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                              CONSULTING AGREEMENT


         This Consulting Agreement (the "Agreement") is entered into this 22nd
day of July, 1999, by and between Coast Bancorp, a California corporation and
Coast Commercial Bank, a California banking corporation on the one hand
(collectively the "Company"), their successors or assigns and HARVEY J.
NICKELSON ("Consultant") on the other hand.

                                    RECITALS

                  A. Consultant represents that he possesses expertise and
knowledge in the area of commercial banking and contact in banking in Santa Cruz
County, California.
                  B. The Company desires to retain Consultant in a consulting
capacity to avail themselves of his skills and knowledge of banking in Santa
Cruz County.
                  C. Consultant desires to be affiliated with the Company in
such a consulting capacity, subject to the terms and conditions of this
Agreement.
         NOW, THEREFORE, in consideration of the above recitals and of the
mutual provision and conditions contained in this Agreement, it is agreed as
follows:
                  1. SCOPE OF SERVICES. During the term of this Agreement as
provided in Section 2, Consultant shall make himself available upon receipt of
seventy-two (72) hours written notice, to market the services of the Company;
for general consultation concerning the business activities of the Company' and
to cooperate fully with and assist the Company in connection with any litigation
or alternative dispute resolution involving the Company ("Consulting Services").
                  2. TERM. The term of this Agreement shall commence upon the
later of consultant's sixtieth birthday or the termination of his position as
president and Chief Executive


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Officer of the Company and shall terminate upon his attaining age sixty-three
(63).

                  3. INDEPENDENT CONTRACTOR RELATIONSHIP. In all Consulting
Services rendered to the Company during the term of this Agreement, Consultant
understands and agrees that Consultant is acting as an independent contractor,
not as an employee. Consultant is not authorized to incur any obligation of any
description on behalf of the Company. Consultant will not be entitled to any
benefits afforded by the Company. Consultant is not required to adhere to any
formal schedule or work hours or duties. Consultant will maintain his own office
or home office, and will pay for his own equipment, materials, supplies and
other overhead expenses. The Company will not supervise the services Consultant
renders to it, will not give detailed instructions to him in connection with his
services as an independent contractor, and will not otherwise exercise control
nor retain the right to control the means and manner by which Consultant
accomplishes the Consulting Services which Consultant undertakes for the
Company. Consultant alone will be responsible for the timely and satisfactory
completion of his duties.
                  4. WARRANTIES, REPRESENTATIONS AND CONVENANTS. Consultant
acknowledges and warrants that Consultant is engaged in an independent business
and has complied, and in the future will comply, with any and all federal, state
and local laws regarding the Consulting Services to be performed for the
Company. The Company further acknowledges that Consultant is engaged, or can
engage, in other activities for other clients and that the Company is not, and
need not be, his sole client.
                  5. COMPENSATION. In consideration of the Consulting Services
provided by consultant to the Company, Consultant will be paid at the rate of
$125,000 per year, payable in equal monthly installments. Consultant will
invoice the Company on the effective date of this Agreement, and thereafter on
the 1st (first) of each month, for the duration of this Agreement.


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Payments by the Company to Consultant will be made within five (5) business days
of receipt of the invoice.

                  6. EXPENSES. Consultant will be reimbursed for expenses
incurred directly on behalf of the Company upon presentation of appropriate
documentation.
                  7. CONFIDENTIALITY. By virtue of Consultant's engagement with
the Company as an independent contractor, Consultant will be entrusted with
confidential and proprietary information pertaining to the Company's business.
Except as required and expressly authorized by the Company or as required by
law, during his engagement, Consultant agrees that Consultant will not, at any
time during his engagement or thereafter, use for his own benefit, or disclose
to others, any confidential business or financial affairs or proprietary
information of the Company.
                  8. TERMINATION. The Agreement may be terminated for "cause" by
the Company or upon the Consultant's death. For this purpose, "cause" shall mean
any act of personal dishonesty or willful misconduct in connection with the
Company, embezzlement, fraud, intentional failure to comply with the Company's
policies, willful violation of any banking law, rule or regulation, or material
breach of any provision of this Agreement.
                  9. RELATIONSHIP OF PARTIES. Consultant understands and
acknowledges that no workers' compensation insurance or disability insurance has
been or will be obtained on his behalf, by the Company. Consultant also
understands and acknowledges that no deductions or withholding will be made from
the payments the Company makes to him for his Consulting Services for any
employment-related taxes or contributions of any kind, including payroll and
employment taxes and contributions (e.g., FICA, FUTA, SSI, SUI/SDI, of federal
or state income taxes). Consultant understands that Consultant will be
responsible to report all amounts Consultant receives from the Company as
ordinary self-employment income on his applicable


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tax return(s). Consultant understands that Consultant remains solely responsible
for any workers' compensation and disability insurance and taxes, and Consultant
agrees to indemnify, defend and holds the Company harmless from any liability
for workers' compensation or disability claims, taxes, contributions, penalties
or interest that may arise from his failure to comply with his self-employment
obligations.

                  10. INDEMNIFICATION. Consultant expressly agrees to indemnify,
defend and hold harmless the Company from and against any and all loss,
liability, expense, claims, costs, suit and damages, including attorneys' fees,
arising out of the performance of Consulting Services under this Agreement.

                  11. APPLICABLE LAW. This Agreement shall be governed by the
laws of the State of California.

                  12. ENTIRE AGREEMENT. This Agreement constitutes the entire
agreement of the Company and the undersigned Consultant and supersedes, cancels
and annuls any and all previous contracts, agreements, arrangements or
understandings, whether oral, written or implied, between the parties hereto
with respect to the matters covered by this Agreement. This Agreement may be
modified only in writing signed by the Company and the undersigned Consultant.


                  13.(a) Attorneys' Fees. If any legal action or other
proceeding is brought for the enforcement of this Agreement, or because of an
alleged dispute, breach, default, or misrepresentation in connection with any of
the provisions of this Agreement, the successful or prevailing party or parties
shall be entitled to recover reasonable attorneys' fees and other costs incurred
in that action or proceeding, in addition to any other relief to which it or
they may be entitled.


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                  13.(b) WAIVER OF JURY TRIAL. THE COMPANY AND EXECUTIVE EACH
HEREBY MUTUALLY, KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE THE RIGHT EACH
MAY HAVE TO A TRIAL BY JURY IN RESPECT TO ANY LITIGATION BASED HEREON OR ARISING
OUT OF OR UNDER IN CONNECTION WITH THIS AGREEMENT OR ANY AGREEMENT CONTEMPLATED
TO BE EXECUTED IN CONJUNCTION HEREWITH, OR ANY COURSE OR CONDUCT, COURSE OF
DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTION OF ANY PARTY. THIS
PROVISION IS A MATERIAL INDUCEMENT FOR THE PARTIES ENTERING INTO THIS AGREEMENT.

                  14. ENFORCEMENT. If any provision of this Agreement is held
invalid or unenforceable, the remainder of this Agreement shall nevertheless
remain in full force and effect. If any provision is held invalid or
unenforceable with respect to particular circumstances, it shall nevertheless
remain in full force and effect in all of these circumstances. Consultant
acknowledges that he has read and understands this Agreement and signs it
voluntarily.

COAST BANCORP                             CONSULTANT

By:_/S/ JAMES C. THOMPSON
        -----------------
Its:  CHAIRMAN                            /S/ HARVEY J. NICKELSON
      --------                                -------------------

COAST COMMERCIAL BANK

By:


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Its:


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