Contract analysis

ARTICLE I — DEFINITIONS As used in this Agreement, the following terms shall have the meanings set forth below. Capitalized terms used but not otherwise defined in this Article I shall have the meanings ascribed to them elsewhere in this Agreement.

Section 1.1. "Agreement" means this Managed Services Agreement, including all Exhibits attached hereto and incorporated herein by reference, as the same may be amended, modified, or supplemented from time to time in accordance with Section 17.4.

Section 1.2. "Authorized Representative" means (a) for BRB: Thomas Ikeda, BSA Officer / AML Program Director; Patricia Langston, Chief Compliance Officer; and Gregory Nardone, General Counsel; and (b) for Pinnacle: Andrea Solis, Director of Managed Services. Either party may designate additional or replacement Authorized Representatives by written notice to the other party in accordance with Section 17.5.

Section 1.3. "BSA/AML Laws" means, collectively, the Bank Secrecy Act (31 U.S.C. § 5311 et seq.), the USA PATRIOT Act (Pub. L. 107-56), the implementing regulations promulgated thereunder (31 C.F.R. Chapter X), OFAC regulations (31 C.F.R. Part 500 et seq.), all applicable guidance issued by the Financial Crimes Enforcement Network ("FinCEN"), and all applicable supervisory guidance, bulletins, advisories, and directi

Section 1.4. "BRB" or "Client" means Belmont Ridge Bank National Association, a national banking association chartered under 12 U.S.C. § 21 et seq., OCC Charter No. 48271, FDIC Certificate No. 31845.

Section 1.5. "BRFG" means Belmont Ridge Financial Group, Inc., a Delaware corporation and bank holding company (NYSE: BRFG), and the sole parent and shareholder of BRB.

Section 1.6. "CDD/EDD" means Customer Due Diligence and Enhanced Due Diligence, as those terms are understood under 31 C.F.R. § 1020.210, the FinCEN CDD Rule (81 FR 29398), and applicable OCC supervisory guidance.

Section 1.7. "Confidential Information" has the meaning set forth in Section 6.1 of this Agreement.

Section 1.8. "Consent Order" means OCC Consent Order No. OCC-2025-003, effective January 15, 2025, as the same may be amended, modified, superseded, or terminated by the OCC.

Section 1.9. "Effective Date" means February 10, 2025.

Section 1.10. "Engagement Period" means the twelve (12)-month term commencing on the Effective Date (February 10, 2025) and concluding on February 9, 2026, unless extended pursuant to Section 9.1 or terminated earlier pursuant to Article IX.

Section 1.11. "FTE" or "Full-Time Equivalent" means one individual providing services on a full-time basis, defined as a minimum of forty (40) hours per week, exclusive of federal and New York State holidays observed by BRB and approved leave.

Section 1.12. "Independent Consultant" means Thornfield Consulting Group LLC, engaged pursuant to Article VII of the Consent Order under engagement reference TCG-BRB-2025-001, to serve as the OCC-mandated independent consultant overseeing BRB's remediation efforts.

Section 1.13. "Key Personnel" means Andrea Solis, who shall serve as Pinnacle's primary engagement lead, and such other senior personnel specifically identified in the Statement of Work (Exhibit A) or otherwise designated as Key Personnel by written agreement of the parties.

Section 1.14. "Managed Staff" means the BSA/AML compliance professionals provided by Pinnacle to BRB under this Agreement, as more particularly described in Article III.

Section 1.15. "OCC" means the Office of the Comptroller of the Currency, an independent bureau of the United States Department of the Treasury.

Section 1.16. "Outside Counsel" means Calderwood & Harkness LLP, 1285 Avenue of the Americas, 40th Floor, New York, NY 10019, engaged as BRB's outside regulatory counsel in connection with the Consent Order and related remediation matters.

Section 1.17. "Pinnacle" or "Service Provider" means Pinnacle Compliance Solutions LLC, a New York limited liability company, with its principal office at 90 Broad Street, 20th Floor, New York, NY 10004.

Section 1.18. "Remediation Action Plan" or "RAP" means the comprehensive remediation plan required to be submitted to the OCC by May 15, 2025, in accordance with the terms and conditions of the Consent Order.

Section 1.19. "SAR" means a Suspicious Activity Report as defined under 31 C.F.R. § 1020.320 and filed with FinCEN through the BSA E-Filing System.

Section 1.20. "Services" means the managed compliance staffing services described in Article II of this Agreement and in the Statement of Work attached hereto as Exhibit A, as the same may be modified from time to time by mutual written agreement.

Section 1.21. "Statement of Work" or "SOW" means the detailed scope of work, staffing plan, deployment schedule, deliverables, and related specifications set forth in Exhibit A attached hereto and incorporated herein by reference (SOW Ref: PCS-BRB-2025-0012).

Section 1.22. "TMS" means Transaction Monitoring System, which for purposes of this Agreement refers to the Veridian Analytics Inc. transaction monitoring platform currently deployed at BRB in version 8.3 (TMS v.8.3), to be upgraded to version 10.0 (TMS v.10.0) during the Engagement Period.

ARTICLE II — SCOPE OF SERVICES

Section 2.1 — General Scope Pinnacle shall provide thirty (30) full-time-equivalent BSA/AML compliance professionals (the "Managed Staff") to BRB for the duration of the Engagement Period to support BRB's BSA/AML remediation efforts undertaken in response to and in compliance with the Consent Order. The Services shall encompass the staffing, training support, and operational support activities described in this Artic

Section 2.2 — Service Categories The Managed Staff shall provide services across the following service categories, as more fully described in the Statement of Work (Exhibit A): (a) SAR Investigation and Filing Support. Managed Staff assigned to the SAR Investigation workstream shall support BRB's efforts to review and disposition the backlog of approximately two thousand four hundred (2,400) unreviewed suspicious act

Section 2.3 — Alignment with Consent Order Milestones The Services shall be planned, prioritized, and executed so as to support BRB's achievement of the following Consent Order and remediation milestones. While Pinnacle is not independently responsible for the achievement of these milestones, Pinnacle shall deploy its Managed Staff in a manner that maximizes BRB's ability to meet these deadlines: (a) March 31, 2025:

Section 2.4 — Exclusions Notwithstanding any other provision of this Agreement, the following activities are expressly excluded from the scope of Services: (a) Legal Advice. Pinnacle shall not provide legal advice or act as legal counsel to BRB. Managed Staff are not licensed attorneys (unless otherwise noted in individual qualifications) and shall not render legal opinions, provide legal analysis, or hold themselves

ARTICLE III — STAFFING REQUIREMENTS AND QUALIFICATIONS

Section 3.1 — Staffing Commitment Pinnacle shall provide and maintain a minimum of thirty (30) FTEs throughout the Engagement Period in accordance with the staffing plan and deployment schedule set forth in this Article III and in the Statement of Work (Exhibit A). The thirty (30)-FTE commitment represents Pinnacle's core obligation under this Agreement, and Pinnacle acknowledges that BRB's ability to meet the Consen

Section 3.2 — Qualification Requirements All Managed Staff deployed by Pinnacle under this Agreement shall possess, at minimum, the following qualifications: (a) A bachelor's degree from an accredited college or university; (b) One of the following: (i) current Certified Anti-Money Laundering Specialist ("CAMS") certification issued by ACAMS, or (ii) an equivalent professional certification such as Certified Financia

Section 3.3 — Background Checks and Screening Prior to the deployment of any Managed Staff member to BRB, Pinnacle shall conduct comprehensive background checks and screening, which shall include at a minimum: (a) A criminal background check covering all jurisdictions of residence for the preceding seven (7) years; (b) A consumer credit report; (c) Verification of employment history for the preceding five (5) years;

Section 3.4 — Replacement of Personnel (a) Vacancy Replacement. In the event any Managed Staff member is unable to perform Services due to resignation, termination, incapacity, personal leave, or any other cause, Pinnacle shall provide a qualified replacement who satisfies all requirements of this Article III within five (5) business days of the vacancy arising. During any vacancy period, the understaffing adjustment

Section 3.5 — Key Personnel Andrea Solis shall serve as Pinnacle's primary engagement lead and principal point of contact throughout the Engagement Period. Ms. Solis shall be responsible for overall management of Pinnacle's performance under this Agreement, coordination with BRB's Authorized Representatives, and resolution of staffing and operational issues. Pinnacle shall not replace, reassign, or otherwise remove A

ARTICLE IV — SUPERVISION AND OPERATIONAL CONTROL

Section 4.1 — BRB Supervision All Managed Staff shall work under the day-to-day operational direction and supervision of BRB personnel. The primary supervisory structure shall be as follows: (a) Thomas Ikeda, BSA Officer / AML Program Director — shall serve as the primary operational supervisor for all Managed Staff, with authority to direct the daily activities, work assignments, priorities, and workflow of Managed

Section 4.2 — Pinnacle Management Oversight Notwithstanding BRB's operational direction of Managed Staff as described in Section 4.1, Pinnacle shall retain administrative and employment management responsibility for all Managed Staff, including: (a) Payroll processing and compensation; (b) Employee benefits administration; (c) Workers' compensation insurance and claims management; (d) Employment-related tax withholdi

Section 4.3 — Quality Control BRB shall implement and maintain quality review protocols for all work product generated by Managed Staff. Pinnacle acknowledges the critical importance of work product quality in the context of BRB's regulatory remediation and agrees to cooperate fully with BRB's quality assurance framework. Specific quality control measures shall include: (a) SAR Narrative Quality Review: BRB shall con

Section 4.4 — Coordination with Third Parties Managed Staff shall cooperate with the Independent Consultant (Thornfield Consulting Group LLC) to the extent directed by BRB's Authorized Representatives. Such cooperation may include providing access to work product samples, responding to questions about processes and procedures, and participating in interviews or reviews conducted by Thornfield as part of its assessmen

ARTICLE V — COMPENSATION AND PAYMENT

Section 5.1 — Fee Structure In consideration of Pinnacle's provision of the Services described herein, BRB shall pay Pinnacle a monthly fee of Three Hundred Thousand Dollars ($300,000), calculated as thirty (30) FTEs multiplied by Ten Thousand Dollars ($10,000) per FTE per month. The total contract value for the twelve (12)-month Engagement Period is Three Million Six Hundred Thousand Dollars ($3,600,000). The per-FT

Section 5.2 — Invoicing and Payment Terms Pinnacle shall submit monthly invoices to BRB within five (5) business days following the end of each calendar month during the Engagement Period. Each invoice shall be submitted in a format reasonably acceptable to BRB and shall include the following detail: (a) The number of FTEs deployed during the invoice month, broken down by service category; (b) The number of hours wor

Section 5.3 — Adjustments for Understaffing If Pinnacle fails to maintain the thirty (30)-FTE staffing commitment for any calendar month (excluding the approved ramp-up period described in Section 3.1(a) and reasonable replacement periods under Section 3.4 not to exceed five (5) business days per vacancy), the monthly fee shall be prorated based on the actual number of FTEs deployed during the relevant month. The pro

Section 5.4 — Additional Staffing BRB may request that Pinnacle provide additional FTEs beyond the thirty (30)-FTE commitment upon thirty (30) days' prior written notice to Pinnacle. Additional FTEs shall be billed at the same rate of Ten Thousand Dollars ($10,000) per FTE per month, subject to Pinnacle's ability to source qualified personnel meeting the requirements of Section 3.2 within the requested timeframe. Any

Section 5.5 — Expenses The monthly per-FTE fee set forth in Section 5.1 is inclusive of all ordinary operating expenses incurred by Pinnacle in connection with the provision of Services, including but not limited to personnel costs, office overhead, management time, administrative support, and standard business expenses. BRB shall not be responsible for, and shall not reimburse Pinnacle for, any travel, lodging, tran

Section 6.1 — Confidential Information As used in this Agreement, "Confidential Information" means all non-public information of BRB, BRFG, or any of their affiliates that is disclosed to, made available to, or otherwise accessible by Pinnacle or any Managed Staff member in connection with the performance of the Services, regardless of the form or medium in which such information is communicated or maintained (includ

Section 6.2 — Obligations Pinnacle shall hold all Confidential Information in strict confidence and shall not disclose, publish, release, or transfer any Confidential Information to any third party without the prior written consent of BRB, except: (a) as required by applicable law, regulation, or legal process (including subpoena or regulatory inquiry), provided that Pinnacle shall, to the extent legally permitted, p

Section 6.3 — SAR Confidentiality Pinnacle and all Managed Staff are subject to the SAR confidentiality provisions of 31 U.S.C. § 5318(g)(2), which prohibit the unauthorized disclosure of SARs, the existence of SARs, and SAR-related information. Violations of SAR confidentiality may result in civil and criminal penalties. Pinnacle shall train all Managed Staff on SAR confidentiality requirements prior to deployment a

Section 6.4 — Return and Destruction Upon the expiration or termination of this Agreement for any reason, Pinnacle shall promptly (and in any event within fifteen (15) business days) return to BRB or destroy, at BRB's sole election, all Confidential Information in Pinnacle's possession or control, in whatever form or medium. Destruction shall be accomplished through means appropriate to the sensitivity of the informa

Section 6.5 — Privilege Protections Pinnacle acknowledges that certain materials, documents, and communications that may be disclosed to or generated by Managed Staff in the course of performing the Services may be subject to the attorney-client privilege, the work-product doctrine, or other legal protections belonging to BRB and its counsel, Calderwood & Harkness LLP. These may include, without limitation, materials

ARTICLE VII — DATA SECURITY AND INFORMATION PROTECTION

Section 7.1 — Information Security Requirements Pinnacle shall comply with BRB's information security policies, standards, and guidelines, copies of which shall be provided to Pinnacle and Managed Staff during the onboarding process. Pinnacle shall also comply with all applicable federal and state data security requirements, including the OCC's guidelines for safeguarding customer information (12 C.F.R. Part 30, Appe

Section 7.2 — System Access BRB shall provide Managed Staff with access to BRB's systems and applications necessary for the performance of the Services, including without limitation: (a) The Veridian TMS (currently v.8.3, to be upgraded to v.10.0 during the Engagement Period); (b) BRB's case management system; (c) BRB's OFAC screening platform; (d) CDD/EDD documentation and workflow systems; (e) BRB's customer inform

Section 7.3 — Incident Response Pinnacle shall immediately notify BRB of any actual or suspected data security incident involving BRB Confidential Information, including but not limited to unauthorized access, disclosure, acquisition, use, or destruction of such information. Notification shall be provided within two (2) hours of Pinnacle's discovery of or reasonable belief that an incident has occurred. Notification

ARTICLE VIII — PERFORMANCE STANDARDS AND REPORTING

Section 8.1 — Key Performance Indicators (KPIs) Pinnacle's performance under this Agreement shall be measured against the following Key Performance Indicators ("KPIs"), which the parties agree are reasonable and appropriate given the nature of the Services and the importance of BRB's remediation objectives: BRB and Pinnacle may agree to modify, add, or adjust KPIs during the Engagement Period to reflect evolving reme

Section 8.2 — Reporting Pinnacle shall provide BRB with the following reports during the Engagement Period: (a) Weekly Reports. Within two (2) business days following the end of each work week, Pinnacle shall provide a weekly report to Thomas Ikeda (BSA Officer) that includes: (i) the current staffing roster by name and service category; (ii) attendance and availability data for each Managed Staff member; (iii) hours

Section 8.3 — Performance Review Meetings BRB and Pinnacle shall hold bi-weekly performance review meetings on a schedule mutually agreed upon by the parties. Bi-weekly meetings shall be attended, at a minimum, by Thomas Ikeda (BRB BSA Officer) and Andrea Solis (Pinnacle engagement lead), together with such other personnel as either party may designate. Agenda topics for bi-weekly meetings shall include staffing stat

Section 8.4 — Remediation of Performance Deficiencies If Pinnacle fails to meet any KPI set forth in Section 8.1 for two (2) consecutive measurement periods, Pinnacle shall submit a written corrective action plan ("CAP") to BRB within five (5) business days of being notified of the deficiency. The CAP shall identify the root cause of the deficiency, the specific corrective actions to be taken, the timeline for implem