# **Exhibit10.86**

 

**SEVERANCE AGREEMENT**

 

This SeveranceAgreement (“Agreement”), which is entered into by and between Western SierraBancorp (Hereinafter “Bancorp”), and Kirk Dowdell (hereinafter “Executive”) ismade with reference to the following facts:

** **

**RECITAL**

 

**WHEREAS,**Bancorp desires toprovide Executive with severance compensation and Executive desires severancecompensation, in the event there is a change in control of Bancorp.

 

**NOW, THEREFORE,**in considerationof the representations, warranties and covenants set forth herein, the parties,intending to be bound thereby, hereby agree as follows:

 

**ARTICLE 1.**

**SEVERANCE**

 

**1.1          Severance Payment.**  In the event of (i) any mergeror consolidation where Bancorp is (A) not the surviving or resultingcorporation or (B) the shareholders of Bancorp at the time immediately prior tosuch merger will own less than fifty percent (50%) on a direct or indirectbasis of the voting equity interests of the surviving corporation after suchmerger, (ii) the transfer of all or substantially all of the assets of Bancorp,or (iii) a sale of the equity securities of Bancorp representing more thanfifty percent (50%) of the aggregate voting power of all outstanding equitysecurities of Bancorp to any person or entity, or any group of persons and/orentities acting in concert (any of these events shall be referred to as an“Acquisition”), this Agreement shall continue in full force and effect.  In the event that an Acquisition occurs andthat Executive: (i) is not retained by the resulting corporation for a periodof eighteen (18) months in a position comparable to that of the highest levelexecutive vice-president of the resulting corporation or position accepted byExecutive, or (ii) the resulting corporation reduces Executive’s base salaryfrom Executive’s base salary at the time immediately prior to the Acquisitionat any time during the eighteen (18) month period following the consummation ofthe Acquisition, then Bancorp shall pay to Executive a sum equal to his monthlybase salary, measured by the month immediately preceding the consummation ofthe Acquisition, multiplied by the lesser eighteen (18) or the number of fullor partial calendar months remaining between the consummation of theAcquisition and the Executive’s sixty-fifth (65th) birthday, whichshall be paid to Executive in a lump sum, which sall be payable within ten (10)days of termination of Executives employment with the resulting corporation.

 

Theelection provided for herein shall be in writing, and shall be delivered toBancorp’s principal executive office. The payment provided for herein shall be considered to be in full andcomplete satisfaction of any and all rights which Executive may enjoy otherthan (i) rights under the Executive’s Salary Continuation Agreement, and (ii)rights, if any, to exercise any stock options which vested prior to suchtermination.

 

**1.2          Dissolution ofBancorp. **This Agreementshall not be terminated by the voluntary or involuntary dissolution ofBancorp.  Notwithstanding the foregoing,in the event proceedings for liquidation of Bancorp are commenced by regulatoryauthorities, this Agreement and all rights and benefits hereunder shallterminate.

 

**1.3          Term of Agreement****.******This Agreementshall continue until 12/31/08 (hereinafter “Termination Date”).  The Termination Date may be amended orextended by written agreement of the parties. This Agreement shall apply to any Acquisition that is consummated priorto the Termination Date provided that Executive is employed by Bancorp at thedate of public announcement of the Acquisition.

 

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**ARTICLE 2.**

**GENERALPROVISIONS**

 

**2.1.         Headings. **The subjectheadings of the paragraphs and subparagraphs of this Agreement are included forpurposes of convenience only, and shall not affect the construction or interpretationof any of its provisions.

 

**2.2          Entire Agreement.** This Agreement constitutes the entireagreement between the parties pertaining to the subject matter contained in itand supersedes all prior and contemporaneous agreements, representations, and understandingsof the parties.  No supplement,modification, or amendment of this Agreement shall be binding unless executed in writing by all of the parties.  No waiver of any of the provisions of thisAgreement shall be deemed, or shall constitute, a waiver of any otherprovision, whether or not similar, nor shall any waiver constitute a continuingwaiver.  No waiver shall be bindingunless executed in writing by the party making the waiver.

 

**2.3          Parties inInterest.**              Nothingin this Agreement, whether express or implied, is intended to confer any rightsor remedies under or by reason of this Agreement on any person other than theparties to it and their respective successors and assigns, nor is anything inthis Agreement intended to relieve or discharge the obligation or liability ofany third persons to any party to this Agreement, nor shall any provision giveany third persons any right of subrogation or action over or against any partyto this Agreement.

 

**2.4          Successors andAssigns.**  This Agreement shall be binding on, and shall inureto the benefit of, the parties to it, and their respective heirs, legalrepresentatives, successors, and assigns.

 

**2.5          Counterparts.**      This Agreement may be executed in anynumber of counterparts and each such counterpart shall be deemed to be anoriginal instrument.

 

**2.6          Attorneys’ Feesand Costs.**               Ifany party to this Agreement shall take any action to enforce this Agreement orbring any action or commence any arbitration for any relief against any otherparty, declaratory or otherwise, arising out of this Agreement, the losingparty shall pay to the prevailing party a reasonable sum for attorneys’ feesincurred in bringing such suit or arbitrations and/or enforcing any judgmentgranted therein, all of which shall be deemed to have accrued upon thecommencement of such action or arbitration and shall be paid whether or notsuch action or arbitration is prosecuted to judgment.  Any judgment or order entered in such action or arbitration shallcontain a specific provision providing for the recovery of attorneys’ fees andcosts incurred in enforcing such judgment. For purposes of this section, attorneys’ fees shall include, withoutlimitation, fees incurred in the following:  (a)post-judgment motions and collection actions; (b) contempt proceedings; (c)garnishment, levy and debtor and third party examinations; (d) discovery; and(e) bankruptcy litigation.

 

**2.7          Jurisdiction andVenue.**                    Anysuit involving any dispute or matter arising under this Agreement may only bebrought in the appropriate United States District Court in California or anyCalifornia State Court having jurisdiction over the subject matter of thedispute or matter.  All parties herebyconsent to the exercise of personal jurisdiction by any such court with respectto any such proceeding.

 

**2.8          Governing Law.**   This Agreement shall be construed inaccordance with, and governed by, the laws of the State of California, theUnited States of America.

 

**IN WITNESS WHEREOF,**the parties heretohave executed this Agreement on the day and year set forth below.

 
|   | **WESTERN SIERRA BANCORP** |
|--------|----------------------------|
|   |                       |
| By:    | / s/ Kirk Dowdell          |   |   | By: | / s/ Gary D. Gall |   |
|   | Executive                  |   |   |   | Gary D. Gall, President/CEO |
|   |                       |   |
|   |                       |   |   |
| Dated: | January  16, 2004          |   |   | Dated: |    January 16, 2004 |   |
|        |                            |  |  |  |  |  |  |  |  |

 

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