls and procedures (as such term is defined in Rule 13a 15(e) and 15d 15(e) under the 1934 Act. Such disclosure controls and procedures will be (A) designed to ensure that material information relating to the Company, including its consolidated subsidiaries, is made known to the Company’s Chief Executive Officer and its Chief Financial Officer by others within those entities to allow timely decisions regarding disclosures, (B) evaluated for effectiveness as of the end of the most recent fiscal quarter and (C) effective to perform the functions for which they were established.

          4.14 To comply with any of the provisions of any undertaking in any Registration Statement.

     5. Payment of Expenses.

     Whether or not this Agreement is terminated or the sale of the Shares contemplated by this Agreement is consummated, the Company covenants and agrees that it will pay or cause to be paid (directly or by reimbursement) all costs and expenses incident to the performance of the obligations of the Company under this Agreement, including: (a) all costs and expenses in connection with the preparation, and printing of the Private Placement Memorandum (including attachments and enclosures), and any amendments or supplements to the Private Placement Memorandum; (b) the printing of any other instruments or documents relating to any transaction contemplated in this Agreement; (c) the issuance and delivery of the Shares, including taxes, if any; (d) the cost of all certificates representing the Shares; (e) the fees and disbursements of counsel for the Company; (f) all fees and other charges of the independent public accountants of the Company; (g) the cost of furnishing to the Placement Agent and to offerees copies of the Private Placement Memorandum (including attachments and enclosures), and any amendments or supplements to the Private Placement Memorandum; (h) all costs of obtaining exemption from registration of the offer and sale of the Shares under the applicable state securities laws; and (i) all other costs and expenses incident to the performance of its obligations hereunder which

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are not otherwise specifically provided for in this section. It is understood, however, that, except as provided in this section and Section 7, the Placement Agent will pay all of their own costs and expenses, including the fees of their counsel.

     The Company will also reimburse the Placement Agent for all documented out-of-pocket expenses incurred by it in connection with the Offering, including, without limitation, transportation, meals, and lodging expenses with respect to roadshows or other selling efforts (but not including fees of counsel), not to exceed $50,000 unless otherwise approved by the Company.

     6. Conditions to the Placement Agent’s Obligations.

     The obligations of the Placement Agent hereunder are subject to the accuracy of the representations and warranties and to compliance with the agreements of the Company herein as of the date hereof and as of the Closing Date, to the accuracy of the written statements of the Company made pursuant to the provisions hereof, to the performance by the Company of their covenants and obligations hereunder, and to the following additional conditions:

          6.1 Neither the Private Placement Memorandum nor any amendment or supplement thereto shall contain an untrue statement of a fact which, in the Placement Agent’s opinion, is material or omits to state a fact which, in the Placement Agent’s opinion, is material and is necessary to make statements therein, in the light of the circumstances under which they were made, not misleading.

          6.2 Since the respective dates as of which information is given in the Private Placement Memorandum there shall not have been any (i) material change in the capital stock or long-term debt of the Company, the Bank, South Coast Bancorp or SCCB; (ii) any material adverse change, or any development involving a prospective material adverse change, in or affecting the business, its financial condition, management or results of operations of the Company and the Bank, taken as a whole, or South Coast Bancorp and SCCB, taken as a whole, other than as set forth or contemplated in the Private Placement Memorandum; or (iii) any suspension or material limitation of trading in the capital stock of the Company, the effect of which in the judgment of the Placement Agent makes it impracticable or inadvisable to proceed with the offering or the delivery of the Shares on the Closing Date on the terms and in the manner contemplated in the Private Placement Memorandum;

          6.3 All corporate proceedings and other legal matters incident to the authorization, form, and validity of this Agreement and the Shares, and the authorization and form of the Private Placement Memorandum, other than financial statements and other financial data, and all other legal matters relating to

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this Agreement and the transactions contemplated hereby shall be satisfactory in all material respects to counsel for the Placement Agent, and the Company and the Bank shall have furnished to such counsel all documents and information relating thereto that they may reasonably request to enable them to pass upon such matters.

          6.4 Horgan, Rosen, Beckham & Coren, LLP, a California limited liability partnership, counsel for the Company (“Company Counsel”), shall have furnished to the Placement Agent their signed opinion, dated the Closing Date, in form and substance satisfactory to counsel for the Placement Agent, to the effect that:

     (a) Each of the Company, the Merger Sub and South Coast Bancorp has been validly incorporated and is validly existing and in good standing under the laws of the State of California. South Coast Bancorp is validly registered as a bank holding company under the BHC Act. Each of the Bank and SCCB is a state-chartered commercial bank validly organized, validly existing, and in active status or good standing, as applicable, with all applicable regulators and under the laws of the State of California. Each of the Company, the Bank, South Coast Bancorp and SCCB has the corporate or other power and authority to own or lease its properties and to conduct its as such business is described in the Private Placement Memorandum.

     (b) The Company’s common stock and the Shares conform to the descriptions thereof in the Private Placement Memorandum in all material respects. The issued and outstanding shares of the Company’s common stock have been validly authorized and validly issued and are fully paid and nonassessable, except to the extent that such shares may be deemed assessable under 12 U.S.C. § 1831o. To the best of such counsel’s knowledge, and except as described in the Private Placement Memorandum, there are no rights, options, or warrants to purchase, no other outstanding securities convertible into or exchangeable for, and no commitments, plans, or arrangements to issue, any shares of capital stock of the Company.

     (c) The issuance, sale and delivery of the Shares in accordance with the terms and conditions of the Transaction Documents have been validly authorized by all necessary corporate actions of the Company and the Bank.

     (d) The Shares have been validly authorized for issuance by the Company and, when issued and sold in accordance with the Transaction Documents, will be validly issued, fully paid and non-assessable, and the

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issuance of the Shares will not be subject to any preemptive or similar rights.

     (e) There are no preemptive or other rights to subscribe for or to purchase and other than as disclosed in the Private Placement Memorandum, no restrictions upon the voting or transfer of any shares of capital stock or equity securities of the Company pursuant to the corporate charter, bylaws, or other governing documents of the Company or the Bank, or, to the best of such counsel’s knowledge, any agreement or other instrument to which the Company or the Bank is a party or by which the Company or the Bank may be bound.

     (f) Each of the Company and the Bank has all requisite corporate power to enter into and perform its obligations under the Transaction Documents, and this Agreement has been validly authorized, executed, and delivered by the Company and the Bank and constitutes the legal, valid, and binding obligations of the Company and the Bank enforceable against the Company and the Bank in accordance with its terms, except as the enforcement thereof may be limited by general principles of equity and by bankruptcy or other laws relating to or affecting creditors’ rights generally, and except as the indemnification and contribution provisions hereof may be limited under applicable laws.

     (g) To the best of such counsel’s knowledge, neither the Company nor the Bank is in breach or violation of, or default under, with or without notice or lapse of time or both, its corporate charter, bylaws, or other governing documents. The execution, delivery, and performance of the Transaction Documents or the Shares and the consummation of the transactions contemplated by the Transaction Documents do not and will not conflict with, result in the creation or imposition of any material lien, claim, charge, encumbrance, or restriction upon any property or assets of the Company or the Bank pursuant to, or constitute a breach or violation of, or constitute a material default under, with or without notice or lapse of time or both, any of the terms, provisions, or conditions of the charter, bylaws, operating agreement, or other governing documents of the Company or the Bank, or any indenture, mortgage, deed of trust, loan or credit agreement, note, material contract, lease, franchise, license, or any other material agreement or instrument known to such counsel to which either the Company or the Bank is a party or by which any of them or any of their respective properties may be bound or any order, decree, judgment, franchise, license, or Permit known to such counsel, or any rule or regulation of any court, arbitrator, government, or governmental agency or instrumentality, domestic or foreign, having jurisdiction over the Company or the Bank or any of their respective properties. No

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authorization, approval, consent, or order of, or filing, registration, or qualification with, any person (including, without limitation, any court, governmental body, or authority) is required under California or United States federal law in connection with the transactions contemplated by the Transaction Documents, including in connection with the placement of the Shares by the Placement Agent, other than the order of the Commission declaring the Shelf Registration Statement (as defined in the Registration Rights Agreement) effective.

     (h) To the best of such counsel’s knowledge, holders of securities of the Company either do not have any right that, if exercised, would require the Company to cause such securities to be included in the offering of the Shares or have waived such right. To the best of such counsel’s knowledge, neither the Company nor the Bank is a party to any agreement or other instrument which grants rights for or relating to the registration of any securities of the Company.

     (i) Except as set forth in the Private Placement Memorandum, to the best of such counsel’s knowledge, (i) no action, suit, or proceeding at law or in equity is pending or threatened in writing to which any of the Company or the Bank is or could reasonably be expected to become a party, and (ii) no action, suit, or proceeding is pending or threatened in writing against or affecting the Company or the Bank or any of their properties, before or by any court or governmental official, commission, board, or other administrative agency, authority or body, or any arbitrator, wherein an unfavorable decision, ruling, or finding could reasonably be expected to have a Material Adverse Effect or which would be required to be disclosed in the Private Placement Memorandum if the Private Placement Memorandum were a prospectus included in a registration statement filed under the 1933 Act and is not so disclosed.

     (j) The offer, sale, issuance, and delivery of the Shares under the circumstances contemplated by this Agreement and the Private Placement Memorandum are exempt from the registration and prospectus delivery requirements of the 1933 Act and state securities laws. No authorization, approval, consent, or order of or filing, registration, or qualification with, any person (including, without limitation, any court, governmental body or authority) is required in connection with the transactions contemplated by this Agreement, and the Private Placement Memorandum.

     (k) To the best of such counsel’s knowledge, there are no contracts, agreements, leases, or other documents of a character that would be required to be disclosed in the Private Placement Memorandum if the

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Private Placement Memorandum were a prospectus included in a registration statement filed under the 1933 Act that are not so disclosed.

     (l) The statements under the captions “Description of Capital Stock,” “Registration Rights,” “Material United States Federal Tax Considerations,” “Supervision and Regulation,” and “Shares Eligible for Future Sale” in the Private Placement Memorandum, insofar as such statements constitute a summary of legal and regulatory matters, documents, or instruments referred to therein, are accurate descriptions of the matters summarized therein in all material respects and fairly present the information that would be called for with respect to such legal and regulatory matters, documents, and instruments if the Private Placement Memorandum were a prospectus included in a registration statement filed under the 1933 Act, other than financial and statistical data, as to which said counsel shall not be required to express any opinion or belief.

     (m) Except as described in the Private Placement Memorandum, to the best of such counsel’s knowledge, there are no contractual encumbrances or restrictions, or material legal restrictions on the ability of the Bank or SCCB (A) to pay dividends or make any other distributions on its capital stock or to pay indebtedness owed to the Company, (B) to make any loans, or advances to, or investments in, the Company, or (C) to transfer any of its property or assets to the Company which, in any such case, would be required to be described in the Private Placement Memorandum if the Private Placement Memorandum were a prospectus included in a registration statement filed under the 1933 Act and which are not so described.

     Such counsel shall also confirm that, in connection with the preparation of the Private Placement Memorandum, such counsel has participated in conferences with officers and representatives of the Bank, the Company, South Coast Bancorp and SCCB and with their independent public accountants, at which conferences such counsel made inquiries of such officers, representatives, and accountants and discussed in detail the contents of the Private Placement Memorandum (without taking further action to verify independently the statements made in the Private Placement Memorandum, and without assuming responsibility for the accuracy or completeness of such statements, except to the extent expressly provided above), and such counsel has no reason to believe that the Private Placement Memorandum or any amendment or supplement thereto (except for the financial statements and related schedules and statistical data and exhibits included therein or Placement Agent’s Information, as to which such counsel need express no opinion), at the date thereof, at the time any such amended or supplemented Private Placement Memorandum was issued, or at the Closing Date, contained or contains any untrue statement of a material fact or omitted or omits to state any

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material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading.

     In giving the above opinion, such counsel may state that, insofar as such opinion involves factual matters, they have relied upon certificates of officers of the Company including, without limitation, certificates as to the identity of any and all indentures, mortgages, deeds of trust, loan or credit agreements, notes, material contracts, leases, franchises, licenses, or other agreements or instruments, and all material Permits, easements, consents, licenses, franchises, and government regulatory authorizations, for purposes of subsections (g), (h), (k), and (m), and certificates of public officials.

          6.5 At the Closing Date, the Placement Agent shall have received a certificate of the Chief Executive Officer and the Chief Financial Officer of the Company dated as of the Closing Date stating that:

     (a) the representations and warranties of the Bank and the Company set forth in Section 2 are accurate as of the Closing Date (except for representations and warranties given as of a specified date, which were true as of such date) and that the Bank and the Company have complied with all agreements and satisfied all conditions on their part to be performed or satisfied at or prior to the Closing Date;

     (b) since the respective dates as of which information is given in the Private Placement Memorandum, there has not been any material adverse change in the condition (financial or otherwise), earnings, business, affairs, prospects, or results of operations of the Company and the Bank on a consolidated basis;

     (c) since such dates there has not been any material transaction entered into by the Company or the Bank other than transactions in the ordinary course of business; and

     (d) they have carefully examined the Private Placement Memorandum as amended or supplemented and nothing has come to their attention that would lead them to believe that the Private Placement Memorandum or any amendment or supplement thereto, as of their respective dates, contained or contains any untrue statement of a material fact, or omits to state a material fact that would be required to be stated therein if the Private Placement Memorandum were a prospectus included in a registration statement filed under the 1933 Act or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading.

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          6.6 On the Closing Date, the Placement Agent shall have received validly executed counterparts of the Subscription Agreements and the Registration Rights Agreement.

          6.7 On or prior to the Closing Date, the Holding Company Reorganization shall have been consummated on terms consistent with the terms described in the Private Placement Memorandum.

          6.8 On or prior to the Closing Date, the Trust Preferred Offering shall have been consummated on terms consistent with the terms described in the Private Placement Memorandum.

          6.9 On the Closing Date, the SCCB Acquisition shall have been consummated on terms consistent with the terms described in the Private Placement Memorandum.

          6.10 Before the Closing Date, the Company shall have furnished to the Placement Agent and counsel for the Placement Agent all such other documents, certificates, and opinions as they have reasonably requested.

     All opinions, certificates, letters, and other documents shall be in compliance with the provisions hereof only if they are reasonably satisfactory in form and substance to the Placement Agent. The Company shall furnish the Placement Agent with conformed copies of such opinions, certificates, letters, and other documents as the Placement Agent shall reasonably request.

     If any of the conditions referred to in this Section 6 shall not have been fulfilled when and as required by this Agreement, this Agreement and all of the Placement Agent’s obligations hereunder may be terminated by the Placement Agent on notice to the Company at, or at any time before, the Closing Date. The Placement Agent may waive, in writing or otherwise, the performance of any one or more of the conditions specified in this Section 6 or extend the time for their performance by the Company. Any such termination shall be without liability of the Placement Agent to the Company.

     7. Indemnification and Contribution.

          7.1 Each of the Company and the Bank, jointly and severally, agrees to indemnify and hold harmless the Placement Agent, each of its directors, officers, and agents, and each person, if any, who controls the Placement Agent within the meaning of the 1933 Act, against any and all losses, claims, damages, liabilities, and expenses (including reasonable costs of investigation and attorneys’ fees and expenses), joint or several, insofar as such losses, claims, damages, judgments, liabilities or expenses (or actions in respect thereof) arise out of or based upon: (i) any untrue statement or alleged untrue statement of a material fact contained in the Private Placement Memorandum or in any

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amendment or supplement thereto; (ii) any omission or alleged omission to state a material fact in the Private Placement Memorandum or in any amendment or supplement thereto that would have been required to be stated therein or necessary to make the statements therein, in the light of the circumstances in which made, not misleading, and against any and all losses, claims, damages, liabilities, and expenses (including reasonable costs of investigation and attorneys’ fees), joint or several, arising out of or based upon any such actual or alleged omission; or (iii) the enforcement of this indemnification provision or the contribution provisions of Section 7.4; and shall reimburse each such indemnified party for any reasonable legal or other expenses as paid and incurred on a quarterly basis, but in no event less frequently than 30 days after each invoice is submitted, incurred by them in connection with investigating or defending against or appearing as a third-party witness in connection with any such loss, claim, damage, liability, or action, notwithstanding the possibility that payments for such expenses might later be held to be improper, in which case such payments shall be promptly refunded; provided, however, that neither the Bank or the Company shall be liable in any such case to the Placement Agent or any of its directors, officers, agents, or control persons to the extent, but only to the extent, that any such losses, claims, damages, liabilities, and expenses arise out of or are based upon any untrue statement or omission or allegation thereof that has been made therein or omitted therefrom in reliance upon and in conformity with Placement Agent’s Information. The foregoing indemnity agreement is in addition to any liability the Bank or the Company may otherwise have to any such indemnified party.

          7.2 The Placement Agent agrees to indemnify and hold harmless the Company and each of its directors and officers, and each person, if any, who controls the Company within the meaning of the 1933 Act, to the same extent as required by the foregoing indemnity from the Company to the Placement Agent, but only with respect to the Placement Agent’s Information furnished by the Placement Agent. The foregoing indemnity agreement is in addition to any liability which the Placement Agent may otherwise have to any such indemnified party.

          7.3 If any action or claim shall be brought or asserted against any indemnified party in respect of which indemnity may be sought from the indemnifying party, such indemnified party shall promptly notify the indemnifying party in writing, and the indemnifying party shall assume the defense thereof, including the employment of counsel reasonably satisfactory to the indemnified party and the payment of all expenses; provided, however, that the failure or delay so to notify the indemnifying party shall not relieve it from any liability which it may have except to the extent, if any, that such failure or delay directly results in an increase in such liability. Any indemnified party shall

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have the right to employ separate counsel in any such action and to participate in the defense thereof, but the fees and expenses of such counsel shall be at the expense of such indemnified party unless (i) the employment thereof has been specifically authorized by the indemnifying party in writing, (ii) the indemnifying party has failed to assume the defense or to employ counsel reasonably satisfactory to the indemnified party, or (iii) the named parties to any such action (including any impleaded parties) include both such indemnified party and the indemnifying party and such indemnified party shall have been advised by such counsel that there may be one or more legal defenses available to it that are different from or in addition to those available to the indemnifying party (in which case, if such indemnified party notifies the indemnifying party in writing that it elects to employ separate counsel at the expense of the indemnifying party, the indemnifying party shall not have the right to assume the defense of such action on behalf of such indemnified party), it being understood, however, that the indemnifying party shall not, in connection with any one such action or separate but substantially similar or related actions in the same jurisdiction arising out of the same general allegations or circumstances, be liable for the fees and expenses of more than one separate firm of attorneys at any time for all such indemnified parties, which firm shall be designated in writing by the indemnified party(ies). Each indemnified party shall use reasonable efforts to cooperate with the indemnifying party in the defense of any such action or claim. The indemnifying party shall not be liable for any settlement of any such action effected without its written consent, but if there be a final judgment for the plaintiff in any such action, the indemnifying party agrees to indemnify and hold harmless any indemnified party person from and against any loss, claim, damage, liability, or expense by reason of such settlement or judgment.

     An indemnifying party shall not, without the prior written consent of each indemnified party, settle, compromise, or consent to the entry of any judgment in any pending or threatened claim, action, suit, or proceeding in respect of which indemnity may be sought hereunder (whether or not such indemnified party is a party to such claim, action, suit, or proceeding), unless such settlement, compromise, or consent includes a release of each such indemnified party reasonably satisfactory to each such indemnified party from all liability arising out of such claim, action, suit, or proceeding or unless the indemnifying party shall confirm in a written agreement with each indemnified party that notwithstanding any federal, state, or common law, such settlement, compromise, or consent shall not alter the right of any indemnified party or controlling person to indemnification or contribution as provided in this Agreement.

          7.4 If the indemnification provided for in this Section 7 is unavailable or insufficient to hold harmless an indemnified party under Sections 7.1, 7.2, or 7.3 in respect of any losses, claims, damages, liabilities, or expenses

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referred to therein, then each indemnifying party, in lieu of indemnifying such indemnified party, shall contribute to the amount paid or payable by such indemnified party as a result of such losses, claims, damages, liabilities, or expenses (i) in such proportion as is appropriate to reflect the relative benefits received by the Bank and the Company on the one hand and the Placement Agent on the other from the offering of the Shares or (ii) if the allocation provided by clause (i) above is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause (i) above but also the relative fault of the Bank and the Company, on the one hand, and the Placement Agent, on the other, in connection with the statements or omissions that resulted in such losses, claims, damages, liabilities, or expenses, as well as any other relevant equitable considerations. The relative benefits received by the Bank and the Company on the one hand and the Placement Agent on the other shall be deemed to be in the same proportion as the total net proceeds from the offering of the Shares (after commissions but before deducting expenses) received by the Bank and the Company bear to the total commissions received by the Placement Agent (before deducting expenses). The relative fault of the Bank and the Company on the one hand and of the Placement Agent on the other shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the Bank and the Company or by the Placement Agent and the parties’ relative intent, knowledge, access to information, and opportunity to correct or prevent such untrue statement or omission. The Bank and the Company and the Placement Agent agree that it would not be just and equitable if contribution pursuant to this Section 7.4 were determined by pro rata allocation or by any other method of allocation that does not take into account the equitable considerations referred to herein. The amount paid or payable by an indemnified party as a result of the losses, claims, damages, liabilities, and expenses referred to in the first sentence of this Section 7.4 shall be deemed to include, subject to the limitations set forth above, any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any such action or claim. Notwithstanding the provisions of this Section 7.4, the Placement Agent shall not be required to contribute any amount in excess of the amount by which the total commissions received by the Placement Agent for Shares sold exceeds the amount of any damages that the Placement Agent has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the 1933 Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation.

     For purposes of this Section 7.4, each person who controls the Placement Agent within the meaning of the 1933 Act shall have the same rights to

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contribution as the Placement Agent, and each person who controls the Company within the meaning of the 1933 Act shall have the same rights to contribution as the Company subject in each case to the preceding sentence. The obligations of the Company under this Section 7.4 shall be in addition to any liability which the Company may otherwise have, and the obligations of the Placement Agent under this Section 7.4 shall be in addition to any liability that the Placement Agent may otherwise have.

          7.5 The indemnity and contribution agreements contained in this Section 7 shall remain operative and in full force and effect, regardless of (i) any investigation made by or on behalf of the Placement Agent (or any person controlling the Placement Agent) or by or on behalf of the Company (or any person controlling the Company), (ii) the sale of any Shares and payment therefor hereunder, and (iii) any termination of this Agreement. A successor of the Placement Agent or of the Company (or of any person controlling the Placement Agent or the Company) shall be entitled to the benefits of the indemnity, contribution and reimbursement agreements contained in this Section 7.

     8. Termination.

     The Placement Agent shall have the right to terminate this Agreement at any time by written notice at or prior to the Closing Date, without liability on the part of the Placement Agent to the Company, if:

     (a) The Bank or the Company shall have failed, refused, or been unable to perform any agreement on its part to be performed under this Agreement, or any of the conditions referred to in Section 6 shall not have been fulfilled, when and as required by this Agreement;

     (b) Any of the Company, the Bank, South Coast Bancorp or SCCB shall have sustained any material loss or interference with its business from fire, explosion, flood, or other calamity, whether or not covered by insurance, or from any labor dispute or court or governmental action, order, or decree, which in the judgment of the Placement Agent materially impairs the investment quality of the Shares;

     (c) There has been since the respective dates as of which information is given in the Private Placement Memorandum, any materially adverse change in, or any development which is reasonably likely to have a Material Adverse Effect, whether or not arising in the ordinary course of business;

     (d) There has occurred any outbreak of hostilities or other calamity or crisis or material change in general economic, political, or financial conditions, or internal conditions, the effect of which on the financial markets of the United States is such as to make it, in the Placement

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Agent’s reasonable judgment, impracticable to market the Shares or enforce contracts for the sale of the Shares;

     (e) Trading generally on the New York Stock Exchange, the American Stock Exchange, or in the Nasdaq National Market shall have been suspended, or minimum or maximum prices for trading shall have been fixed, or maximum ranges for prices for securities shall have been required, by any of said exchanges or market system or by the Commission or any other governmental authority;

     (f) A banking moratorium shall have been declared by either federal or California authorities; or

     (g) Any action shall have been taken by any government in respect of its monetary affairs which, in the Placement Agent’s reasonable judgment, has a material adverse effect on the United States securities markets.

     If this Agreement shall be terminated pursuant to this Section 8, neither the Bank or the Company shall then be under any liability to the Placement Agent except as provided in Sections 5 and 7.

     9. Effective Date of Agreement.

     This Agreement shall become effective on the date of its acceptance by the Placement Agent by delivery of this Agreement, executed by the Placement Agent, to the Company. Until such time as this Agreement shall have become effective, it may be terminated by the Company by notifying the Placement Agent.

     10. Representations, Warranties and Agreements to Survive Delivery.

     The representations, warranties, indemnities, agreements, and other statements of the Bank and the Company and their officers and trustees set forth in or made pursuant to this Agreement and the agreements of the Placement Agent contained in Section 7 shall remain operative and in full force and effect regardless of any investigation made by or on behalf of the Bank or the Company or controlling persons of the Company, or by or on behalf of the Placement Agent or controlling persons of the Placement Agent, and shall survive delivery of and payment for the Shares. The obligations of the Bank and the Company pursuant to Sections 5 and 7 and shall survive delivery of and payment for the Shares and shall survive any termination or cancellation of this Agreement.

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   11. Miscellaneous.

          11.1 Notices. Except as otherwise provided in this Agreement, all notices and other communications hereunder shall be in writing and shall be deemed to have been validly given if delivered by hand, mailed by registered or certified mail, return receipt requested, or transmitted by any standard form of telecommunication and confirmed. Notices to the Bank and the Company shall be sent to FCB Bancorp, 1100 Paseo Camarillo, Camarillo, California 93010, Attention: Chief Financial Officer; and notices to the Placement Agent shall be sent to Keefe, Bruyette & Woods, 235 Pine Street, Suite 1818, San Francisco, California 94104, Attention: Albert DeAlmeida (with a copy to Mitchell Kleinman, Keefe, Bruyette & Woods, Inc., 787 Seventh Avenue, New York, New York 10019).

          11.2 Parties. The Agreement herein set forth is made solely for the benefit of the Placement Agent and the Bank and the Company and, to the extent expressed, directors, trustees, and officers of the Bank and the Company, any person controlling the Company or the Placement Agent, and their respective successors and assigns. No other person shall acquire or have any right under or by virtue of this Agreement. This Agreement and all conditions and provisions of this Agreement being intended to be and being for the sole and exclusive benefit of the parties to this Agreement and their respective executors, administrators, successors, and assigns and said controlling persons and said officers and directors, and for the benefit of no other person or corporation. No Purchaser shall be construed a successor or assign by reason merely of such purchase. No agent, subagent, or participating dealer designated by the Placement Agent shall be construed a successor or assign of the Placement Agent by reason of such designation.

          11.3 Waiver of Breach. One or more waivers of any covenant, term, or condition of this Agreement by any party shall not be construed as a waiver of a subsequent breach of the same covenant, term, or condition.

          11.4 Importance of Each Covenant. Each covenant and agreement on the part of one party is understood and agreed to constitute an essential part of the consideration for each covenant and agreement on the part of the other parties.

          11.5 Headings. The headings of the sections and subsections of this Agreement are for convenience of reference only and do not form a part of this Agreement and in no way interpret or construe such sections and subsections.

          11.6 Governing Law. This Agreement shall be governed by the laws of the State of California, without giving effect to the choice of law or conflicts of law principles thereof.

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          11.7 Counterparts. This Agreement may be executed in one or more counterparts, and when a counterpart has been executed by each party hereto all such counterparts taken together shall constitute one and the same Agreement.

[Signature Page Follows]

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     If the foregoing is in accordance with your understanding of our agreement, please sign and return to us a counterpart hereof, whereupon this shall become a binding agreement among the Company and the Placement Agent in accordance with its terms.

		Very truly yours,
FCB Bancorp			First California Bank
By:			By:
Name:	C.G. Kum		Name:	C.G. Kum
Title:	President and Chief		Title:	President and Chief
	Executive Officer			Executive Officer

Confirmed and accepted as of May ___, 2005.

Keefe, Bruyette & Woods, Inc.
as Placement Agent

By:

Name:

Title:

[Signature Page to Placement Agency Agreement]

EX-10.11

Exhibit 10.11

REGISTRATION RIGHTS AGREEMENT

          This REGISTRATION RIGHTS AGREEMENT (this “Agreement”), dated as of September ___, 2005, by and among FCB Bancorp, a California corporation (the “Company”), and each of the purchasers (individually, a “Purchaser” and, collectively, the “Purchasers”) listed on the Schedule of Purchasers attached as Exhibit A hereto.

          WHEREAS, the Company has agreed to issue and sell to the Purchasers pursuant to subscription agreements (the “Subscription Agreements”), by and among the Company and the Purchasers, up to an aggregate of ___shares (the “Shares”) of the Company’s common stock, no par value (the “Common Stock”); and

          WHEREAS, in order to induce the Purchasers to purchase the Shares, the Company has agreed to provide the registration rights set forth in this Agreement for the benefit of (i) the Purchasers and (ii) the holders of the Shares from time to time until such time as such Shares have been sold pursuant to a Shelf Registration Statement (as defined below).

          NOW, THEREFORE, in consideration of the foregoing and the respective representations, warranties, mutual covenants and agreements set forth herein, the parties hereto agree as follows:

SECTION 1. DEFINITIONS

          Capitalized terms used but not defined herein shall have the respective meanings set forth in the Subscription Agreement. As used in this Agreement, the following capitalized terms shall have the following respective meanings:

          “Business Day” means any day, excluding Saturday, Sunday and any day which is in the City of Los Angeles a legal holiday or a day upon which banking institutions in the City of Los Angeles are required or authorized by law or other governmental action to close.

          “Closing Date” means the date on which the sale of the Shares takes place.

          “Effectiveness Deadline” has the meaning set forth in Section 3(a).

          “Exchange Act” means the Securities Exchange Act of 1934, as amended.

          “Filing Deadline” has the meaning set forth in Section 3(a).

          “Holder” has the meanings set forth in Section 2.

          “Liquidated Damages” has the meaning set forth in Section 4.

          “Prospectus” means the prospectus included in the Shelf Registration Statement at the time the Shelf Registration Statement is declared effective, as amended or supplemented

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by any prospectus supplement and all other amendments thereto, including post-effective amendments, and all material incorporated by reference into such Prospectus.

          “Placement Agreement” means the Private Placement Agency Agreement, dated May 26, 2005, by and between the Company and Keefe, Bruyette & Woods, Inc.

          “Securities Act” means the Securities Act of 1933, as amended.

          “Shelf Registration Statement” has the meaning set forth in Section 3(a).

          “Transfer Restricted Shares” means Shares and any other securities of the Company issued or issuable in exchange therefor or upon any similar event with respect thereto, whether by way of stock split or in connection with a combination of shares, recapitalization, merger, consolidation, other reorganization or otherwise. As to any particular Transfer Restricted Shares held by any particular person, once issued such securities shall cease to be Transfer Restricted Shares when (i) a registration statement with respect to the sale of such securities shall have become effective under the Securities Act and such securities shall have been disposed of in accordance with such registration statement, (ii) such securities shall have been distributed by such person to a non-affiliate of such person pursuant to Rule 144 under the Securities Act, (iii) such securities shall have been otherwise transferred, new certificates for such securities not bearing a legend restricting further transfer shall have been issued to such person and subsequent disposition of such securities shall not require registration or qualification of such securities under the Securities Act or any similar state statute then in force, or (iv) such securities shall have ceased to be outstanding.

SECTION 2. HOLDERS

          A person is deemed to be a holder of Transfer Restricted Shares (each, a “Holder”) whenever such person owns Transfer Restricted Shares.

SECTION 3. SHELF REGISTRATION

          (a) Shelf Registration.

               The Company shall cause to be filed, on or prior to 90 days after the Closing Date (the “Filing Deadline”), a shelf registration statement pursuant to Rule 415 under the Securities Act (which may be an amendment to any previously filed registration statement (the “Shelf Registration Statement”)), relating to all of the Transfer Restricted Shares, and shall use its best reasonable efforts to cause such Shelf Registration Statement to become effective on or prior to 150 days after the Closing Date (the “Effectiveness Deadline”).

          The Company shall use its best reasonable efforts to keep any Shelf Registration Statement required by this Section 3(a) continuously effective, supplemented, amended and current as required by and subject to the provisions of Section 5(a) to the extent necessary to ensure that it is available for sales of Transfer Restricted Shares and in conformity with the requirements of this Agreement, the Securities Act and the policies, rules and regulations of the SEC as announced from time to time, for a period of at least two years (as extended pursuant to

2

Section 5(b)) following the Closing Date, or such shorter period as will terminate upon the earliest to occur of the following: (x) all Transfer Restricted Shares covered by the Shelf Registration Statement have been sold pursuant thereto, and (y) all Transfer Restricted Shares, other than those held by the Company and its affiliates, are eligible to be sold to the public pursuant to Rule 144(k) under the Securities Act or any successor rule thereof (such period being referred to herein as the “Shelf Registration Period”).

          (b) Provision by Holders of Certain Information in Connection with the Shelf Registration Statement.

               No Holder of Transfer Restricted Shares may include any of its Transfer Restricted Shares in the Shelf Registration Statement unless and until such Holder furnishes to the Company in writing, within 20 days after receipt of a request therefor, the information specified in Item 507 or 508 of Regulation S-K, as applicable, of the Securities Act for use in connection with any Shelf Registration Statement or Prospectus or preliminary Prospectus included therein, or any supplement thereto. No Holder of Transfer Restricted Shares shall be entitled to Liquidated Damages pursuant to Section 4 unless and until such Holder shall have provided all such information. Each selling Holder agrees to promptly furnish additional information required to be disclosed in order to make the information previously furnished to the Company by such Holder not materially misleading. Each selling Holder further agrees to be named as a selling security holder in the Shelf Registration Statement and any Prospectus or preliminary Prospectus included therein, or any supplement thereto, and to comply with all applicable requirements of the Securities Act in connection with any offer or sale of Shares by such Holder, including the prospectus delivery requirements thereof.

SECTION 4. LIQUIDATED DAMAGES

          If (a) the Shelf Registration Statement is not filed with the SEC on or prior to the Filing Deadline (a “Filing Default”), (b) the Shelf Registration Statement has not been declared effective by the SEC on or prior to the Effectiveness Deadline (an “Effectiveness Default”), or (c) the Shelf Registration Statement is filed and declared effective but thereafter ceases to be effective or fails to be usable for its intended purpose without being succeeded immediately by a post-effective amendment to such Shelf Registration Statement that cures such failure and that is itself declared effective immediately (a “Cessation Default”, and each of a Filing Default, an Effectiveness Default and a Cessation Default being referred to herein as a “Registration Default”), then, subject to Section 3(b), the Company hereby agrees to pay to each Holder of Shares affected thereby liquidated damages at the following rates (“Liquidated Damages”). Liquidated Damages shall accrue on any Transfer Restricted Shares from and including the date on which any such Registration Default shall occur to but excluding the date on which all such Registration Defaults have been cured, at a rate of 1% per annum (the “Liquidated Damages Rate”) for the first 90-day period immediately following the occurrence of such Registration Default. The Liquidated Damages Rate shall increase by an additional .5% per annum with respect to each subsequent 90-day period until all Registration Defaults have been cured, up to a maximum Liquidated Damages Rate of 2% per annum. Liquidated Damages shall continue to so accrue until, but not including, the date on which the applicable Registration Default is cured or, if earlier, upon the termination of the Shelf Registration Period. Liquidated Damages shall accrue based upon the Liquidated Damages Rate applied to the aggregate purchase price paid

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upon issuance for such Holder’s Transfer Restricted Shares (or, if applicable, for the Shares exchanged for such Transfer Restricted Shares or otherwise preceding such Transfer Restricted Shares). Notwithstanding the foregoing, no Liquidated Damages shall accrue as to any Transfer Restricted Share from and after the earlier of (x) the date such security is no longer a Transfer Restricted Share and (y) the expiration of the Shelf Registration Period. The rate of accrual of the Liquidated Damages with respect to any period shall not exceed the rate provided for in this paragraph notwithstanding the occurrence of multiple concurrent Registration Defaults. Following the cure of all Registration Defaults requiring the payment by the Company of Liquidated Damages to the Holders of Transfer Restricted Shares pursuant to this Section, the accrual of Liquidated Damages will cease (without in any way limiting the effect of any subsequent Registration Default requiring the payment of Liquidated Damages by the Company). No Liquidated Damages shall be payable at any time with respect to any securities which are not Transfer Restricted Shares. No other monetary damages shall be available to the Holders of Transfer Restricted Share for a Registration Default.

          All accrued Liquidated Damages shall be paid in cash to the Holders entitled thereto and shall be payable quarterly in arrears, on March 30, June 30, September 30 and December 30 of each year, as applicable, commencing December 30, 2005. Any such Liquidated Damages shall be payable to the person in whose name the applicable Transfer Restricted Shares are registered at the close of business on the regular record date for such Liquidated Damages, which shall be March 10, June 10, September 10 and December 10 (whether or not a Business Day), as the case may be, next preceding the payment date of any such Liquidated Damages. Any such Liquidated Damages owed and not punctually paid or duly provided for will forthwith cease to be payable to the Holder on such regular record date and will be paid at any time in any other lawful manner not inconsistent with the requirements of any automated quotation system or securities exchange on which the Transfer Restricted Shares may be quoted or listed, and upon such notice as may be required by such automated quotation system or exchange. All obligations of the Company set forth in the preceding paragraph that are outstanding with respect to any Transfer Restricted Share at the time such security ceases to be a Transfer Restricted Share shall survive until such time as all such obligations with respect to such security shall have been satisfied in full.

          Notwithstanding anything to the contrary in this Agreement, the obligations of the Company under this Agreement are subject to the satisfaction of the conditions set forth in the Subscription Agreements and the Placement Agreement, and the consummation of the transactions contemplated therein.

SECTION 5. REGISTRATION PROCEDURES

          (a) Shelf Registration Statement

               In connection with the Shelf Registration Statement, the Company shall:

          (i) use its best reasonable efforts to effect such registration to permit the sale of the Transfer Restricted Shares being sold in accordance with the intended method or methods of distribution thereof (as indicated in the information furnished to

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the Company pursuant to Section 3(b)), and pursuant thereto the Company will prepare and file with the SEC the Shelf Registration Statement on any appropriate form under the Securities Act, which form shall be available for the sale of the Transfer Restricted Shares in accordance with the intended method or methods of distribution thereof within the time periods and otherwise in accordance with the provisions of this Agreement;

          (ii) use its best reasonable efforts to keep the Shelf Registration Statement continuously effective and provide all requisite financial statements for the period specified in Section 3 of this Agreement; and upon the occurrence of any event that would cause the Shelf Registration Statement or the Prospectus contained therein (A) to contain an untrue statement of a material fact or omit to state any material fact necessary to make the statement therein not misleading or (B) not to be effective and usable for resale of Transfer Restricted Shares during the period required by this Agreement, the Company shall file promptly an appropriate amendment to the Shelf Registration Statement curing such defect, and, if the SEC review is required, use its best reasonable efforts to cause such amendment to be declared effective as soon as practicable;

          (iii) prepare and file with the SEC such amendments and post-effective amendments to the applicable Registration Statement as may be necessary to keep the Shelf Registration Statement effective for the applicable period set forth in Section 3, as the case may be; cause the Prospectus to be supplemented by any required Prospectus supplement, and as so supplemented to be filed pursuant to Rule 424 under the Securities Act, and to comply fully with Rules 424, 430A and 462, as applicable, under the Securities Act in a timely manner; and comply with the provisions of the Securities Act with respect to the disposition of all securities covered by the Shelf Registration Statement during the applicable period in accordance with the intended method or methods of distribution by the sellers thereof set forth in the Shelf Registration Statement or supplement to the Prospectus;

          (iv) advise each Holder promptly and, if requested by such Holder, confirm such advice in writing, (A) when the Prospectus or any Prospectus supplement or post-effective amendment has been filed, and, with respect to the Shelf Registration Statement or any post-effective amendment thereto, when the same has become effective, (B) of any request by the SEC for amendments to the Shelf Registration Statement or amendments or supplements to the Prospectus or for additional information relating thereto, (C) of the issuance by the SEC of any stop order suspending the effectiveness of the Shelf Registration Statement under the Securities Act or of the suspension by any state securities commission of the qualification of the Transfer Restricted Shares for offering or sale in any jurisdiction, or the initiation of any proceeding for any of the preceding purposes, and (D) of the existence of any fact or the happening of any event that makes any statement of a material fact made in the Shelf Registration Statement, the Prospectus, any amendment or supplement thereto or any document incorporated by reference therein untrue, or that requires the making of any additions to or changes in the Shelf Registration Statement in order to make the statements therein not misleading, or that requires the making of any additions to or changes in the Prospectus in order to make

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the statements therein, in the light of the circumstances under which they were made, not misleading (provided that the Company determines in its good faith judgment that the disclosure of such fact or happening or event at such time would have a material adverse effect on the business, financial condition, operations or prospects of the Company or the disclosure otherwise relates to a material business transaction which has not yet been publicly disclosed); and if at any time the SEC shall issue any stop order suspending the effectiveness of the Shelf Registration Statement, or any state securities commission or other regulatory authority shall issue an order suspending the qualification or exemption from qualification of the Transfer Restricted Shares under state securities or blue sky laws, the Company shall use its best reasonable efforts to obtain the withdrawal or lifting of such order at the earliest possible time;

          (v) subject to Section 5(a)(ii), if any fact or event contemplated by Section 5(a)(iv)(D) above shall exist or have occurred, prepare a supplement or post-effective amendment to the Shelf Registration Statement or related Prospectus or any document incorporated therein by reference or file any other required document so that, as thereafter delivered to the purchasers of Transfer Restricted Shares, the Prospectus will not contain an untrue statement of a material fact or omit to state any material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading;

          (vi) furnish to each Holder in connection with such sale, if any, before filing with the SEC, copies of the Shelf Registration Statement or any Prospectus included therein or any amendments or supplements to the Shelf Registration Statement or Prospectus (including all documents incorporated by reference after the initial filing of the Shelf Registration Statement), which documents will be subject to the review and reasonable comment of such Holders in connection with such sale, if any, for a period of at least five Business Days, and the Company will not file the Shelf Registration Statement or Prospectus or any amendment or supplement to the Shelf Registration Statement or Prospectus (including all such documents incorporated by reference) to which such Holder shall reasonably object within five Business Days after the receipt thereof; a Holder shall be deemed to have reasonably objected to such filing if the Shelf Registration Statement, amendment, Prospectus or supplement, as applicable, as proposed to be filed, contains an untrue statement of a material fact or omit to state any material fact necessary to make the statements therein not misleading or fails to comply with the applicable requirements of the Securities Act;

          (vii) as soon as reasonably practicable prior to the filing of any document that is to be incorporated by reference into the Shelf Registration Statement or Prospectus, provide copies of such document to each Holder in connection with such sale, if any, make the Company’s representatives available for discussion of such document and other customary due diligence matters for a period of at least five Business Days, and, if appropriate, include such information in such document prior to the filing thereof as such Holder may reasonably request;

          (viii) make available at reasonable times for inspection by each Holder and any attorney or accountant retained by such Holder, all financial and other records,

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pertinent corporate documents of the Company and cause the Company’s officers, directors and employees to supply all information reasonably requested by any such Holder, attorney or accountant in connection with the Shelf Registration Statement or any post-effective amendment thereto subsequent to the filing thereof and prior to its effectiveness; provided, however, that such persons shall first agree in writing with the Company that any information that is reasonably and in good faith designated by the Company in writing as confidential at the time of delivery of such information shall be kept confidential by such persons, unless (A) disclosure of such information on a non-confidential basis is required by court or administrative order or is necessary to respond to inquires of regulatory authorities, (B) disclosure of such information on a non-confidential basis is required by law (including any disclosure requirements pursuant to federal securities laws in connection with the filing of the Shelf Registration Statement or the use of any Prospectus), (C) such information becomes generally available to the public other than as a result of a disclosure or failure to safeguard such information by such person or (D) such information becomes available to such person from a source other than the Company and its subsidiaries and such source is not known, after due inquiry, by such person to be bound by a confidentiality agreement; provided further, that the foregoing investigation shall be coordinated on behalf of such persons by one representative designated by and on behalf of such persons and any such confidential information shall be available from such representative to such persons so long as any person agrees to be bound by such confidentiality agreement;

          (ix) if requested by any Holder in connection with such sale, as soon as reasonably practicable include in the Shelf Registration Statement or Prospectus, pursuant to a supplement or post-effective amendment if necessary, such information as such Holder may reasonably request to have included therein, including, without limitation, information relating to the “Plan of Distribution” of the Transfer Restricted Shares; and make all required filings of such Prospectus supplement or post-effective amendment as soon as reasonably practicable after the Company is notified of the matters to be included in such Prospectus supplement or post-effective amendment;

          (x) furnish to each Holder in connection with such sale, if any, without charge, at least one copy of the Shelf Registration Statement, as first filed with the SEC, and of each amendment thereto, including all documents incorporated by reference therein and all exhibits (including exhibits incorporated therein by reference);

          (xi) deliver to each Holder, without charge, such number of copies of the Prospectus (including each preliminary prospectus) and any amendment or supplement thereto as such Holder reasonably may request; the Company hereby consents to the use (in accordance with law) of the Prospectus and any amendment or supplement thereto by each Holder in connection with the offering and the sale of the Transfer Restricted Shares covered by the Prospectus or any amendment or supplement thereto;

          (xii) upon the request of any Holder, enter into such agreements (including underwriting agreements) and make such representations and warranties and take all such other actions in connection therewith in order to expedite or facilitate the

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disposition of the Transfer Restricted Shares pursuant to the Shelf Registration Statement as may be reasonably requested by such Holder in connection with any sale or resale pursuant to any applicable Registration Statement. In such connection, the Company shall:

               (1) upon the request of any Holder (or, in the case of paragraph (B) below, upon the request of the Holders of a majority of the Shares covered by the Shelf Registration Statement, provided that such request is made in writing prior to the date on which the Shelf Registration Statement is declared effective), furnish (or in the case of paragraph (B) below, use its best reasonable efforts to cause to be furnished) to such Holder, upon the effectiveness of the Shelf Registration Statement:

               (A) a certificate, dated such date, signed on behalf of the Company by (x) the President or any Vice President and (y) a principal financial or accounting officer of the Company, confirming, as of the date thereof, the matters set forth in Sections 2.6 and 6.5(a) of the Placement Agreement and such other similar matters as such Holder may reasonably request;

               (B) an opinion, dated the date of effectiveness of the Shelf Registration Statement, of independent counsel to the Company, covering matters of the type customarily covered in opinions of issuer’s counsel requested in underwritten offerings, such as the effectiveness of the Shelf Registration Statement and such other matters as may be reasonably requested by such Holders; without limiting the foregoing, such counsel may state further that such counsel assumes no responsibility for, and has not independently verified, the accuracy, completeness or fairness of the financial statements, notes and schedules and other financial data included in the Shelf Registration Statement or the related Prospectus; and

               (2) deliver such other documents and certificates as may be reasonably requested by the selling Holders to evidence compliance with the matters covered in clause (1) above and with any customary conditions contained in any agreement entered into by the Company pursuant to this clause (xii);

          (xiii) prior to any public offering of Transfer Restricted Shares, take such action as is reasonably required under the securities or blue sky laws of such jurisdictions within the United States of America as the selling Holders may request to enable the disposition in such jurisdictions of the Transfer Restricted Shares covered by the Shelf Registration Statement; provided, however, that the Company shall not be required to register or qualify as a foreign corporation where the Company is not now so qualified or to take any action that would subject the Company to the service of process in suits or to taxation, other than as to matters and transactions relating to the Shelf Registration Statement, in any jurisdiction where the Company is not now so subject;

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          (xiv) in connection with any sale of Transfer Restricted Shares that will result in such securities no longer being Transfer Restricted Shares, cooperate with the Holders to facilitate the timely preparation and delivery of certificates representing Transfer Restricted Shares to be sold and not bearing any restrictive legends; and to register such Transfer Restricted Shares in such denominations and such names as the selling Holders may request at least two Business Days prior to such sale of Transfer Restricted Shares;

          (xv) use its best reasonable efforts to cause the disposition of the Transfer Restricted Shares covered by the Shelf Registration Statement to be registered with or approved by such other governmental agencies or authorities as may be necessary to enable the seller or sellers thereof to consummate the disposition of such Transfer Restricted Shares, subject to the proviso contained in clause (xiii) above;

          (xvi) otherwise use its best reasonable efforts to comply with all applicable rules and regulations of the SEC, and make generally available to its security holders with regard to the Shelf Registration Statement, as soon as practicable, a consolidated earnings statement meeting the requirements of Rule 158 (which need not be audited) covering a twelve-month period beginning after the effective date of the Shelf Registration Statement (as such term is defined in paragraph (c) of Rule 158 under the Securities Act);

          (xvii) provide promptly to each Holder, upon request, each document filed with the SEC pursuant to the requirements of Section 13 or Section 15(d) of the Exchange Act; and

          (xviii) use its best reasonable efforts to cause the Shares to be listed on any securities exchange or automated quotation system on which similar securities issued by the Company are then listed, to the extent such Shares satisfies applicable listing requirements.

          (b) Restrictions on Holders.

               Each Holder agrees by acquisition of a Transfer Restricted Share that, upon receipt of the notice referred to in Section 5(a)(iv)(C) or any notice from the Company of the existence of any fact of the kind described in Section 5(a)(iv)(D) (in each case, a “Suspension Notice”), such Holder will forthwith discontinue disposition of Transfer Restricted Shares pursuant to the Shelf Registration Statement until (i) such Holder has received copies of the supplemented or amended Prospectus contemplated by Section 5(a)(v), or (ii) such Holder is advised in writing by the Company that the use of the Prospectus may be resumed, and has received copies of any additional or supplemental filings that are incorporated by reference in the Prospectus (in each case, the “Recommencement Date”); provided, however, that any Suspension Period occurring as a result of notice from the Company of the existence of any fact of the kind described in Section 5(a)(iv)(D) shall not exceed, for so long as this Agreement is in effect, the shorter of (x) the period ending on the date the information responsible for the Suspension Period is disclosed to the public and (y) 30 days (provided that no two Suspension Periods shall occur during any period of 90 consecutive days). Each Holder receiving a

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Suspension Notice hereby agrees that it will either (i) destroy any Prospectuses, other than permanent file copies, then in such Holder’s possession which have been replaced by the Company with more recently dated Prospectuses or (ii) deliver to the Company (at the Company’s expense) all copies, other than permanent file copies, then in such Holder’s possession of the Prospectus covering such Transfer Restricted Shares that was current at the time of receipt of the Suspension Notice. The time period regarding the effectiveness of the Shelf Registration Statement set forth in Section 3, shall be extended by a number of days equal to the number of days in the period from and including the date of delivery of the Suspension Notice to the Recommencement Date.

SECTION 6. REGISTRATION EXPENSES

          (a) All expenses incident to the Company’s performance of or compliance with this Agreement will be borne by the Company, regardless of whether the Shelf Registration Statement becomes effective, including without limitation: (i) all registration and filing fees and expenses; (ii) all fees and expenses of compliance with federal securities and state blue sky or securities laws; (iii) all expenses of printing, messenger and delivery services and telephone; (iv) all reasonable fees and disbursements of counsel for the Company; (v) all application and filing fees; and (vi) all reasonable fees and disbursements of independent certified public accountants of the Company (including the expenses of any special audit required by or incident to such performance).

               The Company will, in any event, bear its internal expenses (including, without limitation, all salaries and expenses of its officers and employees performing legal or accounting duties), the expenses of any annual audit and the fees and expenses of any person, including special experts, retained by the Company.

          (b) Each Holder, and not the Company, shall be exclusively responsible for such Holder’s pro rata share of underwriter’s fees incurred by the Holders in connection with the Shelf Registration Statement and any expenses of such Holder in connection with the Shelf Registration Statement, including such Holder’s fees of counsel.

SECTION 7. INDEMNIFICATION

          (a) The Company agrees to indemnify and hold harmless each Holder, any underwriter (as defined in the Securities Act) selling Shares for such Holder, each Holder’s directors, officers and each person, if any, who controls such Holder or such underwriter (within the meaning of either Section 15 of the Securities Act or Section 20 of the Exchange Act) from and against any and all losses, claims, damages, liabilities and judgments (including without limitation the legal fees and other expenses incurred in connection with investigating or defending any matter, including any action that could give rise to any such losses, claims, damages, liabilities or judgments) caused by any untrue statement or alleged untrue statement of a material fact contained in the Shelf Registration Statement, preliminary prospectus or Prospectus (or any amendment or supplement thereto), provided by the Company to the Holders or to any prospective purchaser of Shares, or caused by any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, except insofar as such losses, claims, damages, liabilities or judgments are

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caused by any untrue statement or omission or alleged untrue statement or omission that is based upon information relating to any of the Holders furnished in writing to the Company by such Holders.

          (b) Each Holder agrees, severally and not jointly, to indemnify and hold harmless the Company, its directors, officers and each person, if any, who controls (within the meaning of Section 15 of the Securities Act and Section 20 of the Exchange Act) the Company, to the same extent as the foregoing indemnity from the Company set forth in Section 7(a) above, but only with reference to information relating to such Holder furnished in writing to the Company by such Holder for use in the Shelf Registration Statement or any amendment or supplement thereto. In no event shall any Holder, its directors, officers, or any person who controls such Holder be liable or responsible under this Section 7 for any amount in excess of the amount by which the total amount received by such Holder with respect to its sale of Transfer Restricted Shares pursuant to the Shelf Registration Statement exceeds (i) the amount paid by such Holder for such Transfer Restricted Shares, plus (ii) the amount of any damages that such Holder, its directors, officers, or any person who controls such Holder has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission.

          (c) In case any action shall be commenced involving any person in respect of which indemnity may be sought pursuant to Section 7(a) or 7(b), such person (the “Indemnified person”) shall promptly notify the person against whom such indemnity may be sought (the “Indemnifying person”) in writing, and the Indemnifying person shall assume the defense of such action, including the employment of counsel reasonably satisfactory to the Indemnified person and shall pay all fees and expenses of such counsel as incurred (except that in the case of any action in respect of which indemnity may be sought pursuant to both Sections 7(a) and 7(b), a Holder shall not be required to assume the defense of such action pursuant to this Section 7(c), but may employ separate counsel and participate in the defense thereof, but the fees and expenses of such counsel, except as provided below, shall be at the expense of such Holder). Any Indemnified person shall have the right to employ separate counsel in any such action and participate in the defense thereof, but the fees and expenses of such counsel shall be at the expense of such Indemnified person unless (i) the employment of such counsel shall have been specifically authorized in writing by the Indemnifying person, (ii) the Indemnifying person shall have failed to assume the defense of such action or employ counsel reasonably satisfactory to the Indemnified person or (iii) the named parties in any such action (including any impleaded parties) include both the Indemnifying person and the Indemnified person, and the Indemnified person shall have been advised by such counsel that there may be one or more legal defenses available to it which are different from or additional to those available to the Indemnifying person (in which case the Indemnifying person shall not have the right to assume the defense of such action on behalf of the Indemnified person). It is understood that the Indemnifying person shall not, in connection with any one action or separate but substantially similar or related actions in the same jurisdiction arising out of the same general allegations or circumstances, be liable for the fees and expenses of more than one separate firm of attorneys (in addition to any local counsel) for all Indemnified persons, and that all such fees and expenses shall be reimbursed as they are incurred. Any such separate firm for the indemnified Holders shall be designated in writing by a majority of the indemnified Holders, in the case of parties indemnified

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pursuant to Section 7(a), and any such separate firm for the Company, its directors, its officers and such control persons shall be designated in writing by the Company, in the case of parties indemnified pursuant to Section 7(b). The Indemnifying person shall indemnify and hold harmless the Indemnified person from and against any and all losses, claims, damages, liabilities and judgments by reason of any settlement of any action (i) effected with its written consent or (ii) effected without its written consent if the settlement is entered into more than twenty Business Days after the Indemnifying person shall have received a request from the Indemnified person for reimbursement for the fees and expenses of counsel (in any case where such fees and expenses are at the expense of the Indemnifying person) and, prior to the date of such settlement, the Indemnifying person shall have failed to comply with such reimbursement request. No Indemnifying person shall, without the prior written consent of the Indemnified person, effect any settlement or compromise of, or consent to the entry of judgment with respect to, any pending or threatened action in respect of which the Indemnified person is or could have been a party and indemnity or contribution may be or could have been sought hereunder by the Indemnified person, unless such settlement, compromise or judgment (i) includes an unconditional release of the Indemnified person from all liability on claims that are or could have been the subject matter of such action and (ii) does not include a statement as to or an admission of fault, culpability or a failure to act, by or on behalf of the Indemnified person.

          (d) To the extent that the indemnification provided for in this Section 7 is unavailable to an Indemnified person in respect of any losses, claims, damages, liabilities or judgments referred to therein, then each Indemnifying person, in lieu of indemnifying such Indemnified person hereunder, shall contribute to the amount paid or payable by such Indemnified person as a result of such losses, claims, damages, liabilities or judgments (i) in such proportion as is appropriate to reflect the relative benefits received by the Company, on the one hand, and the indemnified Holder, on the other hand, from their sale of Transfer Restricted Shares or (ii) if the allocation provided by clause 7(d)(i) above is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause 7(d)(i) above but also the relative fault of the Company, on the one hand, and the indemnified Holder, on the other hand, in connection with the statements or omissions that resulted in such losses, claims, damages, liabilities or judgments, as well as any other relevant equitable considerations. The relative fault of the Company, on the one hand, and the indemnified Holder, on the other hand, shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the Company, on the one hand, or by the indemnified Holder, on the other hand, and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission. The amount paid or payable by a party as a result of the losses, claims, damages, liabilities and judgments referred to above shall be deemed to include, subject to the limitations set forth in the second paragraph of Section 7(a), any legal or other fees or expenses reasonably incurred by such party in connection with investigating or defending any action or claim.

               The Company and each Holder agree that it would not be just and equitable if contribution pursuant to this Section 7(d) were determined by pro rata allocation (even if the Holders were treated as one entity for such purpose) or by any other method of allocation that does not take account of the equitable considerations referred to in the

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immediately preceding paragraph. The amount paid or payable by an Indemnified person as a result of the losses, claims, damages, liabilities or judgments referred to in the immediately preceding paragraph shall be deemed to include, subject to the limitations set forth above, any legal or other expenses reasonably incurred by such Indemnified person in connection with investigating or defending any matter including any action that could have given rise to such losses, claims, damages, liabilities or judgments. Notwithstanding the provisions of this Section 7, in no event shall a Holder, its directors, officers, or any person who controls such Holder, be required to contribute, in the aggregate, pursuant to this Section 7 any amount in excess of the amount by which the total received by such Holder with respect to the sale of Transfer Restricted Shares pursuant to the Shelf Registration Statement exceeds the sum of (i) the amount paid by such Holder for such Transfer Restricted Shares, plus (ii) the amount of any damages that such Holder, its directors, officers, or any person who controls such Holder has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. The Holders’ obligations to contribute pursuant to this Section 7(d) are several in proportion to the respective principal amount of the Transfer Restricted Shares held by each Holder hereunder and not joint.

SECTION 8. RULE 144 AND OTHER INFORMATION

          The Company hereby agrees with each Holder, for so long as any Transfer Restricted Shares remain outstanding and during any period in which the Company (i) is not subject to Section 13 or 15(d) of the Exchange Act, to make available, upon request of any Holder of Transfer Restricted Shares, adequate current public information with respect to the Company within the meaning of paragraph (c)(2) of Rule 144 under the Securities Act in order to permit sales of such Transfer Restricted Shares pursuant to Rule 144 under the Securities Act and (ii) is subject to Section 13 or 15(d) of the Exchange Act, to make all filings required thereby in a timely manner in order to permit sales of such Transfer Restricted Shares without registration under the Securities Act within the limitation of the exemptions provided by Rule 144 under the Securities Act.

SECTION 9. MISCELLANEOUS

          (a) Remedies.

               The Company acknowledges and agrees that any failure by the Company to comply with its obligations under Section 3 may result in material irreparable injury to the Holders for which there is no adequate remedy at law, that it will not be possible to measure damages for such injuries precisely and that, in the event of any such failure, any Holder may obtain such relief as may be required to specifically enforce the Company’s obligations under Section 3. The Company further agrees to waive the defense in any action for specific performance that a remedy at law would be adequate.

          (b) No Inconsistent Agreements.

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               The Company will not, on or after the date of this Agreement, enter into any agreement with respect to its securities that is inconsistent with the rights granted to the Holders in this Agreement or otherwise conflicts with the provisions. The Company has not previously entered into any agreement granting any registration rights with respect to its securities to any person. The rights granted to the Holders hereunder do not in any way conflict with and are not inconsistent with the rights granted to the holders of the Company’s securities under any agreement in effect on the date.

          (c) Notices.

               All notices and other communications hereunder shall be in writing and shall be deemed sufficiently given and served for all purposes (i) when personally delivered or given by machine-confirmed facsimile, (ii) one Business Day after a writing is delivered to a national overnight courier service or (iii) three Business Days after a writing is deposited in the United States mail, first class postage or other charges prepaid and registered, return receipt requested, in each case, addressed as follows (or at such other address for a party as shall be specified by like notice): (A) in the case of the Company, to FCB Bancorp, 1100 Paseo Camarillo, Camarillo, California 93010, Attention: Chief Financial Officer, Facsimile No.: (805) — , and (B) in the case of any Holder, at the address set forth on the stock records of the Company.

          (d) Amendments and Waivers.

               No modifications or amendments to, or waivers of, any provision of this Agreement may be made, except pursuant to a document signed by the Company and Holders of a majority of the Shares affected by such amendment, modification, supplement, waiver or consents.

          (e) Interpretation.

               When a reference is made in this Agreement to Sections, paragraphs, clauses or Exhibits, such reference shall be to a Section, paragraph, clause or Exhibit to this Agreement unless otherwise indicated. The words “include,” “includes,” and “including” when used herein shall be deemed in each case to be followed by the words “without limitation.” The table of contents and headings contained in this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement. This Agreement has been negotiated by the respective parties hereto and their attorneys and the language hereof will not be construed for or against either party. The phrases “the date of this Agreement,” “the date hereof,” and terms of similar import, unless the context otherwise requires, shall be deemed to refer to June ___, 2005. The words “hereof,” “herein,” “herewith,” “hereby” and “hereunder” and words of similar import shall, unless otherwise stated, be construed to refer to this Agreement as a whole and not to any particular provision of this Agreement.

          (f) No Third-Party Beneficiaries.

               No person or entity not a party to this Agreement shall be deemed to be a third-party beneficiary hereunder or entitled to any rights hereunder.

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          (g) Successors and Assigns.

               Other than with respect to transferees as to which the Shares held by such transferee have ceased to be Transfer Restricted Shares, this Agreement shall inure to the benefit of and be binding upon the successors and assigns of each of the parties, including without limitation and without the need for an express assignment, subsequent Holders; provided, however, that nothing herein shall be deemed to permit any assignment, transfer or other disposition of Transfer Restricted Shares in violation of the terms or of the Subscription Agreement. If any transferee of any Holder shall acquire Transfer Restricted Shares in any manner, whether by operation of law or otherwise, such Transfer Restricted Shares shall be held subject to all of the terms of this Agreement, and by taking and holding such Transfer Restricted Shares such person shall be conclusively deemed to have agreed to be bound by and to perform all of the terms and provisions of this Agreement, including the restrictions on resale set forth in this Agreement and, if applicable, the Subscription Agreement, and such person shall be entitled to receive the benefits.

          (h) Entire Agreement.

               This Agreement is intended by the parties as a final expression of their agreement and intended to be a complete and exclusive statement of the agreement and understanding of the parties hereto in respect of the subject matter contained herein. There are no restrictions, promises, warranties or undertakings, other than those set forth or referred to herein with respect to the registration rights granted with respect to the Transfer Restricted Shares. This Agreement supersedes all prior agreements and understandings between the parties with respect to such subject matter.

          (i) Severability.

               If any provision of this Agreement is held to be illegal, invalid or unenforceable under present or future laws, then, if possible, such illegal, invalid or unenforceable provision will be modified to such extent as is necessary to comply with such present or future laws and such modification shall not affect any other provision hereof; provided that if such provision may not be so modified such illegality, invalidity or unenforceability will not affect any other provision, but this Agreement will be reformed, construed and enforced as if such invalid, illegal or unenforceable provision had never been contained herein.

          (j) GOVERNING LAW.

               THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH CONTRACTS MADE AND TO BE PERFORMED IN THE STATE OF CALIFORNIA.

          (k) Banking Laws.

               Each of the provisions of this Agreement is subject to and shall be enforced in compliance with applicable banking laws.

15

          (l) Counterparts.

               This Agreement may be executed in one or more counterparts, all of which shall be considered one and the same agreement and shall become effective when one or more counterparts have been signed by each of the parties and delivered to each the other parties, it being understood that all parties need not sign the same counterpart.

(signature page follows)

16

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

FCB Bancorp
By:
	Name:
	Title:
as a Purchaser
By:
	Name:
	Title:

[SIGNATURE PAGE TO REGISTRATION RIGHTS AGREEMENT]

Exhibit A

Schedule of Purchasers

Name and Address	Number of
of Purchaser	Shares

A-1

COVER

September 1, 2005

Via Hand Delivery

United States Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
Attention: Mr. William Friar

Re:  FCB Bancorp, Camarillo, California
Pre-Effective Amendment No. 2 to Form S-4 (File No. 333-126401)

Ladies and Gentlemen:

     On behalf of our client, FCB Bancorp (“FCB”), and in response to your comment letter dated August 26, 2005, we respectfully submit for your review three (3) copies of the Pre-Effective Amendment No. 2 to FCB’s Registration Statement on Form S-4, marked to show the changes (with the printer’s “r” tags) from FCB’s Pre-Effective Amendment No. 1 filed on August 15, 2005.

     For your information, the Pre-Effective Amendment No. 2 was filed via Edgar today.

     Please note that the following corresponds to the numbered items listed in your comment letter, a copy of which is also enclosed (capitalized terms not otherwise defined herein shall have the same meanings ascribed to them in the Registration Statement, as amended) (all page references below correspond to the enclosed marked version):

Introduction, page 3

1.	Please revise this section to conform to the principles of plain English. For example, please avoid using legalistic parentheticals. Also please revise to avoid a legalistic or overly technical description of the transactions. We note as examples such phrases as “pursuant to,” “merge with and into,” “for a moment in time.”
	The Introduction section has been revised to conform to the principles of plan English.

Securities Exchange Commission
September 1, 2005
Page 2

Loans, page 39

2.	We note your response to our prior comment 14. Please revise your disclosure to include a discussion of the specific risks that attach to each type of loan in your portfolio, as well as the degree of risk inherent in each type of loan relative to the other types of loans.
	The discussion of loans has been expanded and revised to include a discussion of the specific risks that attach to each type of loan in First California Bank’s portfolio, and to address the degree of risk inherent in each type of loan relative to the other types of loans.

Background and Description of South Coast Bancorp Transaction, page 64

3.

Provide us with a full description of the details of the private placement offering, including the number of shares that will be sold in the offering, the timing of the offering, its current status, the price at which the shares are to be sold and the method used to determined the price. Tell us what exemption from registration is being claimed and the relevant facts to support the use of that exemption. Submit a copy of any offering memoranda. Give us your analysis of why the private placement should not be integrated with the present public offering. Also, tell us why the mention of the offering in the S-4 does not constitute a general solicitation.

On May 26, 2005, FCB and First California Bank engaged Keefe, Bruyette & Woods, Inc. (“KBW”) in connection with the placement of FCB’s common stock in a private placement (the “2005 Private Offering”). FCB has included a copy of the Private Placement Agency Agreement as Exhibit 10.10 to the Registration Statement. In connection with the 2005 Private Offering, FCB distributed a Private Placement Memorandum to a limited number of accredited investors. A copy of the Private Placement Memorandum is submitted as requested. On June 9, 2005, 21 investors subscribed for 1,115,000 shares of FBC’s common stock at a purchase price of $19.75 per share in connection with the 2005 Private Offering. FCB has not solicited any additional subscriptions and has not and will not accept any additional subscriptions. The price of FCB’s common stock sold in the 2005 Private Offering was determined through negotiations among FCB and the investors. In addition to prevailing market conditions, the factors considered in determining the offering price included (1) the valuation multiples of publicly traded companies that are engaged in similar activities to FCB, including the trading price of First California Bank’s common stock, (2) FCB and First California Bank’s financial information, (3) the history of, and the prospects for, FCB and the industry in which it competes, (4) an assessment of FCB’s management, its past and present operations, and the prospects for, and timing of, FCB’s future performance, (5) the present state of FCB’s development and (6) the above factors in relation to market

Securities Exchange Commission
September 1, 2005
Page 3

values and various valuation measures of other companies engaged in activities similar to FCB. FCB has included a form of the subscription agreements returned by the 2005 Private Offering investors and a form of registration rights agreement for the shares of common stock to be issued in the 2005 Private Offering as Exhibits 10.9 and 10.11, respectively, to the Registration Statement. FCB has also revised the registration statement to include appropriate disclosure concerning the 2005 Private Offering.

FCB is making the 2005 Private Offering without registration under the Securities Act in reliance on the exemptions from registration contained in Section 4(2) of, and Rule 506 of Regulation D promulgated under, the Securities Act. These issuance are not subject to integration with the present public offering pursuant to the Rule 152 safe harbor from integration for a Section 4(2) offering effected prior to the filing of a registration statement, as interpreted by the Staff of the Commission in Black Box, Inc. (available June 26, 1990), and Squadron, Ellenoff, Pleasant & Lehrer (available February 28, 1992). The issuance of common stock at the closing of the 2005 Private Offering constituted a private placement that was “completed” prior to the filing of the registration statement for the public offering because all of the investors in the 2005 Private Offering had committed to the terms of the 2005 Private Offering prior to the filing of he registration statement, subject only to conditions, the satisfaction of which were not within the control of the investors. Subsequent to the execution of the subscription agreements for the 2005 Private Offering, there was no renegotiation of the terms of the 2005 Private Offering. Moreover, there was no general solicitation of the investors in connection with the 2005 Private Offering and all of the investors in the 2005 Private Offering are accredited investors. Finally, FCB’s inclusion of limited details about the 2005 Private Offering in the Registration Statement does not constitute a general solicitation since the 2005 Private Offering was “completed” prior to the filing of the registration and no additional solicitations have been made and no additional subscriptions have been or will be accepted after the filing of the Registration Statement.

The discussions regarding the 2005 Private Offering in the “Introduction” section and in the section entitled “South Coast Bancorp, Inc.” (page 64) have been revised to include information concerning the 2005 Private Offering. In addition, the section entitled “Description of FCB Bancorp Common Stock” has been revised to include a discussion regarding FCB’s registration rights obligations in connection with the shares to be issued in the 2005 Private Offering. FCB also has filed the form of registration rights agreement in connection with the 2005 Private Offering as Exhibit 10.11 to the Registration Statement.

4.	Provide us with similar information regarding the issuance of the trust preferred securities.
	The issuance of approximately $10 million of non-convertible trust preferred securities (the “Trust Preferred Placement”) will be made directly to KBW, a “qualified institutional buyer”

Securities Exchange Commission
September 1, 2005
Page 4

as defined in Rule 144A promulgated under the Securities Act, and possibly one other qualified institutional buyer. FCB has discussed the terms of the Trust Preferred Placement with KBW and KBW has indicated that it may invite another investor with which KBW has made similar investments to participate in the Trust Preferred Placement. The terms of the Trust Preferred Placement will be negotiated between FCB and KBW (and possibly this other investor) and are expected to reflect market terms for such instruments at the time of such issuance. The Trust Preferred Placement will be exempt from registration under Section 4(2) of the Securities Act because it will not involve a public offering of securities of FCB. Moreover, the Trust Preferred Placement would involve different securities than included in the registration statement and will be issued for different consideration than the offering to be effected under the registration statement. The registration statement is not a general solicitation in connection with the Trust Preferred Placement because FCB did not solicit KBW (and will not solicit the other investor) by means of the registration statement, which only included disclosure about the Trust Preferred Placement sufficient to assist First California Bank’s shareholders in connection with their investment decision in connection with the merger. Under the Staff’s policy position articulated in Black Box and Squadron, Ellenoff, as a private placement solely to a single qualified institutional buyer or large institutional accredited investor, such issuance should not be integrated with the offering to be effected under the registration statement.

Part II
Undertakings

5.	Please include the undertaking found in Item 512(h) of Regulation S-K.
	The undertaking found in Item 521(h) of Regulation S-K has been added.

**********************

     Please note that the timing of the mailing of the proxy materials has become critical. Under the terms of the definitive agreement with South Coast Bancorp, the transaction must close by September 30, 2005. Prior to and as a condition to the closing of that transaction, the proposed holding company reorganization must close. FCB has tentatively scheduled its shareholders’ meeting for September 20 in order to provide for sufficient time to consummate the holding company formation, close the 2005 Private Offering, complete the Trust Preferred Placement and then consummate the South Coast transaction by the September 30 drop dead date. California law requires that FCB provide shareholders with at least 10 days prior notice of the meeting, which means that FCB must mail its proxy materials by no later than September 10 in order to hold the meeting on September 20. Accordingly, we would sincerely appreciate every effort your office can make in expediting your review of the document.

Securities Exchange Commission
September 1, 2005
Page 5

     Should you have any questions or need additional information, please do not hesitate to contact the undersigned at your earliest possible convenience.

Very truly yours,




Gary M. Horgan
 

cc: Mr. C. G. Kum
Casey Fleck, Esq.
Young H. Park, Esq.

CONFIDENTIAL

PRIVATE PLACEMENT MEMORANDUM

                            Shares

FCB Bancorp

Common Stock

        We are offering up to                      shares (the “Shares”) of common stock, no par value (the “Common Stock”), of FCB Bancorp (the “Company”). We are conducting this offering in order to fund our acquisition of South Coast Bancorp, Inc. and to provide working capital. The Company was formed at the direction of the Board of Directors of First California Bank (the “Bank”) for the purpose of establishing a holding company for the Bank. For more information, please see “Important Notices,” “Risk Factors” and “Use of Proceeds” on pages 1, 16, and 21, respectively.

      The Shares have not been registered under the Securities Act of 1933, as amended (“Securities Act”), or any state securities laws, and, unless so registered, may not be offered or sold except pursuant to an exemption from, or in a transaction not subject to, those laws. Accordingly, the shares offered hereby are being offered and sold only to “accredited investors” (as defined in Rule 501(a) of the Securities Act). Prospective purchasers are hereby notified that the Shares offered hereby are restricted securities issued pursuant to an exemption from the registration requirements of Section 5 of the Securities Act. The Shares will not be transferable except in accordance with the restrictions and/or after registration, as described under “Important Notices” on page 1.

      We reserve the right to withdraw, cancel or modify this offer and reject orders in whole or in part. It is expected that the closing of the sale of the Shares will be made in Camarillo, California on or about                     , 2005.

KEEFE, BRUYETTE & WOODS

The date of this private placement memorandum is May 26, 2005.

ii

IMPORTANT NOTICES

Subscription Agreement and Conditions to Sale of the Shares

      Payment of the purchase price for the Shares subscribed for in this offering shall be made at the offices of [                    ], or such other place as shall be agreed upon by the subscriber and the Company, at 9:00 A.M., New York City time, on the date that the acquisition of South Coast Bancorp is consummated, or such other time not later than ten business days after such date as shall be agreed upon by the subscriber and the Company (such date of payment and delivery being herein called the “Closing Date”). The Company shall notify subscribers at least two business days prior to the Closing Date that the Company expects that the Closing Date will occur on such date. In the event that each of the following transactions are not consummated by the Closing Date: (i) the holding company reorganization, (ii) the trust preferred offering, and (iii) the acquisition of South Coast Bancorp; the Company shall return to each subscriber any funds that the subscriber has distributed to the Company for the Shares no later than one business day after receipt of such funds. In addition, the subscription agreement will terminate if the sale of the Shares has not occurred on or prior to October 10, 2005.

The Shares are restricted securities

      The Shares have not been registered under the Securities Act or under the laws of any state and, therefore, the Shares cannot be resold except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and applicable state securities laws. Consequently, you may not be able to resell the Shares until a registration statement covering the Shares is filed by us and declared effective by the Securities and Exchange Commission (the “SEC”). You must be prepared to bear the economic risk of an investment in the Shares for that period of time.

      Any certificates representing Shares issued prior to their registration will include a legend referring to the above transfer restrictions.

      In connection with the sale of the Shares, we will enter into a registration rights agreement, in the form attached hereto as Exhibit B, with each purchaser of Shares. The registration rights agreement will require us to file a registration statement on an appropriate form with the SEC within ninety (90) days after the closing of the sale of the Shares. In addition, we will be required to use our best reasonable efforts to cause the registration statement to become effective within one hundred and fifty (150) days after the closing. In the event we fail to file the registration statement with the SEC within such 90 day period, or the registration statement is not effective within 150 days after the closing, we will be obligated to pay “liquidated damages” in the form of cash payments for the period running from the 90^th or 150^th day after closing, as applicable, and ending on the sooner of the date on which the registration statement is filed or declared effective, as applicable, and the second anniversary of the closing. Except in certain circumstances, liquidated damages will also be payable for any period during which the registration statement ceases to be effective when the Company is required to keep the registration statement effective. Liquidated damages accrue at a rate of 1% of the aggregate purchase price per annum for the first 90 days of registration default, increasing by an additional .5% for each subsequent 90 day period of registration default up to a maximum rate of 2% per annum. For a more detailed description of the terms of the Registration Rights Agreement, see “Registration Rights” on page 57.

SEC Review

      In the course of the review by the SEC of the registration statement that we have agreed to file and the registration statement that we expect to file in connection with the holding company reorganization, we may be required to make changes to the description of our business, our financial information and data and the presentation of our financial information included in this private placement memorandum. Any such changes or modifications could be significant. In addition, the SEC could require that we include additional financial information in the registration statements that are filed with the SEC or remove certain financial information included in this private placement memorandum from such registration statements. Any such changes could be significant. In addition, the SEC may not view certain financial data included in this private placement memorandum as complying with Article 11 of Regulation S-X of the SEC, and may require us to modify or

1

reformulate such information contained in this private placement memorandum. Any such modifications or reformulations could be significant.

Notices regarding the private placement and this private placement memorandum

      The Shares offered hereby involve a high degree of risk. Accordingly, you should not purchase these Shares if you cannot afford the loss of your entire investment. Prospective investors should carefully consider the matters discussed under the caption “Risk Factors” prior to making any investment in us.

      Neither the SEC nor any state securities commission or other regulatory authority has approved or disapproved of the Shares or determined if this memorandum is truthful or complete. Any representation to the contrary is a criminal offense.

      This offer and sale of Shares is intended to be exempt from (a) registration with the SEC as a private placement under Section 4(2) of the Securities Act and Regulation D promulgated thereunder, and (b) registration and/or qualification under the securities laws of the states in which this offering is being made pursuant to exemptive provisions of such laws or pursuant to Section 18 of the Securities Act making such laws inapplicable to this offering. Consequently, this private placement memorandum may not present as much information as would be required, and the terms of this offering may not be as favorable to you as would be required, if this offer and sale were so registered or qualified.

      This private placement memorandum constitutes an offer only to the person to whom it was first delivered and only if such person meets the suitability standards set forth in this private placement memorandum. This private placement memorandum does not constitute an offer to any other person or the public generally to subscribe for or otherwise to acquire the Shares. No action has been taken that would permit an offering of the Shares or the circulation or distribution of this private placement memorandum or any offering material in relation to us or the Shares in any country or jurisdiction where action for that purpose is legally required. This private placement memorandum is not an offer to sell to or a solicitation of an offer to buy from, nor shall any Shares be offered or sold to, any person in any jurisdiction in which such an offer, solicitation, purchase or sale would be unlawful under the laws of such jurisdiction.

      To purchase Shares offered hereby, you must complete and return a subscription agreement in the form of Exhibit A to this private placement memorandum and which shall be separately provided, pursuant to which you must represent that you are an “accredited investor” as defined in this private placement memorandum. See “Representations and Acknowledgements of Investors” on page 62. The subscription agreement and the registration rights agreement contain other important representations, warranties and covenants. The form of registration rights agreement, Exhibit B to this private placement memorandum, shall be separately provided. In addition, the subscription agreement incorporates by reference the placement agency agreement, dated                    , 2005, between the Company and the placement agent, which contains certain important representations, warranties and covenants of the Company. The subscription agreement further provides that a purchaser of Shares may enforce the placement agency agreement against the Company as if the purchaser were a party to the placement agency agreement. The placement agency agreement, Exhibit C to this private placement memorandum, shall be separately provided. You should carefully review these documents with your legal, financial, tax and other advisers.

      In addition, the Company is offering Shares only to sophisticated investors who are capable of evaluating for themselves the merits and risks of an investment in us. In making an investment decision, you must rely on your examination of us, our prospects and the terms of this offer. We have prepared this private placement memorandum to assist you in your evaluation, but this private placement memorandum may be incomplete and may not address all issues relevant to you and may not fully discuss those issues that are addressed. You should consult your legal, financial, tax and other advisors prior to subscribing for Shares.

      Our offer to sell Shares is made subject to the terms described in this private placement memorandum and the subscription agreement, and may be withdrawn at any time. We and Keefe, Bruyette & Woods, Inc., our placement agent, reserve the right to reject any subscription in whole or in part for any reason whatsoever, to modify, amend or withdraw all or any portion of this offer or to allot to you fewer Shares than you desire to purchase. Neither we nor the placement agent shall have any liability to you for any of the foregoing.

2

      This private placement memorandum makes no representations or warranties to investors. The only representations and warranties in connection with this offering that shall have any legal effect are those contained in (or made pursuant to) one or more definitive written agreements (including a subscription agreement and registration rights agreement) when, as and if executed, and subject to the limitations and restrictions specified in such definitive written agreements. Although we believe all information in this private placement memorandum is correct as of its date, nothing contained in this private placement memorandum is, or shall be relied upon as, a promise or representation, whether as to the past or the future. The delivery of this private placement memorandum at any time after the date on its cover does not imply that the information herein remains correct as of any later date.

      Any additional information given or made by us or the placement agent or its representatives (other than in a written agreement), whether written or oral, does not constitute and shall not be construed as a representation or warranty as to the matters addressed, should not be relied upon by you and is qualified in its entirety by the information set forth in this private placement memorandum (as it may be supplemented in writing) including, but not limited to, the risk factors set forth herein. We and the placement agent expressly disclaim any and all liability based on or relating to use of information in this private placement memorandum or additional information provided by them or their representatives.

      If you invest in the Shares, you will be deemed to have acknowledged that (1) you have been afforded an opportunity to request and to review, and have received and reviewed, all additional information that you considered to be necessary to verify the accuracy of or to supplement the information herein, and (2) neither we nor the placement agent authorized any person to make any representation or warranty concerning the Shares or us and, if given or made, that you have not relied on any such purported representation or warranty.

      If you wish to invest in the Shares, you will also be deemed to have made the acknowledgements, representations and agreements as set forth under the caption “Notice to Investors.”

      As you have previously agreed with the Placement Agent, this private placement memorandum is confidential. The acceptance of this private placement memorandum from the Company or the Placement Agent constitutes an agreement by the recipient hereof, pending the Company’s public disclosure of material, non-public information contained herein, (a) not to use any such information other than in connection with evaluating this offering, (b) not to purchase or sell the Company’s securities outside of this offering, and (c) to abide by all applicable restrictions imposed by the United States securities laws in connection with this offering. The agreements set forth in the preceding sentence are intended for our benefit and we may enforce these agreements. The Company will publicly disclose all material, non-public information contained herein in a registration statement filed in connection with the holding company reorganization. If you have received a copy of this private placement memorandum without having agreed to the above restrictions, please notify the placement agent at (212) 887-8908 or (212) 887-7777 so as to make arrangements for its return.

      This private placement memorandum does not render professional advice. In particular, you should not construe the contents of this private placement memorandum as investment or legal advice. You should consult your financial advisors, counsel, accountants, tax experts and other advisors as to legal, tax, business, financial and related aspects of an investment in the Shares. No representation or warranty is made as to whether, or the extent to which, the Shares constitute legal investments for investors whose investment authority is subject to legal restrictions. Such investors should consult their legal advisors regarding such matters.

      Like all summaries, the description of our agreements and organizational documents in this private placement memorandum are incomplete. Such descriptions are qualified in their entirety by reference to the complete text of such agreements and documents, copies of which may be obtained from us upon request.

Notices regarding the placement agent

      The placement agent has not verified the information we have prepared and presented. The placement agent’s sole role in this offering is to introduce us to prospective investors and to facilitate communications between investors and us. The placement agent makes no representation or warranty of any kind as to any aspect of this offering.

3

Cautionary note regarding the forward-looking statements in this private placement memorandum

      Certain statements contained in this private placement memorandum, including, without limitation, statements containing the words “believes,” “anticipates,” “intends,” “expects,” and words of similar import, constitute “forward-looking statements.” Such forward looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Such factors include, among others, the following: general economic and business conditions in those areas in which we operate, demographic changes, competition, fluctuations in interest rates, changes in business strategy or development plans, changes in governmental regulation, credit quality, the availability of capital to fund the expansion of our business, and other risk factors referenced in this private placement memorandum. The factors set forth under “Risk Factors” and other cautionary statements made in this private placement memorandum should be read and understood as being applicable to all related forward-looking statements wherever they appear in this private placement memorandum. We disclaim any obligation to update any such factors or to publicly announce the results of any revisions to any of the forward-looking statements contained herein to reflect future events or developments.

4

TABLE OF CONTENTS

Important Notices		1
Summary		6
The Offering		8
Summary Financial Information		9
Pro Forma Consolidated and Combined Balance Sheet		11
Recent Developments		13
Risk Factors		16
Use of Proceeds		21
Market for Common Stock and Dividends		22
Capitalization		24
Management’s Discussion and Analysis of Financial Condition and Results of Operations		25
Business		41
Supervision and Regulation		47
Description of Capital Stock		56
Registration Rights		57
Shares Eligible for Future Sale		58
Plan of Distribution		60
Notice to Investors		60
Material United States Federal Tax Considerations		63
Legal Matters		64
Independent Auditors		64
Available Information		64
EXHIBITS:
	Form of Subscription Agreement
	Form of Registration Rights Agreement
	Private Placement Agency Agreement

5

SUMMARY

      The following summary highlights information contained elsewhere in this private placement memorandum. This summary is not intended to be complete. You should carefully read the entire private placement memorandum, including the “Risk Factors” section as well as all Exhibits and documents separately provided and incorporated by reference, before making an investment in the Shares.

      Unless the context requires otherwise, the “Company” refers to FCB Bancorp, the “Bank” refers to First California Bank, “South Coast Bancorp” refers to South Coast Bancorp, Inc., and “SCCB” refers to South Coast Commercial Bank, and the terms “us,” “we,” and “our” refer to FCB Bancorp only.

FCB Bancorp

      FCB Bancorp was incorporated under the laws of the State of California on January 25, 2005, at the direction of the Board of Directors of the Bank for the purpose of becoming the Bank’s holding company. The Company’s principal business will be to serve as a holding company for the Bank. In connection with the pending holding company reorganization, all of the outstanding shares of the Bank’s common stock will be exchanged for shares of the Company’s common stock on a one-for-one basis. It is anticipated that the holding company reorganization will be consummated by no later than September 30, 2005.

      Concurrently with the holding company reorganization, and subject to regulatory approval, the Company is acquiring South Coast Bancorp, Inc. We will use substantially all of the proceeds of this offering to fund the South Coast Bancorp acquisition and to provide working capital.

      The Bank derives its income primarily from interest received on loans and investment securities and from fees received from deposit services. The expenses of the Bank are the interest it pays on deposits and borrowings, salaries and benefits for employees, occupancy costs for its banking offices and general operating expenses. Our assets will consist primarily of the assets of the Bank.

      The Bank currently has six banking offices located in Camarillo, Westlake Village, Oxnard, Ventura, Thousand Oaks and Simi Valley. South Coast Bancorp currently has two banking offices located in Irvine and Anaheim Hills. We may establish additional banking offices in the years to come.

      As of March 31, 2005, the Bank’s total assets were $285.9 million, total deposits were $231.9 million, loans were $185.8 million and total equity was $22.6 million. As of March 31, 2005, SCCB’s total assets were $147.7 million, total deposits were $130.4 million, loans were $121.3 million and total equity was $16.9 million.

Overview of Transactions

      The capital to be raised through this offering, together with approximately $10.0 million of junior subordinated debt in the form of trust preferred securities, will be used by FCB Bancorp to fund its acquisition of South Coast Bancorp, Inc. as a critical element in the following transactions:

The Parties

•  First California Bank (the “Bank”) is California state-chartered commercial bank headquartered in Camarillo, California.

•  FCB Bancorp (the “Company”) is a newly formed California corporation, being organized by and at the direction of the Bank, which will, upon receipt of regulatory and shareholder approval, become the Bank’s holding company.

•  SCB Merger Corp. (the “Merger Sub”) is a newly formed California corporation and wholly-owned subsidiary of the Company.

•  South Coast Bancorp, Inc. (“South Coast Bancorp”) is a California corporation and a bank holding company under the Bank Holding Company Act of 1956, as amended, headquartered in Irvine, California.

•  South Coast Commercial Bank (“SCCB”) is a California state-chartered commercial bank and a wholly-owned subsidiary of South Coast Bancorp.

6

The Transactions

•  The Company, the Bank, the Merger Sub, South Coast Bancorp and SCCB have entered into an Agreement and Plan of Reorganization dated as of February 2, 2005, pursuant to which the Merger Sub will merge with and into South Coast Bancorp, with South Coast Bancorp surviving, followed immediately by a second stage merger of South Coast Bancorp with and into the Company, with South Coast Bancorp’s shareholders receiving cash consideration in the amount of approximately $36.0 million.

•  Payment of the purchase price for the Shares subscribed for in this offering shall be made at the offices of [                    ], or such other place as shall be agreed upon by the subscriber and the Company, at 9:00 A.M., New York City time, on the date that the acquisition of South Coast Bancorp is consummated, or such other time not later than ten business days after such date as shall be agreed upon by the subscriber and the Company (such date of payment and delivery being herein called the “Closing Date”). The Company shall notify subscribers at least two business days prior to the Closing Date that the Company expects that the Closing Date will occur on such date. In the event that each of the following transactions are not consummated by the Closing Date: (i) the holding company reorganization, (ii) the trust preferred offering, and (iii) the acquisition of South Coast Bancorp; the Company shall return to each subscriber any funds that the subscriber has distributed to the Company for the Shares no later than one business day after receipt of such funds. In addition, the subscription agreement will terminate if the sale of the Shares has not occurred on or prior to October 10, 2005.

•  The Company expects to raise approximately $10.0 million through the sale of trust preferred securities which will be used to fund, in part, the proposed acquisition of South Coast Bancorp and provide the Company with additional working capital.

•  In addition to the anticipated $22.0 million to be raised through this offering, and approximately $10.0 million from the trust preferred offering, the Bank will pay a cash dividend of approximately $5.0 million to the Company in order to provide the balance of the funds necessary to close the South Coast Bancorp acquisition.

•  Subsequent to the acquisition of South Coast Bancorp and its merger into the Company, the Bank and SCCB will each be wholly owned subsidiaries of the Company.

•  Once the Bank and SCCB are both wholly owned subsidiaries of the Company, the Company will cause the two banks to consolidate, either by way of a merger or an asset purchase and liability assumption transaction.

•  When all of the above is accomplished, the Company will have one wholly owned subsidiary, First California Bank, which will have materially all of the combined assets of the current First California Bank plus those of SCCB, which are projected on a pro forma basis to be approximately $452 million based upon total assets of each entity as of March 31, 2005.

Our Address

      Our headquarters are located at 1100 Paseo Camarillo, Camarillo, California, 93010. Our telephone number is (805) 322-9308 and our e-mail address is help@fcbank.com. Our Internet address is www.fcbank.com.

Additional Documents

      The following documents have been delivered together with the private placement memorandum to each prospective purchaser of Shares:

•  First California Bank’s Annual Report for the year ended December 31, 2004; and

•  South Coast Bancorp, Inc. Annual Report for the year ended December 31, 2004.

      If you purchase Shares and execute a subscription agreement, you will be required to represent and warrant that these documents have been delivered to you for review and have been received by you.

7

THE OFFERING

Securities Offered	Up to                      shares of common stock, no par value of FCB Bancorp.
Payment of Subscription Funds and Conditions	Payment of the purchase price for the Shares subscribed for in this offering shall be made at the offices of [                    ], or such other place as shall be agreed upon by the subscriber and the Company, at 9:00 A.M., New York City time, on the date that the acquisition of South Coast Bancorp is consummated, or such other time not later than ten business days after such date as shall be agreed upon by the subscriber and the Company (such date of payment and delivery being herein called the “Closing Date”). The Company shall notify subscribers at least two business days prior to the Closing Date that the Company expects that the Closing Date will occur on such date. In the event that each of the following transactions are not consummated by the Closing Date: (i) the holding company reorganization, (ii) the trust preferred offering, and (iii) the acquisition of South Coast Bancorp; the Company shall return to each subscriber any funds that the subscriber has distributed to the Company for the Shares no later than one business day after receipt of such funds. In addition, the subscription agreement will terminate if the sale of the Shares has not occurred on or prior to October 10, 2005.
Use of Proceeds	Substantially all of the net proceeds will be used to fund our acquisition of South Coast Bancorp and the remaining net proceeds will be used to provide working capital. See “Use of Proceeds” on page 21.
Registration Rights	Pursuant to the registration rights agreement, a form of which is attached hereto as Exhibit B, we will be required to file a registration statement with the SEC within 90 days after the closing of this offering. In addition, we will be required to use our best reasonable efforts to cause the registration statement to become effective within 150 days after the closing. If we miss either deadline, we will be required to pay liquidated damages in the form of cash payments for the registration default period. We will also have to pay liquidated damages in the event the registration statement ceases to be effective when we are required to keep it effective. Liquidated damages accrue at a rate of 1% of the aggregate purchase price per annum for the first 90 days of registration default, increasing by an additional .5% for each subsequent 90 day period of registration default up to a maximum rate of 2% per annum. See “Registration Rights” on page 57.
Investor Qualifications	Each purchaser of Shares must be an accredited investor. See “Notice to Investors” on page 60.

8

SUMMARY FINANCIAL INFORMATION

First California Bank

      The following tables set forth certain information concerning the financial condition, operating results, and key operating ratios for the Bank, at the dates and for the periods indicated. This information does not purport to be complete and should be read in conjunction with “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and the Financial Statements of the Bank and Notes thereto.

			As of or for the Year Ended December 31,
			2004			2003			2002			2001			2000
			(Dollars in thousands, except per share amounts)
Results of Operations
	Net interest income		$	11,656		$	10,898		$	9,141		$	7,488		$	6,804
	Provision for loan losses			418			510			510			576			115
	Noninterest income			1,925			1,899			1,240			1,071			814
	Noninterest expense			9,409			8,836			7,222			5,724			5,241
	Net income			2,435			2,207			1,614			1,355			1,407
	Earnings per share:
		Basic	$	1.17		$	1.12		$	0.91		$	0.86		$	0.88
		Diluted		1.14			1.10			0.86			0.86			0.88
Financial Position
	Assets		$	283,745		$	256,285		$	203,907		$	151,447		$	129,408
	Loans			182,873			157,952			142,379			121,699			92,024
	Deposits			227,190			211,929			186,661			139,356			118,319
	Shareholders’ equity			22,545			18,365			16,448			11,248			10,450
	Book value per share			10.42			9.26			8.38			7.20			6.57
Ratios
	Return on average assets			0.91	%		0.99	%		0.88	%		0.97	%		1.25	%
	Return on average equity			11.97	%		12.67	%		11.24	%		12.64	%		14.33	%
	Average equity to average assets			7.63	%		7.83	%		7.86	%		7.67	%		8.72	%
	Net interest margin(1)			4.78	%		5.45	%		5.47	%		5.96	%		6.75	%
	Efficiency ratio(2)			69.76	%		68.92	%		69.78	%		67.55	%		68.80	%
	Nonaccrual loans to loans			1.19	%		1.55	%		0.27	%		0.66	%		1.04	%
	Allowance for loan losses to loans			1.28	%		1.47	%		1.38	%		1.38	%		1.21	%

(1)	Computed by dividing net interest income on a tax equivalent basis by average earning assets.
(2)	Computed by dividing noninterest expense by net interest income and noninterest income. The ratio is a measurement of the amount of revenue that is utilized to meet overhead expenses.

9

South Coast Bancorp, Inc.

      The following tables set forth certain information concerning the financial condition, operating results, and key operating ratios for the South Coast Bancorp, Inc. at the dates and for the periods indicated. This information does not purport to be complete and should be read in conjunction with “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and the Financial Statements of South Coast Bancorp, Inc. and Notes thereto.

		As of or for the Year Ended December 31,
		2004			2003			2002			2001			2000
		(Dollars in thousands)
Results of operations
	Net interest income	$	5,809		$	6,255		$	6,262		$	5,663		$	5,499
	Provision (credit) for loan losses		(55	)		(4	)		(81	)		66			89
	Noninterest income		715			1,271			895			536			386
	Noninterest expense		3,558			3,888			3,486			3,229			3,050
	Net income		2,915			3,515			3,620			1,682		$	1,592
Financial position
	Assets	$	146,725		$	142,679		$	133,805		$	130,499		$	121,968
	Loans		120,719			115,646			104,714			103,705			100,438
	Deposits		128,799			125,485			117,260			115,357			108,496
	Shareholders’ equity		16,767			15,781			15,037			13,571			12,379
Ratios(1)
	Return on average assets		2.04	%		2.58	%		2.77	%		1.32	%		1.36	%
	Return on average equity		18.13	%		22.85	%		25.54	%		13.08	%		13.65	%
	Equity capital to total assets		11.43	%		11.06	%		11.24	%		10.40	%		10.15	%
	Net interest margin(2)		4.49	%		5.07	%		5.13	%		4.69	%		4.94	%
	Efficiency ratio(3)		53.20	%		49.97	%		47.06	%		50.80	%		50.96	%
	Nonaccrual loans to loans		0.00	%		0.07	%		0.39	%		0.41	%		0.43	%
	Allowance for loan losses to loans		.98	%		1.05	%		1.15	%		1.23	%		1.20	%

(1)	Source: SNL Financial
(2)	Computed by dividing net interest income on a tax equivalent basis by average earning assets.
(3)	Computed by dividing noninterest expense by net interest income and noninterest income. The ratio is a measurement of the amount of revenue that is utilized to meet overhead expenses.

10

PRO FORMA CONSOLIDATED AND COMBINED BALANCE SHEET

      The following table sets forth certain information concerning the financial condition for FCB Bancorp and South Coast Bancorp, Inc. on a pro forma combined basis, as of March 31, 2005. This information does not purport to be complete and should be read in conjunction with “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” and the Financial Statements of the Bank and South Coast Bancorp, Inc., and Notes thereto.

FCB Bancorp

Pro Forma Consolidated and Combined Balance Sheet

March 31, 2005

							Pro Forma									Pro Forma
					Proceeds		FCB						Pro Forma			FCB
		Pro Forma			from		Bancorp			South Coast			Purchase			Bancorp
		Consolidated(1)			Offering(2)		Consolidated			Bancorp, Inc.			Adjustments			Consolidated
		(Dollars in thousands)
Assets
Cash and due from banks		$	9,048		$	30,630	$	39,678		$	13,502		$	(35,270	)(3)	$	17,910
Securities			75,005			—		75,005			4,516			(23	)(4)		79,498
Federal funds sold			4,080			—		4,080			7,500			—			11,580
Loans			185,778			—		185,778			121,259			4,992	(4)		312,029
Allowance for loan losses			(2,537	)		—		(2,537	)		(1,173	)		—			(3,710	)
Premises and equipment, net			4,828			—		4,828			1,723			1,800	(4)		8,351
Goodwill			—			—		—			—			15,919	(4)		15,919
Other assets			9,707			—		9,707			655			—			10,362
	Total Assets	$	285,909		$	30,630	$	316,539		$	147,982		$	(12,582	)	$	451,939
Liabilities
Deposits		$	231,882		$	—	$	231,882		$	130,424		$	1,349	(4)	$	363,655
Federal Home Loan Bank borrowings			30,350			—		30,350			—			—			30,350
Junior subordinated debt (trust preferred securities)			—			10,000		10,000			—			—			10,000
Other liabilities			1,090			—		1,090			396			3,093	(4)		4,717
														138	(3)
	Total Liabilities		263,322			10,000		273,322			130,820			4,580			408,722
Shareholders’ Equity
Common stock			11,965			20,630		32,595			850			(850	)		32,595
Surplus			—			—		—			1,378			(1,378	)		—
Retained earnings			10,622			—		10,622			14,934			(14,934	)		10,622
	Total Shareholders’ Equity		22,587			20,630		43,217			17,162			(17,162	)		43,217
	Total Liabilities and Shareholders’ Equity	$	285,909		$	30,630	$	316,539		$	147,982		$	(12,582	)	$	451,939

Please see accompanying notes to pro forma consolidated and combined balance sheet.

11

NOTES TO PRO FORMA CONSOLIDATED AND COMBINED BALANCE SHEET

NOTE 1 — BASIS OF PRESENTATION

      The pro forma consolidated and combined balance sheet has been prepared from unaudited financial information pertaining to First California Bank and South Coast Bancorp, Inc. as of March 31, 2005. The pro forma information for FCB Bancorp assumes its formation and approval as a holding company for First California Bank occurred prior to March 31, 2005.

NOTE 2 — PROCEEDS FROM OFFERING

      FCB Bancorp will receive net proceeds of $20,630,000 from this offering and will issue approximately $10,000,000 in junior subordinated debentures (trust preferred securities) to assist in funding the acquisition of South Coast Bancorp, Inc. In addition, the Bank anticipates paying a special cash dividend of approximately $5,000,000 to FCB Bancorp to facilitate the acquisition. The following summarizes these transactions.

	(In thousands)
Common stock issued in this offering	$	22,000
Less investment banking, legal and accounting fees		(1,370	)
Net equity from issuance of common stock		20,630
Issuance of junior subordinated debt		10,000
Dividends		5,000
Total cash acquired by FCB Bancorp	$	35,630

NOTE 3 — COMPUTATION OF SOUTH COAST BANCORP, INC. PURCHASE PRICE

      FCB Bancorp will acquire all of the outstanding stock of South Coast Bancorp, Inc. for a purchase price that is not to exceed $36,000,000. The purchase price will be reduced if the consolidated equity of South Coast Bancorp, Inc. is less than $16,500,000, based upon calculations set forth in the closing financial statements of South Coast Bancorp. For purposes of the pro forma balance sheet presentation, the following summarizes the assumed computation of the South Coast Bancorp, Inc. acquisition price.

		(In thousands)
South Coast Bancorp, Inc. consolidated shareholders’ equity		$	17,162
Less transaction costs of South Coast Bancorp, Inc.:
	Legal and accounting fees		(200	)
	Severance and employment contract expenses		(1,465	)
	Transfer of bank-owned automobile		(37	)
Adjusted consolidated shareholders’ equity			15,460
Shareholders’ equity required			16,500
Purchase price adjustment			(1,040	)
Base purchase price			36,000
Adjusted purchase price			34,960
Plus direct transaction costs of FCB Bancorp
	Investment banking, legal and accounting fees		310
	Estimated restructuring charges		138
Calculated purchase price		$	35,408

12

NOTE 4 — PURCHASE ACCOUNTING ADJUSTMENTS IN ACQUISITION OF SOUTH COAST BANCORP, INC.

      FCB Bancorp will account for its acquisition of South Coast Bancorp, Inc. using the purchase method of accounting for business combinations. Accordingly, the assets acquired and liabilities assumed will be recorded by FCB Bancorp at fair value on the date acquisition. The difference between the adjusted purchase price and the net assets acquired will be recorded as goodwill by FCB Bancorp and will be periodically evaluated in the future for impairment. The following summarizes the pro forma purchase accounting adjustments to be made at the time the acquisition is completed. Deferred taxes are recorded at a rate of 38%.

		(In thousands)
South Coast Bancorp, Inc. assets acquired		$	147,982
South Coast Bancorp, Inc. liabilities assumed			130,820
Net assets acquired			17,162
Less transaction costs of South Coast Bancorp, Inc.			(1,702	)
Fair value adjustments:
	Securities		(23	)
	Loans		4,992
	Premises and equipment		1,800
	Deposits		(1,349	)
	Other liabilities		(1,391	)
Fair value of net assets acquired			19,489
Calculated purchase price			35,408
Excess of calculated purchase price over net assets acquired, recorded as goodwill		$	15,919

RECENT DEVELOPMENTS

      Certain statements contained in this section, below, constitute “forward-looking statements” involving known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Please see “Cautionary note regarding the forward-looking statements in this private placement memorandum” on page      , above, for more information.

Recent Developments — First California Bank

      Net income for the Bank for the quarter ended March 31, 2005 totaled $577,000, the same amount that was posted for the first quarter of 2004. On a diluted per share basis, net income for the first quarter of 2005 was $0.26 compared with $0.28 for the year ago period. The lower earnings per share data reflect the increase in weighted average shares outstanding that resulted from the exercise of 179,300 warrants in the second quarter of 2004.

		March 31,
		2005		2004
		(In thousands, except
		per share data)
Results of operations
Net interest income		$	3,102	$	3,009
Provision for loan losses			122		104
Noninterest income			516		412
Noninterest expense			2,565		2,416
Net income		$	577	$	577
Earnings per share
	Basic	$	0.27	$	0.29
	Diluted	$	0.26	$	0.28

13

      Net interest income for the first three months of 2005 totaled $3,102,000, up 3 percent from $3,009,000 for the same period a year ago. The net interest margin (on a tax-equivalent basis) for the 2005 first quarter was 4.82 percent compared with 5.21 percent for the 2004 first quarter. For the fourth quarter of 2004 the net interest margin was 4.64 percent and for the third quarter of 2004 the net interest margin was 4.48 percent. The increase in the net interest margin since the third quarter of 2004 reflects the asset-sensitive nature of the Bank’s balance sheet. The Bank should continue to experience an increase in net interest margin as the prime rate increases. The decrease in the net interest margin from the first quarter of 2004 to the first quarter of 2005 reflects the change in the mix of loans, securities, deposits and borrowings from a year ago.

      Noninterest income for the first quarter of 2005 increased to $516,000, up 25 percent from the first quarter of 2004 on higher levels of service charges on deposit accounts, net gains on sales of SBA 7(a) loans and commissions on brokered SBA 504 loans. Loan commissions and gains on sales of loans totaled $102,000 for the first three months of 2005 compared with $18,000 for the same period last year. The Bank also realized in the first quarter of 2004 net gains on sales of securities of $12,000. There were no securities transactions in the first quarter of 2005. Noninterest expenses for the first quarter of 2005 were $2,565,000, up 6 percent from the year ago period. The increase in operating expenses reflects principally the increase in occupancy and equipment costs stemming from the new Simi Valley branch that opened in January 2005, the expansion of the Westlake Village office in the fourth quarter of 2004 and the expansion into a new operations center in the third quarter of 2004. The efficiency ratio for the 2005 first quarter was 70.90 percent compared with 70.61 percent for the 2004 first quarter.

	March 31,
	2005		2004
	(In thousands, except per
	share data)
Financial position
Assets	$	285,909	$	254,155
Loans		185,778		164,604
Deposits		231,882		210,099
Shareholders’ equity		22,587		19,386
Book value per share	$	10.44	$	9.77

      Loans stood at $185,778,000 at the end of the first quarter of 2005, a 13 percent increase from end of the same quarter a year ago. At March 31, 2005, the allowance for loan losses was $2,537,000 and the ratio of the allowance to loans was 1.37 percent. The provision for loan losses for the first quarter of 2005 totaled $122,000 and net recoveries for the same period totaled $69,000. Deposits increased to $231,882,000 at March 31, 2005, up 10 percent from March 31, 2004. Total assets were $285,909,000 million at the end of the 2005 first quarter, up from $254,155,000 a year ago.

	March 31,
	2005		2004
Ratios
Return on average assets		0.83%		0.91%
Return on average equity		10.09%		12.23%
Average equity to average assets		7.90%		7.63%
Net interest margin (tax-equivalent)		4.82%		5.21%
Efficiency ratio		70.90%		70.61%
Total capital ratio		12.59%		11.68%
Tier 1 capital ratio		11.34%		10.43%
Tier 1 leverage ratio		8.27%		7.63%

      Shareholders’ equity increased 17 percent from $19,386,000 at the end of the first quarter of 2004 to $22,587,000 at the end of the first quarter of 2005. In 2002, the Bank successfully completed an offering of 400,000 new common shares along with 200,000 warrants to purchase additional shares. All warrant holders

14

subsequently exercised their option to purchase additional shares by the end of second quarter 2004. The capital raised through the offering totaled $5.5 million. The book value per common share was $7.94 at the time of the 2002 offering and has since increased 31 percent to $10.44 at March 31, 2005. The Bank’s capital ratios at March 31, 2005 continue to exceed the levels established by banking regulators for a “well-capitalized” institution.

Recent Developments — South Coast Bancorp, Inc.

      Net income for South Coast Bancorp, Inc. for the first quarter of 2005 was $629,000, down from $845,000 for the same period a year ago principally due to a lower level of net interest income.

	March 31,
	2005			2004
	(Dollars in thousands)
Results of operations
Net interest income	$	1,531		$	1,721
Provision (credit) for loan losses	$	(10	)	$	(44	)
Noninterest income	$	3		$	3
Noninterest expense	$	892		$	892
Net income	$	629		$	845

      Loans increased 9 percent to $121,259,000 at March 31, 2005 from $111,698,000 at March 31, 2004. Deposits also increased to $130,424,000, or 6 percent, at the end of the 2005 first quarter. Total assets at March 31, 2005 were $147,723,000.

	March 31,
	2005		2004
	(Dollars in thousands)
Financial position
Assets	$	147,723	$	139,965
Loans	$	121,259	$	111,698
Deposits	$	130,424	$	123,507
Shareholders’ equity	$	16,903	$	15,862

      As of March 31, 2005 and 2004, SCCB’s capital ratios exceeded the levels for a “well-capitalized” institution.

	March 31,
	2005			2004
	(Dollars in thousands)
Ratios(1),(2)
Return on average assets		1.71	%		2.40	%
Return on average equity		15.24	%		21.77	%
Equity to total assets		11.44	%		11.33	%
Net interest margin		4.26	%		4.98	%
Efficiency ratio		58.15	%		51.74	%
Total capital ratio		14.27	%		15.87	%
Tier 1 capital ratio		13.34	%		14.78	%
Tier 1 leverage ratio		11.51	%		11.28	%

(1)	Source: SNL Financial
(2)	Where appropriate, the ratios have been annualized

15

RISK FACTORS

      Investing in the Company’s common stock involves risks. In addition to the other information contained in this private placement memorandum, you should consider carefully the following risks before purchasing our securities. If any of these risks occurs, our business, financial condition or operating results could be adversely affected. In that case, the trading price of our common stock could decline and you could lose all or part of your investment.

      Please note that for purposes of the following discussion under “Risk Factors,” the terms “us,” “we,” and “our” refer to FCB Bancorp, First California Bank, South Coast Bancorp and South Coast Commercial Bank, on a pro forma consolidated basis giving effect to the holding company formation, the acquisition of South Coast Bancorp, and the subsequent consolidation of South Coast Commercial Bank with First California Bank.

RISKS RELATING TO FCB BANCORP, FIRST CALIFORNIA BANK, SOUTH COAST BANCORP, INC. AND SOUTH COAST COMMERCIAL BANK

We are highly dependent on real estate and events that negatively impact the real estate market could hurt our business.

      A significant portion of our loan portfolio is dependent on real estate. At March 31, 2005, real estate served as the principal source of collateral with respect to approximately 72% of First California Bank’s loan portfolio. Our financial condition may be adversely affected by a decline in the value of the real estate securing our loans and, while we presently hold no real estate acquired through foreclosure or other judicial proceeding, a decline in the value of real estate that may be owned by us, through foreclosure or otherwise, in the future could adversely impact our financial condition. In addition, acts of nature, including earthquakes, brush fires and floods, which may cause uninsured damage and other loss of value to real estate that secures these loans, may also negatively impact our financial condition. This is particularly significant in light of the fact that substantially all of the real estate that makes up the collateral of our real estate secured loans is located in Southern California, where earthquakes and brush fires are common.

Economic conditions in the Southern California area could adversely affect our operations.

      Our banking operations are concentrated primarily in Ventura, Orange and Los Angeles Counties. As a result of this geographic concentration, our results of operations depend largely upon economic conditions in these areas. Deterioration in economic conditions in our market area could have a material adverse impact on the quality of our loan portfolio and the demand for our retail and commercial banking products and services, which in turn may have a material adverse effect on our results of operations.

We are dependent on the continued services of key management.

      Our continued success depends on the retention, recruitment and continued contributions of key management, including C. G. Kum, the Bank’s President and Chief Executive Officer, Thomas E. Anthony, the Bank’s Executive Vice President and Chief Credit Officer and Romolo Santarosa, the Bank’s Executive Vice President and Chief Financial Officer, and other key officers of the Bank, and SCCB (upon consummation of the proposed acquisition). The loss of such key personnel could have an adverse affect on our growth and profitability, and many of these persons would be difficult or impossible to replace. The competition for qualified personnel is intense. The loss of services of members of our key personnel could have a material adverse effect on our business, financial condition and results of operations.

We face strong competition from financial service companies and other companies that offer banking services that could hurt our business.

      The banking business in California, generally, and in the Ventura, Orange and Los Angeles County areas where our banking offices are located, specifically, is highly competitive with respect to both loans and deposits and is dominated by major banks, both domestic and foreign, which have many offices operating over wide

16

geographic areas. We compete for deposits and loans principally with these major banks, but also with small independent banks located in our service area. Among the advantages which the major banks have over us are their ability to finance extensive advertising campaigns and to allocate their investment assets to regions of highest yield and demand. Many of the major commercial banks operating in our service area offer certain services that are not offered directly by us and, by virtue of their greater total capitalization, such banks have substantially higher lending limits than us. In addition, we face direct competition from newly chartered banks which are formed from time to time in our service area.

      Moreover, banks generally, and we in particular, face increasing competition for loans and deposits from non-bank financial intermediaries such as savings and loan associations, thrift and loan associations, credit unions, mortgage companies, insurance companies, and other lending institutions. Money market funds offer rates competitive with, or higher than those of, banks, and an increasingly sophisticated financial services industry continually develops new products for businesses and consumers that compete with banks for investment dollars. In addition, other entities (both public and private) seeking to raise capital through the issuance and sale of debt or equity securities compete with banks in the acquisition of deposits.

      Increasing levels of competition in the banking and financial services businesses may reduce our market share or cause the prices we charge for our services to fall. Our results may differ in future periods depending upon the nature or level of competition.

We may not or will not sustain recent growth trends.

      The Bank has grown in recent years, including with respect to net income, assets, loans, deposits and other benchmarks. For example, the Bank’s net income for the year ended December 31, 2004 totaled $2.4 million, up 10.3% from $2.2 million earned in 2003. On a per share basis, the 2004 results equate to $1.14 per diluted share, versus $1.10 per diluted share in the prior year. At December 31, 2004, the Bank’s total assets were $283.7 million, compared with $256.3 million at the close of 2003. Total deposits amounted to $227.2 million, up from $211.9 million twelve months earlier, and loans increased to $182.9 million, compared with $158.0 million last year. No assurances can be given that such growth patterns can be sustained in the future.

Our growth presents certain risks, including a decline in credit quality or capital adequacy.

      The Bank’s asset growth of recent years may continue, even if not at the same percentage rate we have experienced in recent years. Such growth presents certain risks. While management believes that the Bank has maintained good credit quality relative to its peers notwithstanding such growth, rapid growth is frequently associated with a decline in credit quality. Accordingly, continued asset growth could lead to a decline in our credit quality in the future. In addition, continued asset growth could cause a decline in the Company’s or the Bank’s capital adequacy for regulatory purposes, which could in turn cause the Company to have to raise additional capital in the future to maintain or regain “well capitalized” status as defined under applicable banking regulations.

Failure to successfully execute our strategy could adversely affect our performance.

      Our financial performance and profitability depends on our ability to execute our corporate growth strategy. Continued growth may present operating and other problems that could adversely affect our business, financial condition and results of operations. Accordingly, there can be no assurance that we will be able to execute our growth strategy or maintain the level of profitability that we have recently experienced.

Our performance and growth are dependent on our maintaining a high quality of service for our customers, and will be impaired by a decline in our quality of service.

      Our continued growth is dependent on our maintaining a high quality of service for our customers. As we continue to grow, it may become increasingly difficult to maintain high service quality for our customers. This could cause a decline in our performance and growth with respect to net income, deposits, assets and other benchmarks.

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Our size subjects us to lower lending limits than many of our competitors are subject to.

      The Bank and SCCB are subject to lending limits, calculated as a function of our respective capital. After the acquisition of SCCB and subsequent consolidation with the Bank, the Bank will have a greater lending limit as a result of the increased capital. Notwithstanding the increased capital of the Bank after the merger, however, because of the Bank’s size, the Bank will be limited in the size of loans it will be able to make, singly or in the aggregate, to existing or potential customers. As of March 31, 2005, the Bank’s lending limit for secured loans was approximately $6.5 million and the Bank’s lending limit for unsecured loans was approximately $3.9 million. On a pro forma basis (giving effect to the consolidation of SCCB with the Bank), as of March 31, 2005, the Bank’s lending limit for secured loans would be approximately $14.5 million and the Bank’s lending limit for unsecured loans would be approximately $8.7 million. In the event that a customer’s loan demands exceed the Bank’s lending limits, the Bank may attempt to arrange for such loans on a participation basis with its correspondent banks. Where this is not feasible, the Bank may be unable to make the loan. This may result in the loss of existing or prospective business.

We are subject to other government regulation that could limit or restrict our activities, which in turn could adversely impact our operations.

      The financial services industry is regulated extensively. Federal and state regulation is designed primarily to protect the deposit insurance funds and consumers, rather than our shareholders. These regulations can sometimes impose significant limitations on our operations. In addition, these regulations are constantly evolving and may change significantly over time.

      New laws and regulations or changes in existing laws and regulations or repeal of existing laws and regulations may adversely impact our business. The impact on us and our financial performance of the recently enacted Sarbanes-Oxley Act of 2002 and various rule makings by the SEC and the NASD cannot presently be determined. Further, federal monetary policy, particularly as implemented through the Federal Reserve System, significantly affects economic conditions for us.

If a significant number of borrowers, guarantors and related parties fail to perform as required by the terms of their loans, we will sustain losses.

      A significant source of risk for us arises from the possibility that losses will be sustained if a significant number of our borrowers, guarantors and related parties fail to perform in accordance with the terms of their loans and guaranties. This risk increases when the economy is weak. We have adopted underwriting and credit monitoring procedures and credit policies, including the establishment and review of the allowance for loan losses, that management believes are appropriate to minimize this risk by assessing the likelihood of nonperformance, tracking loan performance and diversifying our credit portfolio. These policies and procedures, however, may not prevent unexpected losses that could materially adversely affect our results of operations.

Our business is subject to interest rate risk and changes in interest rates may adversely affect our performance and financial condition.

      Our earnings are impacted by changing interest rates, which are unpredictable and beyond our control. Changes in interest rates impact the demand for new loans, the credit profile of our borrowers, the rates received on loans and securities and rates paid on deposits and borrowings. The difference between the rates received on loans and securities and the rates paid on deposits and borrowings is known as interest rate spread. Given our current volume and mix of interest-bearing liabilities and interest-earning assets, we would expect our interest rate spread to increase if interest rates rise and, conversely, to decline if interest rates fall. Although we believe our current level of interest rate sensitivity is reasonable, significant fluctuations in interest rates may have an adverse effect on our business, financial condition and results of operations.

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We could be adversely affected by general economic conditions.

      A decline in current economic conditions or rising interest rates could have an adverse effect on the demand for new loans and the ability of borrowers to repay outstanding loans, which could adversely affect our financial condition and results of operations in general and the market value of our common stock.

We are exposed to risk of environmental and other liabilities with respect to properties to which we take title.

      In the course of our business, we may foreclose and take title to real estate, and could be subject to environmental or other liabilities with respect to these properties. We may be held liable to a governmental entity or to third persons for property damage, personal injury, investigation and clean-up costs incurred by these parties in connection with environmental contamination, or may be required to investigate or clean up hazardous or toxic substances, or chemical releases at a property. The costs associated with investigation or remediation activities could be substantial. In addition, in the event we become the owner or former owner of a contaminated site, we may be subject to common law claims by third parties based on damages and costs resulting from environmental contamination emanating from the property. If we ever become subject to significant environmental liabilities, our business, financial condition, liquidity and results of operations could be materially and adversely affected.

Our internal operations are subject to a number of risks.

      We are subject to certain operations risks, including, but not limited to, data processing system failures and errors, customer or employee fraud and catastrophic failures resulting from terrorist acts or natural disasters. We maintain a system of internal controls to mitigate against such occurrences and maintain insurance coverage for such risks that are insurable, but should such an event occur that is not prevented or detected by our internal controls and uninsured or in excess of applicable insurance limits, it could have a significant adverse impact on our business, financial condition or results of operations.

We will incur additional costs as a result of operating as a public company.

      Upon consummation of the holding company reorganization, the Company will be a “public company” and will be required to comply with the reporting requirements under the Securities Exchange Act of 1934, as amended (the “Exchange Act”) and its related regulations, including the rules implementing the provisions of the Sarbanes-Oxley Act of 2002, or the SOX. As a financial institution, the Bank has a history of filing regulatory reports and being subject to frequent government oversight. The Bank’s audit committee consists entirely of outside (i.e., non-employee) directors. The Bank also has a system of internal controls. Although the Bank cannot be certain of the effect, if any, the new requirements and regulations as a public company will have on its business, the Bank and the Company do not anticipate that complying with these regulations and requirements will result in any material changes in corporate governance, business or results of operations other than the additional costs associated with the reporting requirements under the Exchange Act and the enhanced disclosures under the SOX. At this point, such additional costs cannot be estimated or predicted and could be significant. Future changes in the laws, regulation, or policies that could also impact the Bank and the Company cannot necessarily be predicted and may have a material adverse effect on business and earnings.

RISKS RELATING TO OUR COMMON STOCK

The Company’s common stock is currently not traded and only a limited trading market exists for the Bank’s common stock.

      Presently, there is no trading market for the Company’s common stock. In connection with the holding company formation, the Bank’s shareholders will exchange their shares of the Bank’s common stock for the Company’s common stock on a one-for-one basis. As of March 31, 2005, there were 2,162,807 shares of the Bank’s common stock issued and outstanding. Only a limited trading market for the Bank’s common stock exists on the OTC “Bulletin Board.” We are aware of four dealers currently trading shares of the Bank’s common stock. However, we cannot assure you that an active public market for the Company’s common stock

19

will ever develop or the extent to which those dealers will continue trading the Company’s common stock after the holding company formation.

The shares of common stock sold in this offering will be subject to transfer restrictions.

      The Shares are subject to restrictions on transfer in order to ensure compliance with federal and state securities laws. In connection with the sale of the Shares, we will enter into a registration rights agreement, Exhibit B to this private placement memorandum and separately provided, with each purchaser of Shares. The registration rights agreement will require us to file a registration statement on an appropriate form with the SEC within 90 days after the closing of the sale of the Shares. In addition, we will be required to use our best reasonable efforts to cause the registration statement to become effective within 150 days after the closing. However, we may not be able to have the registration statement declared effective within that time period, if at all. For a more detailed description of the terms of the Registration Rights Agreement, see “Registration Rights” on page      .

The interests of our controlling shareholders may differ from yours.

      As of the date of this private placement memorandum, and without taking into account any dilution in voting power as a result of this offering, the Bank’s directors, executive officers and their related interests have voting control with respect to approximately 54.7% of its outstanding shares. In particular, James O. Birchfield, the Bank’s Chairman, together with members of his immediate family, beneficially own and have voting power with respect to approximately 34.7% of the Bank’s outstanding common stock. After the holding company formation, Mr. Birchfield will own the same percentage voting interests in the Company as he owns in the Bank. The interests of these controlling shareholders may differ from yours. Because of this beneficial ownership and voting power, our controlling shareholders have the power to substantially control any matter presented to shareholders for a vote, including with respect to the election of directors or other material transactions, such as a future issuance of securities, a potential acquisition of, or take-over proposal made by, another company. As a result, these controlling shareholders may cause the defeat of a proposal you support, or cause the passing of a proposal you oppose.

A holder with as little as a 5% interest in FCB Bancorp could, under certain circumstances, be subject to regulation as a “bank holding company.”

      A holder (not including a natural person) of 25% or more of the outstanding FCB Bancorp common stock, or 5% or more if such holder otherwise exercises a “controlling influence” over FCB Bancorp, may be subject to regulation as a “bank holding company” in accordance with the Bank Holding Company Act of 1956, as amended (the BHCA). In addition, (i) any bank holding company or foreign bank with a U.S. presence may be required to obtain the approval of the Federal Reserve Board under the BHCA to acquire or retain 5% or more of the outstanding FCB Bancorp common stock and (ii) any person other than a bank holding company may be required to obtain the approval of the Federal Reserve Board under the Change in Bank Control Act to acquire or retain 10% or more of the outstanding FCB Bancorp common stock. Becoming a bank holding company imposes certain statutory and regulatory restrictions and burdens, and might require the holder to divest all or a portion of the holder’s investment in FCB Bancorp. In addition, because a bank holding company is required to provide managerial and financial strength for its bank subsidiary, such a holder may be required to divest investments that may be deemed incompatible with bank holding company status, such as a material investment in a company unrelated to banking.

RISKS RELATING TO THE HOLDING COMPANY REORGANIZATION AND THE ACQUISITION OF SOUTH COAST COMMERCIAL BANK

There is a risk that the holding company formation will not be approved.

      Although we have every reason to believe that the proposed holding company formation will be approved, there is no assurance that the transaction will close. In order for the holding company formation to close, the transaction requires the prior approval of the Federal Reserve Board, the Federal Deposit Insurance

20

Corporation and the California Department of Financial Institutions, as well as approval by a majority of the outstanding shares of common stock of the Bank. The Bank’s directors, executive officers and certain other shareholders, who in the aggregate own more than a majority of the Bank’s outstanding common stock, have entered into a shareholders agreement pursuant to which they have agreed to vote in favor of approving the proposed holding company formation.

The acquisition of South Coast Bancorp may not be consummated as planned.

      Although we have every reason to believe that the acquisition of South Coast Bancorp will be consummated as planned, the Company’s ability to consummate the acquisition is subject to a number of material conditions and there can be no assurances that we will be able to consummate the transaction. Under the terms of the subscription agreements, in the event that each of the following transactions are not consummated by the Closing Date: (i) the holding company reorganization, (ii) the trust preferred offering, and (iii) the acquisition of South Coast Bancorp; the Company shall return to each subscriber any funds that the subscriber has distributed to the Company for the Shares no later than one business day after receipt of such funds. In addition, the subscription agreement will terminate if the sale of the Shares and the consummation of the acquisition of South Coast Bancorp have not occurred on or prior to October 10, 2005. As a result, there can be no assurance that investors that sign subscription agreements will receive the Shares that they intend to purchase. In addition, under the terms of the subscription agreements, subscribers will purchase the Shares immediately prior to the consummation of the acquisition of South Coast Bancorp. If the acquisition is not consummated after that purchase, for any reason, the Company may be prevented from repurchasing the shares sold to the investors.

There is a risk that we may not be able to integrate our business successfully with South Coast Bancorp.

      If we are unable to integrate our businesses successfully, our business and earnings may be negatively effected. The acquisition involves the integration of companies that have previously operated independently. Successful integration of South Coast Bancorp’s consolidated operations will depend primarily on our ability to consolidate operations, systems and procedures and to eliminate redundancies and costs. No assurance can be given that we will be able to integrate our operations without encountering difficulties including, without limitation, the loss of key employees and customers, the disruption of our respective ongoing businesses or possible inconsistencies in standards, controls, procedures and policies. If we have difficulties with the integration, we might not achieve the economic benefits we expect to result from the acquisition and this would likely hurt our business and our earnings.

USE OF PROCEEDS

      The net proceeds to us from the sale of up to                      shares of our common stock in this private placement will be approximately $20,630,000, after deducting placement agent fees and estimated offering expenses (estimated at approximately $1,370,000) payable by us.

      We plan to use substantially all of the net proceeds from this offering to fund the South Coast Bancorp acquisition, with the remaining proceeds to be used as working capital. In addition to the anticipated $22.0 million to be raised through this private placement offering, and the approximately $10.0 million from the issuance of trust preferred securities, the Bank will pay a special cash dividend of approximately $5.0 million to the Company in order to provide the balance of the funds necessary to close the South Coast Bancorp acquisition.

      The amounts actually expended for working capital purposes may vary significantly and will depend on a number of factors, including the amount of our future revenues and the other factors described under “RISK FACTORS.” In the event the South Coast Bancorp transaction fails to close by the Closing Date (as defined in the subscription agreement), the Company will be obligated to return to each subscriber any funds that the subscriber has distributed to the Company for the Shares no later than one business day after receipt of such funds.

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MARKET FOR COMMON STOCK AND DIVIDENDS

Market Information

      Presently, there is no market for the Company’s common stock. There has been a limited trading market for the Bank’s common stock on the OTC “Bulletin Board” (trading symbol “FCAA”) and no assurance can be given that a more active public trading market for the Company’s common stock will develop in the future. The Company is aware of only four dealers that effected trades in the Bank’s common stock. The Company’s common stock is not registered under the Securities Exchange Act of 1934 and, therefore, is not currently eligible for listing on any exchange or on the Nasdaq National Market.

      The information in the following table indicates the high and low sales prices and volume of trading for the Bank’s common stock for each quarterly period since January 1, 2003, and is based upon information provided by the OTC “Bulletin Board.” Because of the limited market for the Bank’s common stock, these prices may not be indicative of the fair market value of the Bank’s common stock. The information does not include transactions for which no public records are available. The trading prices in such transactions may be higher or lower than the prices reported below.

	Sales Prices				Approximate Number
Quarter Ended	High		Low		of Shares Traded
March 31, 2003	$	10.87	$	10.50		13,700
June 30, 2003	$	12.00	$	11.00		15,600
September 30, 2003	$	13.00	$	11.75		4,300
December 31, 2003	$	15.75	$	13.10		11,488
March 31, 2004	$	22.00	$	15.80		32,387
June 30, 2004	$	20.80	$	17.95		13,559
September 30, 2004	$	19.75	$	17.75		24,272
December 31, 2004	$	23.00	$	19.25		14,693
March 31, 2005	$	23.00	$	22.50		190,970
Period Ended
May 26, 2005	$	22.05	$	19.25		7,560

      According to information provided by the OTC “Bulletin Board,” the most recent trade in the Bank’s common stock prior to the date of this prospectus occurred on May 26, 2005 for 200 shares, at a sales price of $19.75 per share. The “bid” and “asked” prices as of May 26, 2005, were $19.60 and $20.00, respectively.

Dividends

      The Bank has not paid any cash dividends since 2001. Payment of cash dividends in the future will depend upon our earnings and financial condition and other factors deemed relevant by our Board of Directors, as well as federal and state governmental policies and regulations applicable to us, which limit the amount that may be paid as dividends without prior approval. See “Supervision and Regulation” for information regarding our ability to pay cash dividends. It is our current intention to follow our strategic plan of retaining earnings to increase our capital and provide additional basis for growth. Accordingly, no assurance can be given that any cash dividends will be declared in the foreseeable future.

Stock Option Plan

      The Bank adopted the 2003 Stock Option Plan that allows for the granting of both incentive and nonstatutory stock options. The option price for incentive stock options cannot be less than 100% of the fair market value of the shares on the date of grant. The stock options expire eight years from the date of grant. The option price, number of shares granted to recipients, and duration for the plan stock options are determined and approved by the Board of Directors.

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      As of March 31, 2005, all options outstanding vest five years and expire eight years after the date of grant. The following table summarizes information regarding stock options outstanding at March 31, 2005:

Incentive Stock Options						Nonstatutory Stock Options
				Weighted Average						Weighted Average
				Remaining						Remaining
Exercise		Number		Contractual Life		Exercise		Number		Contractual Life
Price		Outstanding		(In Years)		Price		Outstanding		(In Years)
	$11.25		31,750		6.22	$	11.25		10,000		6.22
	$20.25		26,500		7.06	$	20.25		10,000		7.06
			58,250						20,000

      Under the plan, an aggregate of no more than 200,000 shares of the Bank’s common stock were approved for grant. At March 31, 2005, there were 121,750 shares reserved and available for grant. Upon shareholder and regulatory approval of the holding company reorganization, outstanding Bank stock options will be exchanged for Company stock options on a one-for-one basis and on the same terms and conditions as the Bank stock options.

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CAPITALIZATION

      The following table sets forth our actual and pro forma capitalization on a consolidated basis as of March 31, 2005:

•  on an actual basis after giving effect to the formation of the holding company;

•  as adjusted to reflect the receipt and application by us of estimated net proceeds from our sale of                      shares of our common stock in this offering, after deducting the estimated offering expenses and commissions, and receipt of proceeds from our trust preferred offering; and

•  as adjusted for this offering and on a pro forma basis for the consummation of the South Coast Bancorp acquisition.

      You should read this table in conjunction with the financial statements and the other financial information included in this private placement memorandum.

FCB Bancorp

Pro Forma Capitalization and Regulatory Capital Ratios

March 31, 2005

									As Adjusted
									for This
						As Adjusted			Offering and
			Pro Forma			for This			Trust Preferred			Pro Forma
			Actual(1)			Offering			Issuance			Consolidated
			(Unaudited)
			(Dollars in thousands, except share amounts)
Junior Subordinated Debt			$	—		$	—		$	10,000		$	10,000
Shareholders’ Equity:
	Common stock, no par value, 10,000,000 shares authorized			11,965			32,595			32,595			32,595
	Retained earnings			11,416			11,416			11,416			11,416
	Accumulated other comprehensive loss			(794	)		(794	)		(794	)		(794	)
		Total shareholders’ equity	$	22,587		$	43,217		$	43,217		$	43,217
Total number of shares outstanding(2)(3)				2,162,807
Book value per share			$	10.44
Capital Ratios:
	Tier 1 leverage capital ratio			8.27	%		15.56	%		19.09	%		8.70	%
	Tier 1 risk-based capital ratio			11.34	%		21.34	%		26.19	%		11.22	%
	Total risk-based capital ratio			12.59	%		22.59	%		27.44	%		12.60	%

(1)	After giving effect to the formation of the holding company.
(2)	Does not reflect 78,250 unissued shares subject to outstanding stock options.
(3)	Assumes                      shares issued at an offering price of $           per share.

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MANAGEMENT’S DISCUSSION AND ANALYSIS

OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

First California Bank

Overview

      The following is a discussion of First California Bank’s results of operations and financial condition. You should read this discussion in conjunction with the Bank’s audited financial statements and the related footnotes.

      For 2004 the Bank had net income of $2,435,000, up 10 percent from 2003. On a diluted per share basis, net income for 2004 was $1.14 compared with $1.10 for 2003. The growth in net income followed from an increase in earning assets — loans and securities. The earnings per share data for the year reflect the increase in weighted average shares outstanding that resulted from the exercise of warrants at the end of the second quarter of 2004.

      Net income for 2003 was $2,207,000, up 37 percent from 2002 net income of $1,614,000. Earnings per diluted share for 2002 were $0.86. The increase in net income again was a result of an increase in earning assets.

      Net income for the five years ended December 31, 2004 has increased at a compound average annual rate of 21 percent. The growth in net income reflects:

•  The opening of three de novo branches since 1999,

•  Our focus on services and technology to meet the needs of the small business banking market,

•  An expanded customer base in Ventura and surrounding counties, and

•  The successful issuance in 2002 of 400,000 shares of common stock, with 200,000 warrants attached, for a total of $5.5 million in capital to support our growth strategy.

Critical accounting policies

      The discussion and analysis of our results of operations and financial condition are based upon our audited financial statements which have been prepared in accordance with accounting principles generally accepted in the United States of America. The preparation of these financial statements requires management to make estimates and judgments that affect the reported amounts of assets and liabilities, income and expense, and the related disclosures of contingent assets and liabilities at the date of these financial statements. Management believes these estimates and assumptions to be reasonably accurate; however, actual results may differ from these estimates under different assumptions or circumstances. The following are the principal critical accounting policies of the Bank.

      An estimate of probable losses incurred in the loan portfolio is necessary in determining the amount of the allowance for loan losses which is presented as a reduction of our loan balances. The provision for loan losses, charged to operations, is the amount that is necessary to establish the allowance. The information used by management to make this estimate is described later in this section and in the notes to the financial statements. The allowance for loan losses was $2,346,000 at December 31, 2004.

      An estimate of probable income tax benefits that will not be realized in future years is required in determining the necessity for a valuation allowance for deferred tax assets. The information used by management to make this estimate is described later in this section and in the notes to the financial statements. Net deferred tax assets were $448,000 at December 31, 2004; there was no valuation allowance.

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Results of Operations

Net interest income

      Net interest income is the difference between interest and fees earned on loans, securities and federal funds sold (i.e., earning assets) and the interest paid on deposits and borrowings (i.e., interest-bearing funds). Net interest margin is net interest income expressed as a percentage of earning assets.

      The following table shows average balances and interest income or interest expense, with resulting average yield or rates on a tax equivalent basis, by category of earning assets or interest bearing liabilities.

		December 31,
		2004							2003							2002
		Average		Income/					Average		Income/					Average		Income/
		Balance		Expense		Rate			Balance		Expense		Rate			Balance		Expense		Rate
									(Dollars in thousands)
ASSETS:
Loans:
Commercial		$	69,317	$	5,046		7.28	%	$	60,022	$	4,370		7.28	%	$	49,936	$	3,627		7.26	%
Real estate			94,088		5,758		6.12	%		81,573		5,926		7.26	%		75,218		5,951		7.91	%
Consumer			5,209		405		7.78	%		7,591		642		8.46	%		7,081		548		7.74	%
	Total loans		168,614		11,209		6.65	%		149,186		10,938		7.33	%		132,235		10,126		7.66	%
Securities:
Taxable			65,583		1,970		3.00	%		40,128		1,194		2.98	%		17,569		643		3.66	%
Nontaxable			7,308		299		6.20	%		4,752		212		6.76	%		4,206		199		7.17	%
	Total securities		72,892		2,269		3.11	%		44,880		1,406		3.13	%		21,775		842		3.87	%
Federal funds sold and deposits with banks			5,777		74		1.28	%		8,025		85		1.06	%		14,881		232		1.56	%
Total earning assets			247,283		13,552		5.48	%		202,091		12,429		6.15	%		168,891		11,200		6.63	%
Non-earning assets			19,220							20,430							13,901
Total assets		$	266,503						$	222,521						$	182,792
LIABILITIES AND SHAREHOLDERS’ EQUITY
Interest bearing deposits:
Interest bearing demand deposits		$	19,776		21		0.11	%	$	17,946		19		0.11	%	$	16,303		21		0.13	%
Savings			61,697		487		0.79	%		51,807		372		0.72	%		35,414		277		0.78	%
Certificates of deposit			52,138		807		1.55	%		54,804		949		1.73	%		62,216		1,761		2.83	%
Total interest bearing deposits			133,611		1,315		0.98	%		124,557		1,340		1.08	%		113,933		2,059		1.81	%
Borrowed funds:
Federal funds purchased			70		2		2.86	%		—		—		—			—		—		—
FHLB advances			29,706		579		1.95	%		12,405		191		1.54	%		—		—		—
	Total borrowed funds		29,776		581		1.95	%		12,405		191		1.54	%		—		—		—
Total interest bearing funds			163,387		1,896		1.16	%		136,962		1,531		1.12	%		113,933		2,059		1.81	%
Noninterest bearing demand deposits			81,455							67,400							53,472
Other liabilities			1,315							746							1,022
Shareholders’ equity			20,346							17,413							14,365
Total liabilities and shareholder’s equity		$	266,503						$	222,521						$	182,792
Net interest income				$	11,656						$	10,898						$	9,141
Net interest margin (tax equivalent)							4.78	%						5.45	%						5.47	%

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      Net interest income for 2004 was $11,656,000, up 7 percent from $10,898,000 for 2003. Net interest income was $9,141,000 for 2002. The increase in net interest income reflects the increase in earning assets. Average earning assets increased 22 percent to $247,283,000 for 2004 from $202,091,000 for 2003. Average earning assets for 2002 were $168,891,000.

      The following table shows changes in net interest income attributed to changes in the average volume of earning assets and interest earning funds and changes in the average rate earned or paid.

		2004 to 2003 Change in									2003 to 2002 Change in
		Interest Expense Due to:									Interest Expense Due to:
		Rate			Volume			Total			Rate			Volume			Total
		(Dollars in thousands)
Interest income
	Interest on loans	$	(1,153	)	$	1,424		$	271		$	(486	)	$	1,298		$	812
	Interest on securities		(15	)		878			863			375			189			564
	Interest on Federal funds sold		14			(25	)		(11	)		(40	)		(107	)		(147	)
	Total interest income		(1,154	)		2,277			1,123			(151	)		1,380			1,229
Interest expense
	Interest bearing demand deposits		1			2			3			(4	)		2			(2	)
	Savings		44			72			116			(41	)		136			95
	Certificates of deposit		(98	)		(46	)		(144	)		(602	)		(210	)		(812	)
	Total interest on deposits		(53	)		28			(25	)		(647	)		(72	)		(719	)
	Interest on borrowings		122			268			390			—			191			191
	Total interest expense		69			296			365			(647	)		119			(528	)
Net interest income		$	(1,223	)	$	1,981		$	758		$	496		$	1,261		$	1,757

      Net interest margin (on a tax equivalent basis) was 4.78% for 2004 compared with 5.45% for 2003. Net interest margin was 5.47% for 2002. The decline in the net interest margin reflects the change in the mix of earning assets and funding sources from the year ago periods.

      Average loans were $168,614,000 for 2004 and represented 68 percent of average earning assets, compared with $149,186,000 and 74 percent for 2003. For 2002, average loans were $132,235,000 or 78 percent of average earning assets. Average loans increased 13 percent in 2004 and 2003. The increase in loans reflects the expansion of our branch network over these periods and the success of our business strategy.

      Average securities were $72,892,000 for 2004 and represented 29 percent of average earning assets, compared with $44,880,000 and 22 percent for 2003. For 2002, average securities were $21,775,000 or 13 percent of average earning assets. Average securities increased 62 percent for 2004 and 106 percent for 2003. Beginning in 2003, the Bank began to more actively manage its investments, core funding sources, alternative funding sources and capital. In this regard, mid-year 2003, the Bank purchased approximately $30,000,000 U.S. agency mortgage-backed securities with a final maturity of seven years. In addition, the Bank secured $25,000,000 of FHLB term advances with final maturities of three months to three years. From mid-year 2004 to year-end 2004, the Bank made several other purchases of U.S. agency mortgage-backed securities of approximately $15,000,000 with concomitant FHLB term advances of $14,900,000. While the addition of these securities had the effect of decreasing, in part, the net interest margin for the periods presented, net interest income has increased.

      Average deposits were $215,066,000 for 2004 and represented 87 percent of average earning assets, compared with 191,957,000 and 95 percent for 2003. Average deposits were $167,405,000 or 91 percent for 2002. Average deposits increased 12 percent for 2004 and 15 percent for 2003. The increase in deposits, especially in noninterest-bearing demand deposits, reflects the expansion of our branch network and the success of our business strategy. The Bank does not accept broker certificates of deposits.

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      Average FHLB advances were $29,706,000 for 2004 compared with $12,405,000 for 2003. There were no FHLB advances for 2002. The increase in FHLB advances reflects the more active management of investments, core funding sources, alternative funding sources and capital described above.

Provision for loan losses

      The provision for loan losses for 2004 was $418,000 compared with $510,000 for 2003. The provision for loan losses for 2002 was $510,000. See also the discussion of the allowance for loan losses later in this section.

Noninterest income

      Noninterest income was $1,925,000 for 2004 compared with $1,899,000 for 2003. Noninterest income was $1,240,000 for 2002.

	December 31,
	2004		2003			2002
	(Dollars in thousands)
Service charges on deposit accounts	$	1,056	$	965		$	744
Earnings on cash surrender value of life insurance		224		260			—
Commissions on brokered loans		132		307			43
Net gain loan sales		87		75			119
Net servicing fees		42		34			32
Other income		290		280			271
Subtotal service charges, fees, and other		1,831		1,921			1,209
Net gain (loss) on sales of securities		94		(22	)		31
Total noninterest income	$	1,925	$	1,899		$	1,240

      Service charges on deposit accounts increased 9 percent to $1,056,000 for 2004 from $965,000 for 2003. Service charges on deposit accounts were $744,000 for 2002. The increase in service charge income reflects the higher level of checking and savings accounts from the year ago periods as well as a general increase in scheduled service fees.

      Earnings on cash surrender value of life insurance were $224,000 for 2004 compared with $260,000 for 2003. There were no earnings in 2002. The Bank purchased life insurance policies at the end of December 2002 to support life insurance benefits for several key employees and salary continuation benefits for certain executives.

      Gains on loan sales and commissions on brokered loans totaled $219,000 for 2004 compared with $382,000 for 2003. Gains on loans sales and commissions on brokered loans totaled $162,000 for 2002. The Bank originates SBA 7(a) loans and sells the guaranteed portion of the loan into the secondary market for a gain. The Bank also arranges SBA 504 and other loans for customers that are ultimately funded by other institutions and receives commissions for its services. The change in income reflects the change in the number and amount of loans sold or brokered in each period.

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Noninterest expense

      Noninterest expense for 2004 was $9,409,000, up 6 percent from $8,836,000 for 2003. Noninterest expense for 2002 was $7,222,000. The efficiency ratio was 69.8% for 2004 compared with 68.9% for 2003 and 69.8% for 2002.

	December 31,
	2004		2003		2002
	(Dollars in thousands)
Salaries and benefits	$	5,373	$	5,220	$	4,131
Premises and equipment		1,301		972		693
Data processing		758		836		743
Legal, audit, and other professional services		418		328		326
Printing stationary and supplies		141		166		199
Telephone		163		161		92
Directors’ fees		128		106		103
Advertising and marketing		299		298		289
Postage		81		84		86
Other expenses		747		665		560
Total noninterest expense	$	9,409	$	8,836	$	7,222

      The Bank has pursued a growth strategy through de novo branching. This requires the Bank to recruit and hire personnel and lease or build facilities to operate and house the new branch. These expenses are incurred prior to the opening of the branch and generally are in excess of the income from the branch when it commences operations. The increase in salaries and benefits expense and premises and equipment expense reflects this growth strategy. The Oxnard office was opened in the spring of 2000, the Ventura office was opened in the summer of 2002, the Thousand Oaks office was opened in the fall of 2003 and the Simi Valley office was opened in January of 2005. The Bank also expanded into a new operations center in the summer of 2004 consolidating into one facility loan, deposit and technology operations.

      In addition, in 2004, the Bank implemented a new core application processing system that is anticipated to lower unit costs while providing a platform that more readily supports growth and expansion of services.

Income taxes

      The provision for income taxes was $1,319,000 for 2004 compared with $1,244,000 for 2003. The provision for income taxes was $1,035,000 for 2002. The effective tax rate was 35.1% for 2004 compared with 36.0% for 2003 and 39.1% for 2002. The combined federal and state statutory rate for all periods was 41.2%. The effective tax rate was less than the combined statutory tax rate as a result of excluding from taxable income interest income on municipal securities and the earnings on the cash surrender value of life insurance.

Financial position

Securities

      The Bank purchases securities to generate interest income and to assist in the management of liquidity risk. Securities are classified as ‘available-for-sale’ for accounting purposes and, as such, are recorded at their fair or market values in the balance sheet. Fair values are based on quoted market prices. Changes in the fair

29

value of securities (i.e., unrealized holding gains or losses) are reported as ‘other comprehensive income’ and carried as accumulated comprehensive income or loss within shareholders’ equity until realized.

		As of December 31, 2004
					After One			After Five
		One Year			Year to			Years to			Over
		or Less			Five Years			Ten Years			Ten Years			Total
		(Dollars in thousands)
Maturity distribution
	Mortgage-backed securities	$	1,226		$	36,848		$	10,314		$	7,960		$	56,348
	Collateralized mortgage obligations		—			—			1,568			3,347			4,915
	U.S. Treasury Obligations		2,993			—			—			—			2,993
	State and municipal securities		100			295			2,723			3,615			6,733
	U.S. agency securities		3,746			3,050			—			—			6,796
	Total	$	8,065		$	40,193		$	14,605		$	14,922		$	77,785
Weighted average yield
	Mortgage-backed securities		3.75	%		3.26	%		4.10	%		4.50	%		3.60	%
	Collateralized mortgage obligations		—			—			4.91	%		4.72	%		4.78	%
	U.S. Treasury obligations		2.75	%		—			—			—			2.75	%
	State and municipal securities		7.12	%		7.96	%		5.47	%		6.03	%		5.90	%
	U.S. Agency securities		2.69	%		2.62	%		—			—			2.66	%
	Total		2.93	%		3.25	%		4.44	%		4.92	%		3.76	%

      Securities, at amortized cost, increased to $77,785,000, or 19 percent, at December 31, 2004 from $65,286,000 at December 31, 2003. Securities, at amortized cost, were $27,001,000 at December 31, 2002. The increase in securities reflect (i) the shift from investing in overnight, lower-yielding federal funds into longer-term, higher-yielding securities, (ii) the increase in core deposits over the periods, and (iii) a more active use of equity capital and alternative funding sources to generate interest income.

      Net unrealized holding losses at December 31, 2004 and 2003 were $440,000 and $512,000, respectively. There were net unrealized holding gains at December 31, 2002 of $308,000. As a percentage of securities, at amortized cost, unrealized holding losses and gains were 0.57%, 0.78% and 1.11% at the end of each respective period. Securities are comprised largely of U.S. Government Agency obligations, mortgage-backed securities and California municipal general obligation bonds. The Bank has evaluated unrealized losses of its investment securities and determined that these as of December 31, 2004 are temporary and are related to the fluctuation in market interest rates since purchase.

Loans

      The Bank primarily makes loans to small businesses located principally in Ventura and Los Angeles counties. Total loans increased 16 percent to $182,873,000 at December 31, 2004 from $157,952,000 at December 31, 2003. Total loans were $142,379,000 at December 31, 2002. The increase in loans reflects the expansion of our branch network over these periods.

	December 31,
	2004			2003			2002
	(Dollars in thousands)
Commercial real estate	$	83,457		$	87,638		$	80,020
Commercial loans and lines		68,996			42,076			31,876
Construction		12,330			16,540			16,842
Home equity loans and lines		2,114			5,808			7,036
Home mortgage		11,558			2,898			2,756
Installment and credit card		4,418			2,992			3,849
Total loans		182,873			157,952			142,379
Less allowances for loan losses		(2,346	)		(2,325	)		(1,970	)
Loans, net	$	180,527		$	155,627		$	140,409

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      The following table shows the maturity distribution of loans.

			As of December 31, 2004
			One Year		One Year to		After
			or Less		Five Years		Five Years		Total
			(Dollars in thousands)
Fixed rate loan maturities
	Commercial real estate		$	669	$	3,394	$	3,484	$	7,547
	Commercial loans and lines			476		3,955		685		5,116
	Consumer			84		582		22		688
	Other			7,275		—		5,653		12,928
		Total fixed rate loan maturities		8,504		7,931		9,844		26,279
Adjustable rate loan repricings
	Commercial real estate			38,728		42,389		—		81,117
	Commercial loans and lines			50,677		4,388		1,950		57,015
	Construction			12,609		—		—		12,609
	Consumer			3,308		—		—		3,308
	Other			2,545		—		—		2,545
		Total adjustable rate loan maturities		107,867		46,777		1,950		156,594
		Total maturities and repricings	$	116,371	$	54,708	$	11,794	$	182,873

Allowance for loan losses

      The allowance for loan losses is established through a provision charged to expense. Loans are charged-off against the allowance when the Bank believes that it is unlikely that the loan will be paid. The amount of the allowance at each period end is based on an evaluation of the probable losses inherent in the portfolio of loans at such times. The evaluation takes into consideration, among other things, the type of loans, the delinquency or default status of loans, the trends in the loan portfolio, and current and future economic conditions that may affect the borrower’s ability to pay.

      The following table shows the activity in the allowance for loan losses for the periods indicated.

	December 31,
	2004			2003			2002
	(Dollars in thousands)
Beginning balance	$	2,325		$	1,970		$	1,680
Provision for loan losses		418			510			510
Loans charged-off		(359	)		(124	)		(336	)
Recoveries on loans charged off		12			69			116
Transfers to undisbursed commitment liability		(50	)		(100	)		—
Ending balance	$	2,346		$	2,325		$	1,970
Ratio of net charge-offs to average loans		0.21	%		0.04	%		0.17	%

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      The following table shows an allocation of the allowance for loan losses to loan categories. The amount attributed to a loan category should not be interpreted as an indication that changes to the allowance will be incurred in these amounts or proportions.

	December 31, 2004
			Percent of
			Allowance
	Amount		to Loans
	(Dollars in thousands)
Commercial real estate	$	422		0.51	%
Commercial loans and lines		856		1.24	%
Construction loans		487		3.95	%
Home equity loan and lines		13		0.81	%
Home mortgage		58		0.50	%
Installment and credit card		45		1.01	%
Subtotal	$	1,881		1.03	%
Unallocated		465		0.25	%
Total	$	2,346		1.28	%

      The allowance for loan losses, as a percentage of total loans, was 1.28% at December 31, 2004, compared with 1.47% at December 31, 2003. At December 31, 2002 this ratio was 1.38%. The provision for loan losses for 2004 was $418,000 compared with $510,000 for 2003. The provision for loan losses for 2002 was $510,000. Net charge-offs for the same periods were $347,000, $55,000, and $220,000, respectively.

      The Bank does not accrue interest on loans for which payment of interest or principal is not expected. Nonaccrual loans totaled $2,180,000 at December 31, 2004 compared to $2,443,000 at December 31, 2003. At December 31, 2002 nonaccrual loans totaled $333,000. The increase in nonaccrual loans represents a participation in a construction loan with several other banks to a borrower who defaulted on the payment terms and filed for bankruptcy. In December 2004, the bankruptcy court approved a settlement and the borrower has, in 2005, resumed payments under the approved settlement. The Bank anticipates the full repayment of this loan with interest and does not anticipate a loss.

	December 31,
	2004			2003			2002
	(Dollars in thousands)
Accruing loans past due 90 days	$	—		$	132		$	18
Nonaccrual loans	$	2,180		$	2,443		$	333
Ratios:
Accrual loans past due to average loans		—			0.09	%		0.01	%
Nonaccrual loans to average loans		1.29	%		1.64	%		0.25	%
Interest income on nonaccrual loans:
Contractual due	$	197		$	254		$	47
Collected		69			14			52

Deposits

      The Bank primarily accepts deposits of small businesses located principally in Ventura and Los Angeles counties. Core deposits totaled $194,939,000 at December 31, 2004 compared with $184,432,000 at

32

December 31, 2003 and $155,471,000 at December 31, 2002. Core deposits represent a significant low-cost source of funds that support the Bank’s lending activities.

		Years Ended December 31,
		2004					2003					2002
		Average		Average			Average		Average			Average		Average
		Balance		Rate			Balance		Rate			Balance		Rate
		(Dollars in thousands)
Core deposits
	Noninterest bearing demand deposits	$	81,455		—		$	67,400		—		$	53,472		—
	Interest checking		19,776		0.11	%		17,946		0.11	%		16,303		0.13	%
	Savings accounts		61,697		0.79	%		51,807		0.72	%		35,414		0.78	%
	Time deposits less than $100,000		24,783		1.79	%		26,724		1.93	%		33,505		3.05	%
	Total core deposits		187,711		0.80	%		183,877		0.84	%		138,694		1.29	%
Noncore deposits
	Time deposits of $100,000 or more		27,355		1.33	%		28,080		1.54	%		28,712		2.58	%
Total		$	215,066		0.98	%	$	191,957		1.08	%	$	167,405		1.81	%

      Large certificates of deposits (i.e., $100,000 or more) totaled $32,251,000 at December 31, 2004 compared with $27,497,000 at December 31, 2003 and $31,190,000 at December 31, 2002. A large part of these deposits represent deposits placed by the State Treasurer of California with the Bank. The remainder represents deposits accepted from customers in the Bank’s market area. There were no broker deposits as of December 31, 2004, 2003 or 2002, respectively.

      The following table shows the maturity distribution of time deposits of $100,000 or more.

	December 31, 2004
	Amount		Percentage
	(Dollars in thousands)
Three months or less	$	17,394		53.9	%
Over three months through six months		7,571		23.5	%
Over six months through one year		2,086		6.5	%
Over one year		5,200		16.1	%
	$	32,251		100.00	%

Borrowings

      The Bank is a member of the Federal Home Loan Bank of San Francisco (FHLB). Membership allows the Bank to borrow, approximately $71.0 million at December 31, 2004, to meet funding needs and otherwise assist in the management of liquidity risk. Borrowings with the FHLB are collateralized by the Bank’s investment in FHLB stock as well as loans or securities which may be pledged. At December 31, 2004 the Bank’s investment in FHLB stock totaled $1,992,000.

	2004					2003					2002
	Federal		Weighted			Federal		Weighted			Federal		Weighted
	Home Loan		Average			Home Loan		Average			Home Loan		Average
	Bank		Interest			Bank		Interest			Bank		Interest
	Advances		Rate			Advances		Rate			Advances		Rate
	(Dollars in thousands)
Amount outstanding at end of period	$	32,850		2.39	%	$	25,000		1.63	%		—		—
Maximum amount outstanding at any month-end during the period	$	32,850		2.39	%	$	25,000		1.63	%		—		—
Average amount outstanding during the period	$	29,706		1.95	%	$	12,405		1.54	%		—		—

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      The following table shows the maturities of the FHLB advances outstanding at December 31, 2004.

		Maturity
Amount		Year
$	16,050		2005
	11,550		2006
	5,250		2007
$	32,850

Off balance sheet arrangements

      In the normal course of business, the Bank makes commitments to extend credit or issues letters of credit to customers. These commitments generally are not recognized in the balance sheet. These commitments do involve, to varying degrees, elements of credit risk; however, the Bank uses the same credit policies and procedures as it does for on-balance sheet credit facilities. Commitments to extend credit totaled $63,604,000 at December 31, 2004 compared with $45,291,000 at December 31, 2003 and $51,894,000 at December 31, 2002. Commercial and standby letters of credit were $914,000, $1,337,000, and $552,000 at December 31, 2004, 2003, and 2002, respectively.

Contractual Obligations and Commitments

      Below is a schedule of First California Bank’s current contractual obligations by maturity and/or payment due date.

	As of December 31, 2004
	<1 Year		1-3 Years		3-5 Years		>5 Years		Total
	(Dollars in thousands)
FHLB term advances	$	16,050	$	11,550	$	5,250	$	—	$	32,850
Salary continuation benefits		—		—		—		180		180
Operating lease obligations		332		846		276		960		2,414
Total	$	16,382	$	12,396	$	5,526	$	1,140	$	35,444

Quantitative and qualitative disclosures about risk

Credit risk

      Credit risk is the risk to earnings or capital arising from an obligor’s failure to meet the terms of any contract with the Bank or otherwise to perform as agreed. Credit risk is found in all activities in which success depends on counterparty, issuer, or borrower performance. Credit risk is present any time Bank funds are extended, committed, invested, or otherwise exposed through actual or implied contractual agreements, whether reflected on or off the balance sheet.

      The Bank manages credit risk through Board approved policies and procedures. These policies are reviewed and approved at least annually by the Directors. Lending policies provide Bank management with a framework for consistent loan underwriting and a basis for sound credit decisions. Lending policies specify, among other things, the parameters for the type or purpose of the loans, the required debt service coverage and the required collateral requirements. Credit limits are also established and certain loans require approval by the Directors’ Loan Committee. The Directors’ Audit Committee also engages a third party to perform a credit review of the loan portfolio to ensure compliance with policies and assist in the evaluation of the credit risk inherent in the loan portfolio.

      An estimate of probable losses incurred in the loan portfolio is necessary in determining the amount of the allowance for loan losses which is presented as a reduction of our loan balances. This estimate is performed monthly by management and reviewed and approved by the Board of Directors. This estimate takes into

34

consideration, among other things, the type of loans, the delinquency or default status of loans, the trends in the loan portfolio, and current and future economic conditions that may affect the borrower’s ability to pay.

      Nonaccrual loans, as a percentage of total loans, were 1.19% at December 31, 2004 compared with 1.55% at December 31, 2003. Nonaccrual loans are comprised principally of a participation in a construction loan with several other banks to a borrower who defaulted on the payment terms and filed bankruptcy. In December 2004, the bankruptcy court approved a settlement and the borrower has, in 2005, resumed payments under the approved settlement. The Bank anticipates the full repayment of this loan with interest.

Interest rate risk

      Interest rate risk is the risk to earnings or capital arising from movements in interest rates. Interest rate risk arises from differences between the timing of rate changes and the timing of cash flows (re-pricing risk), from changing the rate relationships among different yield curves affecting bank activities (basis risk), from changing rate relationships across the spectrum of maturities (yield curve risk), and from interest-related options embedded in loans and products (options risk).

      The Bank manages interest risk through Board approved policies and procedures. These policies are reviewed and approved at least annually by the Directors. Interest rate risk policies provide Bank management with a framework for consistent evaluation of risk (a modified-gap analysis, an earnings-at-risk analysis and an economic value of equity analysis) and establish risk tolerance parameters. Management’s Asset and Liability Committee meets regularly to evaluate interest rate risk, engages a third party to assist in the measurement and evaluation of risk and reports quarterly to the Directors’ Funds Management Committee on compliance with policies. The Directors’ Audit Committee also engages a third party to perform a review of management’s asset and liability practices to ensure compliance with policies.

      The Bank’s funding sources are dominated by checking and savings accounts, which either have no interest rate or are re-priced infrequently. The Bank’s loan portfolio is dominated by loans that use the Wall Street Journal prime rate as an index. The Bank’s securities portfolio is comprised chiefly of U.S. Agency mortgage-backed securities that are either fixed rate, adjustable or a hybrid. This composition produces a balance sheet that is generally asset-sensitive, that is as the general level of interest rates rise, net interest income generally increases and as the general level of interest rates fall, net interest income generally decreases.

		By Repricing Interval
		0-3			4-12
		Months			Months			1-5 Years			>5 Years			Total
		(Dollars in thousands)
Earning assets
	Loans	$	96,499		$	3,659		$	69,888		$	10,647		$	180,693
	Securities		4,755			9,569			38,308			24,713			77,345
	Federal funds sold		4,055			—			—			—			4,055
	Total interest earning assets	$	105,309		$	13,228		$	108,196		$	35,360		$	262,093
Deposits and borrowings
	Deposits	$	35,669		$	57,048		$	49,773		$	—		$	142,490
	Borrowings		2,500			13,550			16,800			—			32,850
	Total deposits and borrowings		38,169			70,598			66,573			—			175,340
Interest rate sensitivity gap		$	67,140		$	(57,370	)	$	41,623		$	35,360		$	86,753
Cumulative gap		$	67,140		$	9,770		$	51,393		$	86,753
Cumulative gap as a percentage of interest earning assets			23.62	%		3.73	%		19.61	%		33.10	%

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Liquidity risk

      Liquidity risk is the risk to earnings or capital arising from the Bank’s inability to meet its obligations when they come due without incurring unacceptable losses. Liquidity risk includes the inability to manage unplanned decreases or changes in funding sources as well as the failure to recognize or address changes in market conditions that affect the ability to liquidate assets quickly and with minimal loss in value.

      The Bank manages liquidity risk through Board approved policies and procedures. These policies are reviewed and approved at least annually by the Directors. Liquidity risk policies provide Bank management with a framework for consistent evaluation of risk and establish risk tolerance parameters. Management’s Asset and Liability Committee meets regularly to evaluate liquidity risk, review and establish deposit interest rates, review loan and deposit in-flows and out-flows and reports quarterly to the Directors’ Funds Management Committee on compliance with policies. The Directors’ Audit Committee also engages a third party to perform a review of management’s asset and liability practices to ensure compliance with policies.

      The Bank enjoys a large base of core deposits (representing checking, savings and small certificates of deposit (i.e., under $100,000)). At December 31, 2004 core deposits totaled $194,939,000, compared with $184,432,000 at December 31, 2003. Core deposits totaled $155,471,000 as of December 31, 2002. Core deposits represent a significant low-cost source of funds that support the Bank’s lending activities.

Capital Resources

      The Board of Directors recognizes that a strong capital position is vital to growth, continued profitability, and depositor and investor confidence. The policy of the Board of Directors is to maintain sufficient capital at not less than the well-capitalized thresholds established by banking regulators. In 2002, the Bank successfully issued 400,000 shares of common stock, with 200,000 warrants attached, for a total of $5.5 million in capital to support our growth strategy. The Bank has not paid cash or stock dividends since 2001.

												To be Well-
							For Capital					Capitalized Under
							Adequacy					Prompt Corrective
		Actual					Purposes					Action Provisions
		Amount		Ratio			Amount		Ratio			Amount		Ratio
		(Dollars in thousands)
December 31, 2004
	Total capital to risk-weighted assets	$	25,300		12.25	%	$	16,518		8.00	%	$	20,647		10.00	%
	Tier 1 capital to risk-weighted assets	$	22,804		11.04	%	$	8,259		4.00	%	$	12,388		6.00	%
	Tier 1 capital to average assets	$	22,804		8.61	%	$	10,974		4.00	%	$	13,718		5.00	%

      The Bank’s capital ratios exceed the levels established by banking regulators for a “well-capitalized’ institution at December 31, 2004.

South Coast Bancorp, Inc.

Overview

      The following is a discussion of the results of operations and financial condition of South Coast Bancorp, Inc., South Coast Commercial Bank’s parent holding company. You should read this discussion in conjunction with South Coast Bancorp’s audited financial statements and the related footnotes.

      South Coast Bancorp is a bank holding company whose only active subsidiary is South Coast Commercial Bank, headquartered in Irvine, California. SCCB makes loans primarily collateralized by commercial, retail and industrial properties located throughout Southern California. SCCB funds loans primarily with FDIC-insured savings accounts and certificates of deposits. SCCB is subject to regulation by the California Department of Financial Institutions and the FDIC. SCCB elected to be taxed as an S Corporation under the federal and state income tax laws. These laws provide that, in lieu of corporate income taxes, the shareholders separately account for their share of income, deductions, losses and credits. As

36

a result, no corporate income taxes have been provided for in the results of operations except for certain state and federal income taxes.

      On February 2, 2005, the Bank entered into an Agreement of Merger with South Coast Bancorp pursuant to which South Coast Bancorp will merge with and into a newly formed bank holding company, FCB Bancorp. The merger is pending all necessary shareholder and regulatory approvals. South Coast Bancorp shareholders will receive approximately $36.0 million in cash if and when the merger transaction is completed. The transaction will be accounted for as a purchase; accordingly, the results of operations from the acquisition will be included in the consolidated financial statements of FCB Bancorp from the date of acquisition forward.

Critical accounting policies

      The discussion and analysis of South Coast Bancorp’s results of operations and financial condition are based upon audited financial statements which have been prepared in accordance with accounting principles generally accepted in the United States of America. The preparation of these financial statements requires South Coast Bancorp’s management to make estimates and judgments that affect the reported amounts of assets and liabilities, income and expense, and the related disclosures of contingent assets and liabilities at the date of these financial statements. South Coast Bancorp believes these estimates and assumptions to be reasonably accurate; however, actual results may differ from these estimates under different assumptions or circumstances. Material estimates that are particularly susceptible to significant change in the near-term relate to the determination of the allowance for loan losses.

      The allowance for loan losses is maintained by additions charged to operations as provisions for loan losses and by loan recoveries, with actual losses charged as reductions to the allowance. There are three basic elements to South Coast Bancorp’s process for evaluating the adequacy of the allowance for loan loss allowances: first the identification of impaired loans; second, the establishment of appropriate loan loss allowances once individual specific impaired loans are identified; and third, a methodology for estimating loan losses based on the inherent risk in the remainder of the loan portfolio. Loss allowances are established for specifically identified impaired loans based on the fair value of the underlying collateral property. Measurement of loan impairment is based on the fair value of the loans’ collateral. Impairment losses are included in the allowance for loan losses through a charge to provision for loan losses. Adjustments to impairment losses due to changes in the fair value of impaired loans’ collateral are included in the provision for loan losses. The allowance for loan losses was $1,183,000 at December 31, 2004.

Results of operations and financial position

	As of December 31,
	2004			2003			2002
	(Dollars in thousands)
Results of Operations
Net interest income	$	5,809		$	6,255		$	6,262
Provision (credit) for loan losses	$	(55	)	$	(4	)	$	(81	)
Noninterest income	$	715		$	1,271		$	895
Noninterest expense	$	3,558		$	3,888		$	3,486
Net income	$	2,915		$	3,515		$	3,620
Financial position
Assets	$	146,725		$	142,679		$	133,805
Loans	$	120,719		$	115,646		$	104,714
Deposits	$	128,799		$	125,485		$	117,260
Shareholders’ equity	$	16,767		$	15,781		$	15,037

      For 2004, South Coast Bancorp had net income of $2,915,000, down 17 percent from $3,515,000 for 2003. Net income declined principally on lower levels of noninterest income, specifically, net gains on loans held for sale. Net income for 2003 declined 3 percent from $3,620,000 for 2002.

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Net interest income

      Net interest income for 2004 was $5,809,000, down $446,000 or 7.13% from $6,255,000 for 2003. Net interest income was $6,262,000 for 2002.

		As of December 31,
		2004		2003		2002
		(Dollars in thousands)
Interest on:
	Loans	$	9,075	$	9,445	$	10,053
	Securities		94		123		191
	Federal funds sold		105		92		141
	Deposit with banks		308		308		368
Total interest income			9,582		9,968		10,753
Interest expense on deposits			3,773		3,713		4,491
Net interest income		$	5,809	$	6,255	$	6,262

      The decline in net interest income from 2002 to 2004 reflects principally the decline in the yield on loans. The general level of interest rates declined significantly from 2002 to mid-year 2003. For example, the prime interest rate was 4.75% at November 1, 2002. By June 2003, the prime interest rate fell to 4.00%. The prime interest has since increased to 5.25% at the end of 2004. The following table indicates rates earned or paid for the periods indicated.

	As of December 31,(1)
	2004			2003			2002
Loans		7.52	%		8.17	%		9.60	%
Securities		2.21	%		3.07	%		4.77	%
Federal funds sold		1.50	%		0.92	%		1.66	%
Deposits with interest		2.57	%		3.34	%		3.11	%
Interest earning assets		6.65	%		7.18	%		8.33	%
Interest bearing deposits		3.05	%		3.20	%		4.51	%
Net interest margin		4.03	%		4.50	%		4.85	%

(1)  Source: SNL Financial

Noninterest income

      Noninterest income for 2004 was $715,000, down $556,000 from $1,271,000 for 2003. The decline in noninterest income reflects the absence of gains on sales of loans held for sale.

	As of December 31,
	2004			2003		2002
	(Dollars in thousands)
Delinquency charges	$	37		$	34	$	51
Rental income		194			264		238
Fee income		481			409		303
(Loss) gain on sale of assets		(9	)		38		—
Net gain on sales of loans held for sale		—			516		291
Other		12			10		12
Total noninterest income	$	715		$	1,271	$	895

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      In the years 2002 to 2003, SCCB originated and sold 1-4 family loans; this activity was discontinued in 2004.

Noninterest expense

      Noninterest expense for 2004 was $3,558,000, down $330,000 or 9 percent from 3,888,000 from 2003. Noninterest expenses were $3,486,000 for 2002.

      Noninterest expenses were as follows for the periods indicated:

	As of December 31,
	2004		2003		2002
	(Dollars in thousands)
Salaries and wages	$	2,394	$	2,582	$	2,305
Occupancy		372		380		347
Postage and supplies		94		119		97
FDIC assessment		18		19		20
Data processing		83		73		80
Insurance and fidelity bonds		97		87		68
Accounting and auditing services		69		88		105
State supervision and examination		31		26		22
Appraisal costs		30		31		30
Equipment maintenance		44		36		30
Automobile		22		18		17
Board meetings and directors’ fees		48		49		48
Dues and subscriptions		24		29		33
Promotion and advertising		120		174		148
Credit reports		15		13		14
Other		97		164		122
Total noninterest expense	$	3,558	$	3,888	$	3,486

      The decline in noninterest expense for 2004 reflects the reduction in incentive pay and other production or volume based expenses.

Provision (credit) for loan losses

      The allowance for loan losses is maintained by additions charged to the results of operations for loan losses, or credits to the results of operations for reductions. The allowance is also increased by actual recoveries from loans previously charged-off and decreased by actual losses from loans charged-off. There are three basic elements to the SC Bank’s process for evaluating the adequacy of the allowance — first, the identification of impaired loans; second, the establishment of appropriate loan loss allowances once individual specific impaired loans are identified; and third, a methodology for estimating loan losses based on the inherent risk in the remainder of the loan portfolio.

	As of December 31,
	2004			2003			2002
	(Dollars in thousands)
Allowance for loan losses — beginning	$	1,211		$	1,199		$	1,273
Provision (credit) to earnings		(55	)		(4	)		(81	)
Charge-offs		—			—			—
Recoveries		27			16			7
Allowance for loan losses — ending	$	1,183		$	1,211		$	1,199

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Provision for income taxes

      SC Bank elected, effective January 1, 2002, to be taxed as an S Corporation under federal and state income tax laws. These laws provide that, in lieu of corporate income taxes, the shareholders separately account for their share of income, deductions, losses and credits. As a result, no corporate income taxes have been provided for in the results of operations except for certain state and federal income taxes.

	As of December 31,
	2004			2003			2002
	(Dollars in thousands)
Earnings before income taxes	$	3,021		$	3,642		$	3,752
Income taxes		106			127			132
Net income	$	2,915		$	3,515		$	3,620
Effective tax rate		3.51	%		3.49	%		3.52	%

Loans, investments and deposits

	As of December 31,
	2004		2003		2002
	(Dollars in thousands)
Loans	$	120,719	$	115,646	$	104,714
Securities	$	4,528	$	4,005	$	4,008
Interest bearing deposits at banks	$	12,006	$	9,226	$	11,823
Deposit liabilities	$	128,799	$	125,485	$	117,260

      Loans increase 4 percent to $120,719,000 at the end of 2004 from $115,646,000 at the end of 2003. Loans increased 10 percent for 2003 from $104,714,000 at December 31, 2003.

      Investments, consisting of US Treasury securities and $100,000 certificates of deposits placed at various banks, increased 25 percent in 2004 primarily as a result of higher customer deposits. Investments decreased 16 percent in 2003 primarily as a result of higher loan balances.

      Deposits increased to $128,799,000, or 3 percent at December 31, 2004, from $125,485,000 at December 31, 2003. Deposits increased 7 percent for 2003 from $117,260,000 at December 31, 2002.

Capital Resources

      SCCB’s actual capital amounts and ratios are presented in the table below.

											To be Well
						For Capital					Capitalized Under
						Adequacy					Prompt Corrective
	Actual					Purposes					Action Provision
	Amount		Ratio			Amount		Ratio			Amount		Ratio
	(Dollars in thousands)
December 31, 2004
Total Capital (to risk weighted assets)	$	17,691		14.01	%	$	10,100		8.00	%	$	12,625		10.00	%
Tier I capital (to risk weighted assets)	$	16,508		13.07	%	$	5,051		4.00	%	$	7,577		6.00	%
Tier I capital (to average assets)	$	16,508		11.24	%	$	5,874		4.00	%	$	7,342		5.00	%

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BUSINESS

      The following summary highlights information contained elsewhere in this private placement memorandum. This summary is not intended to be complete. You should carefully read the entire private placement memorandum, including the “Risk Factors” section as well as the exhibits and documents separately provided, before making an investment in our Shares.

Business of First California Bank

      First California Bank is a full-service commercial bank headquartered in Camarillo, California. The Bank is chartered under the laws of the State of California and is subject to supervision by the California Commissioner of Financial Institutions. The Federal Deposit Insurance Corporation insures the Bank’s deposits up to the maximum legal limit.

      The Bank opened for business in 1979 under the name “Camarillo Community Bank” with one branch office located in Camarillo. The Bank provides a broad range of banking products and services, including credit, cash management and deposit services through six full service banking offices which are located in Camarillo, Westlake Village, Oxnard, Thousand Oaks, Ventura and Simi Valley. In October 2001, the Bank changed its name to “First California Bank” in order to reflect the Bank’s growth beyond its initial primary market of Camarillo.

      The Bank’s goal is to offer our customers a consistently high level of individualized personal service. The Bank’s strategy in attaining its goals has been to implement and maintain risk management and controls to achieve a safe and sound business policy, employing an aggressive marketing plan which emphasizes relationship banking and the “personal touch,” offering competitive products and managing our growth. The Bank provides convenience through six banking offices with ATM access, 24 hour telephone access to account information, on line banking and courier service. The diversity of our delivery systems enables customers to choose the method of banking, which is most convenient for them. The Bank trains its staff to recognize each customer, greet them, and be able to address them by name so that they feel as if they have a “private banker.”

Our Goals and Strategy

      The goal of First California Bank is to be the community bank in every market we serve. We believe we can compete effectively against both the smaller and de novo institutions as well as the larger regional and national banks. Unlike smaller banks, our capital base is large enough to support the borrowing needs of our communities. Additionally, unlike many larger banks we continue to offer a traditional community bank delivery system including a personal service oriented culture, minimal bureaucracy, and local decision making. To continue to build on our success, we have identified and successfully implemented the following strategies:

•  Attract and retain talented bankers.

•  Focus on small business banking.

•  Develop niche oriented retail banking.

•  Expand through de novo branching and opportunistic acquisitions.

•  Increase low cost core deposits.

•  Maintain our strong commitment to risk management.

Attract and Retain Talented Bankers

      The focus of the Bank since the arrival of new management in late 1999 has been to identify and to recruit senior relationship managers at banks that were recently acquired. These were bankers who were known and respected in their communities and had a significant client following. Successful recruitment of these individuals provides a strong foundation that has enabled us to grow the Bank and to open four new offices in five years with the sixth office opened in January of 2005. The clients brought over by these talented

41

local bankers have enabled these new offices to reach profitability within a relatively short timeframe of 12-18 months.

Focus On Small Business Banking

      Our primary target market has been small businesses with annual sales up to $35.0 million with credit needs between $1.0 to $3.0 million. Our infrastructure reflects our commitment to meeting the needs of small businesses. Our lending expertise is in the commercial lending area with products such as equipment loans, working capital lines, asset-based lending along with expertise in construction lending, and mini-perm commercial real estate loans. We are an organization that is disciplined in practicing relationship banking as evidenced by the significant number of our borrowing customers having non-interest bearing checking and/or money market accounts with us. This focus on relationship banking has enabled us to fund our loan growth, which has grown in excess of 20% per annum, with relatively inexpensive core deposits. The growth of First California Bank has been and will continue to be focused on growing its small business banking clientele.

      Increasing fee income is a priority for First California Bank. First, we have been leveraging our existing expertise in lending to increase fee income. As a PLP (Preferred Lender Provider) approved lender by the Small Business Administration, we originate 7(a) and 504 loans for their fee potential. For our clients that require long term fixed rate loans, we generate fee income by brokering these loans to wholesale commercial lenders. We expect to materially increase our investment and commitment to the SBA programs over the next 12 months as we expand the sales force and our geographic footprint to cover most of Southern California.

      Additionally, in 2004 we invested in a more powerful and flexible data processing platform that will enable us to make available additional products and services to our small business clients and integrate these products and services into our core processor on a seamless basis. Utilizing this platform, we have begun the process of expanding and improving our fee based services. One of our primary objectives for the next 12 months is also to significantly improve our cash management services to our business clients by expanding our menu of products and services.

Develop Niche Oriented Retail Banking

      Throughout the history of First California Bank, we have been successful at servicing the needs of our commercial banking customers. In 2004, we made the decision to leverage our success in that area and expand our products and services into retail banking. Our intent was to focus our efforts and resources on only those niche clients whose needs we could better serve such as professionals including, doctors, attorneys and CPAs.

      We are taking the best of First California Bank’s current services and rolling out new products and tools in 2005. We plan to offer attractive packages for professionals such as doctors, attorneys and CPAs. Bundling products and services together in a “professional suite” of services will provide comprehensive and customized retail advantages to our current and potential commercial clients. For example, our professional clients will have the advantage of earning Continuing Education Units through our First Professionals Program — where we partner with educators to offer a range of timely business seminars and workshops that our busy professionals need.

Expand Through De Novo Branching and Opportunistic Acquisitions

      The core philosophy of our growth strategy has been to grow organically by focusing on increasing loans and deposits in each and every one of the markets in which we operate. Since 2000, we have been expanding our geographic footprint by opening a new branch office every 18 months. We have opened four new branch offices since 2000 in those communities that meet the following criteria:

•  Availability of local banking talent that fosters our community banking customer service philosophy and have a following of clients.

•  A prospective market that is underserved by community banks.

•  A local economy that is diverse and healthy.

42

      As we evaluate new markets to enter, we will continue to apply the above criteria. In addition, we will give strong consideration to expanding into those markets that will allow us to connect our Ventura County and Orange County operations. Based on these criteria, we have identified the following communities as possibilities for new branch offices: San Fernando Valley, West Los Angeles, and the Fullerton/ Santa Ana area.

      We will also continue to look for opportunistic acquisitions that are a strategic complement to our organic/de novo growth strategy. We have applied a disciplined approach to evaluating these opportunities by applying the following criteria:

•  A transaction must maximize shareholder value and create minimal dilution.

•  A transaction must be accretive to earnings within the first 12 months of the purchase.

•  The marketplace served by a target bank must be underserved by other community banks.

•  The local economy served by a target bank must be diverse and healthy.

      We believe that our purchase of South Coast Bancorp meets all of the above criteria. We will maintain our disciplined approach to evaluating potential acquisition options with a focus on those banking franchises that will enable us to either expand our market presence in Orange County or Ventura County or allow us to more closely link our operations in these two counties.

Increase Low Cost Core Deposits

      Due to our on-going focus on relationship banking, First California Bank has historically enjoyed a relatively high level of low cost core deposits. The growth of low cost core deposits will continue to be a priority for the Bank to support our growth objectives. To augment the deposits generated by relationship managers on the business banking side, we are re-tooling our branch offices and its personnel with sales training and production related incentive programs to transition these offices to a sales platform with a focus on increasing low cost core deposits. We have also hired business development officers who specialize in deposit generation.

Maintain Our Strong Commitment to Risk Management

      First California Bank has a history of strong credit risk management. Under the leadership of a highly competent Chief Credit Officer (“CCO”), we have developed a credit culture centered on a conservative loan underwriting policy and experienced commercial lenders, who on average have more than 20 years of lending experience. The fact that loans charged off averaged less than $175,000 per year for the past five years, while the loan portfolio has grown on average over 20% per year reflects a credit culture that is conservative yet supportive of a growing institution like ours. In 2005, in anticipation of the South Coast Bancorp acquisition, we will bring on board a Credit Administrator to support the CCO in credit risk management as well as to further develop our loan administration infrastructure.

      Over the last two years, we have strengthened the Bank’s overall risk management by partnering with an outside vendor to provide comprehensive internal audit services, as well as hiring a full time compliance/ CRA officer. We are proactively addressing regulatory concerns in regards to compliance with the Bank Secrecy Act (“BSA”) by acquiring the necessary software and staff to manage BSA compliance. In conjunction with the South Coast Bancorp acquisition, we will bring on board an internal auditor who will also oversee BSA compliance. In 2004, we also strengthened risk management in the operations area by creating Central Operations Department to gain efficiency with regard to backroom operational functions, as well as to centralize operational risk management. As reflected in our commitment to comply with BSA, First California Bank’s management culture will continue to proactively manage regulatory issues before they are forced upon us.

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Management

      Set forth below is biographical information for certain of our executive officers and managers of our business units.

      C. G. Kum, President and Chief Executive Officer. Mr. Kum began his banking career in 1977 as a corporate banking trainee with Bank of California in San Francisco, California. He served as Regional Vice President and Manager of Asset Quality Administration for United Banks of Colorado from 1984 until 1987. Mr. Kum then served as Vice President and Division Manager of Special Projects Division for Colorado National Bank from 1987 until 1993. Mr. Kum moved to California in 1993 and served as Executive Vice President and Chief Credit Officer of City Commerce Bank, Santa Barbara, California from 1993 until 1999.

      Mr. Kum was appointed to his current position as the President and the Chief Executive Officer of First California Bank (formerly known as Camarillo Community Bank) on September 1, 1999. Under his leadership, the Bank has grown from total assets of $100 million and two branches in 1999, to total assets as of December 31, 2004 of $283 million and six branches (the sixth branch was opened on January 24, 2005 in the City of Simi Valley). He is a graduate of University of California at Berkeley and received his Masters Degree in Business Administration from Pepperdine University. Mr. Kum also is a graduate of Stonier Graduate School of Banking. He has served as a member of Board of Directors of Casa Pacifica, a non profit organization that serves high risk youths in Ventura County, California State University at Channel Islands Foundation, and the United Way of Ventura County. He was recently elected to the position of the President of the Board of Directors of Community Bankers of California, an association of California community bank presidents, for the fiscal year of 2005-06. Mr. Kum lives in Camarillo, Calif. with his wife Vikki and their three children.

      Thomas E. Anthony, Executive Vice President and Chief Credit Officer. Mr. Anthony moved from Illinois and began his banking career in 1970 as a commercial loan trainee with the then United California Bank in Los Angeles. He served as Vice President — Commercial Lender at Independence Bank from 1988 to 1992. He then served as Executive Vice President and Chief Credit Officer at Channel Islands National Bank from 1992 until 1998 when it was merged with American Commercial Bank, where he served in the same capacity from 1998 until 1999. Mr. Anthony joined First California Bank in 1999 as Executive Vice President and Chief Credit Officer.

      Mr. Anthony graduated from Northern Illinois University with a degree in Management. He has held several commercial lending and credit administration positions with banks in California and has been active on several community boards/committees and with charitable and professional organizations.

      Romolo Santarosa, Executive Vice President and Chief Financial Officer. Mr. Santarosa began his banking career in 1991 with Shawmut National Corporation as its Controller. In 1995, Mr. Santarosa joined Sanwa Bank California and served as controller until 1997. He then served as Chief Financial Officer of Southern Pacific Bank from 1997 until 2000, of Eldorado Bancshares, Inc. from 2000 to 2001, and of Treasury Bank, N.A. from 2001 to 2002. Mr. Santarosa joined First California Bank in November 2002 as Executive Vice President and Chief Financial Officer.

      Mr. Santarosa is a graduate (1978) of Ithaca College, Ithaca, New York. He began his career in public accounting with Price Waterhouse, an international public accounting firm. He also is a certified public accountant in New York and Connecticut. Mr. Santarosa is active in several professional and community organizations.

44

Executive Compensation

      The following table shows the compensation for the last three fiscal years paid by the Bank to its executive officers whose compensation exceeded $100,000:

Summary Compensation Table

									Long Term Compensation
									Awards
				Annual Compensation					Securities
								Other Annual	Underlying		All Other
Name and Principal Position		Year		Salary		Bonus		Compensation(1)	Options Granted		Compensation
C. G. Kum,			2004		210,047		65,749			9,000		0
	President and Chief Executive		2003		195,000		75,000			10,000		0
	Officer		2002		180,000		50,058			0		0
Thomas E. Anthony,			2004		134,005		28,765			4,500		0
	Executive Vice President and Chief		2003		120,721		39,396			5,000		0
	Credit Officer		2002		114,243		30,617			0		0
Romolo Santarosa,			2004		133,951		34,587			4,500		0
	Executive Vice President and Chief		2003		120,000		39,396			1,000		0
	Financial Officer		2002		15,000		0			0		0

(1)  Perquisites paid to an executive officer that total less than the lesser of $50,000 or 10% of salary and bonus are omitted.

      In March 2003, the Bank entered into a Salary Continuation Agreement with C. G. Kum. The agreement provides for a maximum annual benefit of $160,471, which will be paid over the lesser of 17 years or such shorter period of time based upon the number of years that Mr. Kum is employed by the Bank prior to normal retirement. The Bank also entered into a split-dollar life insurance agreement with Mr. Kum in March 2003. Pursuant to the terms of that agreement, the Bank owns the insurance policies, is entitled to the cash value of the policies and is responsible for paying the associated premiums. Upon Mr. Kum’s death, the beneficiary is entitled to receive $1.5 million of the total proceeds, with the Bank entitled to the balance. The Bank paid an aggregate premium in 2002 amounting to $1.4 million.

      In March 2003, the Bank also entered into a Salary Continuation Agreement with Thomas E. Anthony. The agreement provides for a maximum annual benefit of $84,667, which will be paid over the lesser of 15 years or such shorter period of time based upon the number of years that Mr. Anthony is employed by the Bank prior to normal retirement. The Bank also entered into a split-dollar life insurance agreement with Mr. Anthony in March 2003. Pursuant to the terms of that agreement, the Bank owns the insurance policies, is entitled to the cash value of the policies and is responsible for paying the associated premiums. Upon Mr. Anthony’s death, the beneficiary is entitled to receive $1.05 million of the total proceeds, with the Bank entitled to the balance. The Bank paid an aggregate premium in 2002 amounting to $1.0 million.

Employees and Employee Benefits

      As of March 31, 2005, we had a total of 91 full-time equivalent employees. Our employees are an important component of our success and we believe our employee relations are very good. A significant number of the Bank’s employees are long-term employees. We believe our employee turnover is low in comparison to many of our competitors.

      The Bank has adopted a 401(k) savings investment plan which allows employees to defer certain amounts of compensation for income tax purposes under Section 401(k) of the Internal Revenue Code. Essentially, all eligible employees may elect to defer and contribute up to statutory limits. The Bank may, at its discretion, make matching contributions, the total of which may not exceed 15% of eligible compensation. For the years ending December 31, 2004, 2003, and 2002, the Bank made matching contributions of approximately $89,000, $59,000, and $67,000, respectively, to the plan.

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      The Bank has established an employee incentive compensation program which provides eligible participants additional compensation based upon the achievement of certain Bank goals. For the years ending December 31, 2004, 2003 and 2002, additional compensation expense of approximately $270,000, $350,000, and $260,000, respectively, was recognized and paid subsequent to each year-end to eligible employees, pursuant to this program.

      On December 30, 2002, the Bank purchased life insurance to support life insurance benefits for several key employees and salary continuation benefits for certain executives. As of December 31, 2004 and 2003, the cash surrender value of the life insurance was $5.0 million and $4.8 million, respectively. As of December 31, 2004, the Bank recognized a liability for salary continuation benefits of $180,000. Payments under the salary continuation plan commence when the respective executive reaches the age of 65 and continue for a period of 20 years.

Marketing and Products Development

      The officers and employees of the Bank are continually engaged in marketing activities and have developed new products and services for the convenience of our customers. This includes the evaluation and development of new products and services, such as cash management and online banking services. These new products and services serve to enable the Bank to retain and enhance its competitive position in its service area.

Competition

      The banking business in California, generally, and in southern California, specifically, where the Bank’s offices are located, is highly competitive with respect to both loans and deposits and is dominated by a relatively small number of major banks, which have many offices operating over wide geographic areas. The Bank competes for deposits and loans principally with these major banks, but also with small independent banks located in its service areas. Among the advantages which the major banks have over the Bank are their ability to finance extensive advertising campaigns and to allocate their investment assets to regions of highest yield and demand. Many of the major commercial banks operating in the Bank’s service area offer certain services that are not offered directly by the Bank and, by virtue of their greater total capitalization, such banks have substantially higher lending limits than the Bank.

      Moreover, banks generally, and the Bank in particular, face increasing competition for loans and deposits from non-bank financial intermediaries such as savings and loan associations, thrift and loan associations, credit unions, mortgage companies, insurance companies, and other lending institutions. Money market funds offer rates competitive with banks, and an increasingly sophisticated financial services industry continually develops new products for businesses and consumers that compete with banks for investment dollars. In addition, other entities (both public and private) seeking to raise capital through the issuance and sale of debt or equity securities compete with banks in the acquisition of deposits.

      The Bank conducts no material business outside of California and has no immediate plans to do so. However, such activities are permitted in accordance with applicable law. As a result, out-of-state banks, as well as California banks, compete with the Bank in our service areas.

      Recent legislation and economic developments have favored increased competition between different types of financial institutions for both deposits and loans, resulting in increased cost of funds to banks generally and to the Bank in particular. In order to compete with the other financial institutions in its service area, the Bank relies principally upon personal contacts by its officers, directors, employees and shareholders; local promotional activity including direct mail, advertising in local newspapers and business journals; and specialized services. The Bank’s promotional activities emphasize the advantages of dealing with a locally-owned and headquartered institution attuned to the particular needs of the community. In the event that a customer’s loan demands exceed the Bank’s lending limits, the Bank may attempt to arrange for such loans on a participation basis with its correspondent banks. Where this is not feasible, the Bank may be unable to make the loan. The Bank also assists customers requiring services not offered by the Bank to obtain these services from its correspondent banks.

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SUPERVISION AND REGULATION

Supervision and Regulation of the Company

      Upon consummation of the holding company reorganization, the Bank will be a wholly-owned subsidiary of the Company. The Company, as the Bank’s parent company, will be a bank holding company registered under the Bank Holding Company Act of 1956, as amended (the “BHCA”), is subject to regulation by the Board of Governors of the Federal Reserve System (“Federal Reserve Board”). Under Federal Reserve Board regulation, the Company will be expected to act as a source of managerial and financial strength for its bank subsidiary. It cannot conduct operations in an unsafe or unsound manner and must commit resources to support its banking subsidiary in circumstances where the Company might not otherwise do so. Under the BHCA, the Company and its banking subsidiary will be subject to periodic examination by the Federal Reserve Board. The Company will also file periodic reports of its operations and any additional information regarding its activities and those of its subsidiaries with the Federal Reserve Board, as may be required.

      The Company will also be deemed to be a bank holding company within the meaning of Section 3700 of the California Financial Code. As such, the Company and its subsidiaries will be subject to examination by, and may be required to file reports with, the Commissioner of the California Department of Financial Institutions (the “Commissioner” or the “DFI”). Regulations have not yet been proposed or adopted or steps otherwise taken to implement the Commissioner’s powers under this statute.

Sarbanes-Oxley Act of 2002

      The Sarbanes-Oxley Act of 2002 (the “SOX”) is designed to protect investors in capital markets by improving the accuracy and reliability of corporate disclosures of public companies. The SOX is intended to provide a framework that improves the quality of independent audits and accounting services, financial reporting, to strengthen the independence of accounting firms and increase the responsibility of management for corporate disclosures and financial statements. The SOX’s provisions are significant to the Company and all other companies that have a class of securities registered under Section 12 of the Exchange Act or are otherwise reporting to the SEC pursuant to Section 15(d) of the Exchange Act (collectively, “public companies”). It is intended that by addressing these weaknesses, public companies will be able to avoid the problems encountered by many notable companies in 2002.

      The SOX’s provisions have and will become effective at different times, ranging from immediately upon enactment, which was July 30, 2002, to later dates specified in the SOX or the date on which the required implementing regulations become effective. In addition to SEC rulemaking to implement the SOX, Nasdaq and the New York Stock Exchange will be proceeding with their proposed changes to their listing standards which, in some instances, may impose requirements more rigorous than those set forth in the SOX. Wide-ranging in scope, the SOX will have a direct and significant impact on banks and bank holding companies that are public companies, including the Company.

The California Corporate Disclosure Act

      On January 1, 2003, the California Corporate Disclosure Act (the “CCD”) became effective. The CCD amends Section 1502 and 2117 of the California Corporations Code, which previously required companies incorporated or qualified to do business in California to make biannual filings with the California Secretary of State disclosing relatively limited corporate information. The new form, which was published recently by the Secretary of State, reflects the significant additional information required under the CCD for publicly traded companies. The CCD also increases the frequency of the filing to annually.

Bank Holding Company Liquidity

      The Company is a legal entity, separate and distinct from its “to be” bank subsidiary, First California Bank. Although it has the ability to raise capital on its own behalf or borrow from external sources, the Company may also obtain additional funds through dividends paid by, and fees for services provided to, the

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Bank. However, regulatory constraints may restrict or totally preclude the Bank from paying dividends to the Company. See “Limitations on Dividend Payments” on page 49.

      The Federal Reserve Board’s policy regarding dividends provides that a bank holding company should not pay cash dividends exceeding its net income or which can only be funded in ways, such as by borrowing, that weaken the bank holding company’s financial health or its ability to act as a source of financial strength to its subsidiary banks. The Federal Reserve Board also possesses enforcement powers over bank holding companies and their non-bank subsidiaries to prevent or remedy actions that represent unsafe or unsound practices or violations of applicable statutes and regulations.

Transactions with Affiliates

      The Company and any subsidiaries it may purchase or organize will be deemed to affiliates of the Bank within the meaning of Sections 23A and 23B of the Federal Reserve Act, herein referred to as the “FRA,” as amended. Pursuant thereto, loans by the Bank to affiliates, investments by the Bank in affiliates’ stock, and taking affiliates’ stock as collateral for loans to any borrower will be limited to 10% of the Bank’s capital, in the case of any one affiliate, and will be limited to 20% of the Bank’s capital in the case of all affiliates. In addition, such transactions must be on terms and conditions that are consistent with safe and sound banking practices. Specifically, a bank and its subsidiaries generally may not purchase from an affiliate a low-quality asset, as defined in the FRA. Such restrictions also prevent a bank holding company and its other affiliates from borrowing from a banking subsidiary of the bank holding company unless the loans are secured by marketable collateral of designated amounts. The Company and the Bank will also be subject to certain restrictions with respect to engaging in the underwriting, public sale and distribution of securities.

Limitations on Businesses and Investment Activities

      Under the BHCA, a bank holding company must obtain the Federal Reserve Board’s approval before directly or indirectly acquiring more than 5% ownership or control of any voting shares of another bank or bank holding company; acquiring all or substantially all of the assets of another bank; or merging or consolidating with another bank holding company, all subject to certain exceptions. In addition, federal law prohibits a bank holding company and any subsidiary banks from engaging in certain tie-in arrangements in connection with the extension of credit.

      The Gramm-Leach-Bliley Act (the “GLB Act”), enacted in 1999, permits banks and bank holding companies to engage in previously prohibited activities under certain conditions. Also, banks and bank holding companies may affiliate with other financial service providers such as insurance companies and securities firms under certain conditions. Consequently, a qualifying bank holding company, called a financial holding company, herein referred to as “FHC,” can engage in a full range of financial activities, including banking, insurance, and securities activities, as well as merchant banking and additional activities that are beyond those traditionally permitted for bank holding companies. Moreover, various non-bank financial service providers who were previously prohibited from engaging in banking can now acquire banks while also offering services such as securities underwriting and underwriting and brokering insurance products. The GLB Act also expands passive investment activities by FHCs, permitting them to indirectly invest in any type of company, financial or non-financial, through merchant banking activities and insurance company affiliations.

Capital Adequacy

      Bank holding companies must maintain minimum levels of capital under the Federal Reserve Board’s risk based capital adequacy guidelines. If capital falls below minimum guideline levels, a bank holding company, among other things, may be denied approval to acquire or establish additional banks or non-bank businesses.

      The Federal Reserve Board’s risk-based capital adequacy guidelines for bank holding companies and state member banks, discussed in more detail below (see “— Supervision and Regulation of the Bank-Risk-Based Capital Guidelines” on page 50), assign various risk percentages to different categories of assets, and capital is measured as a percentage of those risk assets. Under the terms of the guidelines, bank holding

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companies are expected to meet capital adequacy guidelines based both on total risk assets and on total assets, without regard to risk weights.

      The risk-based guidelines are minimum requirements. Higher capital levels will be required if warranted by the particular circumstances or risk profiles of individual organizations. For example, the Federal Reserve Board’s capital guidelines contemplate that additional capital may be required to take adequate account of, among other things, interest rate risk, the risks posed by concentrations of credit, or risks associated with nontraditional banking activities or securities trading activities. Moreover, any banking organization experiencing or anticipating significant growth or expansion into new activities, particularly under the expanded powers of the GLB Act, may be expected to maintain capital ratios, including tangible capital positions, well above the minimum levels. See “Risk-Based Capital Guidelines” on page 50.

Limitations on Dividend Payments

      After the holding company formation, the Company will be entitled to receive dividends when and as declared by the Bank’s Board of Directors, out of funds legally available for dividends as specified and limited by the California Financial Code. Under Section 642 of the California Financial Code, funds available for cash dividend payments by a bank are restricted to the lesser of: (i) a bank’s retained earnings; or (ii) a bank’s net income for its last three fiscal years (less any distributions to shareholders made during such period). With the prior approval of the DFI, cash dividends may also be paid out of the greater of: (i) a bank’s retained earnings; (ii) net income for a bank’s last preceding fiscal year; or (iii) net income for a bank’s current fiscal year. If the DFI finds that the shareholders’ equity of the bank is not adequate or that the payment of a dividend would be unsafe or unsound for the bank, the DFI may order the bank not to pay a dividend to the bank’s shareholders.

      Since the Bank is an FDIC insured institution, it is also possible, depending upon its financial condition and other factors, that the FDIC could assert that the payment of dividends or other payments might, under some circumstances, constitute an unsafe or unsound practice and, thus, prohibit those payments.

      As a California corporation, the Company’s ability to pay dividends is subject to the dividend limitations of the California Corporations Code, herein referred to as the “CCC.” Section 500 of the CCC allows the Company to pay a dividend to its shareholders only to the extent that the Company has retained earnings and, after the dividend, the Company meets the following criteria:

•  its assets (exclusive of goodwill and other intangible assets) would be 1.25 times its liabilities (exclusive of deferred taxes, deferred income and other deferred credits); and

•  its current assets would be at least equal to its current liabilities.

Supervision and Regulation of the Bank

General

      Banking is a complex, highly regulated industry. The primary goals of the regulatory scheme are to maintain a safe and sound banking system, protect depositors and the FDIC’s insurance fund, and facilitate to conduct of sound monetary policy. In furtherance of these goals, Congress and the states have created several largely autonomous regulatory agencies and enacted numerous laws that govern banks, bank holding companies and financial services industry. Consequently, the Bank’s growth and earnings performance can be affected not only by management decisions and general economic conditions, but also by the requirements of applicable state and federal statutes, regulations and the policies of various governmental regulatory authorities, including:

•  the FDIC;

•  the DFI; and

•  the Federal Deposit Insurance Corporation.

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      The system of supervision and regulation applicable to the Bank governs most aspects of the Bank’s business, including:

•  the scope of permissible business;

•  investments;

•  reserves that must be maintained against deposits;

•  capital levels that must be maintained;

•  the nature and amount of collateral that may be taken to secure loans;

•  the establishment of new regional offices;

•  mergers and consolidations with other financial institutions; and

•  the payment of dividends.

      The Bank, as a California state chartered bank which is not a member of the Federal Reserve System, is subject to regulation, supervision, and regular examination by the DFI and the FDIC. The Bank’s deposits are insured by the FDIC up to the maximum extent provided by law. The regulations of these agencies govern most aspects of the Bank’s business. California law exempts all banks from usury limitations on interest rates.

      The following summarizes the material elements of the regulatory framework that applies to the Bank. It does not describe all of the statutes, regulations and regulatory policies that are applicable. Also, it does not restate all of the requirements of the statutes, regulations and regulatory policies that are described. Consequently, the following summary is qualified in its entirety by reference to the applicable statutes, regulations and regulatory policies may have material effect on the Bank’s business.

Risk-Based Capital Guidelines

      General. The federal banking agencies have established minimum capital standards known as risk-based capital guidelines. These guidelines are intended to provide a measure of capital that reflects the degree of risk associated with a bank’s operations. The risk-based capital guidelines include both a new definition of capital and a framework for calculating the amount of capital that must be maintained against a bank’s assets and off-balance sheet items. The amount of capital required to be maintained is based upon the credit risks associated with the various types of a bank’s assets and off-balance sheet items. A bank’s assets and off-balance sheet items are classified under several risk categories, with each category assigned a particular risk weighting from 0% to 100%. The bank’s risk-based capital ratio is calculated by dividing its qualifying capital, which is the numerator of the ratio, by the combined risk weights of its assets and off-balance sheet items, which is the denominator of the ratio.

      Qualifying Capital. A bank’s total qualifying capital consists of two types of capital components: “core capital elements,” known as Tier 1 capital, and “supplementary capital elements,” known as Tier 2 capital. The Tier 1 component of a bank’s qualifying capital must represent at least 50% of total qualifying capital and may consist of the following items that are defined as core capital elements:

•  common stockholders’ equity;

•  qualifying non-cumulative perpetual preferred stock (including related surplus); and

•  minority interests in the equity accounts of consolidated subsidiaries.

      The Tier 2 component of a bank’s total qualifying capital may consist of the following items:

•  a portion of the allowance for loan and lease losses;

•  certain types of perpetual preferred stock and related surplus;

•  certain types of hybrid capital instruments and mandatory convertible debt securities; and

•  a portion of term subordinated debt and intermediate-term preferred stock, including related surplus.

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      Risk Weighted Assets and Off-Balance Sheet Items. Assets and credit equivalent amounts of off-balance sheet items are assigned to one of several broad risk classifications, according to the obligor or, if relevant, the guarantor or the nature of the collateral. The aggregate dollar value of the amount in each risk classification is then multiplied by the risk weight associated with that classification. The resulting weighted values from each of the risk classifications are added together. This total is the bank’s total risk weighted assets.

      A two-step process determines risk weights for off-balance sheet items, such as unfunded loan commitments, letters of credit and recourse arrangements. First, the “credit equivalent amount” of the off-balance sheet items is determined, in most cases by multiplying the off-balance sheet item by a credit conversion factor. Second, the credit equivalent amount is treated like any balance sheet asset and is assigned to the appropriate risk category according to the obligor or, if relevant, the guarantor or the nature of the collateral. This result is added to the bank’s risk-weighted assets and comprises the denominator of the risk-based capital ratio.

      Minimum Capital Standards. The supervisory standards set forth below specify minimum capital ratios based primarily on broad risk considerations. The risk-based ratios do not take explicit account of the quality of individual asset portfolios or the range of other types of risks to which banks may be exposed, such as interest rate, liquidity, market or operational risks. For this reason, banks are generally expected to operate with capital positions above the minimum ratios.

      All banks are required to meet a minimum ratio of qualifying total capital to risk weighted assets of 8%. At least 4% must be in the form of Tier 1 capital, net of goodwill. The maximum amount of supplementary capital elements that qualifies as Tier 2 capital is limited to 100% of Tier 1 capital, net of goodwill. In addition, the combined maximum amount of term subordinated debt and intermediate-term preferred stock that qualifies as Tier 2 capital for risk-based capital purposes is limited to 50% of Tier 1 capital. The maximum amount of the allowance for loan and lease losses that qualifies as Tier 2 capital is limited to 1.25% of gross risk weighted assets. The allowance for loan and lease losses in excess of this limit may, of course, be maintained, but would not be included in a bank’s risk-based capital calculation.

      The federal banking agencies also require all banks to maintain a minimum amount of Tier 1 capital to total assets, referred to as the leverage ratio. For a bank rated in the highest of the five categories used by regulators to rate banks, the minimum leverage ratio of Tier 1 capital to total assets is 3%. For all banks not rated in the highest category, the minimum leverage ratio is 5%. These uniform risk-based capital guidelines and leverage ratios apply across the industry. Regulators, however, have the discretion to set minimum capital requirements for individual institutions, which may be significantly above the minimum guidelines and ratios.

      Whether or not dividends, either cash or stock, will be paid in the future will be determined by our Board of Directors after consideration of various factors. The declaration and payment of cash dividends are determined by the Board of Directors in light of the earnings, capital requirements and financial condition of the Company, and other relevant factors. The ability of the Company to pay cash dividends depends on the amount of cash dividends paid to it by the Bank and the capital position of the Company. Capital distributions, including dividends, by the Bank are subject to federal and state regulatory restrictions tied to its earnings and capital. See “Supervision and Regulation — Limitations on Dividend Payments”.

Other Factors Affecting Minimum Capital Standards

      The federal banking agencies have established certain benchmark ratios of loan loss reserves to be held against classified assets. The benchmark by federal banking agencies is the sum of:

•  100% of assets classified loss;

•  50% of assets classified doubtful;

•  15% of assets classified substandard; and

•  estimated credit losses on other assets over the upcoming twelve months.

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Notwithstanding the above, the Bank’s current practice is to take the more conservative approach of including 20%, rather than 15%, of assets classified substandard.

      The federal risk-based capital rules adopted by banking agencies take into account banks’ concentrations of credit and the risks of engaging in non-traditional activities. Concentrations of credit refers to situations where a lender has a relatively large proportion of loans involving a single borrower, industry, geographic location, collateral or loan type. Non-traditional activities are considered those that have not customarily been part of the banking business, but are conducted by a bank as a result of developments in, for example, technology, financial markets or other additional activities permitted by law or regulation. The regulations require institutions with high or inordinate levels of risk to operate with higher minimum capital standards.

      The federal banking agencies also are authorized to review an institution’s management of concentrations of credit risk for adequacy and consistency with safety and soundness standards regarding internal controls, credit underwriting or other operational and managerial areas.

      The federal banking agencies also limit the amount of deferred tax assets that are allowable in computing a bank’s regulatory capital. Deferred tax assets that can be realized for taxes paid in prior carry back years and from future reversals of existing taxable temporary differences are generally not limited. However, deferred tax assets that can only be realized through future taxable earnings are limited for regulatory capital purposes to the lesser of:

•  the amount that can be realized within one year of the quarter-end report date; or

•  10% of Tier 1 capital.

      The amount of any deferred tax in excess of this limit would be excluded from Tier 1 capital, total assets and regulatory capital calculations.

      The federal banking agencies have also adopted a joint agency policy statement which provides that the adequacy and effectiveness of a bank’s interest rate risk management process, and the level of its interest rate exposure is a critical factor in the evaluation of the bank’s capital adequacy. A bank with material weaknesses in its interest rate risk management process or high levels of interest rate exposure relative to its capital will be directed by the federal banking agencies to take corrective actions. Financial institutions which have significant amounts of their assets concentrated in high risk loans or nontraditional banking activities, and who fail to adequately manage these risks, may be required to set aside capital in excess of the regulatory minimums.

Prompt Corrective Action

      The federal banking agencies possess broad powers to take prompt corrective action to resolve the problems of insured banks. Each federal banking agency has issued regulations defining five capital categories: “well capitalized,” “adequately capitalized,” “undercapitalized,” “significantly undercapitalized,” and “critically undercapitalized.” Under the regulations, a bank shall be deemed to be:

•  “well capitalized” if it has a total risk-based capital ratio of 10.0% or more, has a Tier 1 risk-based capital ratio of 6.0% or more, has a leverage capital ratio of 5.0% or more, and is not subject to specified requirements to meet and maintain a specific capital level for any capital measure;

•  “adequately capitalized” if it has a total risk-based capital ratio of 8.0% or more, a Tier 1 risk-based capital ratio of 4.0% or more, and a leverage capital ratio of 4.0% or more (3.0% under certain circumstances) and does not meet the definition of “well capitalized”;

•  “undercapitalized” if it has a total risk-based capital ratio that is less than 8.0%, a Tier 1 risk-based capital ratio that is less than 4.0%, or a leverage capital ratio that is less than 4.0% (3.0% under certain circumstances);

•  “significantly undercapitalized” if it has a total risk-based capital ratio that is less than 6.0%, a Tier 1 risk-based capital ratio that is less than 3.0% or a leverage capital ratio that is less than 3.0%; and

•  “critically undercapitalized” if it has a ratio of tangible equity to total assets that is equal to or less than 2.0%.

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      Banks are prohibited from paying dividends or management fees to controlling persons or entities if, after making the payment the bank would be “undercapitalized,” that is, the bank fails to meet the required minimum level for any relevant capital measure. Asset growth and branching restrictions apply to “undercapitalized” banks. Banks classified as “undercapitalized” are required to submit acceptable capital plans guaranteed by its holding company, if any. Broad regulatory authority was granted with respect to “significantly undercapitalized” banks, including forced mergers, growth restrictions, ordering new elections for directors, forcing divestiture by its holding company, if any, requiring management changes, and prohibiting the payment of bonuses to senior management. Even more severe restrictions are applicable to “critically undercapitalized” banks, those with capital at or less than 2%. Restrictions for these banks include the appointment of a receiver or conservator after 90 days, even if the bank is still solvent. All of the federal banking agencies have promulgated substantially similar regulations to implement this system of prompt corrective action.

      The following table sets forth FCB Bancorp’s pro forma capital amounts and ratios and comparison to the minimum ratios:

											To be Well-
						For Capital					Capitalized Under
						Adequacy					Prompt Corrective
	Pro forma(1)					Purposes					Action Provisions
	Amount		Ratio			Amount		Ratio			Amount		Ratio
	(Dollars in thousands)
March 31, 2005
Total capital to risk-weighted assets	$	41,952		12.60	%	$	26,639		8.00	%	$	33,299		10.00	%
Tier 1 capital to risk-weighted assets	$	37,362		11.22	%	$	13,319		4.00	%	$	19,979		6.00	%
Tier 1 capital to average assets	$	37,362		8.70	%	$	13,319		4.00	%	$	16,649		5.00	%

(1)  assumes combined risk-weighted assets of $332,999,000, combined average assets of $429,699,000 after reduction of goodwill, and Tier 1 and Total capital as adjusted for this offering and the Trust Preferred Issuance and goodwill.

      The following table sets forth the Bank’s actual capital amounts and comparison to the minimum ratios:

												To be Well-
							For Capital					Capitalized Under
							Adequacy					Prompt Corrective
		Actual					Purposes					Action Provisions
		Amount		Ratio			Amount		Ratio			Amount		Ratio
		(Dollars in thousands)
March 31, 2005
	Total capital to risk-weighted assets	$	25,960		12.59	%	$	16,498		8.00	%	$	20,622		10.00	%
	Tier 1 capital to risk-weighted assets	$	23,381		11.34	%	$	8,249		4.00	%	$	12,373		6.00	%
	Tier 1 capital to average assets	$	23,381		8.27	%	$	11,315		4.00	%	$	14,144		5.00	%

      A bank, based upon its capital levels, that is classified as “well capitalized,” “adequately capitalized” or “undercapitalized” may be treated as though it were in the next lower capital category if the appropriate federal banking agency, after notice and opportunity for hearing, determines that an unsafe or unsound condition, or an unsafe or unsound practice, warrants such treatment. At each successive lower capital category, an insured bank is subject to more restrictions. The federal banking agencies, however, may not treat an institution as “critically undercapitalized” unless its capital ratios actually warrant such treatment.

Effect of the Offering on Capital Adequacy Measures

      As of March 31, 2005, the Bank was in compliance with all applicable capital adequacy guidelines. The capital invested in the Company as a result of the sale of shares in this offering and in the Bank as a result of the consolidation of the Bank and SCCB will improve both the Company’s and the Bank’s capital adequacy.

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Deposit Insurance Assessments

      The FDIC has implemented a risk-based assessment system in which the deposit insurance premium relates to the probability that the deposit insurance fund will incur a loss. The FDIC sets semi-annual assessments in an amount necessary to maintain or increase the reserve ratio of the insurance fund to at least 1.25% of insured deposits or a higher percentage as determined to be justified by the FDIC.

      Under the risk-based assessment system adopted by the FDIC, banks are categorized into one of three capital categories, “well capitalized,” “adequately capitalized,” and “undercapitalized.” Assignment of a bank into a particular capital category is based on supervisory evaluations by its primary federal regulator.

Interstate Banking and Branching

      Bank holding companies from any state may generally acquire banks and bank holding companies located in any other state, subject in some cases to nationwide and state-imposed deposit concentration limits and limits on the acquisition of recently established banks. Banks also have the ability, subject to specific restrictions, to acquire by acquisition or merger branches located outside their home state. The establishment of new interstate branches is also possible in those states with laws that expressly permit it. Interstate branches are subject to many of the laws of the states in which they are located.

      California law authorizes out-of-state banks to enter California by the acquisition of or merger with a California bank that has been in existence for at least five years, unless the California bank is in danger of failing or in certain other emergency situations. Interstate branching into California is, however, limited to the acquisition of an existing bank.

Enforcement Powers

      In addition to measures taken under the prompt corrective action provisions, insured banks may be subject to potential enforcement actions by the federal regulators for unsafe or unsound practices in conducting their businesses, or for violation of any law, rule, regulation, condition imposed in writing by the regulatory agency, or term of a written agreement with the regulatory agency. Enforcement actions may include: the appointment of a conservator or receiver for the bank; the issuance of a cease and desist order that can be judicially enforced; the termination of the bank’s deposit insurance; the imposition of civil monetary penalties; the issuance of directives to increase capital; the issuance of formal and informal agreements; the issuance of removal and prohibition orders against officers, directors and other institution-affiliated parties; and the enforcement of such actions through injunctions or restraining orders based upon a judicial determination that the deposit insurance fund or the bank would be harmed if such equitable relief was not granted.

FDIC Receivership

      The FDIC may be appointed as conservator or receiver of any insured bank or savings association. In addition, the FDIC may appoint itself as sole conservator or receiver of any insured state bank or savings association for any, among others, of the following reasons: insolvency; substantial dissipation of assets or earnings due to any violation of law or regulation or any unsafe or unsound practice; an unsafe or unsound condition to transact business, including substantially insufficient capital or otherwise; any willful violation of a cease and desist order which has become final; any concealment of books, papers, records or assets of the institution; the likelihood that the institution will not be able to meet the demands of its depositors or pay its obligations in the normal course of business; the incurrence or likely incurrence of losses by the institution that will deplete all or substantially all of its capital with no reasonable prospect for the replenishment of the capital without federal assistance; or any violation of any law or regulation, or an unsafe or unsound practice or condition which is likely to cause insolvency or substantial dissipation of assets or earnings, or is likely to weaken the condition of the institution or otherwise seriously prejudice the interests of its depositors.

      As a receiver of any insured depository institution, the FDIC may liquidate such institution in an orderly manner and dispose of any matter concerning such institution as the FDIC determines is in the best interests of that institution, its depositors and the FDIC. Further, the FDIC shall, as the conservator or receiver, by

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operation of law, succeed to all rights, titles, powers and privileges of the insured institution, and of any shareholder, member, account holder, depositor, officer or director of that institution with respect to the institution and the assets of the institution; may take over the assets of and operate the institution with all the powers of the members or shareholders, directors and the officers of the institution and conduct all business of the institution; collect all obligations and money due to the institution and preserve and conserve the assets and property of the institution.

Safety and Soundness Guidelines

      The federal banking agencies have adopted guidelines to assist in identifying and addressing potential safety and soundness concerns before capital becomes impaired. These guidelines establish operational and managerial standards relating to:

•  internal controls, information systems and internal audit systems;

•  loan documentation;

•  credit underwriting;

•  asset growth; and

•  compensation, fees and benefits.

      Additionally, the federal banking agencies have adopted safety and soundness guidelines for asset quality and for evaluating and monitoring earnings to ensure that earnings are sufficient for the maintenance of adequate capital and reserves. If an institution fails to comply with a safety and soundness standard, the appropriate federal banking agency may require the institution to submit a compliance plan. Failure to submit a compliance plan or to implement an accepted plan may result in a formal enforcement action.

      The federal banking agencies have issued regulations prescribing uniform guidelines for real estate lending. The regulations require insured depository institutions to adopt written policies establishing standards, consistent with such guidelines, for extensions of credit secured by real estate. The policies must address loan portfolio management, underwriting standards and loan-to-value limits that do not exceed the supervisory limits prescribed by the regulations.

Consumer Protection Laws and Regulations

      The bank regulatory agencies are focusing greater attention on compliance with consumer protection laws and their implementing regulations. Examination and enforcement have become more intense in nature, and insured institutions have been advised to carefully monitor compliance with various consumer protection laws and their implementing regulations. Banks are subject to many federal consumer protection laws and their regulations, including:

•  the Community Reinvestment Act;

•  the Truth in Lending Act;

•  the Fair Housing Act;

•  the Equal Credit Opportunity Act;

•  the Home Mortgage Disclosure Act;

•  the Real Estate Settlement Procedures Act; and

•  the Gramm-Leach-Bliley Act.

Other Aspects of Banking Law

      The Bank is also subject to federal and state statutory and regulatory provisions covering, among other things, security procedures, currency and foreign transactions reporting, insider and affiliated party transac-

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tions, management interlocks, electronic funds transfers, funds availability, and truth-in-savings. There are also a variety of federal statutes which regulate acquisitions of control and the formation of bank holding companies.

USA Patriot Act of 2001

      On October 26, 2001, President Bush signed the USA Patriot Act of 2001. The Patriot Act is intended to strengthen the U.S. law enforcement and the intelligence communities’ abilities to work cohesively to combat terrorism on a variety of fronts. The impact of the Patriot Act on financial institutions of all kinds is significant and wide ranging. The Patriot Act contains sweeping anti-money laundering and financial transparency, in addition to current requirements, laws and requires various regulations.

Impact of Monetary Policies

      Banking is a business that depends on interest rate spreads. In general, the difference between the interest rate paid by a bank on its deposits and its other borrowings and the interest rate earned on its loans, securities and other interest-earning assets comprises the major source of the Bank’s earnings. These rates are highly sensitive to many factors which are beyond the Bank’s control and, accordingly, the earnings and growth of the Bank are subject to the influence of economic conditions generally, both domestic and foreign, including inflation, recession, and unemployment; and also to the influence of monetary and fiscal policies of the United States and its agencies, particularly the Federal Reserve Board. The Federal Reserve Board implements national monetary policy, such as seeking to curb inflation and combat recession, by:

•  Open-market dealings in United States government securities;

•  Adjusting the required level of reserves for financial institutions subject to reserve requirements; and

•  Adjusting the discount rate applicable to borrowings by banks which are members of the Federal Reserve System.

      The actions of the Federal Reserve Board in these areas influence the growth of bank loans, investments, and deposits and also affect interest rates. Since January 2001 through early 2004 the FRB decreased interest rates thirteen times, reducing the overnight “Federal Funds” rate from 6.50% to 1.00%, the lowest level in over four decades. Since June 2004, the FRB has increase interest rates eight times to 3.0%. The nature and timing of any future changes in the Federal Reserve Board’s policies and their impact on the Company and the Bank cannot be predicted; however, depending on the degree to which our interest-earning assets and interest-bearing liabilities are rate sensitive, increases in rates would have the effect of increasing our net interest margin, while decreases in interest rates would have the opposite effect. In addition, adverse economic conditions could make a higher provision for loan losses a prudent course and could cause higher loan charge-offs, thus adversely affecting our net income or other operating costs.

DESCRIPTION OF CAPITAL STOCK

      The following summary description of the Company’s capital stock does not purport to be complete and is subject to the more detailed provisions of the Company’s Articles of Incorporation and Bylaws and is qualified in its entirety by reference thereto.

      The authorized capital stock of the Company consists of 10,000,000 shares of common stock, no par value (the “Common Stock”), and 10,000,000 shares of serial preferred stock (the “Preferred Stock”). The Preferred Stock may be divided into such number of series as the Board of Directors may determine. The Board of Directors is authorized to determine and alter the rights, preferences, privileges and restrictions granted to and imposed upon any wholly unissued series of Preferred Stock, and to fix the number of shares of any series of Preferred Stock and the designation of any such series of Preferred Stock. The Board of Directors, within the limits and restrictions stated in any resolution or resolutions of the Board of Directors originally fixing the number of shares constituting any series, may increase or decrease (but not below the

56

number of shares of such series then outstanding) the number of shares of any series subsequent to the issue of shares of that series.

      The issuance of Preferred Stock could affect the rights of holders of Common Stock. No shares of Preferred Stock will be issued in connection with the holding company reorganization or the acquisition of SCCB and there are no plans to issue Preferred Stock at the present time.

      Upon liquidation or dissolution of the Company, the assets legally available for distribution to holders of shares of the Company’s Common Stock, after payment of all obligations of the Company and payment of any liquidation preference of all other classes and series of stock entitled thereto, including Preferred Stock, if any, are distributable ratably among the holders of the Company’s Common Stock.

      The holders of the Company’s Common Stock are entitled to one vote per share of Common Stock held of record on all matters submitted to vote upon the stockholders. The shares of Common Stock are entitled to cumulative voting rights for the election of directors. The holders of the Company’s Common Stock have no preemptive rights to subscribe for new issue securities, and shares of the Company’s Common Stock are not subject to redemption, conversion, or sinking fund provisions. The shares of the Common Stock, when issued in connection with the holding company reorganization, will be validly issued, fully paid, and non assessable.

      After the preferential dividends upon all other classes and series of stock entitled thereto shall have been paid or declared and set apart for payment and after the Company shall have complied with all requirements, if any, with respect to the setting aside of sums as a sinking fund or for a redemption account on any class of stock, then the holders of the Company’s Common Stock are entitled to such dividends as may be declared by the Board of Directors out of funds legally available therefore under the laws of the State of California.

      As of the date of this private placement memorandum, there were 100 shares of the Company’s Common Stock issued and outstanding. Those shares were issued to C. G. Kum, the Bank’s President and Chief Executive Officer, for $1,000 in order to capitalize the Company. At the time of the holding company reorganization and pursuant to a written agreement, these shares will be repurchased for $1,000 and cancelled by the Company.

REGISTRATION RIGHTS

      In connection with the offering of Shares hereby, the Company will enter into a registration rights agreement with each purchaser of Shares. The following description of certain provisions of the registration rights agreement is a summary and, accordingly, is not complete. The summary is subject to, and qualified in its entirety by reference to, the provisions of the registration rights agreement, Exhibit B hereto and is incorporated herein by reference, which shall be separately provided to you.

      Pursuant to the terms of the registration rights agreement and for the benefit of the holders of Shares, the Company has agreed, at its expense, to:

•  file a shelf registration statement with the SEC to register all transfer restricted Shares on or prior to 90 days after the closing of the sale of the Shares;

•  use its best reasonable efforts to have the shelf registration statement declared effective on or prior to 150 days after the closing of the sale of the Shares; and

•  use its best reasonable efforts to keep the shelf registration statement effective for two years after the Closing or such shorter period as will terminate upon the earliest to occur of the following:

      (1) All Shares have been sold pursuant to the shelf registration statement, and

      (2) all Shares, other than those held by the Company and its affiliates, are eligible to be sold to the public pursuant to Rule 144(k) under the Securities Act or any successor rule thereof.

      The Company will also agree to use its best reasonable efforts to take a number of other actions necessary to permit public resales of the Shares, including, but not limited to, notifying each holder of Shares when the

57

shelf registration statement becomes effective and providing copies of the prospectus included in the shelf registration statement to each holder of Shares.

      Before a holder may include its Shares in the shelf registration statement, the holder must furnish the Company in writing, within 20 days after receipt of a request therefor, with certain information regarding the holder, its holdings of Shares, its plan of distribution of Shares, and certain other information required by the registration rights agreement for use in connection with any shelf registration statement or prospectus or preliminary prospectus included therein. Each holder must also agree to be named as a selling security holder in the shelf registration statement and any prospectus included therein, and to comply with all applicable requirements of the Securities Act, including the prospectus delivery requirements thereof.

Liquidated Damages

      We will pay liquidated damages, in cash, if the shelf registration statement:

•  has not been filed with the SEC on or prior to 90 days after the closing of the sale of Shares;

•  is not declared effective on or prior to 150 days after the closing of the sale of Shares; or

•  ceases to be effective or fails to be usable for its intended purpose without being promptly succeeded by a post-effective amendment that cures such failure, with certain exceptions.

      Liquidated damages accrue at a rate of 1% of the aggregate purchase price per annum for the first 90 days of registration default, increasing by an additional .5% for each subsequent 90 day period of registration default up to a maximum rate of 2% per annum. Liquidated damages will accrue at such rate from and after a registration default until the earlier of the curing of the registration default or the date on which such registration rights have terminated. At no time will the Company be required to pay liquidated damages in excess of           % of the aggregate purchase price per annum, regardless of whether one or multiple registration defaults exist.

      Liquidated damages accrue only on securities that are then restricted securities. Liquidated damages will be paid quarterly in arrears on March 30, June 30, September 30 and December 30 of each year, with the first quarterly payment due on the first such payment date following the date on which the liquidated damages began to accrue.

Indemnification

      Pursuant to the registration rights agreement, the Company will agree to indemnify the selling security holders and related parties against losses, claims, damages or liabilities arising out of or based upon any untrue statement of material fact or an omission of a material fact required to be stated in the shelf registration statement or any prospectus included therein. As a consequence of having their Shares included in the shelf registration statement, the selling security holders will agree to indemnify the Company against losses, claims, damages or liabilities that arise out of or are based upon an untrue statement of material fact or an omission of a material fact contained in the shelf registration statement or any prospectus included therein, but only with reference to information relating to such holder furnished in writing to the Company by such holder for use in the shelf registration statement or prospectus.

SHARES ELIGIBLE FOR FUTURE SALE

      Future sales of substantial amounts of our common stock in the public market, or the availability of such shares for sale, including shares issued upon the exercise of outstanding options, could adversely affect the market price of our common stock. These sales also might make it more difficult for us to sell equity or equity-related securities in the future at a time and price that we deem appropriate.

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Sale of Restricted Shares

      After giving effect to the holding company reorganization (                     shares) and this offering (                     shares), we will have an aggregate of                      shares of common stock outstanding, assuming no exercise of outstanding options to purchase common stock. Substantially all shares of our common stock issuable in connection with the holding company reorganization will be freely tradable, except for shares held by “affiliates,” as that term is defined in Rule 144(a) under the Securities Act. For purposes of Rule 144, an “affiliate” of an issuer is a person that, directly or indirectly through one or more intermediaries, controls, or is controlled by or is under common control with, such issuer. The                      shares of common stock to be sold in this offering will not be freely tradable until registered. Under the registration rights agreement to be executed by the Company and each purchaser of Shares pursuant to this offering, we will be required to use our best reasonable efforts to cause the shelf registration statement to be declared effective by the SEC within 180 days after the completion of this offering. See “Registration Rights” on page      .

Rule 144

      In general, under Rule 144 as currently in effect, a person who has beneficially owned shares of our common stock for at least one year would be entitled to sell, within any three-month period, a number of shares that does not exceed the greater of:

•  1% of the number of shares of common stock then outstanding, which will equal approximately                      shares immediately after this offering and the holding company reorganization, or

•  the average weekly trading volume of our common stock on OTC Bulletin Board during the four calendar weeks preceding the filing of a notice on Form 144 with respect to that sale, which amount is currently only approximately                      shares (based upon the trading activity of the Bank’s common stock).

Sales under Rule 144 are also subject to other requirements regarding the manner of sale, notice filing and the availability of current public information about us.

Rule 144(k)

      Under Rule 144(k), a person who is not deemed to have been one of our affiliates at any time during the three months preceding a sale, and who has beneficially owned the shares proposed to be sold for at least two years, including the holding period of any prior owner other than an affiliate, is entitled to sell those shares without complying with the manner of sale, public information, volume limitation or notice filing provisions of Rule 144. Therefore, all “144(k) shares” may be sold without restriction, subject to the provisions of the lock-up agreements described herein.

Stock Options

      As of March 31, 2005, options to purchase approximately 78,250 shares of common stock were outstanding under the Bank’s 2003 stock option plan. In connection with the holding company reorganization, all options that have been granted will be exchanged for substitute options under the Company’s 2005 stock option plan. In the near future, we expect to file a registration statement on Form S-8 to register all of the shares of common stock that could be purchased upon the exercise of such stock options under the Company’s stock option plan. Accordingly, the shares purchased upon exercise of options granted under our stock option plans will be available for resale in the public market, subject to Rule 144 limitations applicable to affiliates, vesting restrictions and the expiration of lock-up agreements.

Lock-up Agreements

      The shares to be held by affiliates of the Company, including approximately                      shares to held by our officers and directors, will be subject to lock-up agreements under which these individuals have agreed not to offer or sell any of these shares of common stock for a period of 90 days from the closing of the offering, without the prior written consent of the Placement Agent, Keefe, Bruyette & Woods, Inc. Sales of a

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substantial number of shares of our common stock following the expiration of the lock-up period could cause our stock price to fall.

PLAN OF DISTRIBUTION

      Keefe, Bruyette & Woods, Inc. (“KBW”), under the terms and subject to the conditions of a placement agreement entered into with us, has agreed, as our placement agent, to assist us in offering the Shares for sale on a “best efforts” basis. The Shares offered hereby will be sold in transactions not requiring registration under the Securities Act or applicable state securities laws. Each investor of Shares offered hereby will be required to complete and deliver to the placement agent for redelivery to us a subscription agreement, copies of which are available from us and the placement agent. Upon executing a subscription agreement, each investor agrees to purchase the number of Shares set forth in their subscription agreement, subject to the satisfaction of the conditions set forth therein. Pursuant to the subscription agreement, the investors will not be obligated to purchase Shares from the Company, and the Company will not be obligated to sell Shares to the investor, unless (1) the holding company reorganization is consummated, (2) the trust preferred offering is consummated, and (3) the acquisition of South Coast Bancorp is consummated on the Closing Date (as defined in the subscription agreement), in each case, on terms consistent with the terms described in this private placement memorandum. In addition, the subscription agreement will terminate if the sale of the Shares has not occurred on or prior to October 10, 2005. In addition, each purchaser will be deemed to have made certain acknowledgments, representations and agreements as set forth under “Notice to Investors”.

      Pursuant to the placement agreement, we have agreed to indemnify the placement agent against certain liabilities, including liabilities under the Securities Act and applicable state securities laws.

      The placement agent will offer or sell the Shares to persons it reasonably believes to be “accredited investors” as defined in Rule 501 (a) of the Securities Act.

      We have agreed to pay the placement agent a cash fee equal to 6% of the gross proceeds from the sale of Shares. We have also agreed to reimburse the placement agent for up to $50,000 of its reasonable expenses incurred in connection with the Offering, not including fees of its counsel.

NOTICE TO INVESTORS

General

      The Shares being offered have not been registered under the Securities Act or any state securities laws and, unless so registered, may not be offered or sold except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and applicable state securities laws. Accordingly, these Shares are being offered and sold only to a limited number of institutional “accredited investors,” as defined in Rule 501 (a)(1), (2), (3) or (7) under the Securities Act as set forth below, residing in some jurisdictions.

      The standards discussed below represent minimum standards for prospective investors to participate in this offering. If you satisfy or exceed these standards, it does not necessarily mean that our securities are a suitable investment for you. You are encouraged to consult your personal financial advisors to determine whether an investment in our Shares and shares is appropriate for you. We may reject subscriptions, in whole or in part, in our sole discretion.

      To participate in this offering, you must represent in the subscription agreement, Exhibit A to this private placement memorandum, which shall be separately provided, among other things, that:

•  by reason of your business or financial experience, or that of your professional advisor, you are capable of evaluating the merits and risks of an investment in the Shares and of protecting your own interests in connection with the transaction;

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•  you are acquiring the Shares for your own account, for investment only and not with a view toward the distribution thereof,

•  you are aware that the Shares have not been registered under the Securities Act or any state or foreign securities laws and the transfer of the Shares is restricted by the Securities Act, applicable state or foreign securities laws;

•  you meet the requirements set forth below to be an “accredited investor.”

Accredited Investor Defined

      Rule 501 (a) of Regulation D under the Securities Act defines an “accredited investor” to be, concerning the Shares,

      (1) any bank as defined in Section 3(a)(2) of the Securities Act or any savings and loan association or other institution as defined in Section 3(a)(5)(A) of the Securities Act whether acting in its individual or fiduciary capacity, a broker or dealer registered pursuant to Section 15 of the Securities Exchange Act of 1934; any insurance company as defined in Section 2(13) of the Securities Act; any investment company registered under the Investment Company Act of 1940 or a business development company as defined in Section 2(a)(48) of that Act; any Small Business Investment Company licensed by the U.S. Small Business Administration under Section 301(c) or (d) of the Small Business Investment Act of 1958; any plan established and maintained by a state, its political subdivisions, or any agency or instrumentality of a state or its political subdivisions, for the benefit of its employees, if such plan has total assets in excess of $5,000,000; any employee benefit plan within the meaning of the Employee Retirement Income Security Act of 1974, if the investment decision is made by a plan fiduciary, as defined in Section 3(21) of such Act, which is either a bank, savings and loan association, insurance company, or registered investment advisor, or if the employee benefit plan has total assets in excess of $5,000,000 or, if a self-directed plan, with investment decisions made solely by persons that are accredited investors;

      (2) any private business development company as defined in Section 202(a)(22) of the Investment Advisors Act of 1940;

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

      (4) any director or executive officer of FCB Bancorp;

      (5) any natural person whose individual net worth or joint net worth with that person’s spouse, at the time of such person’s purchase of the shares exceeds $1,000,000;

      (6) a natural person who had an individual income in excess of $200,000 in each of the two most recent years or joint income with that person’s spouse in excess of $300,000 in each of those years and has a reasonable expectation of reaching the same income level in the current year,

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

      (8) an entity in which all of the equity owners are accredited investors, as defined above.

      As used above, the term “net worth” means the excess of total assets over total liabilities. In computing net worth for the purpose of (5) above, your principal residence must be valued at cost, including cost of improvements, or at a recently appraised value by an institutional lender making a secured loan, net of encumbrances. In determining income, you should add to your adjusted gross income any amounts attributable to tax-exempt income received, losses claimed as a limited partner in any limited partnership, deductions claimed for depletion, contributions to an IRA or KEOGH retirement plan, alimony payments and any amount by which income from long-term capital gains has been reduced in arriving at adjusted gross income.

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Representations and Acknowledgments of Investors

      By your acceptance of our offer to sell you Shares, the Subscription Agreement will require you to acknowledge, represent to, and agree with us as follows:

      1. You understand and acknowledge that the Shares have not been registered under the Securities Act or any other applicable securities law, are being offered for sale in transactions not requiring registration under the Securities Act or any other securities laws, and, unless so registered may not be offered, sold or otherwise transferred except in compliance with the registration requirements of the Securities Act or any other applicable securities law, pursuant to an exemption therefrom or in a transaction not subject thereto.

      2. You are an institutional “accredited investor” within the meaning of subparagraph (a)(1), (2), (3) or (7) of Rule 501 under the Securities Act or, if the Shares are to be purchased for one or more accounts, “investor accounts”, for which you are acting as fiduciary or agent, each such account is an institutional accredited investor on a like basis. In the normal course of your business, you invest in or purchase securities similar to the Shares and you have such knowledge and experience in financial and business matters that you are capable of evaluating the merits and risks of purchasing the Shares. You are aware that you, or any investor account, may be required to bear the economic risk of an investment in the Shares for an indefinite period of time and you, or such account, are able to bear that risk for an indefinite period.

      3. You acknowledge that neither we nor any person representing us has made any representation to you about us or the private placement or sale of the Shares, other than the information contained in this private placement memorandum and the subscription agreement which have been delivered to you and upon which you are relying in making your investment decision relating to the Shares and, accordingly, you acknowledge that no representation or warranty is made as to the accuracy or completeness of these materials. You have had access to financial and other information concerning us and the Shares as you have deemed necessary in connection with your decision to purchase the Shares, including an opportunity to ask questions of and request information from us.

      4. You are purchasing the Shares for your own account, or for one or more investor accounts for which you are acting as a fiduciary or agent, in each case for investment, and not with a view to, or for offer or sale in connection with, any distribution of the Shares in violation of the Securities Act, subject to any requirement of law that the disposition of your property or the property of an investor account or accounts be at all times within your or their control and subject to your or their ability to resell the Shares pursuant to any exemption from registration available under the Securities Act.

      5. You acknowledge that we and others will rely upon the truth and accuracy of your acknowledgments, representations and agreements and agree that, if any of the acknowledgments, representations or warranties deemed to have been made by you by your purchase of the Shares are no longer accurate, you shall promptly notify us. If you are acquiring any of the Shares as a fiduciary or agent for one or more investor accounts, you represent that you have sole investment discretion for each such account and that you have full power to make these acknowledgments, representations and agreements on behalf of each such account.

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MATERIAL UNITED STATES FEDERAL TAX CONSIDERATIONS

      This summary of material United States federal tax considerations is for general information only and is not tax advice. We urge you to consult your tax advisor with respect to the application of the United States federal income tax laws to your particular situation as well as any tax consequences arising under the Federal estate or gift tax rules or under the laws of any state, local, foreign or other taxing jurisdiction or under any applicable tax treaty.

Consequences to U.S. Holders

      The following is a summary of certain United States federal income tax consequences that will apply to you if you are a U.S. holder of the Shares. “Non-U.S. holders” of the Shares should consult their tax advisors with respect to tax consequences arising under the tax laws of both the United States and other jurisdictions. “U.S. holder” means a beneficial owner of a Share that is:

•  an individual citizen or resident of the United States;

•  A corporation or other entity taxable as a corporation for United States federal income tax purposes, or partnership, or other entity taxable as a partnership for United States federal income tax purposes, created or organized in the United States or under the laws of the United States, any state thereof, or the District of Columbia;

•  an estate, the income of which is subject to United States federal income taxation regardless its source; or

•  A trust that (1) is subject to the primary supervision of a United States court and the control of one or more United States persons or (2) has a valid election in effect under applicable Treasury Regulations to be treated as a United States person.

Sale, Exchange or Redemption of the Shares

      Upon the sale, exchange (other than a conversion or other tax-free exchange) or redemption of a Share, you generally will recognize capital gain equal to the amount by which the cash proceeds and the fair market value of any property that you receive on the sale, exchange or redemption exceeds your adjusted tax basis in the Share for determining gain, or capital loss equal to the amount by which your adjusted tax basis in the Share for determining loss exceeds the cash proceeds and the fair market value of any property you receive on the sale,. Your adjusted tax basis in a Share generally will equal the amount you paid for the Share. If you are an individual and have held the Share for more than one year, such capital gain will generally be subject to tax at a maximum rate of 15% (5% in the case of gain that would otherwise be taxed at a regular tax rate below 25%, i.e., at 10% or 15%) Your ability to deduct capital losses may be limited. As the law presently stands, after 2008, long-term capital gains of noncorporate taxpayers now taxed at a rate of 5% will be taxed at a rate of 10% (8% for Shares held for more than five years), and long-term capital gains now taxed at a rate of 15% will be taxed at a rate of 20% (18% for Shares held for more than five years).

Dividends

      Distributions, if any, made to you as a shareholder generally will be dividend income to the extent of our current or accumulated earnings and profits. Such dividends will ordinarily be Qualified Dividends, taxable, if paid before 2009, at the same rate as capital gains (i.e., 15% or 5%). Thereafter, under current law, all dividends received will again be taxable at ordinary income rates. Distributions in excess of our current and accumulated earnings and profits will be treated as a return of capital to the extent of your basis in the common stock and any amount in excess of your basis as capital gain from the sale or exchange of such common stock. Subject to certain restrictions, if you are a corporate U.S. holder, dividends received by you will be eligible for a dividends received deduction.

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Liquidated Damages

      In the event of a registration default, we are required to pay liquidated damages. You must include any such liquidated damages paid or accrued as ordinary income at the time it is received or accrued, in accordance with your regular method of accounting for United States federal income tax purposes. See “Registration Rights — Liquidated Damages,” above.

Backup Withholding and Information Reporting

      We are required to furnish to the record holders of the Shares, other than corporations and other exempt holders, and to the IRS, information with respect to dividends paid on Shares.

      You may be subject to backup withholding with respect to dividends paid on the Shares or with respect to proceeds received from a disposition of the Shares. Certain holders (including, among others, corporations and certain tax-exempt organizations) are generally not subject to backup withholding. You will be subject to backup withholding if you are not otherwise exempt and you (i) fail to furnish your taxpayer identification number (“TIN”), which, for an individual is ordinarily his or her social security number; (ii) furnish an incorrect TIN; (iii) are notified by the IRS that you have failed to properly report payments of interest or dividends; or (iv) fail to certify, under penalties of perjury, that you have furnished a correct TIN and that the IRS has not notified you that you are subject to backup withholding. Backup withholding is not an additional tax but, rather, is a method of tax collection. U.S. holders will be entitled to credit any amounts withheld under the backup withholding rules against your actual tax liabilities provided the required information is furnished to the IRS.

      The preceding discussion of material United States federal income tax considerations is for general information only and is not tax advice. Accordingly, you are urged to consult your tax advisors as to the particular tax considerations to you of the acquisition, ownership and disposition of the Shares, including the effect and applicability of state, local, foreign or other tax laws, as well as the consequences of any proposed change in applicable laws.

LEGAL MATTERS

      Certain legal matters will be passed upon for us by Horgan, Rosen, Beckham & Coren, LLP, a California limited liability partnership.

INDEPENDENT AUDITORS

      The financial statements of First California Bank as of and for the year ended December 31, 2004, have been audited by Moss Adams LLP, independent auditors, as stated in their report appearing therein. The financial statements of South Coast Bancorp, Inc., as of and for the year ended December 31, 2004, have been audited by Grant Thornton LLP, independent auditors, as stated in their report appearing therein.

AVAILABLE INFORMATION

      We have engaged Keefe, Bruyette & Woods, Inc. to act as our exclusive placement agent, on a “best efforts” basis, to arrange the private placement of the Shares offered hereby. The placement agent will act as primary contact for, and will be available to consult with, any prospective investor to whom this memorandum has been delivered.

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      We have agreed to make available to each prospective investor, prior to the sale of the Shares, the opportunity to ask questions of and receive answers from us concerning the terms and conditions of the offering and to obtain any additional information necessary to verify the accuracy of the information contained in this memorandum or for any other purpose relevant to a prospective investment in the Shares offered hereby. However, we may choose not to supply such additional information if we do not possess it and cannot obtain it upon reasonable effort and expense.

      In connection with the holding company formation for the Bank, the Company will file a registration statement on Form S-4 with the SEC. This registration statement is not part of this private placement memorandum. We are not currently subject to the information reporting requirements of the Exchange Act. However, once our registration statement on Form S-4 is declared effective by the SEC, we will be subject to such reporting requirements and will file reports and other information with the SEC. You will then be able to access these reports and other information. It is anticipated that our registration statement will be declared effective prior to September 30, 2005. We intend to furnish our shareholders with annual reports containing financial statements audited and reported on by our independent auditors and quarterly reports containing unaudited interim financial information for each of the first three fiscal quarters of each fiscal year after becoming subject to the reporting requirements under the Exchange Act.

      All communications or inquires relating to these materials or to a possible investment in us should be directed to the following individual:

Keefe, Bruyette & Woods, Inc.

Direct phone: (212) 887-8908

Main Phone: (212) 887-7777

Facsimile: (212) 582-5419

787 Seventh Avenue, 4th Floor

New York, NY 10019

Attn: Jeffrey Evans

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CONFIDENTIAL

PRIVATE PLACEMENT MEMORANDUM

                            Shares

FCB Bancorp

Common Stock

KEEFE, BRUYETTE & WOODS

                    , 2005

      As you have previously agreed with the placement agent, this private placement memorandum is confidential. The acceptance of this private placement memorandum from the Company or the placement agent constitutes an agreement by the recipient hereof, pending FCB Bancorp’s public disclosure of material, non-public information contained herein, (a) not to use any such information other than in connection with evaluating this offering, (b) not to purchase or sell FCB Bancorp securities outside of this offering, and (c) to abide by all applicable restrictions imposed by the United States securities laws in connection with this offering. FCB Bancorp will publicly disclose all material, non-public information contained herein in a registration statement filed in connection with the holding company reorganization. If you have received a copy of this private placement memorandum without having agreed to such restrictions, please notify the placement agent at (212) 887-8908 or (212) 887-7777 so as to make arrangements for its return.