##### Table of Contents



UNITED STATES SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-Q
 (Mark One)
 þ
    
    QUARTERLY REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934
 FOR THE QUARTERLY PERIOD ENDED September 30, 2006
 o
    
    TRANSITION REPORT UNDER SECTION 13 OR 15 (D) OF THE SECURITIES EXCHANGE ACT OF 1934
 FOR THE TRANSITION PERIOD FROM  TO
 COMMISSION FILE NUMBER: 000-49883
 PLUMAS BANCORP
  California
    
    75-2987096(State or Other Jurisdiction of 
Incorporation or Organization)
    
    (I.R.S. Employer Identification No.)35 S. Lindan Avenue, Quincy, California
    
    95971(Address of Principal Executive Offices)
    
    (Zip Code)
 (530) 283-7305
 þ o
  o þ o
 o þ




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TABLE OF CONTENTS  PART I  FINANCIAL INFORMATIONITEM 1. FINANCIAL STATEMENTSPART I  FINANCIAL INFORMATIONITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISKITEM 4. CONTROLS AND PROCEDURESPART II  OTHER INFORMATIONITEM 1. LEGAL PROCEEDINGSITEM 1A RISK FACTORSITEM 2. UNREGISTERD SALES OF EQUITY SECURITIES AND USE OF PROCEEDSITEM 3. DEFAULTS UPON SENIOR SECURITIESITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERSITEM 5. OTHER INFORMATIONITEM 6. EXHIBITSSIGNATURESEXHIBIT 10.49EXHIBIT 31.1EXHIBIT 31.2EXHIBIT 32.1EXHIBIT 32.2    Table of Contents  
 PART I  FINANCIAL INFORMATION
 
 ITEM 1. FINANCIAL STATEMENTS
 PLUMAS BANCORP
CONDENSED CONSOLIDATED BALANCE SHEET
(Unaudited)
 September 30,
    
    
    December 31,2006
    
    
    2005AssetsCash and due from banks
    
    $
    13,899
    
    
    $
    17,271Federal funds sold
    
    
    505
    
    
    
    7,325Cash and cash equivalents
    
    
    14,404
    
    
    
    24,596Investment securities (fair value of $81,108 at September 30, 2006
and $97,712 at December 31, 2005)
    
    
    80,968
    
    
    
    97,844Loans, less allowance for loan losses of $3,905 at September 30,
2006 and $3,256 at December 31, 2005 (Notes 3 and 4)
    
    
    346,898
    
    
    
    319,156Premises and equipment, net
    
    
    14,444
    
    
    
    11,404Intangible assets, net
    
    
    1,413
    
    
    
    1,638Bank owned life insurance
    
    
    9,366
    
    
    
    8,930Accrued interest receivable and other assets
    
    
    9,609
    
    
    
    9,235Total assets
    
    $
    477,102
    
    
    $
    472,803Liabilities and Shareholders EquityDeposits:Non-interest bearing
    
    $
    130,848
    
    
    $
    129,734Interest bearing
    
    
    287,165
    
    
    
    296,826Total deposits
    
    
    418,013
    
    
    
    426,560Federal Home Loan Bank advances
    
    
    9,500
    
    
    
    Accrued interest payable and other liabilities
    
    
    4,447
    
    
    
    4,796Junior subordinated deferrable interest debentures
    
    
    10,310
    
    
    
    10,310Total liabilities
    
    
    442,270
    
    
    
    441,666Commitments and contingencies (Note 4)
    
    
    
    
    
    
    Shareholders equity (Notes 5, 7 and 8):Serial preferred stock, no par value; 10,000,000 shares
authorized, none issued
    
    
    
    
    
    
    Common stock, no par value; 22,500,000 shares authorized; issued
and outstanding  5,007,927 shares at September 30, 2006 and
4,976,654 shares at December 31, 2005
    
    
    4,650
    
    
    
    4,412Retained earnings
    
    
    31,046
    
    
    
    27,816Accumulated other comprehensive loss (Note 6)
    
    
    (864
    )
    
    
    (1,091
    )Total shareholders equity
    
    
    34,832
    
    
    
    31,137Total liabilities and shareholders equity
    
    $
    477,102
    
    
    $
    472,803
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##### Table of Contents



PLUMAS BANCORP
CONDENSED CONSOLIDATED STATEMENT OF INCOME
(Unaudited)
 For the Three Months
    
    
    For the Nine MonthsEnded September 30,
    
    
    Ended September 30,2006
    
    
    2005
    
    
    2006
    
    
    2005Interest Income:Interest and fees on loans
    
    $
    6,837
    
    
    $
    5,862
    
    
    $
    19,221
    
    
    $
    16,025Interest on investment securities:Taxable
    
    
    608
    
    
    
    640
    
    
    
    1,940
    
    
    
    2,030Exempt from Federal income taxes
    
    
    133
    
    
    
    133
    
    
    
    397
    
    
    
    405Interest on Federal funds sold
    
    
    14
    
    
    
    30
    
    
    
    158
    
    
    
    34Total interest income
    
    
    7,592
    
    
    
    6,665
    
    
    
    21,716
    
    
    
    18,494Interest Expense:Interest on deposits
    
    
    1,561
    
    
    
    1,107
    
    
    
    4,342
    
    
    
    2,817Interest on Federal Home Loan Bank advances
    
    
    69
    
    
    
    44
    
    
    
    108
    
    
    
    210Interest on junior subordinated deferrable interest
debentures
    
    
    215
    
    
    
    111
    
    
    
    599
    
    
    
    295Other
    
    
    6
    
    
    
    4
    
    
    
    15
    
    
    
    9Total interest expense
    
    
    1,851
    
    
    
    1,266
    
    
    
    5,064
    
    
    
    3,331Net interest income before provision for loan
losses
    
    
    5,741
    
    
    
    5,399
    
    
    
    16,652
    
    
    
    15,163Provision for Loan Losses
    
    
    300
    
    
    
    300
    
    
    
    900
    
    
    
    900Net interest income after provision for loan
losses
    
    
    5,441
    
    
    
    5,099
    
    
    
    15,752
    
    
    
    14,263Non-Interest Income:Service charges
    
    
    1,022
    
    
    
    868
    
    
    
    2,731
    
    
    
    2,531Gain (loss) on sale of other real estate and vehicles, net
    
    
    4
    
    
    
    8
    
    
    
    6
    
    
    
    (37
    )Earnings on Bank owned life insurance policies
    
    
    100
    
    
    
    84
    
    
    
    291
    
    
    
    263Other
    
    
    267
    
    
    
    346
    
    
    
    825
    
    
    
    962Total non-interest income
    
    
    1,393
    
    
    
    1,306
    
    
    
    3,853
    
    
    
    3,719Non-Interest Expenses:Salaries and employee benefits
    
    
    2,500
    
    
    
    2,405
    
    
    
    7,366
    
    
    
    7,071Occupancy and equipment
    
    
    827
    
    
    
    775
    
    
    
    2,387
    
    
    
    2,268Other
    
    
    1,253
    
    
    
    1,234
    
    
    
    3,579
    
    
    
    3,595Total non-interest expenses
    
    
    4,580
    
    
    
    4,414
    
    
    
    13,332
    
    
    
    12,934Income before provision for income taxes
    
    
    2,254
    
    
    
    1,991
    
    
    
    6,273
    
    
    
    5,048Provision for Income Taxes
    
    
    858
    
    
    
    743
    
    
    
    2,392
    
    
    
    1,820Net income
    
    $
    1,396
    
    
    $
    1,248
    
    
    $
    3,881
    
    
    $
    3,228Basic earnings per share (Notes 5 and 7)
    
    $
    0.28
    
    
    $
    0.25
    
    
    $
    0.78
    
    
    $
    0.65Diluted earnings per share (Notes 5 and 7)
    
    $
    0.27
    
    
    $
    0.24
    
    
    $
    0.76
    
    
    $
    0.64
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PLUMAS BANCORP
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
(Unaudited)
 For the Nine MonthsEnded September 30,2006
    
    
    2005Cash Flows from Operating Activities:Net income
    
    $
    3,881
    
    
    $
    3,228Adjustments to reconcile net income to net cash provided by operating
activities:Provision for loan losses
    
    
    900
    
    
    
    900Change in deferred loan origination costs/fees, net
    
    
    (398
    )
    
    
    (967
    )Depreciation and amortization
    
    
    1,582
    
    
    
    1,565Stock-based compensation expense
    
    
    130
    
    
    
    Net loss on sale of available-for-sale investment securities
    
    
    
    
    
    
    8Amortization of investment security premiums
    
    
    312
    
    
    
    541Accretion of investment security discounts
    
    
    (67
    )
    
    
    (52
    )Net loss on disposal/sale of premises and equipment
    
    
    6
    
    
    
    4Net (gain) loss on sale of other real estate and vehicles
    
    
    (6
    )
    
    
    37Earnings on Bank owned life insurance policies
    
    
    (291
    )
    
    
    (263
    )Expenses on Bank owned life insurance policies
    
    
    55
    
    
    
    51Increase in accrued interest receivable and other assets
    
    
    (673
    )
    
    
    (1,405
    )(Decrease) increase in accrued interest payable and other liabilities
    
    
    (349
    )
    
    
    1,954Net cash provided by operating activities
    
    
    5,082
    
    
    
    5,601Cash Flows from Investing Activities:Proceeds from matured and called available-for-sale investment securities
    
    
    14,346
    
    
    
    11,000Proceeds from matured and called held-to-maturity investment securities
    
    
    
    
    
    
    1,097Proceeds from sales of available-for-sale investment securities
    
    
    
    
    
    
    1,992Purchases of held-to-maturity investment securities
    
    
    (155
    )
    
    
    Proceeds from principal repayments from available-for-sale
government-guaranteed mortgage-backed securities
    
    
    2,782
    
    
    
    2,780Proceeds from principal repayments from held-to-maturity
government-guaranteed mortgage-backed securities
    
    
    45
    
    
    
    79Net increase in loans
    
    
    (28,591
    )
    
    
    (47,167
    )Proceeds from sale of other real estate and vehicles
    
    
    124
    
    
    
    183Purchase of bank owned life insurance
    
    
    (200
    )
    
    
    (281
    )Purchase of premises and equipment
    
    
    (4,035
    )
    
    
    (2,467
    )Net cash used in investing activities
    
    
    (15,684
    )
    
    
    (32,784
    )
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##### Table of Contents



PLUMAS BANCORP
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
(Unaudited)
 For the Nine MonthsEnded September 30,2006
    
    
    2005Cash Flows from Financing Activities:Net (decrease) increase in demand, interest bearing and savings deposits
    
    $
    (1,779
    )
    
    $
    36,718Net (decrease) increase in time deposits
    
    
    (6,768
    )
    
    
    9,494Proceeds from issuance of junior subordinated deferrable interest debentures
    
    
    
    
    
    
    4,124Proceeds (payment of) from Federal Home Loan Bank advances
    
    
    9,500
    
    
    
    (1,035
    )Proceeds from exercise of stock options
    
    
    108
    
    
    
    289Payment of cash dividends
    
    
    (651
    )
    
    
    (536
    )Net cash provided by financing activities
    
    
    410
    
    
    
    49,054(Decrease) increase in cash and cash equivalents
    
    
    (10,192
    )
    
    
    21,871Cash and Cash Equivalents at Beginning of Year
    
    
    24,596
    
    
    
    11,444Cash and Cash Equivalents at End of Period
    
    $
    14,404
    
    
    $
    33,315Supplemental Disclosure of Cash Flow Information:Cash paid during the period for:Interest expense
    
    $
    4,945
    
    
    $
    3,075Income taxes
    
    $
    2,585
    
    
    $
    730Non-Cash Investing Activities:Vehicles acquired through foreclosure
    
    $
    117
    
    
    $
    141Loan transferred to other assets
    
    $
    230
    
    
    $
    Net change in unrealized loss on available-for-sale securities
    
    $
    227
    
    
    $
    (409
    )Non-Cash Financing Activities:Common stock retired in connection with the exercise of stock options
    
    $
    354
    
    
    $
    80
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PLUMAS BANCORP
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
 1. GENERAL
   2. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
    6




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##### Table of Contents



3. LOANS
  September 30,
    
    
    December 31,2006
    
    
    2005Commercial
    
    $
    35,467
    
    
    $
    42,252Agricultural
    
    
    34,818
    
    
    
    31,018Real estate  mortgage
    
    
    114,469
    
    
    
    110,686Real estate  construction and land development
    
    
    74,987
    
    
    
    56,370Consumer
    
    
    89,898
    
    
    
    81,320349,639
    
    
    
    321,646Deferred loan costs, net
    
    
    1,164
    
    
    
    766Allowance for loan losses
    
    
    (3,905
    )
    
    
    (3,256
    )$
    346,898
    
    
    $
    319,156
 4. COMMITMENTS AND CONTINGENCIES
     7




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5. EARNINGS PER SHARE
  For the Three Months
    
    For the Nine MonthsEnded September 30,
    
    Ended September 30,2006
    
    2005
    
    2006
    
    2005Earnings Per Share:Basic earnings per share
    
    $
    0.28
    
    
    $
    0.25
    
    
    $
    0.78
    
    
    $
    0.65Diluted earnings per share
    
    $
    0.27
    
    
    $
    0.24
    
    
    $
    0.76
    
    
    $
    0.64Weighted Average Number of
Shares Outstanding:(in thousands)Basic shares
    
    
    5,005
    
    
    
    4,951
    
    
    
    4,998
    
    
    
    4,939Diluted shares
    
    
    5,090
    
    
    
    5,133
    
    
    
    5,090
    
    
    
    5,083
  6. COMPREHENSIVE INCOME
    7. STOCK-BASED COMPENSATION
 Share Based Payment Accounting for Stock Based Compensation Accounting for Stock Issued to Employees
 8




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For the Three
    
    
    For the NineMonths Ended
    
    
    Months EndedSeptember 30,
    
    
    September 30,2005
    
    
    2005Net income as reported
    
    $
    1,248
    
    
    $
    3,228Deduct: Total stock-based compensation
expense determined under the fair value
based method for all awards, net of
related tax effects
    
    
    45
    
    
    
    132Pro forma net income
    
    $
    1,203
    
    
    $
    3,096Basic earnings per share  as reported
    
    $
    0.25
    
    
    $
    0.65Basic earnings per share  pro forma
    
    $
    0.24
    
    
    $
    0.63Diluted earnings per share  as reported
    
    $
    0.24
    
    
    $
    0.64Diluted earnings per share  pro forma
    
    $
    0.23
    
    
    $
    0.61
 8. STOCK OPTION PLANS
  9




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Weighted AverageWeighted Average
    
    
    Remaining
    
    
    Intrinsic ValueShares
    
    
    Exercise Price
    
    
    Contractual Term
    
    
    (in thousands)Incentive:Options outstanding at January 1, 2006
    
    
    242,845
    
    
    
    11.05Options granted
    
    
    5,000
    
    
    
    16.89Options exercised
    
    
    48,656
    
    
    
    8.94Options cancelled
    
    
    4,756
    
    
    
    12.68Options outstanding at September 30,
2006
    
    
    194,433
    
    
    
    11.68
    
    
    
    6.7
    
    
    $
    926Options exercisable at September 30,
2006
    
    
    92,895
    
    
    
    9.92
    
    
    
    5.9
    
    
    $
    606Nonstatutory:Options outstanding at January 1, 2006
    
    
    113,131
    
    
    
    10.59Options granted
    
    
    2,500
    
    
    
    18.79Options exercised
    
    
    
    
    
    
    Options cancelled
    
    
    
    
    
    
    Options outstanding at September 30,
2006
    
    
    115,631
    
    
    
    10.77
    
    
    
    6.0
    
    
    $
    656Options exercisable at September 30,
2006
    
    
    70,386
    
    
    
    9.15
    
    
    
    5.0
    
    
    $
    513
    For the Three Months EndedSeptember 30, 2006
    
    
    September 30, 2005Weighted average fair value of options granted
    
    $
    4.54
    
    
    $
    4.77Dividend yield
    
    
    1.5
    %
    
    
    1.4
    %Expected volatility
    
    
    23.7
    %
    
    
    13.7
    %Risk-free interest rate
    
    
    4.7
    %
    
    
    4.1
    %Expected option life in years
    
    
    5.0
    
    
    
    5.0
 For the Nine Months EndedSeptember 30, 2006
    
    
    September 30, 2005Weighted average fair value of options granted
    
    $
    4.56
    
    
    $
    4.77Dividend yield
    
    
    1.4
    %
    
    
    1.4
    %Expected volatility
    
    
    21.4
    %
    
    
    13.7
    %Risk-free interest rate
    
    
    4.7
    %
    
    
    4.1
    %Expected option life in years
    
    
    5.0
    
    
    
    5.0
 10




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9. RECENT ACCOUNTING DEVELOPMENTS
 Accounting for Servicing of Financial Assets
 Accounting for Servicing of Financial Assets  An Amendment of FASB Statement No. 140
 Accounting for Uncertainty in Income Taxes
 Accounting for Uncertainty in Income Taxes Accounting for Income Taxes.
 Accounting for Purchases of Life Insurance
 Accounting for Purchases of Life Insurance  Determining the Amount
That Could Be Realized in Accordance with FASB Technical Bulletin No. 85-4, Accounting for
Purchases of Life Insurance
 11




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Fair Value Measurements
 Fair Value Measurements
 Consideration of the Effects of Prior Year Misstatements
 Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in
Current Year Financial Statements.
 
 PART I  FINANCIAL INFORMATION
 
 ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
   12




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INTRODUCTION
   CASH DIVIDEND
  CRITICAL ACCOUNTING POLICIES AND ESTIMATES
 Share Based Payment for Stock-Based
Compensation.
  RESULTS OF OPERATIONS FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2006
 OVERVIEW
    Net interest income before provision for loan losses.
 13




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14




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For the Nine Months Ended September 30,
    
    
    For the Nine Months Ended September 30,2006
    
    
    2005Average Balance
    
    
    Interest
    
    
    Yield/
    
    
    Average Balance
    
    
    Interest
    
    
    Yield/(in thousands)
    
    
    (in thousands)
    
    
    Rate
    
    
    (in thousands)
    
    
    (in thousands)
    
    
    RateInterest-earning assets:Loans (1) (2)
    
    $
    330,153
    
    
    $
    19,221
    
    
    
    7.78
    %
    
    $
    297,526
    
    
    $
    16,025
    
    
    
    7.20
    %Investment securities (1)
    
    
    87,142
    
    
    
    2,337
    
    
    
    3.59
    %
    
    
    101,545
    
    
    
    2,435
    
    
    
    3.21
    %Federal funds sold
    
    
    4,679
    
    
    
    158
    
    
    
    4.51
    %
    
    
    1,267
    
    
    
    34
    
    
    
    3.59
    %Total interest earning assets
    
    
    421,974
    
    
    
    21,716
    
    
    
    6.88
    %
    
    
    400,338
    
    
    
    18,494
    
    
    
    6.18
    %Cash and due from banks
    
    
    13,489
    
    
    
    
    
    
    
    
    
    
    
    16,276Other assets
    
    
    31,425
    
    
    
    
    
    
    
    
    
    
    
    26,580Total assets
    
    $
    466,888
    
    
    
    
    
    
    
    
    
    
    $
    443,194Interest-bearing liabilities:NOW, money market, & savings deposits
    
    $
    199,261
    
    
    
    1,947
    
    
    
    1.31
    %
    
    $
    176,195
    
    
    
    910
    
    
    
    0.69
    %Time deposits
    
    
    93,100
    
    
    
    2,395
    
    
    
    3.44
    %
    
    
    98,044
    
    
    
    1,907
    
    
    
    2.60
    %FHLB advances
    
    
    2,743
    
    
    
    108
    
    
    
    5.26
    %
    
    
    9,254
    
    
    
    210
    
    
    
    3.03
    %Other interest-bearing liabilities
    
    
    281
    
    
    
    15
    
    
    
    7.14
    %
    
    
    237
    
    
    
    9
    
    
    
    5.08
    %Junior subordinated debentures
    
    
    10,310
    
    
    
    599
    
    
    
    7.77
    %
    
    
    6,231
    
    
    
    295
    
    
    
    6.32
    %Total interest-bearing liabilities
    
    
    305,695
    
    
    
    5,064
    
    
    
    2.21
    %
    
    
    289,961
    
    
    
    3,331
    
    
    
    1.54
    %Non-interest bearing deposits
    
    
    123,677
    
    
    
    
    
    
    
    
    
    
    
    120,256Other liabilities
    
    
    4,466
    
    
    
    
    
    
    
    
    
    
    
    4,094Shareholders equity
    
    
    33,050
    
    
    
    
    
    
    
    
    
    
    
    28,883Total liabilities & equity
    
    $
    466,888
    
    
    
    
    
    
    
    
    
    
    $
    443,194Cost of funding interest-earning assets (3)
    
    
    
    
    
    
    
    
    
    
    1.60
    %
    
    
    
    
    
    
    
    
    
    
    1.12
    %Net interest income and margin (4)
    
    
    
    
    
    $
    16,652
    
    
    
    5.28
    %
    
    
    
    
    
    $
    15,163
    
    
    
    5.06
    %
 
 (1)
    
    Not computed on a tax-equivalent basis.(2)
    
    Loan (costs) fees included in loan interest income for the nine-month periods ended September
30, 2006 and 2005 were $(251,000) and $148,000, respectively.(3)
    
    Total annualized interest expense divided by the average balance of total earning assets.(4)
    
    Annualized net interest income divided by the average balance of total earning assets. 15




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##### Table of Contents



2006 over 2005 change in net interest incomefor the nine months ended September 30(in thousands)Volume (1)
    
    
    Rate (2)
    
    
    Mix (3)
    
    
    TotalInterest-earning assets:Loans
    
    $
    1,757
    
    
    $
    1,297
    
    
    $
    142
    
    
    $
    3,196Investment securities
    
    
    (345
    )
    
    
    288
    
    
    
    (41
    )
    
    
    (98
    )Federal funds sold
    
    
    91
    
    
    
    9
    
    
    
    24
    
    
    
    124Total interest income
    
    
    1,503
    
    
    
    1,594
    
    
    
    125
    
    
    
    3,222Interest-bearing liabilities:NOW, money market & savings
    
    
    119
    
    
    
    812
    
    
    
    106
    
    
    
    1,037Time deposits
    
    
    (96
    )
    
    
    615
    
    
    
    (31
    )
    
    
    488FHLB advances
    
    
    (148
    )
    
    
    155
    
    
    
    (109
    )
    
    
    (102
    )Other interest-bearing liabilities
    
    
    1
    
    
    
    4
    
    
    
    1
    
    
    
    6Junior subordinated debentures
    
    
    193
    
    
    
    67
    
    
    
    44
    
    
    
    304Total interest expense
    
    
    69
    
    
    
    1,653
    
    
    
    11
    
    
    
    1,733Net interest income
    
    $
    1,434
    
    
    $
    (59
    )
    
    $
    114
    
    
    $
    1,489
 
 (1)
    
    The volume change in net interest income represents the change in average balance divided by
the previous periods rate.(2)
    
    The rate change in net interest income represents the change in rate multiplied by the previous
periods average balance.(3)
    
    The mix change in net interest income represents the change in average balance multiplied by
the change in rate. Provision for loan losses.
 Non-interest income.
  16




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##### Table of Contents



For the Nine MonthsEnded September 30,
    
    
    Dollar
    
    
    Percentage2006
    
    
    2005
    
    
    Change
    
    
    ChangeService charges on deposit accounts
    
    $
    2,731
    
    
    $
    2,531
    
    
    $
    200
    
    
    
    7.9
    %Earnings on life insurance policies
    
    
    291
    
    
    
    263
    
    
    
    28
    
    
    
    10.6
    %Merchant processing income
    
    
    242
    
    
    
    252
    
    
    
    (10
    )
    
    
    -4.0
    %Official check fees
    
    
    126
    
    
    
    78
    
    
    
    48
    
    
    
    61.5
    %Customer service fees
    
    
    83
    
    
    
    82
    
    
    
    1
    
    
    
    1.2
    %Investment services income
    
    
    78
    
    
    
    148
    
    
    
    (70
    )
    
    
    -47.3
    %Federal Home Loan Bank dividends
    
    
    76
    
    
    
    59
    
    
    
    17
    
    
    
    28.8
    %Safe deposit box and night depository income
    
    
    51
    
    
    
    51
    
    
    
    
    
    
    
    
    %Other deposit account fees
    
    
    40
    
    
    
    25
    
    
    
    15
    
    
    
    60.0
    %Printed check fee income
    
    
    38
    
    
    
    31
    
    
    
    7
    
    
    
    22.6
    %Loan commission and servicing fees
    
    
    36
    
    
    
    130
    
    
    
    (94
    )
    
    
    -72.3
    %Gain (loss) on sale of real estate and vehicles
    
    
    6
    
    
    
    (37
    )
    
    
    43
    
    
    
    116.2
    %Loss on sale of securities
    
    
    
    
    
    
    (8
    )
    
    
    8
    
    
    
    100.0
    %Loss on sale of loans
    
    
    (4
    )
    
    
    
    
    
    
    (4
    )
    
    
    -100.0
    %Tax refunds
    
    
    
    
    
    
    58
    
    
    
    (58
    )
    
    
    -100.0
    %Other
    
    
    59
    
    
    
    56
    
    
    
    3
    
    
    
    5.4
    %Total non-interest income
    
    $
    3,853
    
    
    $
    3,719
    
    
    $
    134
    
    
    
    3.6
    %
 Non-interest expenses.
  Share Based Payment
  17




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##### Table of Contents



For the Nine MonthsEnded September 30,
    
    
    Dollar
    
    
    Percentage2006
    
    
    2005
    
    
    Change
    
    
    ChangeSalaries and employee benefits
    
    $
    7,366
    
    
    $
    7,071
    
    
    $
    295
    
    
    
    4.2
    %Occupancy and equipment
    
    
    2,387
    
    
    
    2,268
    
    
    
    119
    
    
    
    5.2
    %Professional fees
    
    
    533
    
    
    
    542
    
    
    
    (9
    )
    
    
    -1.7
    %Outside service fees
    
    
    443
    
    
    
    509
    
    
    
    (66
    )
    
    
    -13.0
    %Business development
    
    
    405
    
    
    
    364
    
    
    
    41
    
    
    
    11.3
    %Advertising and shareholder relations
    
    
    364
    
    
    
    340
    
    
    
    24
    
    
    
    7.1
    %Telephone and data communication
    
    
    286
    
    
    
    265
    
    
    
    21
    
    
    
    7.9
    %Director compensation
    
    
    279
    
    
    
    237
    
    
    
    42
    
    
    
    17.7
    %Deposit premium amortization
    
    
    226
    
    
    
    226
    
    
    
    
    
    
    
    Stationery and supplies
    
    
    205
    
    
    
    253
    
    
    
    (48
    )
    
    
    -19.0
    %Armored car and courier
    
    
    202
    
    
    
    270
    
    
    
    (68
    )
    
    
    -25.2
    %Postage
    
    
    181
    
    
    
    182
    
    
    
    (1
    )
    
    
    -0.5
    %Insurance
    
    
    129
    
    
    
    177
    
    
    
    (48
    )
    
    
    -27.1
    %Loan and collection expenses
    
    
    111
    
    
    
    79
    
    
    
    32
    
    
    
    40.5
    %Other
    
    
    215
    
    
    
    151
    
    
    
    64
    
    
    
    42.4
    %Total non-interest expense
    
    $
    13,332
    
    
    $
    12,934
    
    
    $
    398
    
    
    
    3.1
    %
 Provision for income taxes.
 RESULTS OF OPERATIONS FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2006
 OVERVIEW
   18




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##### Table of Contents



Net interest income before provision for loan losses.
      19




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##### Table of Contents



For the Three Months Ended September 30,
    
    
    For the Three Months Ended September 30,2006
    
    
    2005Average Balance
    
    
    Interest
    
    
    Yield/
    
    
    Average Balance
    
    
    Interest
    
    
    Yield/(in thousands)
    
    
    (in thousands)
    
    
    Rate
    
    
    (in thousands)
    
    
    (in thousands)
    
    
    RateInterest-earning assets:Loans (1) (2)
    
    $
    343,622
    
    
    $
    6,837
    
    
    
    7.89
    %
    
    $
    317,730
    
    
    $
    5,862
    
    
    
    7.32
    %Investment securities (1)
    
    
    81,513
    
    
    
    741
    
    
    
    3.61
    %
    
    
    96,071
    
    
    
    773
    
    
    
    3.19
    %Federal funds sold
    
    
    1,113
    
    
    
    14
    
    
    
    4.99
    %
    
    
    3,207
    
    
    
    30
    
    
    
    3.71
    %Total interest earning assets
    
    
    426,248
    
    
    
    7,592
    
    
    
    7.07
    %
    
    
    417,008
    
    
    
    6,665
    
    
    
    6.34
    %Cash and due from banks
    
    
    13,119
    
    
    
    
    
    
    
    
    
    
    
    17,675Other assets
    
    
    33,114
    
    
    
    
    
    
    
    
    
    
    
    27,467Total assets
    
    $
    472,481
    
    
    
    
    
    
    
    
    
    
    $
    462,150Interest-bearing liabilities:NOW, money market, & savings deposits
    
    $
    200,529
    
    
    
    730
    
    
    
    1.44
    %
    
    $
    178,964
    
    
    
    354
    
    
    
    0.78
    %Time deposits
    
    
    90,585
    
    
    
    831
    
    
    
    3.64
    %
    
    
    102,308
    
    
    
    753
    
    
    
    2.92
    %Federal Home Loan Bank advances
    
    
    5,137
    
    
    
    69
    
    
    
    5.33
    %
    
    
    4,935
    
    
    
    44
    
    
    
    3.54
    %Other interest-bearing liabilities
    
    
    289
    
    
    
    6
    
    
    
    8.24
    %
    
    
    251
    
    
    
    4
    
    
    
    6.32
    %Junior subordinated debentures
    
    
    10,310
    
    
    
    215
    
    
    
    8.27
    %
    
    
    6,320
    
    
    
    111
    
    
    
    6.97
    %Total interest-bearing liabilities
    
    
    306,850
    
    
    
    1,851
    
    
    
    2.39
    %
    
    
    292,778
    
    
    
    1,266
    
    
    
    1.72
    %Non-interest bearing deposits
    
    
    127,145
    
    
    
    
    
    
    
    
    
    
    
    134,678Other liabilities
    
    
    4,350
    
    
    
    
    
    
    
    
    
    
    
    4,670Shareholders equity
    
    
    34,136
    
    
    
    
    
    
    
    
    
    
    
    30,024Total liabilities & equity
    
    $
    472,481
    
    
    
    
    
    
    
    
    
    
    $
    462,150Cost of funding interest-earning assets (3)
    
    
    
    
    
    
    
    
    
    
    1.73
    %
    
    
    
    
    
    
    
    
    
    
    1.20
    %Net interest income and margin (4)
    
    
    
    
    
    $
    5,741
    
    
    
    5.34
    %
    
    
    
    
    
    $
    5,399
    
    
    
    5.14
    %
 
 (1)
    
    Not computed on a tax-equivalent basis.(2)
    
    Loan (costs) fees included in loan interest income for the three-month periods ended
September 30, 2006 and 2005 were $(177,000) and $48,000, respectively.(3)
    
    Total interest expense divided by the average balance of total earning assets.(4)
    
    Net interest income divided by the average balance of total earning assets. 20




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##### Table of Contents



2006 over 2005 change in net interest incomefor the three months ended September 30(in thousands)Volume (1)
    
    
    Rate (2)
    
    
    Mix (3)
    
    
    TotalInterest-earning assets:Loans
    
    $
    478
    
    
    $
    460
    
    
    $
    37
    
    
    $
    975Investment securities
    
    
    (117
    )
    
    
    100
    
    
    
    (15
    )
    
    
    (32
    )Federal funds sold
    
    
    (19
    )
    
    
    10
    
    
    
    (7
    )
    
    
    (16
    )Total interest income
    
    
    342
    
    
    
    570
    
    
    
    15
    
    
    
    927Interest-bearing liabilities:NOW, money market, & savings
    
    
    43
    
    
    
    297
    
    
    
    36
    
    
    
    376Time deposits
    
    
    (86
    )
    
    
    185
    
    
    
    (21
    )
    
    
    78FHLB advances
    
    
    2
    
    
    
    22
    
    
    
    1
    
    
    
    25Other interest-bearing liabilities
    
    
    1
    
    
    
    1
    
    
    
    
    
    
    
    2Junior subordinated debentures
    
    
    70
    
    
    
    21
    
    
    
    13
    
    
    
    104Total interest expense
    
    
    30
    
    
    
    526
    
    
    
    29
    
    
    
    585Net interest income
    
    $
    312
    
    
    $
    44
    
    
    $
    (14
    )
    
    $
    342
 
 (1)
    
    The volume change in net interest income represents the change in average balance divided by
the previous periods rate.(2)
    
    The rate change in net interest income represents the change in rate divided by the previous
periods average balance.(3)
    
    The mix change in net interest income represents the change in average balance multiplied by
the change in rate. Provision for loan losses.
 Non-interest income.
 21




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##### Table of Contents



For the ThreeMonthsEnded September 30,
    
    
    Dollar
    
    
    Percentage2006
    
    
    2005
    
    
    Change
    
    
    ChangeService charges on deposit accounts
    
    $
    1,022
    
    
    $
    868
    
    
    $
    154
    
    
    
    17.7
    %Merchant processing income
    
    
    111
    
    
    
    120
    
    
    
    (9
    )
    
    
    -7.5
    %Earnings on life insurance policies
    
    
    100
    
    
    
    84
    
    
    
    16
    
    
    
    19.0
    %Official check fees
    
    
    46
    
    
    
    32
    
    
    
    14
    
    
    
    43.8
    %Federal Home Loan Bank dividends
    
    
    28
    
    
    
    21
    
    
    
    7
    
    
    
    33.3
    %Customer service fees
    
    
    23
    
    
    
    30
    
    
    
    (7
    )
    
    
    -23.3
    %Investment services income
    
    
    23
    
    
    
    46
    
    
    
    (23
    )
    
    
    -50.0
    %Safe deposit box and night depository income
    
    
    15
    
    
    
    16
    
    
    
    (1
    )
    
    
    -6.3
    %Other deposit account fees
    
    
    12
    
    
    
    11
    
    
    
    1
    
    
    
    9.1
    %Printed check fee income
    
    
    7
    
    
    
    10
    
    
    
    (3
    )
    
    
    -30.0
    %Gain (loss) on sale of real estate and vehicles
    
    
    4
    
    
    
    8
    
    
    
    (4
    )
    
    
    -50.0
    %Loan commission and servicing fees
    
    
    (29
    )
    
    
    41
    
    
    
    (70
    )
    
    
    -170.7
    %Other
    
    
    31
    
    
    
    19
    
    
    
    12
    
    
    
    63.2
    %Total non-interest income
    
    $
    1,393
    
    
    $
    1,306
    
    
    $
    87
    
    
    
    6.7
    %
 Non-interest expenses.
  22




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##### Table of Contents



For the ThreeMonthsEnded September 30
    
    
    Dollar
    
    
    Percentage2006
    
    
    2005
    
    
    Change
    
    
    ChangeSalaries and employee benefits
    
    $
    2,500
    
    
    $
    2,405
    
    
    $
    95
    
    
    
    4.0
    %Occupancy and equipment
    
    
    827
    
    
    
    775
    
    
    
    52
    
    
    
    6.7
    %Outside service fees
    
    
    224
    
    
    
    172
    
    
    
    52
    
    
    
    30.2
    %Professional fees
    
    
    188
    
    
    
    180
    
    
    
    8
    
    
    
    4.4
    %Business development
    
    
    123
    
    
    
    126
    
    
    
    (3
    )
    
    
    -2.4
    %Advertising and shareholder relations
    
    
    122
    
    
    
    116
    
    
    
    6
    
    
    
    5.2
    %Director compensation
    
    
    104
    
    
    
    78
    
    
    
    26
    
    
    
    33.3
    %Telephone and data communication
    
    
    89
    
    
    
    108
    
    
    
    (19
    )
    
    
    -17.6
    %Deposit premium amortization
    
    
    76
    
    
    
    76
    
    
    
    
    
    
    
    
    %Armored car and courier
    
    
    70
    
    
    
    82
    
    
    
    (12
    )
    
    
    -14.6
    %Stationery and supplies
    
    
    65
    
    
    
    93
    
    
    
    (28
    )
    
    
    -30.1
    %Postage
    
    
    58
    
    
    
    58
    
    
    
    
    
    
    
    
    %Insurance
    
    
    45
    
    
    
    60
    
    
    
    (15
    )
    
    
    -25.0
    %Loan and collection expense
    
    
    31
    
    
    
    34
    
    
    
    (3
    )
    
    
    -8.8
    %Other
    
    
    58
    
    
    
    51
    
    
    
    7
    
    
    
    13.7
    %Total non-interest expense
    
    $
    4,580
    
    
    $
    4,414
    
    
    $
    166
    
    
    
    3.8
    %
 Provision for income taxes.
 FINANCIAL CONDITION
 Loan portfolio composition.
 Nonperforming assets.
 23




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##### Table of Contents



Analysis of allowance for loan losses.
  For the Nine MonthsEnded September 30,(in thousands)2006
    
    
    2005Balance at January 1,
    
    $
    3,256
    
    
    $
    2,762Charge-offs:Commercial and agricultural
    
    
    (126
    )
    
    
    (141
    )Real estate mortgage
    
    
    
    
    
    
    Real estate construction
    
    
    
    
    
    
    Consumer
    
    
    (349
    )
    
    
    (339
    )Total charge-offs
    
    
    (475
    )
    
    
    (480
    )Recoveries:Commercial and agricultural
    
    
    45
    
    
    
    19Real estate mortgage
    
    
    
    
    
    
    Real estate construction
    
    
    
    
    
    
    Consumer
    
    
    179
    
    
    
    128Total recoveries
    
    
    224
    
    
    
    147Net charge-offs
    
    
    (251
    )
    
    
    (333
    )Provision for loan losses
    
    
    900
    
    
    
    900Balance at September 30,
    
    $
    3,905
    
    
    $
    3,329Net charge-offs during the nine-month period to average loans
    
    
    0.08
    %
    
    
    0.11
    %Allowance for loan losses to total loans
    
    
    1.12
    %
    
    
    1.06
    %
 Investment securities.
 24




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##### Table of Contents



Premises and equipment.
 Deposits.
 Federal Home Loan Bank advances.
 CAPITAL RESOURCES
    25




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##### Table of Contents



September 30, 2006
    
    December 31,2005Amount
    
    Ratio
    
    Amount
    
    RatioTier 1 Leverage RatioPlumas Bancorp and Subsidiary
    
    $
    44,283
    
    
    
    9.4
    %
    
    $
    40,589
    
    
    
    8.5
    %Minimum regulatory requirement
    
    
    18,893
    
    
    
    4.0
    %
    
    
    19,013
    
    
    
    4.0
    %Plumas Bank
    
    
    42,461
    
    
    
    9.0
    %
    
    
    37,611
    
    
    
    7.8
    %Minimum requirement for
Well-Capitalized institution
    
    
    23,587
    
    
    
    5.0
    %
    
    
    24,060
    
    
    
    5.0
    %Minimum regulatory requirement
    
    
    18,870
    
    
    
    4.0
    %
    
    
    19,248
    
    
    
    4.0
    %Tier 1 Risk-Based Capital RatioPlumas Bancorp and Subsidiary
    
    
    44,283
    
    
    
    10.7
    %
    
    
    40,589
    
    
    
    10.3
    %Minimum regulatory requirement
    
    
    16,579
    
    
    
    4.0
    %
    
    
    15,780
    
    
    
    4.0
    %Plumas Bank
    
    
    42,461
    
    
    
    10.3
    %
    
    
    37,611
    
    
    
    9.6
    %Minimum requirement for
Well-Capitalized institution
    
    
    24,834
    
    
    
    6.0
    %
    
    
    23,635
    
    
    
    6.0
    %Minimum regulatory requirement
    
    
    16,556
    
    
    
    4.0
    %
    
    
    15,757
    
    
    
    4.0
    %Total Risk-Based Capital RatioPlumas Bancorp and Subsidiary
    
    
    48,242
    
    
    
    11.6
    %
    
    
    43,845
    
    
    
    11.1
    %Minimum regulatory requirement
    
    
    33,157
    
    
    
    8.0
    %
    
    
    31,560
    
    
    
    8.0
    %Plumas Bank
    
    
    46,365
    
    
    
    11.2
    %
    
    
    40,867
    
    
    
    10.4
    %Minimum requirement for
Well-Capitalized institution
    
    
    41,391
    
    
    
    10.0
    %
    
    
    39,392
    
    
    
    10.0
    %Minimum regulatory requirement
    
    
    33,112
    
    
    
    8.0
    %
    
    
    31,514
    
    
    
    8.0
    %
 LIQUIDITY
     26




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##### Table of Contents



ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
      27




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ITEM 4. CONTROLS AND PROCEDURES
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PART II  OTHER INFORMATION
 
 ITEM 1. LEGAL PROCEEDINGS
  
 ITEM 1A RISK FACTORS
  
 ITEM 2. UNREGISTERD SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
  
 ITEM 3. DEFAULTS UPON SENIOR SECURITIES
  
 ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
  
 ITEM 5. OTHER INFORMATION
  
 ITEM 6. EXHIBITS
  3.1
    
    Articles of Incorporation as amended of Registrant included as exhibit 3.1 to
the Registrants Form S-4, File No. 333-84534, which is incorporated by
reference herein.3.2
    
    Bylaws of Registrant included as exhibit 3.2 to the Registrants Form S-4, File
No. 333-84534, which is incorporated by reference herein.3.3
    
    Amendment of the Articles of Incorporation of Registrant dated November 1, 2002.3.4
    
    Amendment of the Articles of Incorporation of Registrant dated August 17, 2005.4
    
    Specimen form of certificate for Plumas Bancorp included as exhibit 4 to the
Registrants Form S-4, File No. 333-84534, which is incorporated by reference
herein.10.1
    
    Executive Salary Continuation Agreement of Andrew J. Ryback dated August 23,
2005, is included as Exhibit 10.1 to the Registrants 8-K filed on October 17,
2005, which is incorporated by this reference herein.10.2
    
    Split Dollar Agreement of Andrew J. Ryback dated August 23, 2005, is included
as Exhibit 10.2 to the Registrants 8-K filed on October 17, 2005, which is
incorporated by this reference herein.
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10.3
    
    Executive Salary Continuation Agreement as amended of William E. Elliott
dated October 13, 1993, is included as Exhibit 10.3 to the Registrants
10-QSB for June 30, 2002, which is incorporated by this reference herein.10.4
    
    Split Dollar Agreements of William E. Elliott dated January 23, 2002, is
included as Exhibit 10.4 to the Registrants 10-QSB for June 30, 2002, which
is incorporated by this reference herein.10.5
    
    Employment Agreement of Douglas N. Biddle dated January 1, 2006 is included
as Exhibit 10.5 to the Registrants 8-K filed on March 15, 2006, which is
incorporated by this reference herein.10.6
    
    Executive Salary Continuation Agreement as amended of Douglas N. Biddle
dated June 2, 1994, is included as Exhibit 10.6 to the Registrants 10-QSB
for June 30, 2002, which is incorporated by this reference herein.10.7
    
    Split Dollar Agreements of Douglas N. Biddle dated January 24, 2002, is
included as Exhibit 10.7 to the Registrants 10-QSB for June 30, 2002, which
is incorporated by this reference herein.10.9
    
    Executive Salary Continuation Agreement as amended of Dennis C. Irvine dated
June 2, 1994, is included as Exhibit 10.9 to the Registrants 10-QSB for
June 30, 2002, which is incorporated by this reference herein.10.10
    
    Split Dollar Agreements of Dennis C. Irvine dated January 24, 2002, is
included as Exhibit 10.10 to the Registrants 10-QSB for June 30, 2002,
which is incorporated by this reference herein.10.11
    
    First Amendment to Executive Salary Continuation Agreement of Robert T. Herr
dated September 15, 2004, is included as Exhibit 10.11 to the Registrants
8-K filed on September 17, 2004, which is incorporated by this reference
herein.10.13
    
    Deferred Fee Agreement as amended of Jerry V. Kehr dated August 19, 1998, is
included as Exhibit 10.13 to the Registrants 10-QSB for June 30, 2002,
which is incorporated by this reference herein.10.14
    
    Amended and Restated Director Retirement Agreement of Jerry V. Kehr dated
April 28, 2000, is included as Exhibit 10.14 to the Registrants 10-QSB for
June 30, 2002, which is incorporated by this reference herein.10.15
    
    Consulting Agreement of Jerry V. Kehr dated May 10, 2000, is included as
Exhibit 10.15 to the Registrants 10-QSB for June 30, 2002, which is
incorporated by this reference herein.10.16
    
    Deferred Fee Agreement of Jerry V. Kehr dated December 21, 2005 is included
as Exhibit 10.16 to the Registrants 8-K filed on March 15, 2006, which is
incorporated by this reference herein.10.18
    
    Amended and Restated Director Retirement Agreement of Daniel E. West dated
May 10, 2000, is included as Exhibit 10.18 to the Registrants 10-QSB for
 June 30, 2002, which is incorporated by this reference herein.10.19
    
    Consulting Agreement of Daniel E. West dated May 10, 2000, is included as
Exhibit 10.19 to the Registrants 10-QSB for June 30, 2002, which is
incorporated by this reference herein.10.20
    
    Split Dollar Agreements of Robert T. Herr dated September 15, 2004, is
included as Exhibit 10.20 to the Registrants 8-K filed on September 17,
2004, which is incorporated by this reference herein.10.21
    
    Amended and Restated Director Retirement Agreement of Alvin G. Blickenstaff
dated April 19, 2000, is included as Exhibit 10.21 to the Registrants
10-QSB for June 30, 2002, which is incorporated by this reference herein.10.22
    
    Consulting Agreement of Alvin G. Blickenstaff dated May 8, 2000, is included
as Exhibit 10.22 to the Registrants 10-QSB for June 30, 2002, which is
incorporated by this reference herein.
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10.24
    
    Amended and Restated Director Retirement Agreement of Gerald W. Fletcher
dated May 10, 2000, is included as Exhibit 10.24 to the Registrants 10-QSB
for June 30, 2002, which is incorporated by this reference herein.10.25
    
    Consulting Agreement of Gerald W. Fletcher dated May 10, 2000, is included
as Exhibit 10.25 to the Registrants 10-QSB for June 30, 2002, which is
incorporated by this reference herein.10.27
    
    Amended and Restated Director Retirement Agreement of Arthur C. Grohs dated
May 9, 2000, is included as Exhibit 10.27 to the Registrants 10-QSB for
June 30, 2002, which is incorporated by this reference herein.10.28
    
    Consulting Agreement of Arthur C. Grohs dated May 9, 2000, is included as
Exhibit 10.28 to the Registrants 10-QSB for June 30, 2002, which is
incorporated by this reference herein.10.30
    
    Amended and Restated Director Retirement Agreement of Christine McArthur
dated May 12, 2000, is included as Exhibit 10.30 to the Registrants 10-QSB
for June 30, 2002, which is incorporated by this reference herein.10.31
    
    Consulting Agreement of Christine McArthur dated May 12, 2000, is included
as Exhibit 10.31 to the Registrants 10-QSB for June 30, 2002, which is
incorporated by this reference herein.10.33
    
    Amended and Restated Director Retirement Agreement of Terrance J. Reeson
dated April 19, 2000, is included as Exhibit 10.33 to the Registrants
10-QSB for June 30, 2002, which is incorporated by this reference herein.10.34
    
    Consulting Agreement of Terrance J. Reeson dated May 10, 2000, is included
as Exhibit 10.34 to the Registrants 10-QSB for June 30, 2002, which is
incorporated by this reference herein.10.39
    
    Deferred Fee Agreement of Thomas Watson dated March 3, 2001, is included as
Exhibit 10.39 to the Registrants 10-QSB for June 30, 2002, which is
incorporated by this reference herein.10.40
    
    Form of Indemnification Agreement, is included as Exhibit 10.41 to the
Registrants 10-QSB for June 30, 2002, which is incorporated by this
reference herein.10.41
    
    2001 Stock Option Plan as amended is included as exhibit 99.1 of the Form
S-8 filed July 23, 2002, File No. 333-96957.10.42
    
    1991 Stock Option Plan on Form S-8 filed August 19, 2002, File No. 333-98319.10.43
    
    Plumas Bank 401(k) Profit Sharing Plan as amended is included as exhibit
99.1 of the Form S-8 filed February 14, 2003, File No. 333-103229.10.44
    
    Executive Salary Continuation Agreement of Robert T. Herr dated June 4,
2002, is included as Exhibit 10.44 to the Registrants 10-Q for March 31,
2003, which is incorporated by this reference herein.10.46
    
    1991 Stock Option Plan as amended is included as Exhibit 10.46 to the
Registrants 10-Q for September 30, 2004, which is incorporated by this
reference herein.10.47
    
    Specimen form of Incentive Stock Option Agreement under the 1991 Stock
Option Plan is included as Exhibit 10.47 to the Registrants 10-Q for
September 30, 2004, which is incorporated by this reference herein.10.48
    
    Specimen form of Non-Qualified Stock Option Agreement under the 1991 Stock
Option Plan is included as Exhibit 10.48 to the Registrants 10-Q for
September 30, 2004, which is incorporated by this reference herein.10.49
    
    Amended and Restated Plumas Bancorp 2001 Stock Option Plan
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10.59
    
    Director Retirement Agreement of Thomas Watson dated May 1, 2003, is included as Exhibit 10.59
to the Registrants 10-Q for June 30, 2003, which is incorporated by this reference herein.10.60
    
    Consulting Agreement of Thomas Watson dated May 1, 2003, is included as Exhibit 10.60 to the
Registrants 10-Q for June 30, 2003, which is incorporated by this reference herein.10.62
    
    Deferred Fee Agreement of Thomas Watson dated December 23, 2004, is included as Exhibit 10.62
to the Registrants 8-K filed on January 6, 2005, which is incorporated by this reference
herein.10.63
    
    Deferred Fee Agreement of Jerry V. Kehr dated December 24, 2004, is included as Exhibit 10.63
to the Registrants 8-K filed on January 6, 2005, which is incorporated by this reference
herein.11
    
    Computation of per share earnings appears in the attached 10-Q under Plumas Bancorp and
Subsidiary Notes to Consolidated Financial Statements as Footnote 5  Earnings Per Share
Computation.31.1
    
    Rule 13a-14(a) [Section 302] Certification of Principal Financial Officer dated November 8, 200631.2
    
    Rule 13a-14(a) [Section 302] Certification of Principal Executive Officer dated November 8,
2006.32.1
    
    Certification of Principal Financial Officer pursuant to 18 U.S.C. Section 1350, As Adopted
Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 dated November 8, 2006.32.2
    
    Certification of Principal Executive Officer pursuant to 18 U.S.C. Section 1350, As Adopted
Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 dated November 8, 2006.
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SIGNATURES
  PLUMAS BANCORP
  /s/ Andrew J. RybackAndrew J. RybackExecutive Vice President Chief Financial Officer /s/ Douglas N. BiddleDouglas N. BiddlePresident and Chief Executive Officer 33