Document:

EMPLOYMENT AGREEMENT

         THIS EMPLOYMENT AGREEMENT (the "Agreement") is made and entered into as
of the 15th day of April,  2002 (the  "Effective  Date") by and  between  Solano
Bank,  a  California   corporation  (the  "Bank"),  and  John  A.  Nerland  (the
"Employee").

                                   BACKGROUND

         WHEREAS,  the Employee possesses valuable knowledge and skills that the
Bank expects will contribute to the operation of the Bank;

         WHEREAS,  the Bank  desires  to employ  Employee  and the  Employee  is
willing to be employed by the Bank, upon the terms and subject to the conditions
hereinafter set forth; and

         WHEREAS, the Bank is a wholly-owned  subsidiary of North Bay Bancorp, a
California corporation (the "Company").

         NOW, THEREFORE, in consideration of the premises, agreements and mutual
covenants set forth herein, the parties hereto hereby agree as follows:

              1.  Employment

                  1.1 General.  Subject to and  effective  upon  approval of the
California Department of Financial  Institutions and the Federal Reserve Bank of
San Francisco ("Regulatory  Approval"),  the Bank hereby employs the Employee as
President  and Chief  Executive  Officer of the Bank on the terms and subject to
the conditions contained in this Agreement, and the Employee hereby accepts such
employment  on the  terms  and  subject  to the  conditions  contained  in  this
Agreement.  Until  Regulatory  Approval is received by the Bank,  Employee shall
perform  such  duties  and  responsibilities  as may be  assigned  to him by the
President and Chief Executive Officer of the Bank or Company

                  1.2 Duties of Employee. During the Term of this Agreement, the
Employee shall  diligently  perform all duties and  responsibilities  reasonably
accorded to and expected of the  President  and Chief  Executive  Officer of the
Bank and as may be assigned to him by the Board of Directors of the Bank and the
President and Chief  Executive  Officer of the Company,  and shall exercise such
power and  authority as may from time to time be  delegated to him thereby.  The
Employee  shall devote his full  business time and attention to the business and
affairs  of the Bank as  necessary  to perform  his duties and  responsibilities
hereunder,  render  such  services  to the best of his  ability and use his best
efforts to promote the  interests  of the Bank.  The Employee  shall  faithfully
adhere to, execute and fulfill all policies established by the Bank.

                  1.3 Place of  Performance.  Except for required travel for the
Bank's business, the Employee shall perform his duties and responsibilities from
the offices of the Bank, the Company and its subsidiaries.

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              2.  Term.Subject to the provisions of Section 4 of this Agreement,
the  initial  term of  Employee's  employment  hereunder  shall  commence on the
Effective Date and shall continue  thereafter until the third anniversary of the
Effective Date (the "Initial Term"). Unless the Employee shall have notified the
Bank,  or the Bank shall have  notified the  Employee,  not less than sixty (60)
days prior to the expiration of the Initial Term of such party's election not to
continue the Term of this  Agreement,  upon  expiration of the Initial Term, the
Employee's  employment  hereunder shall continue until the fourth anniversary of
the Effective Date and thereafter shall continue on a year-to-year  basis unless
either  party  notifies  the  other,  not less than  sixty  (60)  days  prior to
expiration of the then current  Renewal  Term,  of such party's  election not to
continue the Term of this Agreement (each such  additional  one-year  period,  a
"Renewal Term"; the Initial Term and any Renewal Term are collectively  referred
to hereinafter as the "Term"). The election by the Bank not to continue the Term
of  Employee's  employment  for a Renewal Term shall not be deemed a termination
without Cause pursuant to Section 4.1(b) hereof except as expressly  provided in
Section 4.1(d) hereof.

              3.  Compensation.

                  3.1  Salary.  During  the  Term of the  Employee's  employment
hereunder,  the Employee  shall receive an annual salary of One Hundred  Fifteen
Thousand Dollars  ($115,000.00)  payable at such times and in such manner as the
Bank's normal payroll schedule may from time to time provide.  Employee's annual
salary shall be subject to annual  adjustment  as may be determined by the Board
of  Directors  of  the  Bank,  or  its  appropriate  committee  (the  "Board  of
Directors"), in its sole and absolute discretion.

                  3.2 Incentive Compensation.  The Employee shall be eligible to
receive as additional compensation each year during his employment hereunder, as
determined  by the Board of Directors or an  applicable  committee  thereof,  in
accordance with the terms of an Incentive  Compensation Plan adopted annually by
the Board of Directors.  Such additional  compensation  (if any) to be paid at a
time or times and in a manner  consistent  with the Bank's normal  practices for
the payment of bonuses, or as the Board of Directors or applicable committee may
otherwise determine.

                  3.3 Benefits.  During his employment  hereunder,  the Employee
shall be entitled to participate in all plans adopted for the general benefit of
the Bank's management employees, including medical plans and 401(k) plan, to the
extent  that the  Employee is and remains  eligible to  participate  therein and
subject to the eligibility provisions of such plans in effect from time to time.
In the event Employee's  employment  hereunder is terminated and the Employee is
entitled to  compensation  pursuant to Section  4.4(d),  the  Employee  shall be
entitled to continue to participate in the Bank's medical plan until the earlier
of (a)  expiration  of the  applicable  payment  period  set  forth  in  Section
4.4(d)(i) or (b) the date Employee obtains new employment.

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                  3.4  Vacation. During each year of his  employment  hereunder,
the Employee  shall be entitled to twenty (20) days of paid  vacation,  prorated
for any period of employment of less than an entire year, provided that vacation
time will continue to accrue only so long as Employee's  total accrued  vacation
does not exceed twenty five (25) days. Should  Employee's  accrued vacation time
reach  twenty five (25) days,  Employee  will cease to accrue  further  vacation
until Employee's  accrued vacation time falls below that level.  Notwithstanding
anything contained in the foregoing,  Employee shall take not less than five (5)
consecutive days of vacation during each year during the Term of this Agreement.
Employee may be absent from his employment for vacation only at such time as the
President and Chief  Executive  Officer of the Bank shall determine from time to
time.

                  3.5  Withholding.   Notwithstanding   any  provision  in  this
Agreement to the contrary,  all payments  required to be made by the Bank to the
Employee  hereunder or otherwise  arising out of, related or incidental to or in
connection  with  the  Employee's  employment  hereunder  shall  be  subject  to
withholding  of such  amounts  relating  to taxes  as the  Bank  may  reasonably
determine it should withhold pursuant to any applicable law or regulation.

                  3.6  Reimbursement  of Expenses.  The Bank agrees to reimburse
the Employee for all reasonable business travel and other out-of-pocket expenses
incurred by the Employee in the  discharge of his duties  hereunder,  subject to
the Bank's reimbursement  policies in effect from time to time. All reimbursable
expenses shall be appropriately  documented in reasonable detail by the Employee
upon  submission  of any request for  reimbursement,  and in a format and manner
consistent  with the Bank's  expense  reporting  policy,  as well as  applicable
federal and state record keeping requirements.

                  3.7  Automobile.  The Bank will pay to Employee an automobile
allowance in the amount of five hundred  dollars ($500) per month.  The Employee
shall be responsible  for insurance and maintenance  costs  associated with such
automobile's operation.  The Employee shall not be entitled to reimbursement for
mileage.  Employee shall procure and maintain an automobile  liability insurance
policy  on the  automobile,  with  coverage  including  Employee  for at least a
minimum  of  $300,000  for  bodily  injury or death to any one person in any one
accident,  and $100,000 for property  damage in any one  accident.  The Employer
shall be named as an  additional  insured and Employee  shall  provide  Employer
copies  of  policies  evidencing   insurance  and  Employer's  inclusion  as  an
additional insured.

              4.  Termination

                  4.1 Termination by Bank.

                           (a) With Cause. Notwithstanding any provision in this
Agreement to the contrary, the Employee's employment hereunder may be terminated
by the Bank at any time for  "Cause,"  and such  termination  shall be effective
immediately upon written

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<PAGE>

notice  to the  Employee.  For  purposes  of  this  Agreement,  "Cause"  for the
termination of the Employee's  employment hereunder shall be deemed to exist if,
in the reasonable  judgment of the Board of Directors:  (i) the Employee commits
fraud,  theft or  embezzlement  against the Bank, or any subsidiary or affiliate
thereof;  (ii)  the  Employee  commits  a  felony  or a  crime  involving  moral
turpitude;  (iii) the Employee  compromises  trade secrets or other  proprietary
information  of the Bank,  or any  subsidiary  or  affiliate  thereof;  (iv) the
Employee  breaches  any  non-solicitation   agreement  with  the  Bank,  or  any
subsidiary or affiliate  thereof;  (v) the Employee breaches any of the terms of
this  Agreement  (other than those  referenced in clauses (iii) and (iv) of this
Section  4.1(a))  and fails to cure such  breach  within ten (10) days after the
receipt  of  written  notice of such  breach  from the Bank;  (vi) the  Employee
engages in any grossly negligent act or willful misconduct that causes, or could
be reasonably expected to cause, harm to the business,  operations or reputation
of the Bank, or any subsidiary or affiliate  thereof;  or (vii) the Bank, or any
subsidiary or affiliate  thereof,  is ordered to terminate this Agreement by any
governmental  regulatory agency with supervisory authority over the Bank, or any
subsidiary or affiliate thereof.

                           (b) Without  Cause.  The Bank may at any time, in its
sole and absolute discretion, terminate the employment of the Employee hereunder
without Cause, or otherwise without any cause, reason or justification, provided
that the Bank provides to the Employee written notice (the "Termination Notice")
of such  termination.  In the event of any such  termination  by the  Bank,  the
Employee's  employment  with the Bank  shall  cease  and  terminate  on the date
specified in the Termination Notice.

                           (c) For  Disability of the Employee.  If, as a result
of  incapacity  due to physical  or mental  illness or injury,  the  Employee is
determined to be disabled under any disability policy maintained by the Bank or,
in the event no such policy is maintained by the Bank,  the Employee  shall have
been unable to perform the essential functions of his position,  with or without
reasonable  accommodation,  on a  full-time  basis  for a period  of sixty  (60)
consecutive days, or for a total of ninety (90) days in any twelve-month  period
(a  "Disability"),  then thirty (30) days after  written  notice to the Employee
(which  notice  may be  given  before  or  after  the end of the  aforementioned
periods,  but which  shall  not be  effective  earlier  than the last day of the
applicable period),  the Bank may terminate the Employee's  employment hereunder
if the Employee is unable to resume his  full-time  duties at the  conclusion of
such notice period.

                  4.2 Death of the Employee.  This Agreement  shall  immediately
cease and terminate upon the death of Employee.

                  4.3  Termination  by Employee.  The Employee may terminate his
employment  under  this  Agreement  upon not less than  thirty  (30) days  prior
written notice to the Bank.  Upon learning that the Employee is terminating  his
employment  under  this  Agreement,  the Bank may,  in its sole  discretion  but
subject to its other obligations  under this Agreement,  relieve Employee of his
duties under this Employment  Agreement,  and assign  Employee other  reasonable
duties  and  responsibilities  to be  performed  until the  termination  becomes
effective.

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<PAGE>

                  4.4 Compensation Upon Early Termination.

                           (a) As a Result of Death,  Cause or  Resignation.  If
the  Employee's  employment  under this  Agreement  is  terminated  prior to the
scheduled expiration of the Term by reason of his death, termination by the Bank
for Cause or resignation  by the Employee,  the Employee shall be entitled to be
paid solely (i) the Employee's  salary then in effect through the effective date
of termination, (ii) any accrued vacation due pursuant to Section 3.4, (iii) any
amounts due  pursuant to Section 3.6,  (iv) those  benefits,  if any,  that have
vested by  operation of state or federal law or under any written term of a plan
("Vested Benefits"),  and (v) health care coverage continuation rights under the
Consolidated Omnibus Budget Reconciliation Act of 1985 ("COBRA Rights"), and the
Bank shall have no further  liability or other obligation of any kind whatsoever
to the  Employee.  In the  case of  termination  as a  result  of the  death  of
Employee,  any amounts due pursuant to this Section  4.4(a) shall be paid to the
Employee's  estate,  heirs (at law),  devisees,  legatees  or other  proper  and
legally  entitled  descendants,   or  the  personal  representative,   executor,
administrator   or  other  proper  legal   representative   on  behalf  of  such
descendants.

                           (b) By the Bank  other  than  for  Cause.  Except  as
otherwise  expressly  provided in Section  4.4(d),  if,  prior to the  scheduled
expiration of the Term, the Bank  terminates the Employee's  employment  without
Cause,  the  Employee  shall be  entitled  to receive and be paid solely (i) the
Employee's  salary  then in  effect  until  the  expiration  of six  (6)  months
following the effective date of the termination of Employee's employment payable
over such period at the Bank's  regular and customary  intervals for the payment
of salaries as in effect from time to time ("Severance  Pay"),  (ii) any accrued
vacation due pursuant to Section 3.4,  (iii) any amounts due pursuant to Section
3.6, (iv) any Vested Benefits, and (v) any COBRA Rights, and the Bank shall have
no further liability or other obligation of any kind whatsoever to the Employee.
The payment of Severance Pay shall constitute  liquidated damages in lieu of any
and all claims by the Employee  against the Bank,  shall be in full and complete
satisfaction of any and all rights which the Employee may enjoy  hereunder,  and
shall constitute  consideration for a full and unconditional  release of any and
all liability of the Bank or any of its shareholders,  benefit plans,  affiliate
companies,  subsidiaries,  and the directors,  officers, employees, trustees and
agents of such  entities and their  successors  or assigns,  arising out of this
Agreement  or out of the  employment  relationship  between the Employee and the
Bank (in the  form of  Exhibit  A,  hereafter  the  "Release").  Payment  of the
Severance Pay is expressly  conditioned  upon receipt by the Bank of the Release
executed by the Employee.

                           (c)  Disability.   For  the  sixty  (60)  day  period
following  onset of the  Employee's  Disability,  Employee  shall be entitled to
receive and be paid solely (i) the  Employee's  salary then in effect  until the
expiration of said sixty (60) day period payable over such period of time at the
Bank's regular and customary  intervals for the payment of salaries as in effect
from time to time, (ii) any accrued  vacation due pursuant to Section 3.4, (iii)
any amounts due pursuant to Section 3.6, (iv) any Vested  Benefits,  and (v) any

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COBRA rights.  Following  expiration of the sixty (60) day period,  the Employee
shall be entitled to receive and be paid solely a salary at a rate  commensurate
with the benefit  Employee is eligible to receive  under any  disability  policy
maintained  by the Bank for a period of one hundred  twenty  (120) days or until
Employee's  benefits under any disability  policy maintained by the Bank for the
Employee  commences,  whichever  period is shorter,  payable over such period of
time at the Bank's  regular and customary  intervals for the payment of salaries
as in effect from time to time, and the Bank shall have no further  liability or
other obligation of any kind whatsoever to the Employee.

                  4.5  Expiration  of  the  Term.  If  not  sooner   terminated,
Employee's employment hereunder shall terminate on the expiration of the Initial
Term or the Renewal Term, as applicable in accordance with Section 2 hereof. Not
less than 45 days prior to the scheduled  expiration  of  Employee's  employment
hereunder,  the  parties  agree to  commence  discussions  with  respect  to the
possible  extension of the Term of this Agreement,  possible  execution of a new
employment agreement or other possible continuation of the Employee's employment
(it being  understood and agreed that no such discussion shall imply any current
or future obligation or commitment to enter into any such agreement or extension
or any other expressed or implied  arrangement  for the continued  employment of
the  Employee  following  the  expiration  of the  Initial  Term  or  any  other
termination of the Employee's employment hereunder).

              5. Agreement Not to Solicit  Customers.  The Employee agrees that,
during  the  Term of his  employment  with the  Bank or any  entity  owned by or
affiliated with the Bank (whether pursuant to this Agreement or otherwise),  and
for two (2) years  following  the  termination  thereof  whether  or not for any
reason whatsoever, he will not, either directly or indirectly, call on, solicit,
or take away as a client, customer or prospective client or customer, or attempt
to call on, solicit, or take away as a client, customer or prospective client or
customer, any person or entity that was a client, customer or prospective client
or customer of the Bank, or any subsidiary or affiliate thereof. For purposes of
this  agreement  "prospective  client or customer"  shall  include any person or
entity with whom the Bank has had contact for the purpose of soliciting business
within the six (6) months prior to the  termination  of  employment  or whom the
Bank intended to contact for the purpose of soliciting  business  within six (6)
months after termination of employment, of which contact or intended contact the
Employee had knowledge while employed by the Bank.

              6. Agreement Not to Solicit or Hire Employees. The Employee agrees
that during the Term of his  employment  with the Bank or any entity owned by or
affiliated with the Bank (whether pursuant to this Agreement or otherwise),  and
for two (2) years  following  the  termination  thereof  whether  or not for any
reason whatsoever, he will not, either directly or indirectly, on his own behalf
or in the service or on behalf of others,  solicit,  divert or hire,  attempt to
solicit, divert or hire or induce or attempt to induce to discontinue employment
with the Bank, or any subsidiary or affiliate  thereof,  any person  employed by
the Bank, or any subsidiary or affiliate  thereof,  whether or not such employee
is a full time employee or a temporary employee of the Bank, or any subsidiary

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or  affiliate  thereof and whether or not such  employment  is for a  determined
period or is at will.

              7.  Ownership  and  Non-Disclosure  and  Non-Use  of  Confidential
                  Information.

                  7.1  Confidential  Information.  As used  in  this  Agreement,
"Confidential  Information"  shall mean all customer  deposit,  loan,  sales and
marketing  information,  customer account records,  proprietary  receipts and/or
processing techniques,  information regarding vendors and products, training and
operations  memoranda  and  similar  information,   personnel  records,  pricing
information,  financial  information and trade secrets concerning or relating to
the  business,  accounts,  customers,  employees and affairs of the Bank, or any
subsidiary  or  affiliate  thereof,  obtained  by  or  furnished,  disclosed  or
disseminated to the Employee, or obtained, assembled or compiled by the Employee
or under his  supervision  during the course of his  employment by the Bank, and
all physical embodiments of the foregoing,  all of which are hereby agreed to be
the property of and confidential to the Bank, but Confidential Information shall
not include any of the  foregoing  to the extent that the Employee can show that
the same is or becomes  publicly  known  through no action,  omission,  fault or
breach of this Agreement by the Employee.

                  7.2. Ownership.  The Employee acknowledges and agrees that all
Confidential Information, and all physical embodiments thereof, are confidential
to and shall be and  remain the sole and  exclusive  property  of the Bank.  The
Employee agrees that upon request by the Bank, and in any event upon termination
of the  Employee's  employment  with  the  Bank  whether  or not for any  reason
whatsoever, the Employee shall deliver to the Bank all property belonging to the
Bank, or any of its subsidiaries or affiliates,  including,  without limitation,
all Confidential Information (and all embodiments thereof), then in his custody,
control or possession.

                  7.3  Non-Disclosure  and Non-Use.  The Employee agrees that he
will not,  either  during the Term of his  employment  hereunder  or at any time
thereafter,  use, disclose or make available any Confidential Information to any
person or entity,  nor shall he use,  disclose,  make  available  or cause to be
used, disclosed or made available,  or permit or allow, either on his own behalf
or on behalf of others,  any use or disclosure of such Confidential  Information
other than in the proper performance of the Employee's duties hereunder.

                  7.4  Notification.  The Employee hereby authorizes the Company
to notify my actual or future  employers of the terms of this  Agreement  and my
responsibilities hereunder.

              8. Reasonableness of Restrictions. In the event that any provision
relating to time period set forth in Section 5, 6, or 7 shall be held by a court
of competent jurisdiction to exceed the maximum time period that the court deems
reasonable  and  enforceable,  the  time  period  which  the  court  finds to be
reasonable and enforceable shall

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be deemed to become,  and  thereafter  shall be, the maximum time period of such
restriction as to such jurisdiction.

              9.  Enforceability.  Any provision of this Agreement which is held
by a court of  competent  jurisdiction  to be  invalid or  unenforceable  in any
jurisdiction  shall,  as to such  jurisdiction,  be ineffective to the extent of
such  prohibition  or  unenforceability   without   invalidating  the  remaining
provisions hereof, but shall be enforced to the maximum extent permitted by law,
and any such holding of invalidity or unenforceability in any jurisdiction shall
not invalidate or render unenforceable such provision in any other jurisdiction.

              10.  Injunction.  The Employee  represents that his experience and
capabilities  are such  that the  provisions  of  Sections  5, 6, and 7 will not
prevent him from earning his livelihood,  and acknowledges  that a breach by the
Employee of any of the covenants  contained  therein will cause irreparable harm
and damage to the Bank, the monetary amount of which may be virtually impossible
to ascertain.  As a result, the Employee recognizes and hereby acknowledges that
the  Bank  shall be  entitled  to an  injunction  from  any  court of  competent
jurisdiction  enjoining  and  restraining  any  violation  of  any or all of the
covenants  contained in Section 5, 6, and/or 7 of this Agreement by the Employee
or any of his  affiliates,  associates,  partners or agents,  either directly or
indirectly, without any requirement to post bond or other security and that such
right to  injunction  shall be  cumulative  and in addition  to  whatever  other
remedies the Bank may possess.

              11.  Arbitration.  Subject to the  provisions of Section 10 hereof
regarding  the  remedy of  injunctive  relief,  any  dispute  (whether  based on
contract,  tort,  or  statutory  duty  or  prohibition)  arising  out  of  or in
connection  with this Agreement  shall be submitted to binding  arbitration,  in
accordance  with the Commercial  Arbitration  Rules of the American  Arbitration
Association  (as modified by this  Agreement) by one  arbitrator,  designated in
accordance  with those rules.  No one who has ever had any business,  financial,
family,  or social  relationship with any party to this Agreement shall serve as
an  arbitrator  unless  the  related  party  informs  the  other  party  of  the
relationship  and  the  other  party  consents  in  writing  to the  use of that
arbitrator.

         The party  demanding  arbitration  shall submit a written  claim to the
other party, setting out the basis of the claim. A prearbitration  hearing shall
be held within twenty (20) business days after the arbitrator's  selection.  The
arbitration   shall  be  held  within   ninety  (90)  calendar  days  after  the
prearbitration   hearing.  The  arbitrator  shall  establish  any  deadlines  to
accomplish this goal. The arbitration shall take place in Napa, California, at a
time and place selected by the arbitrator.

         Each party shall be entitled to discovery of  essential  documents  and
witnesses,  as determined by the  arbitrator.  No less than thirty (30) calendar
days before the  arbitration,  a party may serve a document  request calling for
any document that would be discoverable in a state civil proceeding.  The served
with this request  shall  deliver the  requested  documents  and any  objections
within ten (10) calendar  days.  The arbitrator may resolve any dispute over the
exchange of documents.  Each party may take no more

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than three (3)  depositions,  unless  additional  depositions are allowed by the
arbitrator for good cause.  All depositions must be completed as of fifteen (15)
calendar days before the arbitration hearing unless the parties otherwise agree.
The  arbitrator  may resolve any dispute over the  depositions  as they would be
resolved in a state civil proceeding.  Any motion may be heard by the arbitrator
on three (3) days notice  unless the parties  otherwise  agree.  The  arbitrator
shall apply California law.

         The parties agree that all  information  supplied by any party shall be
deemed to be confidential information, and the arbitrator and other participants
in the dispute shall protect such information from disclosure to the same extent
as confidential information under Section 7 of this Agreement.

         The arbitrator shall have the following powers:

                  (a)   To issue  subpenas for the  attendance  of witnesses and
                        subpenas  duces  tecum  for  the  production  of  books,
                        records, documents, and other evidence;

                  (b)   To order depositions to be used as evidence;

                  (c)   Consistent  with  the  discovery  procedures  enumerated
                        above,  to enforce  the  rights,  remedies,  procedures,
                        duties, liabilities,  and obligations of discovery as if
                        the arbitration  were a civil action before a California
                        superior court;

                  (d)   To  conduct  a hearing  on the  arbitration  issues  and
                        related legal and discovery issues;

                  (e)   To administer oaths to parties and witnesses;

                  (f)   To  award  all  damages  and  remedies  which  would  be
                        available in a civil action before a California superior
                        court.

                  (g)   To  award  expenses  and  fees  of  arbitration  as  the
                        arbitrator deems proper; and

                  (h)   To order  such  other  relief  as the  arbitrator  deems
                        proper.

         Within fifteen (15) calendar days after  completion of the arbitration,
the  arbitrator  shall  submit a tentative  decision in writing  specifying  the
reasoning for the decision and any calculations  necessary to explain the award.
Each party shall have  fifteen  (15)  calendar  days in which to submit  written
comments to the  tentative  decision.  Within ten (10)  calendar  days after the
deadline for written  comments,  the arbitrator  shall announce the final award.
Any party may enter the  final  award as a  judgment  in any court of  competent
jurisdiction.

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<PAGE>

         The Bank shall pay the arbitrator's expenses and fees, all meeting room
charges,  and any other  expenses  that would not have been incurred if the case
were  litigated  in the  judicial  forum  having  jurisdiction  over it.  Unless
otherwise ordered by the arbitrator, each party shall pay its own attorney fees,
witness  fees  and  other  expenses  incurred  by the  party  for his or its own
benefit.  The arbitrator may award the prevailing  party his or its expenses and
fees of arbitration,  including  reasonable  attorney fees and costs,  including
witness fees, in such proportion as the arbitrator decides.

              12. No Prior Agreements. The Employee represents and warrants that
he is not a party  to or  otherwise  subject  to or  bound  by the  terms of any
contract,  agreement  or  understanding  which  in any  manner  would  limit  or
otherwise  affect his ability to perform his  obligations  hereunder,  including
without limitation any contract, agreement or understanding containing terms and
provisions in any manner  similar to those  contained in Sections 5, 6, and/or 7
hereof.  The Employee  further  represents and warrants that his employment with
the Bank will not require him to  disclose or use any  confidential  information
belonging to prior employers or other persons or entities.

              13.  Assignment.  The Employee  shall not delegate his  employment
obligations  pursuant to this Agreement to any other person. The Bank may assign
its rights and obligations  hereunder to any subsidiary,  affiliate or successor
of the Bank or the Company,  provided that any such  assignee  fully assumes the
Bank's obligations  hereunder.  The rights and protections of the Bank hereunder
shall extend to any  successors or assigns of the Bank and to the Bank's present
or future parents, subsidiaries, divisions and affiliates.

              14.  Employer's  Authority.  The relationship  between the parties
hereto is that of employer  and  employee.  The  Employee  agrees to observe and
comply with the rules and  regulations  of the Bank, as adopted by the Bank from
time to time with respect to the performance of the duties of the Employee.  The
Employee  acknowledges  that he has no authority to enter into any  contracts or
other  obligations  that are  binding  upon the Bank unless  such  contracts  or
obligations  are  authorized by the Board of Directors.  The Bank shall have the
power to  direct,  control  and  supervise  the  duties to be  performed  by the
Employee,  the manner of performing said duties, and the time of performing said
duties.

              15.  Governing Law. This Agreement,  the rights and obligations of
the  parties  hereto,  and any claims or  disputes  relating  thereto,  shall be
governed  by  and  construed  in  accordance  with  the  laws  of the  State  of
California,  without  giving effect to any of the  conflicts of laws  provisions
thereof that would compel the application of the  substantive  laws of any other
jurisdiction.  The Bank and the Employee each hereby  irrevocably  submit to the
jurisdiction  of the state or federal  courts located in the State of California
in  connection  with any suit,  action  or other  proceeding  arising  out of or
relating to this Agreement and hereby agree not to assert,  by way of motion, as
a defense,  or otherwise in any such suit,  action or proceeding  that the suit,
action or proceeding is brought in an inconvenient  forum, that the venue of the
suit,  action or  proceeding  is improper or that this  Agreement or the subject
matter hereof may not be enforced by such courts.

                                       10
<PAGE>

              16.  Entire  Agreement.  This  Agreement  constitutes  the  entire
agreement  between the parties  hereto with respect to the subject matter hereof
and supersedes all prior agreements,  understandings and arrangements, both oral
and written, between the parties hereto with respect to such subject matter.

              17.   Notices.   All   notices,   requests,   demands   and  other
communications  under this  Agreement  will be in writing  and will be deemed to
have been duly given (a) on the date of the service if served  personally on the
party  to  whom  notice  is to be  given,  (b) on the  date of  transmission  if
transmitted  by  facsimile  with  confirmation  of  receipt,  (c) on the date of
receipt  if  mailed to the  party to whom  notice is to be given by first  class
mail,  registered or certified,  postage prepaid or by overnight courier service
(i.e.,  Federal Express or equivalent) and unless either party should notify the
other of a change of address properly addressed as follows,  or (d) otherwise on
the date of receipt when the intended recipient has acknowledged receipt:

                           (i)      If to the Employee:

                           John A. Nerland

                           -------------------------------------

                           -------------------------------------

                           (ii)     If to the Bank:

                           North Bay Bancorp
                           1500 Soscol Avenue
                           Napa, California  94558
                           Attention:  Terry L. Robinson
                           President and Chief Executive Officer
                           Facsimile:  (707) 257-8025

              18.  Binding  Effect.  The  obligations of the Employee under this
Agreement  shall  continue  after  the  expiration  of  this  Agreement  and the
termination  of his  employment  with the Bank for any reason,  shall be binding
upon his heirs, executors,  personal representatives,  legal representatives and
assigns and shall inure to the benefit of any successor and assigns of the Bank.

              19. Severability.  The invalidity of any one or more of the words,
phrases, sentences, clauses, sections or subsections contained in this Agreement
shall not affect the  enforceability of the remaining portions of this Agreement
or any part  thereof,  all of which are  inserted  conditionally  on their being
valid in law,  and,  in the event  that any one or more of the  words,  phrases,
sentences,  clauses,  sections or subsections contained in this Agreement or any
part thereof shall be declared invalid,  this Agreement shall be construed as if
such invalid word or words, phrase or phrases, sentence or sentences,  clause or
clauses, section or sections or subsection or subsections had not been inserted.
If such  invalidity  is caused by length of time or size of area,  or both,  the
otherwise invalid provision will be considered to be reduced to a period or area
which would cure such invalidity.

                                       11
<PAGE>

              20.  Section  Headings.  The section  headings  contained  in this
Agreement  are for  reference  purposes only and shall not affect in any way the
meaning or interpretation of this Agreement.

              21. No Third Party  Beneficiary.  Nothing  expressed or implied in
this  Agreement is intended,  or shall be construed,  to confer upon or give any
person  other than the  parties  hereto  and their  respective  heirs,  personal
representative,  legal  representative,  successors  and assigns,  any rights or
remedies under or by reason of this Agreement.

              22. Amendment; Modification; Waiver. No amendment, modification or
waiver of the terms of this Agreement  shall be valid unless made in writing and
duly executed by the Bank and the  Employee.  No delay or failure at any time on
the part of the Bank in  exercising  any right,  power or  privilege  under this
Agreement,  or in enforcing  any provision of this  Agreement,  shall impair any
such right, power or privilege, or be construed as a waiver of any default or as
any  acquiescence  therein,  or shall affect the right of the Bank thereafter to
enforce each and every provision of this Agreement in accordance with its terms.
The  waiver by either  party  hereto  of a breach  or  violation  of any term or
provision of this Agreement  shall neither  operate nor be construed as a waiver
of any subsequent breach or violation.

              23.   Counterparts.   This   Agreement  may  be  executed  in  two
counterparts,  each of which shall be deemed to be an original but all of which,
taken together, constitute one and the same agreement.

THE  EMPLOYEE  ACKNOWLEDGES  THAT HE HAS  READ  AND  UNDERSTANDS  THE  FOREGOING
PROVISIONS AND THAT SUCH PROVISIONS ARE REASONABLE.

         IN WITNESS WHEREOF,  the parties hereto have executed this Agreement or
caused this Agreement to be executed as of the day and year first above written.

                                                 EMPLOYEE

                                                 -------------------------------
                                                 John A. Nerland

                                                 SOLANO BANK

                                                 By:  __________________________
                                                          Thomas N. Gavin
                                                          Chairman of the Board

                                       12
<PAGE>

                                    EXHIBIT A

                                 GENERAL RELEASE

<PAGE>

                                 GENERAL RELEASE

1.       I have been offered by SOLANO BANK the sum of six (6) months  severance
         (less all  customary  federal,  state and local taxes) (the  "Severance
         Payment")  for and in  consideration  of the  execution of this General
         Release (the "Release").

2.       I acknowledge that I am not otherwise entitled to receive the Severance
         Payment referenced in paragraph 1 above.

3.       I understand  that my execution of this Release is voluntary,  and that
         if I do not accept this  Severance  Payment,  I will not lose any other
         rights that I may have under other policies or programs of the Bank.

4.       I accept the Severance Payment.

5.       In consideration for the Severance Payment,  I unconditionally  release
         Solano  Bank  and any of its  shareholders,  benefit  plans,  affiliate
         companies,   subsidiaries,  and  the  directors,  officers,  employees,
         trustees and agents of such  entities and their  successors  or assigns
         (collectively hereinafter,  the "Bank") from any and all claims arising
         out of the  employment  relationship  between  the  Bank  and me or the
         termination  of my employment  with the Bank. I agree that this Release
         is meant to be as  general  as  possible  and  covers all claims of any
         nature  whether or not I know the claims exist at this time,  including
         but not limited to contract claims,  tort claims,  and claims under any
         state,  federal,  or local law.  Without limiting the general nature of
         this Release,  I specifically  release the Bank from any and all claims
         under federal or state civil rights and discrimination  laws, including
         but not limited to Title VII of the Civil  Rights Act of 1964,  the Age
         Discrimination  in Employment  Act, the Americans with  Disabilities in
         Employment Act, and the Equal Pay Act.

6.       However,  nothing in this Release  prohibits me from filing a charge of
         discrimination  or cooperating in any proceeding  before the California
         Department  of Fair  Employment  and  Housing  ("CDFEH")  or the  Equal
         Employment   Opportunity   Commission   ("EEOC").   This  Release  only
         constitutes  a waiver by me of my right to file a suit against the Bank
         on the claims set forth in  paragraph 5 and a waiver by me of any right
         to receive  compensation  based on claims, if any, brought by the CDFEH
         or the EEOC.

7.       In further consideration for the Severance Payment, I agree and warrant
         that  all  Bank  files,  papers  and  property  that  have  been  in my
         possession,  custody or control during my employment have been returned
         to the Bank and will not be  copied or  removed  from the  premises.  I
         further agree that I will not disclose the terms of this Release except
         to my attorney and/or tax consultant, or as required by law. I may also
         disclose  the terms to my spouse  so long as my  spouse  agrees  not to
         disclose the terms of this Release.  I also agree that I am still bound
         by certain  provisions  of the  Employment  Agreement  that I signed on
         April 15, 2002 according to the terms thereof.

<PAGE>

8.       I understand I have a seven  consecutive  calendar day period to revoke
         my assent to this Release  beginning  with today's date. If I choose to
         rescind this Release,  I will notify the President and Chief  Executive
         Officer of the Company,  both verbally and confirmed in writing  within
         seven days.  With the exception of the  provisions of paragraph 7, this
         Release  will not be  effective  or  enforceable  until  the  foregoing
         revocation period has expired.

9.       The amounts  provided  under this Release are not offered in connection
         with any  specific  exit  incentives  or other  employment  termination
         program.

10.      I agree not to disparage the Bank, its officers, employees or agents of
         the Bank either within the Bank or externally in any way.

11.      I warrant that I have not assigned any right or claim  released in this
         Release.

12.      This Release is binding on my heirs and assigns.

13.      In executing this Release, I am not relying on any representations made
         to me by the Bank.

14.      I  expressly  assume  any risk that the facts and law  concerning  this
         Release may be other than as presently known to me.

15.      This Release  constitutes the sole and entire agreement I have with the
         Bank and supersedes  any and all  understandings  and  agreements  made
         prior to the date of this Release.

16.      This Release shall be governed in all respects by the laws of the State
         of California. No action involving this Release or my employment by the
         Bank may be brought  except in state or federal  courts  located in the
         State of California.

I HAVE READ AND UNDERSTAND THIS RELEASE AND AGREE TO ALL ITS TERMS.

                                               ---------------------------------
                                               Signature

------------------                             ---------------------------------
Date                                           Print NameNORTH BAY BANCORP

                             2002 DEFERRED FEE PLAN

                                    ARTICLE 1

                        Introduction and Purpose of Plan

         1.1  Establishment  of Plan.  North Bay  Bancorp,  a financial  holding
company (the  "Company"),  has adopted this 2002  Deferred Fee Plan (the "Plan")
effective  as of May 28,  2002 (the "Plan  Effective  Date").  The Plan shall be
administered for the exclusive  benefit of directors and officers of the Company
and its wholly-owned  subsidiaries  ("Subsidiaries") who are engaged or employed
by the Company  and/or its Subsidiary or  Subsidiaries  after the Plan Effective
Date.

         1.2 Purpose of Plan. The purpose of this Plan is to encourage directors
to  remain  members  of the  Board  of  Directors  of  the  Company  and/or  its
Subsidiaries,  encourage  officers to remain  officers of the Company and/or its
Subsidiaries,  and  enable  directors  and  officers  of  the  Company  and  its
Subsidiaries  to enhance their  retirement  security by permitting them to enter
into  agreements  with the  Company  and/or its  Subsidiaries  to defer all or a
portion of their Fees and receive benefits at retirement, termination of service
as a director  or officer  prior to  retirement,  disability,  death,  change in
control  of  the  Company,  or  in  the  event  of  financial  hardship  due  to
unforeseeable emergencies.

         1.3 Eligible Directors and Officers.  Incumbent  directors and officers
of the Company and its Subsidiaries  not  participating in the 1999 Deferred Fee
Plan  (as  defined  below)  are  eligible  to  participate  in this  Plan  after
completing  one year of service (each such  director,  a  "Director";  each such
officer, an "Officer") with credit for service prior to the Plan Effective Date.

         1.4 Deferred Fee Agreements.  Participants in the Plan shall enter into
a Deferred  Fee  Agreement  substantially  in the form  attached to this Plan as
Exhibit A (the "Deferred Fee Agreement").

         1.5 Prior Deferred Fee Plan. On November 1, 1999 the Board of Directors
of the Company  adopted and approved a Deferred Fee Plan (the "1999 Deferred Fee
Plan"), which will continue for the benefit of its participants according to the
terms  thereof.  This  Plan is  established  to  provide  substantially  similar
benefits to the 1999 Deferred Fee Plan for the  Directors and Officers  eligible
hereunder,  and this Plan is not intended to replace,  amend or restate the 1999
Deferred Fee Plan.  After the Plan Effective  Date, it is  anticipated  that all
Directors and Officers  eligible  hereunder shall receive  benefits  pursuant to
this Plan in lieu of any  benefit or  benefits  that may be granted or  approved
under the 1999 Deferred Fee Plan.

<PAGE>

                                    ARTICLE 2

                                   Definitions

         Whenever used in the Plan or in a Deferred Fee  Agreement  entered into
pursuant to this Plan, the following  terms shall have the meanings as set forth
in this  Article  II unless a  different  meaning  is  clearly  required  by the
context.

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

                  2.1.1  "Change of Control"  means the transfer of greater than
25% of the Company's outstanding voting common stock followed within twelve (12)
months  by  termination  of the  Director's  status  as a member of the Board of
Directors of the Company or its  Subsidiaries  or  termination  of the Officer's
status as a corporate officer of the Company or its Subsidiaries.

                  2.1.2  "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.

                  2.1.3   "Deferral   Account"   means  the   Deferred   Account
established pursuant to the Deferred Fee Agreement.

                  2.1.4  "Disability"  means,  if the  Director  or  Officer  is
covered  by a  disability  insurance  policy  sponsored  by the  Company  or its
Subsidiaries,  total  disability as defined in such policy without regard to any
waiting  period.  If the  Director  or Officer is not  covered by such a policy,
Disability  means the  Director or Officer  suffering  a  sickness,  accident or
injury  which,  in the  judgment of a  physician  satisfactory  to the  Company,
prevents the Director or Officer from performing substantially all of the normal
duties of a director or officer. As a condition to any benefits, the Company may
require the Director or Officer to submit to such physical or mental evaluations
and tests as the Company's Board of Directors deems appropriate.

                  2.1.5  "Election Form" means the form attached as Exhibit 1 to
the Deferred Fee Agreement.

                  2.1.6  "Fees"  means the total fees payable to the Director or
Officer for  attending  meetings of the Board of Directors of the Company or its
Subsidiaries or committees of such Boards of Directors.

                  2.1.7 "Normal Termination Date" means the Director attaining a
retirement age fixed by the Company's Board of Directors and completing ten (10)
years of service.  The retirement age fixed by the Company's  Board of Directors
for this purpose shall be no earlier than age 65 and no later than age 75.

                                       2
<PAGE>

                  2.1.8 "Termination of Service" means the Director's ceasing to
be a member of the Officer's ceasing to be a corporate officer of the Company or
its Subsidiaries for any reason whatsoever.

                  2.1.9   "Years  of   Service"   means  the  total   number  of
twelve-month  periods during which the Director  serves as a member of the Board
of  Directors  of the Company or its  Subsidiaries  or the  Officer  serves as a
corporate officer of the Company or its Subsidiaries.

                                    ARTICLE 3

                            Participation in the Plan

         3.1  Participation.  At anytime  after the Plan  Effective  Date,  each
Director  and Officer who is  eligible to  participate  in the Plan may become a
participant  in  this  Plan  on  the  first  day  of the  month  next  following
commencement  of his or her second  year of service as a director  or officer of
the Company or its  Subsidiaries  and  enrollment  pursuant  to this  Article 3.
Directors  elected or  appointed to the Board of Directors of the Company or its
Subsidiaries  shall be deemed to commence  their service at the time such person
assumes  office.   Officers   appointed  as  officers  of  the  Company  or  its
Subsidiaries  shall be deemed to commence  their service at the time such person
assumes office.

         3.2  Directors.  At any time after the Plan  Effective  Date,  eligible
Directors may enroll in the Plan by completing a Election Form and submitting it
to the Administrator. Enrollment shall be effective on or after the first day of
the  month  following  the date the  Election  Form is  properly  completed  and
accepted by the  Administrator  and the director  and the Company or  applicable
subsidiary have executed and delivered to each other a Deferred Fee Agreement.

         3.3  Officers.  At any time  after the Plan  Effective  Date,  eligible
officers  may  enroll  in the  Plan  upon  approval  of the  Company's  Board of
Directors  and  by  completing  an  Election  Form  and  submitting  it  to  the
Administrator.  Enrollment  shall be  effective on or after the first day of the
month following the date the Election Form is properly completed and accepted by
the Administrator and the officer and the Company or applicable  subsidiary have
executed and delivered to each other a Deferred Fee Agreement.

                                    ARTICLE 4

                            Deferral of Compensation

         4.1  Maximum Deferral.  There shall be no  limitation on the amount any
participant can defer in any taxable year.

         4.2  Minimum Deferral.  The minimum deferral amount for any participant
in  any  taxable  year  shall  not be  less  than  fifty  percent  (50%)  of the
participant's Fees.

                                       3
<PAGE>

         4.3  Modifications of Amount Deferred.  As provided in the Deferred Fee
Agreement,  a participant may change  deferral with respect to compensation  not
yet  earned  by  submitting  a  new  properly  executed  Election  Form  to  the
Administrator  at least ten (10) days  prior to the  beginning  of each  taxable
year. Such change shall take effect as soon as administratively  practicable but
not earlier than the first pay period following  receipt by the Administrator of
such Election Form.

         4.4  Effect of Modification of Deferral. As more particularly  provided
in  the  Deferred  Fee  Agreement,  modification  of  deferral  will  result  in
adjustment of benefits at  retirement,  termination  of service as a director or
officer  prior to  retirement,  disability,  death,  change  in  control  of the
Company, or in the event of financial hardship due to unforeseeable emergencies.

                                    ARTICLE 5

                            Distribution of Benefits

         5.1  Eligibility  for Payment.  Distribution  of benefits from the Plan
shall be made in accordance with the each participant's Deferred Fee Agreement.

         5.2 Distribution Due to Unforeseeable  Financial Emergency. As provided
in the Deferred Fee Agreement,  a participant may request a distribution  due to
hardship.

         5.3  Commencement  of  Distributions.  Distribution  of  benefits  to a
participant  under this Plan shall  commence as  provided  in the  participant's
Deferred Fee Agreement.

                                    ARTICLE 6

                          Form of Benefit Distributions

         6.1 Election.  A participant  may elect the form of distribution of his
or her benefits.

         6.2 Forms of  Distribution.  A participant may elect  distributions  of
benefits in one of the following forms:

         (a) Lump sum. A single payment of the entire balance of a participant's
Deferral Account.

         (b) Installments. Periodic payments over a specified period of time.

                                    ARTICLE 7

                             Beneficiary Information

         7.1  Beneficiary  Designation.   A  participant  shall  have  right  to
designate a  beneficiary,  and revoke or modify such  designation at any time as
provided  in  the  participant's  Deferred  Fee  Agreement.  In  the  event  the
participant  fails to  designate  a  beneficiary,  his or her  Deferral  Account
balance  shall be  distributed  as provided in the  participant's  Deferred  Fee
Agreement.

                                       4
<PAGE>

                                    ARTICLE 8

                               Plan Administration

         8.1 Plan  Administration.  The  Company's  Board of Directors  shall be
responsible for appointing an  Administrator to administer the Plan on behalf of
the Company and its Subsidiaries.  Such  Administrator may be an individual or a
committee   authorized  to  act   collectively   on  behalf  of  the  Plan.  The
Administrator  shall  administer  the  Plan  consistent  with  the  Plan and the
Deferred Fee Agreements and establish Deferral Accounts for each participant.

         8.2 Ownership of Assets.  All amounts of Fees deferred  under the Plan,
all property and rights purchased with such amounts and all income  attributable
to such amounts,  property or rights shall remain  (until made  available to the
participant or beneficiary) solely the property and rights of the Company or its
Subsidiaries  (without being  restricted to the provision of benefits under this
Plan) and shall be subject to the claims of the Company's  general  creditors of
the Company or applicable subsidiary.

                                    ARTICLE 9

                        Amendment or Termination of Plan

         9.1  Amendment of Plan.  The Company  shall have the right to amend the
Plan, at any time and from time to time, in whole or in part.  The Company shall
notify each participant in writing of any Plan amendment.

         9.2  Termination.  Although  the Company has adopted this Plan with the
intention and  expectation  to maintain the Plan  indefinitely,  the Company may
terminate  or  discontinue  the Plan in whole or in part at any time without any
liability for such termination or  discontinuance.  Upon Plan  termination,  all
deferrals  shall cease and  participants'  Deferred  Account  balances  shall be
distributed as provided in the Deferred Fee Agreements.

                                   ARTICLE 10

                                  Miscellaneous

         10.1 Limitation of Rights.  Neither the  establishment of this Plan nor
any  modification  thereof,  nor the  creation of any fund or  account,  nor the
payment of any benefits, shall be construed as giving a participant or any other
person any legal or  equitable  right  against the  Company or its  Subsidiaries
except as provided in the Plan or Deferred Fee Agreements.

         10.2  Limitation  on  Assignment.  Benefits  under this Plan may not be
assigned,  sold, transferred,  or encumbered,  and any attempt to do so shall be
void. A participant's or beneficiary's interest in benefits under the Plan shall
not be subject to debts or  liabilities  of any kind and shall not be subject to
attachment, garnishment or other legal process.

                                       5
<PAGE>

         10.3  Severability.  If a court of  competent  jurisdiction  holds  any
provision of this Plan to be invalid or unenforceable,  the remaining provisions
of this Plan shall continue to be fully effective.

         10.4  Applicable  Law. This Plan shall be construed in accordance  with
applicable federal law and, to the extent otherwise applicable,  the laws of the
State of California.

Adopted by the Board of Directors on May 28, 2002

                                       6
<PAGE>

                                    Exhibit A

                             DEFERRED FEE AGREEMENT

         THIS DEFERRED FEE AGREEMENT (this  "Agreement") is made this ___ day of
_______,  20___ by and between  _________________  [North Bay Bancorp or name of
subsidiary]   (the   "Provider"),   and  [NAME  OF  DIRECTOR  OR  OFFICER]  (the
"Director"[OR "OFFICER"; CHANGE THROUGHOUT]).

                                  INTRODUCTION

         North  Bay  Bancorp  (the   "Company")  has  adopted  a  2002  Deferred
Compensation  Plan (the "Plan") for the benefit of the directors and officers of
the Company and its  Subsidiaries as more  particularly set forth in the Plan as
approved by the Company's  Board of Directors on May 28, 2002.  Any  capitalized
terms that are not defined  herein shall have the  meanings  ascribed to them as
set forth in the Plan.

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

         In  furtherance  of the Plan and the  purpose  of this  Agreement,  the
Provider and the Director have entered into this Agreement  pursuant and subject
to all of the  provisions  of the Plan  which  are  incorporated  herein by this
reference and shall govern in the event of any inconsistency.

                                    AGREEMENT

The Director and the Provider agree as follows:

1.   Deferral Election.

         1.1  Initial  Election.  The  Director  shall make an initial  deferral
election under this Agreement by filing with the Administrator a signed Election
Form  (attached  hereto as Exhibit 1) within  thirty (30) 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
Administrator.

         1.2 Election Changes.

                  1.2.1 Generally. The Director may modify the amount of Fees to
be deferred by filing a subsequent  signed Election Form with the  Administrator
at least ten (10) days prior to the beginning of each taxable year. The modified
deferral  shall be effective  as soon as  administratively  practicable  but not
earlier than the first pay period following receipt by the

<PAGE>

Administrator of such Election Form; provided,  however,  deferral changes shall
not reduce the amount of Fees  deferred  to less than the  minimum  deferral  or
increase  the  amount  of  Fees  deferred  to more  than  the  maximum  deferral
established by the Plan. The Director may not change the form of benefit payment
initially elected under Section 2.1.

                 1.2.2   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  Administrator  may reduce or cease
future deferrals under this Agreement.

2.   Deferral Account.

         2.1.  Establishing  and  Crediting.  The  Provider  shall  establish  a
Deferral Account on its books for the Director, and shall credit to the Deferral
Account the following amounts:

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

                  2.1.2 Interest. On the first day of each month and immediately
prior to the payment of any benefits,  interest on the account balance since the
preceding credit under this Section 3.1.2, if any, at an annual rate, compounded
monthly,  equal to the rate determined by the Company's  Board of Directors,  in
its sole discretion.

         2.2 Statement of Account.  The Provider  shall provide to the Director,
within ninety (90) days after the end of each taxable year, a statement  setting
forth the Deferral Account balance.

         2.3 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
Provider for the payment of benefits.  The benefits  represent the mere Provider
promise to pay such  benefits.  The  Director's  rights  are not  subject in any
manner  to  anticipation,   alienation,  sale,  transfer,   assignment,  pledge,
encumbrance, attachment, or garnishment by the Director's creditors.

3.   Lifetime Benefits.

         3.1 Normal  Termination  Benefit.  Upon the  Director's  Termination of
Service on or after the Normal  Termination  Date, the Provider shall pay to the
Director the benefit described in this Section 3.1.

                  3.1.1 Amount of Benefit. The benefit under this Section 3.1 is
the Deferral Account balance at the Director's Termination of Service.

                  3.1.2 Payment of Benefit.  The Provider  shall pay the benefit
to the Director in the form elected by the  Director on the Election  Form.  The
Provider shall continue to credit interest under Section 2.1.2.

                                       2
<PAGE>

         3.2 Early Termination  Benefit. If the Director terminates service as a
director  before the Normal  Termination  Dateby reason of removal in accordance
with the  Company's or  Provider's  Bylaws or pursuant to an order issued by any
governmental  agency with  authority to examine  and/or  regulate the Company or
Provider,  the Provider shall pay to the Director the benefit  described in this
Section 3.2.

                  3.2.1 Amount of Benefit. The benefit under this Section 3.2 is
calculated by recomputing  the Deferral  Account balance from its inception with
the following modification:

                  3.2.1.1  Interest  Rate  Reduction.  The  interest  rate under
Section 2.1.2 shall be reduced by two-hundred (200) basis points.

                  3.2.2 Payment of Benefit.  The Provider  shall pay the benefit
to the Director in the form elected by the  Director on the Election  Form.  The
Provider shall continue to credit interest under Section 2.1.2.

         3.3  Disability  Benefit.  If  the  Director  terminates  service  as a
director for Disability prior to the Normal  Retirement Date, the Provider shall
pay to the Director the benefit described in this Section 3.3.

                  3.3.1 Amount of Benefit. The benefit under this Section 3.3 is
  the Deferral Account balance at the Director's Termination of Service.

                  3.3.2 Payment of Benefit.  The Provider  shall pay the benefit
to the Director in the form elected by the  Director on the Election  Form.  The
Provider shall continue to credit interest under Section 2.1.2.

         3.4  Change of  Control  Benefit.  Upon a Change of  Control  while the
Director is in the active service of the Provider, the Provider shall pay to the
Director the benefit  described in this Section 3.4 in lieu of any other benefit
under this Agreement.

                  3.4.1 Amount of Benefit. The benefit under this Section 3.4 is
the  Deferral  Account  balance  at the date of the  Director's  Termination  of
Service.

                  3.4.2 Payment of Benefit.  The Provider  shall pay the benefit
to the  Director  in a lump sum within  thirty  (30) days  after the  Director's
Termination of Service.

         3.5 Hardship Distribution. Upon the Provider's determination (following
petition by the  Director)  that the  Director  has  suffered  an  unforeseeable
financial emergency as described in Section 1.2.2, the Provider shall distribute
to the Director all or a portion of the Deferral  Account  balance as determined
by the  Provider,  but in no event  shall the  distribution  be greater  than is
necessary to relieve the financial hardship.

4.   Death Benefits

         4.1  Death During  Active  Service.  If the  Director dies while in the
active service of the

                                       3
<PAGE>

Provider, the Provider shall pay to the Director's beneficiary (see also Section
5 below) the benefit described in this Section 4.1.

                  4.1.1 Amount of Benefit.  The benefit under Section 4.1 is the
amount of the Deferral Account Balance at the date of the Director's death.

                  4.1.2 Payment of Benefit.  The Provider  shall pay the benefit
to the beneficiary  within sixty (60) days following the Director's  death.  The
Provider shall continue to credit interest under Section 2.1.2.

         4.2  Death During  Benefit  Period.  If the Director dies after benefit
payments  have  commenced  under this  Agreement  but before  receiving all such
payments,  the  Provider  shall pay the  remaining  benefits  to the  Director's
beneficiary  at the same time and in the same  amounts they would have been paid
to the Director had the Director survived.

5.   Beneficiaries.

         5.1. Beneficiary   Designations.   The   Director  shall   designate  a
beneficiary by filing a written designation  (attached hereto as Exhibit 2) with
the Administrator. 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  Administrator  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.

         5.2  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  Provider may pay such benefit to the
guardian,  legal  representative  or person  having  the care or custody of such
minor,  incompetent  person or incapable  person.  The Administrator 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
Provider and Company from all liability with respect to such benefit.

6.   General Limitations.

Notwithstanding  any provision of this  Agreement to the contrary,  the Provider
shall not pay any benefit under this Agreement:

         6.1 Excess  Parachute  Payment.  To the extent the benefit  would be an
excess parachute payment under Section 280G of the Code.

         6.2 Termination  for Cause. If the Director's  service as a director is
terminated for:

                  6.2.1  Gross negligence or gross neglect of duties;

                  6.2.2  Commission  of  a  felony  or  of  a  gross misdemeanor
involving moral turpitude; or

                                       4
<PAGE>

                  6.2.3  Fraud, disloyalty, dishonesty  or  willful violation of
any law or significant  policy of the Company or its  Subsidiaries  committed in
connection  with the  Director's  service and resulting in an adverse  financial
effect on the Company or its Subsidiaries.

                  6.2.4.  Misconduct  resulting in an order of any  governmental
agency that the Director's service be terminated or the Director resign.

7.   Claims and Review Procedures.

         7.1 Claims  Procedure.  The  Administrator  shall notify the Director's
beneficiary  in  writing,  within  thirty  (30)  days  of  his  or  her  written
application  for  benefits,  of his or her  eligibility  or  noneligibility  for
benefits  under  the  Agreement.  If  the  Administrator   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  Administrator  determines  that there are special  circumstances  requiring
additional  time  to  make  a  decision,  the  Administrator  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
Administrator  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  Compensation
Committee of the Company's Board of Directors (the "Compensation  Committee") by
filing a petition for review with the Administrator within sixty (60) days after
receipt of the notice issued by the Administrator. 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
Administrator  of the  petition,  the  Compensation  Committee  shall afford the
beneficiary (and counsel,  if any) an opportunity to present his or her position
to the  Compensation  Committee  orally or in writing,  and the  beneficiary (or
counsel)  shall  have  the  right  to  review  the  pertinent   documents.   The
Administrator  shall  notify the  beneficiary  of the  Compensation  Committee's
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 Administrator, but notice of this deferral shall be given to
the beneficiary.

8.   Amendments and Termination.

The  Provider  may amend or  terminate  this  Agreement at any time prior to the
Director's Termination of Service by written notice to the Director. 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.

                                       5
<PAGE>

9.   Miscellaneous.

         9.1 Binding  Effect.  This  Agreement  shall bind the  Director and the
Provider,  their  beneficiaries,   survivors,   executors,   administrators  and
transferees, and, where expressly applicable, the Company.

         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
Provider,  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 Provider  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 the State 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  Provider  for the payment of  benefits  under this
Agreement.  The benefits  represent the mere promise by the Provider 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.

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

DIRECTOR:

-----------------------------------------------------

PROVIDER:
[NORTH BAY BANCORP, THE VINTAGE BANK, SOLANO BANK]

By:
     ------------------------------------------------
Name:
Title:  President & CEO

                                       6
<PAGE>

                                    Exhibit 1

                             DEFERRED FEE AGREEMENT

                          Deferral and Benefit Election
<TABLE>
<CAPTION>
I elect to defer Fees under my Deferral Fee Agreement, as follows:

======================================== ===================================== =====================================

         Amount of Deferral                      Frequency of Deferral                       Duration
======================================== ===================================== =====================================

<S>                                       <C>                                   <C>
     [Initial and Complete One]               [Initial and Complete One]            [Initial and Complete One]

 ___ I elect to defer ___% of Fees        ___  Beginning of Year                ___ This Year only

___ I elect to defer $ _____              ___  Each pay period                  ___  For ___ Years
of Fees

                                          ___  Monthly                          ___     Until the Normal
___ I elect not to defer Fees                                                           Termination Date
                                          ___  Quarterly

                                          ___  Semi-Annually

                                          ___  End of Year

---------------------------------------- ------------------------------------- -------------------------------------

======================================== ===================================== =====================================
</TABLE>

I  understand  that I may  change  the  amount,  frequency  and  duration  of my
deferrals   by  filing  a  new   election   form  with  the  North  Bay  Bancorp
Administrator,  provided,  however,  that any  subsequent  election  will not be
effective  until the calendar year  following the year in which the new election
is received by the Administrator.

                                 Form of Benefit

I elect to receive benefits under the Agreement in the following form:
                  _____  Lump sum
                  _____  Equal monthly installments for _______ months

I understand that I may not change the form of benefit elected,  even if I later
change the amount of my deferrals under this Agreement.

Signature
           ------------------------------------------
                  [Director Name]
Date:
       -----------------------------

Accepted this ___ day of                    , 20___.
                         -------------------

By:
     ------------------------------------------------
Name:
      -----------------------------------------------
Title:
       ----------------------------------------------

<PAGE>

                                    Exhibit 2

                             DEFERRED FEE AGREEMENT

                             Beneficiary Designation

         Subject to the terms and  conditions  of the 2002 Deferred Fee Plan and
of the  Deferred  Fee  Agreement  and  pursuant to Section 5 of the Deferred Fee
Agreement,  the  Undersigned  hereby  designates the following  beneficiary  for
purposes of the 2002 Deferred Fee Plan and the Deferred Fee Agreement:

BENEFICIARY:

Exact Name:
                  --------------------------------------------

                  --------------------------------------------
Address/Contact:
                  --------------------------------------------

                  --------------------------------------------

IN WITNESS WHEREOF:

Signature:
            -----------------------------------------

Date:
       ----------------------------------------------

Accepted this ___ day of                    , 20___.
                         -------------------

By:
     ------------------------------------------------
Name:
      -----------------------------------------------
Title:
       ----------------------------------------------

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00041-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00041-of-00352.parquet"}]]