EXECUTIVE SALARY CONTINUATION AGREEMENT


        This  Agreement is made and entered into this 1st day of January,  1994,
by  and  between   Humboldt  Bank,  a  California   state-chartered   bank  (the
"Employer"), and Alan J. Smyth (the "Executive").

                                           RECITALS

        WHEREAS, the  Executive  is an  employee of  the Employer serving as its
Senior Vice President and Cashier; and

        WHEREAS, the Executive's  experience and knowledge of the affairs of the
Employer and the banking  industry  are so  valuable,  it is deemed to be in the
best interests of the Employer to arrange salary  continuation  benefits for the
Executive so as to reasonably  induce the Executive to remain in the  Employer's
employment  during  the  Executive's  lifetime  or until the age of  retirement,
unless the  employment  relationship  is  terminated  earlier as provided in the
Agreement; and

        WHEREAS, it is the desire of the Employer that the Executive's  services
be retained as hereinafter provided; and

        NOW, THEREFORE,  in consideration of the services to be performed in the
future,  as well as the mutual  promises and  covenants  contained  herein,  the
Executive and the Employer agree as follows:

                                    AGREEMENT

                                    ARTICLE I

        1.1 Beneficiary. The term "Beneficiary" shall mean the person or persons
whom the Executive shall designate in a valid Beneficiary  Designation Notice to
receive the benefits provided hereunder. A Beneficiary  Designation Notice shall
be valid only if it is in the form attached hereto and made a part hereof and is
received by the Administrator prior to the Executive's death.

        1.2 Change In Control.  The term "Change in Control" shall mean a change
in control of a nature that would be required to be reported in response to Item
6(e) of Schedule l4A 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 Employer or any stock exchange on which Employer's shares are
listed  which  requires  the  reporting  of a change in control;  or any merger,
consolidation or  reorganization of Employer in which Employer does not survive;
or any sale, lease, exchange,  mortgage,  pledge,  transfer or other disposition
(in one  transaction  or a series of  transactions)  of any  assets of  Employer
having an aggregate  fair market value of fifty percent (50%) of the total value
of the  assets  of  Employer,  reflected  in the most  recent  balance  sheet of
Employer;  or 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  Employer
representing  25% or  more of the  combined  voting  power  of  Employer's  then
outstanding  securities;  or in  any  one-year  period,  individuals  who at the
beginning of such period constitute the Board of Directors of Employer cease for
any reason to constitute at least a majority  thereof,  unless the election,  or
the nomination for election by Employer's shareholders,  of each new director is
approved by a vote of at least  three-quarters  of the  directors  then still in
office who were directors at the  beginning  of the period; or a majority of the

<PAGE>


members of the Board of Directors  of Employer in office prior to the  happening
of any event  determines in its sole  discretion  that as a result of such event
there has been a change in control.

        1.3 Disability.  The term "Disability" shall have the same meaning given
such term in the Employer's  Group Long Term Disability  Benefits portion of the
Group  Insurance  Plan  dated  May 1,  1989,  which is  incorporated  herein  by
reference to the limited extent thereof.

        1.4  Administrator.   The  Administrator  and  sole  fiduciary  of  this
Agreement shall be the Employer.

        1.5    Plan Year.  The term "Plan Year" shall mean the Employer's fiscal
year.

        1.6 Surviving Spouse. The term "Surviving Spouse" shall mean the person,
if any,  who  shall  be  legally  married  to the  Executive  on the date of the
Executive's death.

        1.7 Termination for Cause.  The term  "Termination for Cause" shall mean
termination  of  the  employment  of  the  Executive  by  reason  of  any of the
following:

               (a)    The  willful  breach  of duty by Employee in the course of
                      his employment.

               (b)    The habitual neglect by Employee of his employment duties.

               (c)    The substantial  failure of Employee to perform the duties
                      of his  positions  as  determined  solely  by the Board of
                      Directors of Employer, subject to good faith, fair dealing
                      and  reasonableness  by  Employer  and not as a result  of
                      arbitrary and capricious acts by Employer.

               (d)    Employee's deliberate violation of any State of California
                      or federal banking laws, or of the Bylaws, rules, policies
                      or resolutions of the California  Superintendent  of State
                      Banks or Federal  Deposit  Insurance  Corporation or other
                      regulatory   agency  or  governmental   authority   having
                      jurisdiction over Employer.

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

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

               (g)    Employee   discloses   without  authority  any  secret  or
                      confidential  information not otherwise publicly available
                      concerning  Employer or takes any action which  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
                      customer to breach any contract with Employer.

<PAGE>

                                    ARTICLE 2

        2.1  Employment.  The  Employer  agrees to employ the  Executive in such
capacity as the Employer may from time to time  determine.  The  Executive  will
continue in the employ of the Employer in such capacity and with such duties and
compensation as may be determined from time to time by the Board of Directors of
the Employer.

        2.2 Full  Efforts.  The  Executive  agrees to  devote  his full time and
attention exclusively to the business and affairs of the Employer, except during
vacation  periods,  and to use  his  best  efforts  to  furnish  faithfully  and
satisfactorily services to the Employer.

                                    ARTICLE 3

        3.1  Retirement.  If the Executive  shall  continue in the employ of the
Employer  at least until  attaining  the age of seventy  (70)  years,  seven (7)
months,  the Executive may retire from active daily  employment as of January 1,
2004,  or upon such later date as may be mutually  agreed upon by the  Executive
and the  Employer.  In any event,  however,  the  Executive may continue to work
after the age of seventy (70) years, seven (7) months.

        3.2 Payment.  The Employer  agrees that upon such retirement it will pay
to the Executive the annual sum of Forty Thousand Dollars ($40,000.00),  payable
monthly on the first day of each month following such retirement for a period of
One Hundred  Twenty (120)  months,  subject to the  conditions  and  limitations
hereafter set forth.

        3.3 Death After  Retirement.  The Employer  agrees that if the Executive
shall so  retire,  but shall die  before  receiving  the full  amount of monthly
payments  to which he is  entitled  hereunder,  it will  continue  to make  such
monthly  payments to the  Executive's  designated  beneficiary for the remaining
period.  If a valid Beneficiary  Designation is not in effect,  then the payment
shall be made to the  Executive's  Surviving  Spouse,  or if none,  said payment
shall  be  made to the  duly  qualified  personal  representative,  executor  or
administrator of the Executive's estate.

                                    ARTICLE 4

        4.1 Death Prior to  Retirement.  In the event the  Executive  should die
while  actively  employed  by the  Employer  at any time  after the date of this
Agreement,  but prior to January 1, 2001,  or if the  Executive  chooses to work
after  the age of  seventy  (70)  years,  seven  (7)  months,  but  dies  before
retirement,  the  Employer  will pay the  annual sum of Forty  Thousand  Dollars
($40,000.00) per year to the Executive's designated beneficiary in equal monthly
installments  for a  period  of One  Hundred  Twenty  (120)  months.  If a valid
Beneficiary  Designation  is not in effect,  the  payments  shall be made to the
Executive's  Surviving  Spouse at the time of death,  or if none,  said payments
shall  be  made  to  a  duly  qualified  personal  representative,  executor  or
administrator of the Executive's  estate.  The said monthly payments shall begin
the first day of the month  following  the month of the death of the  Executive,
provided, however, that anything hereinabove to the contrary notwithstanding, no
death  benefits  shall  be  payable  hereunder  if it  is  determined  that  the
Executive's death was caused by suicide on or before December 31, 2003.

        4.2 Disability Prior to Retirement.  In the event the Executive  becomes
disabled while  actively  employed by the Employer at any time after the date of
this  Agreement,  but prior to January 1, 1993, or if the  Executive  chooses to

<PAGE>


work after the age of seventy (70) years, seven (7) months, but becomes disabled
prior to retirement,  the Executive will be considered to be one hundred percent
(100%)  vested  in the  amount  set  forth  for the year in which  the  onset of
disability  occurs as set forth in  Schedule A  attached  hereto and made a part
hereof. Said amount at the election of the Executive will paid to Executive in a
lump sum within three (3) months of the  determination  of disability or be paid
in equal  monthly  installments  over a period not to exceed One Hundred  Twenty
(120) months or such shorter  period as is mutually  agreed upon by the Employer
and the Executive. If the Executive elects to receive monthly payments, interest
will be credited  monthly on the unpaid  portion of the  accrued  benefit at the
rate of prime plus one percent (1%). In the event the Executive  dies within two
(2) years as a result of the  injuries  or  illness  that  caused  the  original
disability,  the full benefit  amount,  as set forth in Schedule A year ten (10)
attached  hereto  and  made a part  hereof,  will  be  paid  to the  Executive's
designated beneficiary as outlined in this Agreement.

                                    ARTICLE 5

        5.1  Termination  of  Employment.  The  Employer  reserves  the right to
terminate  employment of the Executive at any time prior to  retirement.  In the
event that the  employment  of the Executive  shall be  terminated  prior to the
Executive's  attaining the age of seventy (70) years,  seven (7) months,  or the
date of  termination,  other than by reason of  disability  or death,  then this
Agreement  shall  terminate  upon the date of such  termination  of  employment;
provided,  however,  that the  Executive  shall  be  entitled  to the  following
benefits under the following circumstances.

               (a)    Termination Without Cause.   If the Executive's employment
                      is terminated by the Employer without cause, the Executive
                      will be considered to be one hundred percent (100%) vested
                      as set forth in Schedule A, year ten (10), attached hereto
                      and  made a part hereof.  If the Executive's employment is
                      terminated  under the provisions of this Paragraph 5.1(a),
                      the Employer  will  pay the Executive's vested amount upon
                      such terms and conditions  and  commencing at such time as
                      the Employer shall determine, but  in  no event commencing
                      later than age seventy (70)  years, seven  (7) months.  In
                      consideration for this  payment, the Executive shall fully
                      release  Humboldt   Bank,   its  officers,  directors  and
                      employees from any  claim for breach of contract regarding
                      his Contract of  Employment or wrongful termination of his
                      employment.

               (b)    Voluntary Termination by Executive.  In the event that the
                      Executive  voluntarily  terminates his employment prior to
                      his  attaining  the age of seventy  (70) years,  seven (7)
                      months,  the Executive will forfeit any benefits from this
                      Plan.

               (c)    Termination  for Cause. If the Executive is terminated for
                      cause as defined in Paragraph 1.7 of this Agreement,  then
                      the Executive  shall be entitled to no benefits under this
                      Agreement  and no  amount  shall be paid to the  Executive
                      under this Agreement.

               (d)    Contract   Disputes.   In  the  event  of  termination  of
                      employment due to the failure of Employer and Executive to
                      renew or extend any expired  contract of  employment,  the
                      Executive will forfeit any benefits from this Plan.

<PAGE>

               (e)    Termination  Upon Change in Control.  Anything hereinabove
                      to the  contrary  notwithstanding, if the Executive is not
                      fully vested in the  amount  set forth in Schedule A, year
                      ten (10), he will become  fully  vested  in said amount in
                      the event of a change in control as  defined  in Paragraph
                      1.2 of this Agreement, and shall  be  entitled to the full
                      amount set forth in  Schedule  A,  year ten (10), upon the
                      terms and conditions  hereof, if termination of employment
                      thereafter occurs for  any  reason other than as set forth
                      in  Paragraph  5.1(c),  under  this  Paragraph 5.1(e) as a
                      result  of  such  change  in  control.  The amount payable
                      pursuant to this provision shall be  reduced by the amount
                      paid  to  Executive  under  provisions  of  his Employment
                      Agreement  covering  loss  of  employment as a result of a
                      change  in  Bank  ownership.  The full amount specified in
                      Schedule  A  is referred to in this subparagraph 5.1(e) as
                      the "Severance Payment."

                      In the event that any payment or benefit received or to be
                      received by the Executive in connection with the change in
                      control  of  the  Employer  or  the   termination  of  the
                      Executive's  employment  whether  payable  pursuant to the
                      terms of this Agreement or any other plan,  arrangement or
                      agreement with the Employer,  (together with the Severance
                      Payment the "Total  Payments")  will not be deductible (in
                      whole  or in  part) as a  result  of  Section  280G of the
                      Internal  Revenue Code of 1954,  as amended (the  "Code"),
                      the Severance Payment shall be reduced until no portion of
                      the Total Payments is nondeductible as a result of Section
                      280G of the Code, or the  Severance  Payment is reduced to
                      zero (0). For purposes of this limitation:

                      (1)    No portion of the Total  Payments,  the  receipt or
                             enjoyment  of  which  the   Executive   shall  have
                             effectively  waived in writing prior to the date of
                             payment of the  Severance  Payment,  shall be taken
                             into account;

                      (2)    No  portion  of the Total  Payments  shall be taken
                             into  account,  which  in the  opinion  of the  tax
                             counsel  selected  by  the  Employer's  independent
                             auditors and acceptable to the Executive,  does not
                             constitute a "parachute payment" within the meaning
                             of Section 280G of the Code;

                      (3)    The Severance  Payment shall be reduced only to the
                             extent  necessary so that the Total Payments (other
                             than those  referred to in clause (1) or clause (2)
                             in   their    entirety)    constitute    reasonable
                             compensation for services actually rendered within.
                             the  meaning  of Section  280G of the Code,  in the
                             opinion of tax  counsel  referred to in clause (2);
                             and

                      (4)    The value of any  non-cash  benefit or any deferred
                             payment or benefit  included  in the total  payment
                             shall be determined by the  Employer's  Independent
                             auditors  in  accordance  with  the  principles  of
                             Section 280G of the Code.

<PAGE>

                                    ARTICLE 6

        6.1  Termination  of Agreement by Reason of Changes in Law.  Employer is
entering into this Agreement upon the assumption that certain  existing tax laws
will continue in effect in substantially their current form. In the event of any
changes in such federal laws, the Employer shall have the option to terminate or
modify this Agreement,  provided,  however, that the Executive shall be entitled
to at least the same amount as he would have been  entitled  to under  Paragraph
4.2 of this Agreement  relating to disability.  The payment of said amount shall
be made upon such terms and  conditions  and at such time as the Employer  shall
determine,  but in no event commencing later than the age of seventy (70) years,
seven (1) months, or the date of termination of the Executive's  employment with
Employer.

                                    ARTICLE 7

        7.1 Funding.  The  Employer  reserves the right to determine in its sole
and absolute discretion,  whether, to what extent and by what method, if any, to
fund  this  Agreement.  In the  event  that the  Employer  elects  to fund  this
Agreement,  in whole or in part, through the use of life insurance or annuities,
or both, the Employer shall  determine the ownership and beneficial  interest of
any such policy of life insurance or annuity.  The Employer further reserves the
right, in its sole and absolute  discretion,  to terminate any such policy,  and
any other  funding  of this  Agreement,  at any time,  in whole or in part.  The
Executive  shall not have any  right,  title or  interest  in or to any  funding
source or amount utilized by the Employer  pursuant to this  Agreement,  and any
such funding source or amount shall not constitute  security for the performance
or the Employer's  obligations pursuant to this Agreement.  The Executive agrees
to sign any documents and undergo any medical  examination,  or tests, which the
Employer may request and which may be  reasonably  necessary to  facilitate  any
funding for this Agreement including, without limitation, the acquisition of any
policy of insurance or annuity.

                                    ARTICLE 8

        8.1 Nonassignable.  Neither the Executive nor the Executive's spouse nor
any other  beneficiary  under  this  Agreement  shall have any power or right to
transfer,  assign,  anticipate,   hypothecate,  mortgage,  modify  or  otherwise
encumber in advance any of the benefits payable hereunder. Nor shall any of said
benefits be subject to seizure for the payment of any debts, judgements, alimony
or separate maintenance owed by the Executive or the Executive's  beneficiary or
any of them, or be transferrable by operation of law in the event of bankruptcy,
insolvency or otherwise.

                                    ARTICLE 9

        9.1 Claims Procedure.  The Employer shall make all  determinations as to
the rights to  benefits  under this  Agreement.  Any  decision  by the  Employer
denying a claim by the  Executive or the  Executive's  beneficiary  for benefits
under this  Agreement  shall be stated in writing and delivered or mailed to the
Executive  or said  beneficiary.  Such  decision  shall set  forth the  specific
reasons for the denial.  In addition,  the Employer  shall  provide a reasonable
opportunity to the Executive or said beneficiary for full and fair review of the
decision denying such claim.

                                   ARTICLE 10

        10.1  Unsecured  General  Creditor.  The Executive  and the  Executive's
beneficiary shall have no legal or equitable  rights,  interests or claims in or
to  any  property or  assets of the Employer. No assets of the Employer shall be

<PAGE>


held under any trust for the benefit of the  Executive or his  beneficiaries  or
held in any  way as  security  for the  fulfillment  of the  obligations  of the
Employer under this Agreement.  All of the Employer's assets shall be and remain
the general  unpledged,  unrestricted  assets of the  Employer.  The  Employer's
obligation  under this  Agreement  shall be that of an  unfunded  and  unsecured
promise  by the  Employer  to pay money in the  future.  The  Executive  and its
beneficiaries  shall  be  unsecured  creditors  with  respect  to  any  benefits
hereunder.

                                   ARTICLE 11

        11.1 Reorganization. The Employer shall not merge or consolidate into or
with another corporation,  or reorganize or sell substantially all of its assets
to another  corporation,  firm or person,  unless and until such  succeeding  or
continuing  corporation,  firm or  person,  agrees to assume and  discharge  the
obligations  of the Employer under this  Agreement.  Upon the occurrence of such
event the term  "Employer" as used in this Agreement shall be deemed to refer to
such successor or survivor corporation.

                                   ARTICLE 12

        12.1 Binding  Effect.  This Agreement shall be binding upon and inure to
the  benefit  of  the  Executive  and  the  Employer  and as  applicable,  their
respective heirs, beneficiaries,  legal representatives,  agents, successors and
assigns.

                                   ARTICLE 13

        13.1  Contract  of  Employment.  This  Agreement  shall not be deemed to
constitute a contract of  employment  between the Executive and the Employer nor
shall any  provision  of this  Agreement  restrict  the right of the Employer to
terminate the  Executive's  employment or restrict the right of the Executive to
terminate his employment.  In the event that Executive has a separate Employment
Agreement  with  Employer  and in the  event  of any  discrepancy  or  different
treatment  of any term or  condition  in this  Agreement  from  said  Employment
Agreement,  or any renewal or extension thereof, the terms and provisions of the
Employment Agreement shall control.

                                   ARTICLE 14

        14.1 Notice. Any notice required or permitted of either the Executive or
the Employer under this Agreement shall be deemed to have been duly given, if by
personal  delivery,  upon  the date  received  by the  party  or its  authorized
representative;  if  by  facsimile,  upon  transmission  to a  telephone  number
previously  provided  by the  party  to whom the  facsimile  is  transmitted  as
reflected  in the  records  of the party  transmitting  the  facsimile  and upon
reasonable  confirmation of such transmission;  and if by mail, on the third day
after  mailing via U.S.  first  class mail,  registered  or  certified,  postage
prepaid and return receipt requested,  and addressed to the party at the address
given  below for the  receipt  of  notices,  or such  changed  address as may be
requested in writing by a party.

               If to Employer:     Humboldt Bank
                                   Attention:  Personnel Officer
                                   701 Fifth Street
                                   Eureka, CA 95501


<PAGE>

               If to Executive:    Alan J. Smyth
                                   ____________________________
                                   ____________________________


                                   ARTICLE 15

        15.1 Partial Invalidity. If any term, provision,  covenant, or condition
of this  Agreement is held by a court of competent  jurisdiction  to be invalid,
void,  or  unenforceable,  such  determination  shall not render any other term,
provision,  covenant  or  condition  invalid,  void  or  unenforceable,  and the
Agreement  shall  remain in full force and effect  notwithstanding  such partial
invalidity.

                                   ARTICLE 16

        16.1  Arbitration.  All claims,  disputes and other  matters in question
arising  out of or relating to this  Agreement  or the breach of  interpretation
thereof shall be resolved by  arbitration  before the Judicial  Arbitration  and
Mediation Services,  Inc., ("JAMS"),  111 Pine Street, Suite 710, San Francisco,
California,  94111.  In the event JAMS is unable or  unwilling  to  conduct  the
arbitration  pursuant to this provision,  or has discontinued its business,  the
parties agree that the American Arbitration  Association ("AAA"), 417 Montgomery
Street, San Francisco,  California, 94104, shall be selected as a substitute for
JAMS subject to the same terms set forth  herein;  provided,  however,  that the
rules of AAA shall  apply to the  conduct of the  arbitration  to the extent not
inconsistent  with the intent of the  parties  as  expressed  herein.  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 the obligation of the parties to arbitrate
pursuant to this clause shall be  specifically  enforceable  in accordance  with
Title IX of the California Code of Civil  Procedure.  Any arbitration  hereunder
shall be conducted within the city limits of Eureka, California.

                                   ARTICLE 17

        17.1  Governing Law and  Jurisdiction.  The laws of the United States of
America and the State of California, other than those laws denominated choice of
law  rules,  and the rules and  regulations  of the  Board of  Governors  of the
Federal  Reserve  System shall govern the validity,  construction  and effect of
this Agreement.

                                   ARTICLE 18

        18.1  Entire  Agreement.  This  Agreement  supersedes  any and all other
agreements,  either oral or in writing,  between the parties with respect to the
subject  matter  of  this  Agreement  and  contains  all  of the  covenants  and
agreements  between  the  parties  with  respect  thereto.  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.

<PAGE>

                                   ARTICLE 19

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

        IN WITNESS  WHEREOF,  the Employer and the Executive  have executed this
Agreement  in the  city  of  Eureka,  state  of  California  on the  date  first
above-written.

EMPLOYER:                           EXECUTIVE:

/s/ Ronald F. Angell                /s/ Alan J. Smyth                           
Ronald F. Angell                    Alan J. Smyth
Chairman of the Board