AMERICAN RIVER HOLDINGS
EXHIBIT 10.30
<DOCUMENT>
<TYPE>EX-10.30
<SEQUENCE>4
<FILENAME>ex10_30.txt
<DESCRIPTION>EXHIBIT 10.30
<TEXT>

                                                                   EXHIBIT 10.30

                              EMPLOYMENT AGREEMENT

         This Agreement is made and entered into on August _22, 2003 by and
between American River Holdings, a California corporation and bank holding
company registered under the Bank Holding Company Act of 1956, as amended (the
"Employer") and David T. Taber (the "Employee") for the purposes set forth
hereinafter (the "Agreement").

                                    RECITALS
                                    --------

         WHEREAS, the Employee is currently the Chief Executive Officer of the
Employer pursuant to an employment agreement between the Employer and the
Employee dated August 17, 2000 (the "Prior Employment Agreement");

         WHEREAS, it is the intention of the parties to enter into a new
employment agreement for the purposes of assuring the continued services of the
Employee as the Chief Executive Officer of the Employer;

         NOW, THEREFORE, in consideration of the mutual covenants and agreements
contained herein, the Employer and Employee agree as follows:

                                    AGREEMENT
                                    ---------

         1.       Term of Employment; Termination of Prior Employment Agreement
and Waiver of Rights and Benefits and Release of Obligations Thereunder.
Pursuant to this Agreement, the Employer employs the Employee and the Employee
hereby accepts employment with the Employer, upon the terms and conditions
hereinafter set forth. The term of this Agreement shall be a period of two (2)
years from the date hereof. Upon the occurrence of the second annual anniversary
of the date of this Agreement, and on each anniversary date thereafter, the term
of this Agreement shall be deemed automatically extended for an additional one
(1) year term, subject to the termination provisions of paragraph 16.

                  The Employer and the Employee agree that the Prior Employment
Agreement is hereby terminated effective as of the date of this Agreement and
that this Agreement is intended by the parties hereto to supersede in full and
constitute a complete replacement for the Prior Employment Agreement and any
rights and benefits thereunder. In furtherance thereof and notwithstanding any
provision of this Agreement or the Prior Employment Agreement to the contrary,
the Employee, for himself, and his heirs, beneficiaries, executors,
administrators, trustees, and any other legal or personal representatives,
agents, successors or permitted assignees or transferees, further expressly
agrees to and does hereby waive and relinquish any and all rights and benefits
under the Prior Employment Agreement and specifically releases the Employer and
its affiliates and subsidiaries, from any obligations, duties and liabilities

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under the Prior Employment Agreement including any matters covered or
contemplated by California Civil Code Section 1542 which reads as follows:

                  "A general release does not extend to claims which the
creditor does not know or suspect to exist in his favor at the time of executing
the release, which if known by him must have materially affected his settlement
with the debtor."

         2.       Duties and Obligations of Employee. Employee shall serve as
the Chief Executive Officer of the Employer pursuant to this Agreement and shall
perform the customary duties of each such office in the commercial banking
industry as may from time to time be reasonably requested of him by the Board of
Directors of the Employer including the following:

                  (a)      Providing leadership in planning and implementing the
conduct of the business and affairs of the Employer, subject to the direction of
the Board of Directors of the Employer, and carrying out responsibilities of the
position as outlined in any job description approved by the Board of Directors
of the Employer;

                  (b)      Participating in community affairs which are
beneficial to the Employer;

                  (c)      Maintaining a good relationship with the Board of
Directors of the Employer, its management officers and shareholders;

                  (d)      Maintaining a good relationship with regulatory
agencies and governmental authorities having jurisdiction over the Employer and
its subsidiaries;

                  (e)      Acting as a member of the Board of Directors of the
Employer and of its subsidiaries and all committees of the respective Boards of
Directors to which the Employee may be appointed or elected; and

         3.       Devotion to Employer's Business.
                  -------------------------------

                  (a)      The Employee shall devote his full business time,
ability, and attention to the business of the Employer during the term of this
Agreement and shall not during the term of this Agreement engage in any other
business activities, duties, or pursuits whatsoever, or directly or indirectly
render any services of a business, commercial, or professional nature to any
other person or organization, whether for compensation or otherwise, without the
prior written consent of the Board of Directors of the Employer. However, the
expenditure of reasonable amounts of time for educational, charitable, or
professional activities shall not be deemed a breach of this Agreement if those
activities do not materially interfere with the services required of the
Employee under this Agreement. Nothing in this Agreement shall be interpreted to
prohibit the Employee from making passive personal investments. However, the
Employee shall not directly or indirectly acquire, hold, or retain any interest
in any business competing with or similar in nature to the business of Employer,
except passive shareholder investments in other financial institutions and their
respective affiliates which do not exceed five percent (5%) of the outstanding

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voting securities in the aggregate in any single financial institution and its
affiliates on a consolidated basis.

                  (b)      The Employee agrees to conduct himself at all times
with due regard to public conventions and morals. The Employee further agrees
not to do or commit any act that will reasonably tend to shock or offend the
community, or to prejudice the Employer or the banking industry in general.

                  (c)      The Employee hereby represents and agrees that the
services to be performed under the terms of this Agreement are of a special,
unique, unusual, extraordinary, and intellectual character that gives them a
peculiar value, the loss of which cannot be reasonably or adequately compensated
in damages in an action at law. The Employee therefore expressly agrees that the
Employer, in addition to any other rights or remedies that the Employer may
possess, shall be entitled to injunctive and other equitable relief to prevent
or remedy a breach of this Agreement by the Employee.

         4.       Noncompetition by the Employee. The Employee shall not, during
the term of this Agreement, directly or indirectly, either as an employee,
employer, consultant, agent, principal, stockholder, officer, director, or in
any other individual or representative capacity, engage or participate in any
competitive banking or financial services business without the prior written
consent of the Employer.

         5.       Indemnification.
                  ---------------

                  (a)      The Employee shall indemnify and hold the Employer
harmless from all liability for loss, damage, or injury to persons or property
resulting from the gross negligence or intentional misconduct of the Employee.

                  (b)      To the extent permitted by law, the Employer shall
indemnify the Employee if he was or is a party or is threatened to be made a
party in any action brought by a third party against the Employee (whether or
not the Employer is joined as a party defendant) against expenses, judgments,
fines, settlements and other amounts actually and reasonably incurred in
connection with said action if the Employee acted in good faith and in a manner
the Employee reasonably believed to be in the best interest of the Employer (and
with respect to a criminal proceeding if the Employee had no reasonable cause to
believe his conduct was unlawful), provided that the alleged conduct of the
Employee arose out of and was within the course and scope of his employment as
an officer or employee of the Employer.

         6.       Disclosure of Information. The Employee shall not, either
before or after termination of this Agreement, without the prior written consent
of the Board of Directors of Employer or except as required by law to comply
with legal process including, without limitation, by oral questions,
interrogatories, requests for information or documents, subpoena, civil
investigative demand or similar process, disclose to anyone any financial
information, trade or business secrets, customer lists, computer software or
other information not otherwise publicly available concerning the business or

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operations of the Employer and its subsidiaries. The Employee further recognizes
and acknowledges that any financial information concerning any customers of the
Employer and its subsidiaries as it may exist from time to time, is strictly
confidential and is a valuable, special and unique asset of Employer's business.
The Employee shall not, either before or after termination of this Agreement,
without such consent or except as required by law, disclose to anyone said
financial information or any part thereof, for any reason or purpose whatsoever.
In the event the Employee is required by law to disclose such information
described in this paragraph 6, the Employee will provide the Employer and its
counsel with immediate notice of such request so that they may consider seeking
a protective order. If, in the absence of a protective order or the receipt of a
waiver hereunder, the Employee is nonetheless, in the written opinion of
knowledgeable counsel, compelled to disclose any of such information to any
tribunal or any other party or else stand liable for contempt or suffer other
material censure or material penalty, then the Employee may disclose (on an "as
needed" basis only) such information to such tribunal or other party without
liability hereunder. The Employee agrees to execute such form of confidentiality
agreement from time to time during the term of this Agreement as the Board of
Directors of the Employer may require to be executed by officers of the
Employer. Any conflict between this paragraph 6 and such confidentiality
agreement shall be resolved in favor of the provisions of the confidentiality
agreement.

         7.       Written, Printed or Electronic Material. All written, printed
or electronic material, notebooks and records including, without limitation,
computer disks used by the Employee in performing duties for the Employer, other
than the Employee's personal notes and diaries, are and shall remain the sole
property of the Employer. Upon termination of employment, the Employee shall
promptly return all such material (including all copies, extracts and summaries
thereof) to the Employer.

         8.       Surety Bond. The Employee agrees that he will furnish all
information and take any other steps necessary from time to time to enable the
Employer to obtain or maintain a fidelity or similar financial institution bond
which includes the Employee within the coverages provided conditional on the
rendering of a true account by the Employee of all monies, goods, or other
property which may come into the custody, charge, or possession of the Employee
during the term of his employment. The surety company issuing the bond and the
amount of the bond must be acceptable to the Employer. All premiums on the bond
shall be paid by the Employer. The Employer, or its successor, shall have no
obligation to pay or provide severance payments or severance benefits to the
Employee in accordance with paragraph 16 (d) or 16 (e), as applicable, of this
Agreement in the event that the Employee's employment is terminated in
connection with the Employee's failure to qualify for a surety bond at any time
during the term of this Agreement and such failure to qualify results from an
occurrence described in paragraph 16 (a) (5), (6), (7), (8), (9), (10) or (11,
to the extent of an Employee breach).

         9.       Base Salary. In consideration for the services to be performed
hereunder, the Employee shall receive a salary at the rate of Two Hundred
Thousand Dollars ($200,000) per annum, payable in installments during the term
of this Agreement of approximately Eight Thousand Three Hundred Thirty-Three
Dollars and Thirty-Three Cents ($8,333.33) on the first and fifteenth days of

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each month, subject to applicable adjustments for withholding taxes, prorations
for any partial employment period and such other applicable payroll procedures
of the Employer. The Employee shall receive such annual adjustments in salary,
if any, as may be determined by the Employer's Board of Directors, in its sole
discretion, resulting from the Board of Directors annual review of the
Employee's compensation each year during the term of this Agreement.

         10.      Salary Continuation During Disability. If the Employee for any
reason (except as expressly provided below) becomes temporarily or permanently
disabled so that he is unable to perform the duties under this Agreement, the
Employer agrees to pay the Employee the base salary otherwise payable to
Employee pursuant to paragraph 9 of this Agreement, reduced by the amounts
received by the Employee from state disability insurance, or worker's
compensation or other similar insurance benefits through policies provided by
the Employer, for a period of six (6) months from the date of disability.

         For purposes of this paragraph 10, "disability" shall be defined as
provided in the Employer's disability insurance program. Notwithstanding
anything herein to the contrary, the Employer shall have no obligation to make
payments for a disability resulting from the deliberate, intentional actions of
the Employee, such as, but not limited to, attempted suicide or chemical
dependence of the Employee.

         11.      Incentive Compensation. The Employee shall be entitled to
participate in the Incentive Compensation Plan (the "Plan") attached hereto as
Exhibit A and incorporated herein by reference, and receive incentive
compensation in accordance with the Plan, subject to the right of the Board of
Directors in its sole discretion to modify the terms and provisions of the Plan
each year during the term of this Agreement in connection with its review of the
Employee's performance and the Employer's results of operations. Under no
circumstance shall a right to receive incentive compensation exist in favor of
or accrue to or for the benefit of the Employee prior to actual receipt of a
distribution, if any, under the Plan.

         12.      Stock Options/Employment Rights. The Employee has previously
been granted stock options and may be granted additional stock options in the
future in the discretion of the Board of Directors of the Employer. Any such
stock option grant shall be evidenced by a stock option agreement in the form
required by the applicable stock option plan. Notwithstanding any provision of
such stock option plan or any such stock option agreement to the contrary, no
rights of employment shall be conferred upon the Employee or result from any
such stock option plan or any such stock option agreement. Any employment rights
and corresponding duties of the Employee pursuant to his employment by the
Employer shall be limited to and interpreted solely in accordance with the terms
and provisions of this Agreement.

         13.      Other Benefits. The Employee shall be entitled to those
employee benefits adopted by the Employer for all employees of the Employer,
subject to applicable qualification requirements and regulatory approval
requirements, if any. The Employee shall be further entitled to the following
additional benefits which shall supplement or replace, to the extent duplicative

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of any part or all of the general employee benefits, the benefits otherwise
provided to the Employee:

                  (a)      Vacation. The Employee shall be entitled to four (4)
weeks of annual vacation leave and six (6) days of personal absence at his then
existing rate of base salary each year during the term of this Agreement. The
Employee may be absent from his employment for vacation and personal absence as
long as such leave is reasonable and does not jeopardize his responsibilities
and duties specified in this Agreement. The length of vacation should not exceed
two (2) weeks without the approval of the Employer's Board of Directors. The
Employee shall take at least two (2) consecutive weeks of vacation each year
during the term of this Agreement. Vacation time will accrue in accordance with
the Employer's personnel policies.

                  (b)      Automobile Allowance and Insurance. The Employer
shall acquire or otherwise make available to the Employee for his business and
incidental personal use an automobile, suitable to his position, and (i)
maintain it in good condition and repair; and (ii) provide public liability
insurance and property damage insurance policies with insurer(s) acceptable to
the Employer and with coverages in such amounts as may be acceptable to the
Employer from time to time.

                  (c)      Insurance. The Employer shall provide during the term
of this Agreement at the Employer's sole cost, group life, health (including
medical, dental and hospitalization), accident and disability insurance coverage
for the Employee and his dependents through a policy or policies provided by
insurer(s) selected by the Employer in its sole discretion.

         14.      Annual Physical Examination. The Employer shall provide
insurance coverage for or pay or reimburse the Employee for the cost of an
annual physical examination conducted by a California licensed physician
selected by the Employee and reasonably acceptable to the Employer.

         15.      Business Expenses. The Employee shall be reimbursed for all
ordinary and necessary expenses incurred by the Employee in connection with his
employment. The Employee shall also be reimbursed for reasonable expenses
incurred in activities associated with promoting the business of the Employer,
including expenses for entertainment, travel, conventions, educational programs,
and similar items, and with the prior approval of the Employer's Executive
Committee, expenses for club memberships. The Employer will pay for or will
reimburse the Employee for such expenses upon presentation by the Employee from
time to time of receipts or other appropriate evidence of such expenditures.

         16.      Termination of Agreement.
                  ------------------------

                  (a)      Automatic Termination. This Agreement shall terminate
automatically without further act of the parties and immediately upon the
occurrence of any one of the following events, subject to either party's right,
without any obligation whatsoever, to waive an event reasonably susceptible of
waiver, and the obligation of the Employer to pay the amounts which would

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otherwise be payable to the Employee under this Agreement through the end of the
month in which the event occurs, except that only in the event of termination
based upon subparagraphs (1), (4) or (11, to the extent of Employer's breach)
below shall the Employee be entitled to receive severance payments and severance
benefits based upon automatic termination pursuant to paragraph 16 (d) of this
Agreement:

                           (1)      The occurrence of circumstances that make it
                                    impossible or impractical for the Employer
                                    to conduct or continue its business.

                           (2)      The death of the Employee.

                           (3)      The loss by the Employee of legal capacity.

                           (4)      The loss by the Employer of legal capacity
                                    to contract.

                           (5)      The willful, intentional and material breach
                                    of duty by the Employee in the course of his
                                    employment.

                           (6)      The habitual and continued neglect by the
                                    Employee of his employment duties and
                                    obligations under this Agreement.

                           (7)      The Employee's willful and intentional
                                    violation of any State of California or
                                    federal banking or securities laws, or of
                                    the Bylaws, rules, policies or resolutions
                                    of the Employer or its parent holding
                                    company and their respective subsidiaries,
                                    or the rules or regulations of the Board of
                                    Governors of the Federal Reserve System,
                                    California Department of Financial
                                    Institutions, or the Federal Deposit
                                    Insurance Corporation, or other regulatory
                                    agency or governmental authority having
                                    jurisdiction over the Employer or its
                                    subsidiaries.

                           (8)      The determination by a state or federal
                                    banking agency or governmental authority
                                    having jurisdiction over the Employer or its
                                    parent holding company that the Employee is
                                    not suitable to act in the capacity for
                                    which he is employed by the Employer.

                           (9)      The Employee is convicted of any felony or a
                                    crime involving moral turpitude or commits a
                                    fraudulent or dishonest act.

                           (10)     The Employee discloses without authority any
                                    secret or confidential information
                                    concerning the Employer or its subsidiaries
                                    or takes any action which the Employer's
                                    Board of Directors determines, in its sole
                                    discretion and subject to good faith, fair
                                    dealing and reasonableness, constitutes
                                    unfair competition with or induces any

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                                    customer to breach any contract with the
                                    Employer or its subsidiaries.

                           (11)     Either party materially breaches the terms
                                    or provisions of this Agreement.

                  (b)      Termination by Employer. The Employer may, at its
election and in its sole discretion, terminate this Agreement for any reason, or
for no reason, by giving not less than thirty (30) days' prior written notice of
termination to the Employee, without prejudice to any other remedy to which the
Employer may be entitled either at law, in equity or under this Agreement. Upon
such termination, unless otherwise agreed in writing between the Employer and
the Employee, the Employee shall immediately cease performing and discharging
the duties and responsibilities of his position and remove himself and his
personal belongings from the Employer's premises. All rights and obligations
accruing to the Employee under this Agreement shall cease at such termination,
except that such termination shall not prejudice the Employee's rights regarding
employment benefits which shall have accrued prior to such termination,
including the right to receive the severance pay specified in paragraph 16 (d)
below, and any other remedy which the Employee may have at law, in equity or
under this Agreement, which remedy accrued prior to such termination.

                  (c)      Termination by Employee. This Agreement may be
terminated by the Employee for any reason, or no reason, by giving not less than
thirty (30) days' prior written notice of termination to the Employer. Upon such
termination, all rights and obligations accruing to the Employee under this
Agreement shall cease, except that such termination shall not prejudice the
Employee's rights regarding employment benefits which shall have accrued prior
to such termination and any other remedy which the Employee may have at law, in
equity or under this Agreement, which remedy accrued prior to such termination.

                  (d)      Severance Pay - Termination by Employer. In the event
of termination by the Employer pursuant to paragraph 16 (b) or automatic
termination based upon paragraph 16 (a) (1), (4) or (11, to the extent of the
Employer's breach) of this Agreement, the Employee shall be entitled to receive
severance pay at the Employee's rate of base salary immediately preceding such
termination in an amount equal to six (6) months of the Employee's annual base
salary, less applicable withholding deductions (in addition to salary, incentive
compensation, or other payments, if any, due the Employee). Such severance pay
shall be paid to the Employee in lump sum within thirty (30) days following such
termination.

                  Notwithstanding the foregoing, in the event of a "change in
control" as defined in subparagraph (e) below, the Employee shall not be
entitled to the severance pay pursuant to this paragraph 16 (d) and any rights
of the Employee to severance pay shall be limited to such rights as are
specified in paragraph 16 (e) below.

                  The Employee acknowledges and agrees that severance pay
pursuant to this paragraph 16 (d) is in lieu of all damages, payments and
liabilities on account of the early termination of this Agreement and the sole

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and exclusive remedy for the Employee terminated at the will of the Employer
pursuant to paragraph 16 (b) or pursuant to certain provisions of paragraph 16
(a) described herein.

                  (e)      Severance Pay - Change in Control. In the event of a
"change in control" as defined herein during the active service of the Employee
with the Employer and within a period of two (2) years following consummation of
such a change in control (i) the Employee's employment is terminated; or (ii)
without the Employee's consent there occurs (A) any adverse change in the nature
and scope of the Employee's salary or benefits, or (B) any event which
reasonably constitutes a constructive termination (by resignation or otherwise)
of the Employee's employment, then the Employee shall be entitled to receive
severance pay at the Employee's rate of base salary immediately preceding such
termination in an amount equal to eighteen (18) months of the Employee's annual
base salary, less applicable withholding deductions (in addition to salary,
incentive compensation, or other payments, if any, due the Employee). Such
severance pay shall be paid to the Employee in lump sum within thirty (30) days
following such termination.

                  The Employee acknowledges and agrees that severance pay
pursuant to this paragraph 16 (e) is in lieu of all damages, payments and
liabilities on account of the events described above for which such severance
pay may be due the Employee under paragraph 16 (e) of this Agreement. This
paragraph 16 (e) shall be binding upon and inure to the benefit of the Employee
and the Employer, and any successors or assigns thereof or any "person" as
defined herein.

                  Notwithstanding the foregoing, the Employee shall not be
entitled to receive severance payments pursuant to this paragraph 16 (e) in the
event of an occurrence described in paragraph 16 (a), subparagraphs (5), (6),
(7), (8), (9), (10) or (11, to the extent of an Employee breach), or in the
event the Employee terminates employment in accordance with paragraph 16 (c) and
the termination is not a result of or based upon the occurrence of any event
described in paragraph 16 (e) (ii) above.

                  If all or any portion of the amounts payable to the Employee
under this Agreement, either alone or together with other payments which the
Employee has the right to receive hereunder, constitute "excess parachute
payments" within the meaning of Section 280G of the Internal Revenue Code of
1986, as amended (the "Code"), that are subject to the excise tax imposed by
Section 4999 of the Code (or similar tax and/or assessment), such amounts
payable hereunder shall be reduced to the extent necessary, after first applying
any similar reduction in payments to be received from any other plan or program
sponsored by the Employer from which the Employee has a right to receive
payments subject to Sections 280G and 4999 of the Code including, without
limitation, any Salary Continuation Agreement made between the Employer and the
Employee, so as to cause a reduction of any excise tax pursuant to Section 4999
of the Code to equal zero.

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                  A "change in control" for purposes of this Agreement and
paragraph 16 (e) shall mean the occurrence of any of the following events with
respect to the Employer: (i) a change in control of a nature that would be
required to be reported in response to Item 6(e) of Schedule 14A of Regulation
14A promulgated under the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), or in response to any other form or report to the regulatory
agencies or governmental authorities having jurisdiction over the Employer or
its subsidiaries, or any stock exchange on which the shares of the Employer's
parent holding company are listed which requires the reporting of a change in
control; (ii) any merger, consolidation or reorganization of the Employer or any
bank subsidiary in which the Employer or any bank subsidiary does not survive;
(iii) any sale, lease, exchange, mortgage, pledge, transfer or other disposition
(in one transaction or a series of transactions) of any assets of the Employer
having an aggregate fair market value of fifty percent (50%) of the total value
of the assets of the Employer, reflected in the most recent balance sheet of the
Employer; (iv) a transaction whereby any "person" (as such term is used in the
Exchange Act) or any individual, corporation, partnership, trust or any other
entity is or becomes the beneficial owner, directly or indirectly, of securities
of the Employer representing twenty-five percent (25%) or more of the combined
voting power of the Employer's then outstanding securities; (v) a situation
where, in any one-year period, individuals who at the beginning of such period
constitute the Board of Directors of the Employer cease for any reason to
constitute at least a majority thereof, except in the cases of retirement,
disability or death and unless the election, or the nomination for election by
the Employer's shareholder(s), of each new director is approved by a vote of at
least three-quarters (3/4) of the directors then still in office who were
directors at the beginning of the period; or (vi) the shareholder(s) of the
Employer approve the sale or transfer of substantially all of the Employer's
assets to parties that are not within a "controlled group of corporations" (as
that term is defined in section 1563 of the Code) in which the Employer is a
member. Notwithstanding the foregoing or anything else contained herein to the
contrary, there shall not be a change in control for purposes of this Agreement
if the event which would otherwise come within the meaning of the term "change
in control" involves (i) an Employee Stock Ownership Plan sponsored by the
Employer which Plan is the party that acquires "control" or is the principal
participant in the transaction constituting a "change in control," as described
above, or (ii) a reorganization in which any bank subsidiary of the Employer is
merged with and into another bank subsidiary of the Employer to consolidate
operations under the charter of such other bank subsidiary, or (iii) if the
individuals who constitute the directors of the Employer at the time a specific
transaction described in subparagraphs (ii) or (vi) above is first presented to
the Board of Directors of the Employer will, according to the terms of the
definitive agreements for the transaction, constitute a majority of the members
of the board of directors of the resulting corporation or acquiring person
immediately after the transaction, then, before an event that would otherwise
constitute a change in control shall be deemed to have occurred, such Board of
Directors of the Employer may determine by majority vote that the specific
transaction does not constitute a change in control under such subparagraphs
(ii) or (vi) above.

         17.      Notices. Any notices to be given hereunder shall be in writing
and may be transmitted by personal delivery or by U.S. mail, registered or
certified, postage prepaid with return receipt requested. Mailed notices shall
be addressed to the Employee at the address listed in the Employee's personnel

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file and to the Employer at its principal business office. A party may change
the address for receipt of notices by written notice in accordance with this
paragraph 17. Notices delivered personally shall be deemed communicated as of
the date of actual receipt; mailed notices shall be deemed communicated as of
three (3) days after the date of mailing.

         18.      Arbitration. All claims, disputes and other matters in
question arising out of or relating to this Agreement or the breach or
interpretation thereof, other than those matters which are to be determined by
the Employer in its sole and absolute discretion, shall be resolved by binding
arbitration before a representative member, selected by the mutual agreement of
the parties, of the Judicial Arbitration and Mediation Services, Inc. ("JAMS"),
in accordance with the rules and procedures of JAMS then in effect. In the event
JAMS is unable or unwilling to conduct such arbitration, or has discontinued its
business, the parties agree that a representative member, selected by the mutual
agreement of the parties, of the American Arbitration Association ("AAA"), shall
conduct such binding arbitration in accordance with the rules and procedures of
the AAA then in effect. Notice of the demand for arbitration shall be filed in
writing with the other party to this Agreement and with JAMS (or AAA, if
necessary). In no event shall the demand for arbitration be made after the date
when institution of legal or equitable proceedings based on such claim, dispute
or other matter in question would be barred by the applicable statute of
limitations. Any award rendered by JAMS or AAA shall be final and binding upon
the parties, and as applicable, their respective heirs, beneficiaries, legal
representatives, agents, successors and assigns, and may be entered in any court
having jurisdiction thereof. The obligation of the parties to arbitrate pursuant
to this clause shall be specifically enforceable in accordance with, and shall
be conducted consistently with, the provisions of Title 9 of Part 3 of the
California Code of Civil Procedure. Any arbitration hereunder shall be conducted
in Sacramento, California, unless otherwise agreed to by the parties.

         19.      Attorneys' Fees and Costs. In the event of litigation,
arbitration or any other action or proceeding between the parties to interpret
or enforce this Agreement or any part thereof or otherwise arising out of or
relating to this Agreement, the prevailing party shall be entitled to recover
its costs related to any such action or proceeding and its reasonable fees of
attorneys, accountants and expert witnesses incurred by such party in connection
with any such action or proceeding. The prevailing party shall be deemed to be
the party which obtains substantially the relief sought by final resolution,
compromise or settlement, or as may otherwise be determined by order of a court
of competent jurisdiction in the event of litigation, an award or decision of
one or more arbitrators in the event of arbitration, or a decision of a
comparable official in the event of any other action or proceeding. Every
obligation to indemnify under this Agreement includes the obligation to pay
reasonable fees of attorneys, accountants and expert witnesses incurred by the
indemnified party in connection with matters subject to indemnification.

         20.      Entire Agreement. This Agreement supersedes any and all other
agreements, either oral or in writing, between the parties with respect to the
employment of the Employee by the Employer and contains all of the covenants and
agreements between the parties with respect to the employment of the Employee by

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the Employer. Each party to this Agreement acknowledges that no other
representations, inducements, promises, or agreements, oral or otherwise, have
been made by any party, or anyone acting on behalf of any party, which are not
set forth herein, and that no other agreement, statement, or promise not
contained in this Agreement shall be valid or binding on either party.

         21.      Modifications. Any modification of this Agreement will be
effective only if it is in writing and signed by a party or its authorized
representative.

         22.      Waiver. The failure of either party to insist on strict
compliance with any of the terms, provisions, covenants, or conditions of this
Agreement by the other party shall not be deemed a waiver of any term,
provision, covenant, or condition, individually or in the aggregate, unless such
waiver is in writing, nor shall any waiver or relinquishment of any right or
power at any one time or times be deemed a waiver or relinquishment of that
right or power for all or any other times.

         23.      Partial Invalidity. If any provision in this Agreement is held
by a court of competent jurisdiction to be invalid, void, or unenforceable, the
remaining provisions shall nevertheless continue in full force and effect
without being impaired or invalidated in any way.

         24.      Interpretation. This Agreement shall be construed without
regard to the party responsible for the preparation of the Agreement and shall
be deemed to have been prepared jointly by the parties. Any ambiguity or
uncertainty existing in this Agreement shall not be interpreted against either
party, but according to the application of other rules of contract
interpretation, if an ambiguity or uncertainty exists.

         25.      Governing Law and Venue. The laws of the State of California,
other than those laws denominated choice of law rules, shall govern the
validity, construction and effect of this Agreement. Any action which in any way
involves the rights, duties and obligations of the parties hereunder shall be
brought in the courts of the State of California and venue for any action or
proceeding shall be in Sacramento County or in the United States District Court
for the Eastern District of California, and the parties hereby submit to the
personal jurisdiction of said courts.

         26.      Payments Due Deceased Employee. If the Employee dies prior to
the expiration of the term of his employment, any payments that may be due the
Employee from the Employer under this Agreement as of the date of death shall be
paid to the Employee's heirs, beneficiaries, successors, permitted assigns or
transferees, executors, administrators, trustees, or any other legal or personal
representatives.

         27.      Assignment/Binding Effect. Except as specifically set forth in
this Agreement, the Employee may not assign, delegate or otherwise transfer any
of the Employee's rights, benefits, duties or obligations under this Agreement
without the prior written consent of the Employer. This Agreement shall inure to
the benefit of and be binding upon the Employer and its successors and assigns,

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<PAGE>

and the Employee and the Employee's heirs, beneficiaries, successors, permitted
assigns or transferees, executors, administrators, trustees, and any other legal
or personal representatives.

         28.      Effect of Termination on Certain Provisions. Upon the
termination of this Agreement, the obligations of the Employer and the Employee
hereunder shall cease except to the extent of the Employer's obligation to make
payments, if any, to or for the benefit of the Employee following termination,
and provided that paragraphs 1 (to the extent of waivers and releases therein),
5, 6, 7, 17, 18, 19, 20, 23, 24, 25, 26, and 27 shall remain in full force and
effect.

         29.      Advice of Counsel and Advisors. The Employee acknowledges and
agrees that he has read and understands the terms and provisions of this
Agreement and prior to signing this Agreement, he has read and had the advice of
counsel and/or such other advisors as he deemed appropriate in connection with
his review and analysis of such terms and provisions of this Agreement.

         IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written in the City of Sacramento, County of Sacramento, State
of California.


EMPLOYER:                              EMPLOYEE:

AMERICAN RIVER HOLDINGS


By: /s/ CHARLES D. FITE                /s/ DAVID T. TABER
    --------------------------------   -----------------------------------------
    Charles D. Fite                    David T. Taber
    Chairman of the Board


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                                    EXHIBIT A

                           INCENTIVE COMPENSATION PLAN




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</TEXT>
</DOCUMENT>
