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                                                                   EXHIBIT 10.13

                                   PLUMAS BANK

                             DEFERRED FEE AGREEMENT

THIS AGREEMENT is made this 19th day of August 1998 by and between Plumas Bank
(the "Bank"), and Jerry V. Kehr (the "Director").

                                  INTRODUCTION

To encourage the Director to remain a member of the Bank's Board of Directors,
the Bank is willing to provide to the Director a deferred fee opportunity. The
Bank will pay the benefits from its general assets.

                                    AGREEMENT

The Director and the Bank agree as follows:

                                    ARTICLE 1

                                   DEFINITIONS

        1.1 DEFINITIONS. Whenever used in this Agreement, the following words
and phrases shall have the meanings specified:

               1.1.1 "CHANGE OF CONTROL" means the transfer of shares of the
Bank's voting common stock such that one person or a group of persons acting in
concert acquires (or is deemed to acquire under Section 318 of the Code) 51% or
more of the Bank's outstanding voting common stock.

               1.1.2 "CODE" means the Internal Revenue Code of 1986, as amended.
References to a Code section shall be deemed to be to that section as it now
exists and to any successor provision.

               1.1.3 "DISABILITY" means the Director's inability to perform
substantially all normal duties of a director, as determined by the Bank's Board
of Directors in its sole discretion. As a condition to any benefits, the Bank
may require the Director to submit to such physical or mental evaluations and
tests as the Board of Directors deems appropriate.

               1.1.4 "DISTRIBUTION DATE" means five years from the date of this
Agreement.

               1.1.5 "ELECTION FORM" means the Form attached as Exhibit 1.

               1.1.6 "FEES" means the total directors fees payable to the
Director.


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               1.1.7 "NORMAL TERMINATION DATE" means the Director completing
fifteen (15) Years of Service.

               1.1.8 "TERMINATION OF SERVICE" means the Director's ceasing to be
a member of the Bank's Board of Directors for any reason whatsoever.

               1.1.9 "YEARS OF SERVICE" means the total number of twelve-month
periods during which the Director serves as a member of the Bank's Board of
Directors beginning from the date of this Agreement.

                                    ARTICLE 2

                                DEFERRAL ELECTION

        2.1 INITIAL ELECTION. The Director shall make an initial deferral
election under this Agreement by filing with the Bank a signed Election Form
within 15 days after the date of this Agreement. The Election Form shall set
forth the amount of Fees to be deferred and the form of benefit payment. The
Election Form shall be effective to defer only Fees earned after the date the
Election Form is received by the Bank.

        2.2    ELECTION CHANGES

               2.2.1 GENERALLY. The Director may modify the amount of Fees to be
deferred by filing a subsequent signed Election Form with the Bank. The modified
deferral shall not be effective until the calendar year following the year in
which the subsequent Election Form is received by the Bank. The Director may not
change the form of benefit payment without the prior written approval of the
Board of Directors of the Bank.

               2.2.2 HARDSHIP. If an unforeseeable financial emergency arising
from the death of a family member, divorce, sickness, injury, catastrophe or
similar event outside the control of the Director occurs, the Director, by
written instructions to the Bank may reduce future deferrals under this
Agreement.

                                    ARTICLE 3

                                DEFERRAL ACCOUNT

        3.1 ESTABLISHING AND CREDITING. The Bank shall establish a deferral
account ("Deferral Account") on its books for the Director, and shall credit to
the Deferral Account the following amounts:

               3.1.1 DEFERRALS. The Fees deferred by the Director as of the time
the Fees would have otherwise been paid to the Director.

               3.1.2 INTEREST. On a quarterly basis and immediately prior to the
payment of any benefits, interest shall be credited to the Deferral Account with
an annual interest rate equal to the



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floating Wall Street Journal Prime Rate as of the first business day of the
month for such month or part thereof that interest is to be credited minus one
percent (1%) per annum. Interest on the Deferral Account shall be compounded
quarterly. Interest shall continue to accrue on the Deferral Account until all
benefits have been paid.

        3.2 STATEMENT OF ACCOUNTS. The Bank shall provide to the Director,
within one hundred twenty (120) days after each anniversary of this Agreement, a
statement setting forth the Deferral Account balance.

        3.3 ACCOUNTING DEVICE ONLY. The Deferral Account is solely a device for
measuring amounts to be paid under this Agreement. The Deferral Account is not a
trust fund of any kind. The Director is a general unsecured creditor of the Bank
for the payment of benefits. The benefits represent the mere Bank promise to pay
such benefits. The Director's rights to such benefits are not subject in any
manner to anticipation, alienation, sale, transfer, assignment, pledge,
encumbrance, attachment, or garnishment by the Director's creditors.

                                    ARTICLE 4

                                LIFETIME BENEFITS

        4.1 NORMAL TERMINATION BENEFIT. Upon the earlier of the Director's
Termination of Service or the Distribution Date, the Bank shall pay to the
Director the benefit described in this Section 4.1.

               4.1.1 AMOUNT OF BENEFIT. The benefit under this Section 4.1 is
the Deferral Account balance at the date of the Director's Termination of
Service including interest to the time of payment as provided in Section 3.1.2.

               4.1.2 PAYMENT OF BENEFIT. The Bank shall pay the benefit to the
Director in sixty (60) monthly installments as nearly equal as possible
commencing on the first day of the month following the earlier of the Director's
Termination of Service or the Distribution Date.

        4.2 DISABILITY BENEFIT. If the Director terminates service as a director
for Disability prior to the Normal Termination Date, the Bank shall pay to the
Director the benefit described in this Section 4.2.

               4.2.1 AMOUNT OF BENEFIT. The benefit under this Section 4.2 is
the Deferral Account balance at the Director's Termination of Service including
interest to the time of payment as provided in Section 3.1.2.

               4.2.2 PAYMENT OF BENEFIT. The Bank shall pay the benefit to the
Director in a lump sum within 15 days after the Director's Termination of
Service.

        4.3 CHANGE OF CONTROL BENEFIT. Upon a Change of Control while the
Director is in the active service of the Bank and prior to the Normal
Termination Date and the Distribution Date, the Bank shall pay to the Director
the benefit described in this Section 4.3 in lieu of any other benefit under
this Agreement.



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               4.3.1 AMOUNT OF BENEFIT. The benefit under this Section 4.3 is
the Deferral Account balance at the date of the Change of Control including
interest to the time of payment as provided in Section 3.1.2.

               4.3.2 PAYMENT OF BENEFIT. The Bank shall pay the benefit to the
Director in a lump sum within 15 days after the date of the Change of Control.

        4.4 HARDSHIP DISTRIBUTION. Upon the Bank's determination (following
petition by the Director) that the Director has suffered an unforeseeable
financial emergency as described in Section 2.2.2, the Bank shall distribute to
the Director all or portion of the Deferral Account balance as determined by the
Bank, but in no event shall the distribution be greater than is necessary to
relieve the financial hardship.

                                    ARTICLE 5

                                 DEATH BENEFITS

        5.1 DEATH DURING ACTIVE SERVICE. If the Director dies while in the
active service of the Bank and prior to the Normal Termination Date and
Distribution Date, the Bank shall pay to the Director's beneficiary the benefit
described in this Section 5.1 and such benefit shall be in lieu of any other
benefit in this Agreement.

               5.1.1 AMOUNT OF BENEFIT. The benefit under Section 5.1 is the
Deferral Account balance at the time of the Director's death including interest
to the time of payment as provided in Section 5.1.2.

               5.1.2 PAYMENT OF BENEFIT. The Bank shall pay the benefit in 36
equal installments to the beneficiary beginning on the first day of the month
following the Director's death.

                                    ARTICLE 6

                                  BENEFICIARIES

        6.1 BENEFICIARY DESIGNATIONS. The Director shall designate a beneficiary
by filing a written designation with the Bank. The Director may revoke or modify
the designation at any time by filing a new designation. However, designations
will only be effective if signed by the Director and accepted by the Bank during
the Director's lifetime. The Director's beneficiary designation shall be deemed
automatically revoked if the beneficiary predeceases the Director, or if the
Director names a spouse as beneficiary and the marriage is subsequently
dissolved. If the Director dies without a valid beneficiary designation, all
payments shall be made to the Director's surviving spouse, if any, and if none,
to the Director's surviving children and the descendants of any deceased child
by right of representation, and if no children or descendants survive, to the
Director's estate.

        6.2 FACILITY OF PAYMENT. If a benefit is payable to a minor, to a person
declared incompetent, or to a person incapable of handling the disposition of
his or her property, the Bank may pay such benefit to the guardian, legal
representative or person having the care or custody of



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such minor, incompetent person or incapable person. The Bank may require proof
of incompetency, minority or guardianship as it may deem appropriate prior to
distribution of the benefit. Such distribution shall completely discharge the
Bank from all liability with respect to such benefit.

                                    ARTICLE 7

                          CLAIMS AND REVIEW PROCEDURES

        7.1 CLAIMS PROCEDURE. The Bank shall notify the Director's beneficiary
in writing, within ninety (90) days of his or her written application for
benefits, of his or her eligibility or noneligibility for benefits under the
Agreement. If the Bank determines that the beneficiary is not eligible for
benefits or full benefits, the notice shall set forth (1) the specific reasons
for such denial, (2) a specific reference to the provisions of the Agreement on
which the denial is based, (3) a description of any additional information or
material necessary for the claimant to perfect his or her claim, and a
description of why it is needed, and (4) an explanation of the Agreement's
claims review procedure and other appropriate information as to the steps to be
taken if the beneficiary wishes to have the claim reviewed. If the Bank
determines that there are special circumstances requiring additional time to
make a decision, the Bank shall notify the beneficiary of the special
circumstances and the date by which a decision is expected to be made, and may
extend the time for up to an additional ninety-day period.

        7.2 REVIEW PROCEDURE. If the beneficiary is determined by the Bank not
to be eligible for benefits, or if the beneficiary believes that he or she is
entitled to greater or different benefits, the beneficiary shall have the
opportunity to have such claim reviewed by the Bank by filing a petition for
review with the Bank within sixty (60) days after receipt of the notice issued
by the Bank. Said petition shall state the specific reasons which the
beneficiary believes entitle him or her to benefits or to greater or different
benefits.

        Within sixty (60) days after receipt by the Bank of the petition, the
Bank shall afford the beneficiary (and counsel, if any) an opportunity to
present his or her position to the Bank orally or in writing, and the
beneficiary (or counsel) shall have the right to review the pertinent documents.
The Bank shall notify the beneficiary of its decision in writing within the
sixty-day period, stating specifically the basis of its decision, written in a
manner calculated to be understood by the beneficiary and the specific
provisions of the Agreement on which the decision is based. If, because of the
need for a hearing, the sixty-day period is not sufficient, the decision may be
deferred for up to another sixty-day period at the election of the Bank, but
notice of this deferral shall be given to the beneficiary.



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                                    ARTICLE 8

                           AMENDMENTS AND TERMINATION

        The Bank may amend or terminate this Agreement at any time if, pursuant
to legislative, judicial or regulatory action, continuation of the Agreement
would (i) cause benefits to be taxable to the Director prior to actual receipt,
or (ii) result in significant financial penalties or other significantly
detrimental ramifications to the Bank (other than the financial impact of paying
the benefits). In no event shall this Agreement be terminated without payment to
the Director of the Deferral Account balance attributable to the Director's
deferrals and interest credited on such amounts.

                                    ARTICLE 9

                                  MISCELLANEOUS

        9.1 BINDING EFFECT. This Agreement shall bind the Director and the Bank,
and their beneficiaries, survivors, executors, administrators and transferees.

        9.2 NO GUARANTY OF EMPLOYMENT. This Agreement is not a contract for
services. It does not give the Director the right to remain a director of the
Bank, nor does it interfere with the shareholders' rights to replace the
Director. It also does not require the Director to remain a director nor
interfere with the Director's right to terminate services at any time.

        9.3 NON-TRANSFERABILITY. Benefits under this Agreement cannot be sold,
transferred, assigned, pledged, attached or encumbered in any manner.

        9.4 TAX WITHHOLDING. The Bank shall withhold any taxes that are required
to be withheld from the benefits provided under this Agreement.

        9.5 APPLICABLE LAW. The Agreement and all rights hereunder shall be
governed by the laws of California, except to the extent preempted by the laws
of the United States of America.

        9.6 UNFUNDED ARRANGEMENT. The Director and beneficiary are general
unsecured creditors of the Bank for the payment of benefits under this
Agreement. The benefits represent the mere promise by the Bank to pay such
benefits. The rights to benefits are not subject in any manner to anticipation,
alienation, sale, transfer, assignment, pledge, encumbrance, attachment, or
garnishment by creditors of the Director. Any insurance on the Director's life
is a general unpledged, unrestricted asset of the Bank to which the Director and
beneficiary have no preferred or secured



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claim. Furthermore, such insurance shall not be deemed to be held under any
trust for the benefit of the Director or his or her beneficiaries or to be
security for the performance of the obligation of Bank under this Agreement.

IN WITNESS WHEREOF, the Director and a duly authorized Bank officer have signed
this Agreement.

DIRECTOR                                    PLUMAS BANK

/s/ JERRY V. KEHR                           By:  /s/ W. E. ELLIOTT
---------------------------                      --------------------------
  Jerry V. Kehr                                  Title: President & CEO



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                                    EXHIBIT I

                             DEFERRED FEE AGREEMENT

                                DEFERRAL ELECTION

I elect to defer fees under my Deferred Fee Agreement with the Bank, as follows:

<TABLE>
<CAPTION>
================================================================================
      AMOUNT OF DEFERRAL      FREQUENCY OF DEFERRAL       DURATION
================================================================================
<S>                           <C>                      <C>
[Initial and Complete one]                             [Initial One]

      I elect to defer        Each fee payment         ---  This Year only
---      100% of Fees                                  ---  For Five [5] Years
 X    I elect to defer                                  X   Until termination of
---      $700 of Fees                                  ---  service
      I elect not to
---     defer Fees
--------------------------------------------------------------------------------
</TABLE>


I understand that I may change the amount, frequency and duration of my
deferrals by filing a new election form with the Company; provided, however,
that any subsequent election as to the amount of deferral or duration of
deferral will not be effective until the calendar year following the year in
which the new election is received by the Company.

                                 FORM OF BENEFIT

The benefits under the Agreement will be paid to me or my proper beneficiary in
equal monthly installments for 60 months.

I understand that the form of benefit may not be changed even if I later change
the amount of my deferrals under the Agreement.