Document:

Exhibit 10.35

                               AMERICAN RIVER BANK

                          SALARY CONTINUATION AGREEMENT

         THIS SALARY CONTINUATION AGREEMENT (this "Agreement") is made and
entered into this day of August 22, 2003, by and between American River Bank, a
California chartered, FDIC-insured bank with its main office in Sacramento,
California (the "Bank") and Douglas E. Tow (the "Executive").

         WHEREAS, the Bank is a wholly-owned subsidiary of American River
Holdings, a California corporation and bank holding company registered under the
Bank Holding Company Act of 1956, as amended, ("ARH");

         WHEREAS, the Executive has contributed substantially to the success of
the Bank, and the Bank desires that the Executive continue in its employ;

         WHEREAS, to encourage the Executive to remain an employee of the Bank,
the Bank is willing to provide salary continuation benefits to the Executive,
which the Bank will pay from its general assets;

         WHEREAS, none of the conditions or events included in the definition of
the term "golden parachute payment" that is set forth in ss.18(k)(4)(A) of the
Federal Deposit Insurance Act [12 U.S.C. ss.1828(k)(4)(A)] exists or, to the
best knowledge of the Bank, is contemplated by this Agreement insofar as the
Bank is concerned;

         WHEREAS, the Bank and its Board of Directors have consulted with and
have been advised by representatives of Meyer-Chatfield Corporation regarding
compliance with applicable requirements of bank regulatory agencies having
jurisdiction over the Bank pertaining to this Agreement including the Bank's
acquisition, ownership, control and title to and all rights and benefits under
one or more policies of insurance that the Bank may elect to purchase in
connection with this Agreement, including, without limitation, Bulletin 2000-23
issued by the Office of the Comptroller of the Currency and pronouncements by
the Board of Governors of the Federal Reserve System and the Federal Deposit
Insurance Corporation related thereto;

         WHEREAS, it is the intent of the parties hereto that this Agreement be
considered an unfunded arrangement maintained primarily to provide supplemental
retirement benefits for the Executive, and to be considered a nonqualified
benefit plan for purposes of the Employee Retirement Income Security Act of
1974, as amended ("ERISA"); and

         WHEREAS, the Executive is fully advised of the Bank's financial status
and the fact that the Executive has no interest in or rights under any insurance
policies the Bank may elect to purchase in connection with this Agreement.

         NOW, THEREFORE, in consideration of the foregoing premises and other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Executive and the Bank hereby agree as follows:

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                                    Article 1
                                   Definitions

         The following words and phrases used in this Agreement have the
meanings specified:

         1.1      "Accrual Balance" means the amount required to be accrued by
the Bank as required under generally accepted accounting principles to account
for benefits that may become payable to the Executive under this Agreement.

         1.2      "Change in Control" means the occurrence of any of the
following events with respect to the Bank:

                  (a)      a change in control of a nature that would be
required to be reported in response to Item 6(e) of Schedule 14A of Regulation
14A promulgated under the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), or in response to any other form or report to the regulatory
agencies or governmental authorities having jurisdiction over the Bank or ARH,
or any stock exchange on which ARH's shares are listed which requires the
reporting of a change in control;

                  (b)      any merger, consolidation or reorganization of the
Bank or ARH in which the Bank or ARH does not survive;

                  (c)      any sale, lease, exchange, mortgage, pledge, transfer
or other disposition (in one transaction or a series of transactions) of any
assets of the Bank or ARH having an aggregate fair market value of fifty percent
(50%) of the total value of the assets of the Bank or ARH, reflected in the most
recent balance sheet of the Bank or ARH;

                  (d)      a transaction whereby any "person" (as such term is
used in the Exchange Act) or any individual, corporation, partnership, trust or
any other entity is or becomes the beneficial owner, directly or indirectly, of
securities of the Bank or ARH representing twenty-five percent (25%) or more of
the combined voting power of the Bank's or ARH's then outstanding securities;

                  (e)      a situation where, in any one-year period,
individuals who at the beginning of such period constitute the Board of
Directors of the Bank or ARH cease for any reason to constitute at least a
majority thereof, except in the cases of retirement, disability or death and
unless the election, or the nomination for election by the Bank's or ARH's
shareholder(s), of each new director is approved by a vote of at least
three-quarters (3/4) of the directors then still in office who were directors at
the beginning of the period; or

                  (f)      the shareholder(s) of the Bank or ARH approve the
sale or transfer of substantially all of the Bank's or ARH's assets to parties
that are not within a "controlled group of corporations" (as that term is
defined in section 1563 of the Code) in which the Bank or ARH is a member.

         Notwithstanding the foregoing or anything else contained herein to the
contrary, there shall not be a Change in Control for purposes of this Agreement
if the event which would otherwise come within the meaning of the term Change in
Control involves (i) an Employee Stock Ownership Plan sponsored by ARH which
plan is the party that acquires "control" or is the principal participant in the
transaction constituting a "change in control," as described above, or (ii) a
reorganization in which the Bank is merged with and into another wholly-owned
bank subsidiary of ARH to consolidate operations under the charter of such other
bank subsidiary, or (iii) if the individuals who constitute the directors of the
Bank or ARH at the time a specific transaction described in Section 1.2(b) or
1.2(f) is first presented or disclosed to the Board of Directors of the Bank or

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ARH will, according to the terms of the definitive agreement for the
transaction, constitute a majority of the members of the board of directors of
the resulting corporation or acquiring person immediately after the transaction,
then, before an event that would otherwise constitute a Change in Control shall
be deemed to have occurred, such Board of Directors of the Bank or ARH may
determine by majority vote that the specific transaction does not constitute a
Change in Control under Section 1.2(b) or 1.2(f).

         1.3      "Code" means the Internal Revenue Code of 1986, as amended.

         1.4      "Disability" shall have the same meaning given such term in
any policy of disability insurance maintained by the Bank for the benefit of
employees including the Executive. In the absence of such a policy, the term
shall mean bodily injury or disease (mental or physical) which wholly and
continuously prevents the performance of the Executive's duties to the Bank for
at least ninety (90) consecutive days.

         1.5      "Early Termination" means the Termination of Employment before
Normal Retirement Age for reasons other than death, Disability, Termination for
Cause or following a Change in Control.

         1.6      "Early Termination Date" means the month, day and year in
which Early Termination occurs.

         1.7      "Effective Date" means August 22, 2003.

         1.8      Intentional," shall mean an act or failure to act on the
Executive's part that is not in good faith and is without a reasonable belief
that the action or failure to act is in the best interests of the Bank. No act
or failure to act on the part of the Executive shall be deemed to have been
intentional if it was due primarily to an error in judgment or negligence.

         1.9      "Normal Retirement Age" means the Executive's 65th birthday.

         1.10     "Normal Retirement Date" means the date on which the
Termination of Employment occurs after the Executive attains the Normal
Retirement Age.

         1.11     "Plan Year" means a twelve-month period commencing on August
1st, and ending on the last day of July of each year. The initial Plan Year
shall commence on the Effective Date of this Agreement.

         1.12     "Termination for Cause" shall mean the occurrence of any one
or more of the following:

                  (a)      the willful, intentional and material breach of duty
by the Executive in the course of his employment;

                  (b)      the habitual and continued neglect by the Executive
of his employment duties and obligations under this Agreement;

                  (c)      the Executive's willful and intentional violation of
any State of California or federal banking laws, or of the Bylaws, rules,
policies or resolutions of Bank or ARH and their respective subsidiaries, or of
the rules or regulations of the Board of Governors of the Federal Reserve
System, California Department of Financial Institutions or the Federal Deposit
Insurance Corporation, or other regulatory agency or governmental authority
having jurisdiction over Bank or ARH;

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                  (d)      the determination by a state or federal banking
agency or governmental authority having jurisdiction over Bank or ARH that the
Executive is not suitable to act in the capacity for which he is employed by
Bank;

                  (e)      the Executive is convicted of any felony or a crime
involving moral turpitude or commits a fraudulent or dishonest act;

                  (f)      the Executive discloses without authority any secret
or confidential information concerning Bank, ARH or their respective
subsidiaries or takes any action which the Bank's Board of Directors determines,
in its sole discretion and subject to good faith, fair dealing and
reasonableness, constitutes unfair competition with or induces any customer to
breach any contract with Bank, ARH or their respective subsidiaries; or

                  (g)      the Executive breaches the terms or provisions of
this Agreement.

         1.13     "Termination of Employment" means that the Executive ceases to
be employed by the Bank or any affiliate of the Bank for any reason whatsoever,
other than by reason of a leave of absence approved by the Bank or such
affiliate.

                                    Article 2
                                Lifetime Benefits

         2.1      Normal Retirement Benefit. Upon Termination of Employment on
or after the Normal Retirement Age for reasons other than death, the Bank shall
pay to the Executive the benefit described in this Section 2.1 in lieu of any
other benefit under this Agreement.

         2.1.1    Amount of Benefit. The annual benefit under this Section 2.1
is Fifty Thousand Dollars ($50,000). The Bank's Board of Directors, in its sole
discretion, may increase the annual benefit under this Section 2.1.1. However,
any increase shall require the recalculation of Schedule A to this Agreement.

         2.1.2    Payment of Benefit. The Bank shall pay the annual benefit to
the Executive in 12 equal monthly installments payable on the first day of each
month commencing with the month following the Executive's Normal Retirement
Date. The annual benefit shall be paid to the Executive for 15 years.

         2.2      Early Termination Benefit. Upon Early Termination and provided
that the Executive has attained age 62, the Bank shall pay to the Executive the
benefit described in this Section 2.2 in lieu of any other benefit under this
Agreement.

         2.2.1    Amount of Benefit. The benefit under this Section 2.2 is the
Early Termination Annual Benefit amount set forth on Schedule A for the Plan
Year ending immediately prior to the Early Termination Date. The Bank's Board of
Directors, in its sole discretion, may increase the annual benefit under this
Section 2.2.1. However, any increase shall require the recalculation of Schedule
A.

         2.2.2    Payment of Benefit. Provided that the Executive's Early
Termination Date occurs after the Executive's 62nd birthday, the Bank shall pay
the annual benefit to the Executive in 12 equal monthly installments payable on
the first day of each month commencing with the first day of the month following
the Early Termination Date. The annual benefit shall be paid to the Executive
for 15 years.

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         2.3      Disability Benefit. If the Executive terminates employment due
to Disability before Normal Retirement Age, the Bank shall pay to the Executive
the benefit described in this Section 2.3 in lieu of any other benefit under
this Agreement.

         2.3.1    Amount of Benefit. The benefit under this Section 2.3 is the
Disability Annual Benefit amount set forth on Schedule A for the Plan Year
ending immediately prior to the date on which the Termination of Employment
occurs (except during the first Plan Year, the benefit is the amount set forth
for Plan Year 1). The Bank's Board of Directors, in its sole discretion, may
increase the annual benefit under this Section 2.3.1. However, any increase
shall require the recalculation of Schedule A.

         2.3.2    Payment of Benefit. The Bank shall pay the Disability Annual
Benefit amount to the Executive in 12 equal monthly installments payable on the
first day of each month commencing with the month following Termination of
Employment due to Disability. The annual benefit shall be paid to the Executive
for 15 years.

         2.4      Change in Control Benefit. If a Change in Control occurs
during the active service of the Executive with the Bank, and within a period of
two (2) years following consummation of such a Change in Control (i) there
occurs a Termination of Employment; or (ii) without the Executive's consent
there occurs (A) any adverse change in the nature and scope of Executive's
salary or benefits, or (B) any event which reasonably constitutes a constructive
termination (by resignation or otherwise) of the Executive's employment, then
the Executive shall be entitled to receive and the Bank shall pay to the
Executive the benefit described in this Section 2.4 in lieu of any other benefit
under this Agreement.

         2.4.1    Amount of Benefit: The benefit under this Section 2.4 is the
Normal Retirement Age Accrual Balance of Four Hundred Eighty-Seven Thousand Two
Hundred Seventy-Three Dollars ($487,273) required by Section 2.1. In its sole
discretion, the Bank's Board of Directors may increase the benefit under this
Section 2.4.1. However, any increase shall require the recalculation of Schedule
A.

         2.4.2    Payment of Benefit: The Bank shall pay the Change in Control
benefit under Section 2.4 of this Agreement to the Executive in 12 equal monthly
installments payable on the first day of each month commencing with the month
following the occurrence of any event described in clause (i) or (ii) of Section
2.4. The annual benefit shall be paid to the Executive for 15 years.

         2.5      Contradiction in Terms of Agreement and Exhibits. If there is
a contradiction in the terms of this Agreement and the Schedule A attached
hereto with the actual amount of a particular amount due the Executive pursuant
to Section 2.2, 2.3 or 2.4 hereof, then the actual amount of said benefit set
forth in this Agreement shall control.

         2.6      Revisions to Schedule A. In the event that (i) the Bank's
Board of Directors elects to increase the benefits specified in this Article 2,
(ii) the Executive commences to receive benefits other than on the date he
attains the Normal Retirement Age, or (iii) if this Agreement is modified as
provided in Section 7.12 in order to conform to applicable law, rules or
regulations, then Schedule A shall be appropriately modified.

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                                    Article 3
                                 Death Benefits

         3.1      Death During Active Service. If the Executive dies before the
Normal Retirement Age while in the active service of the Bank, the Bank shall
pay to the Executive's beneficiary the benefit set forth in Section 2.1 as if
the Termination of Employment occurred on the date he would have attained the
Normal Retirement Age. The annual benefit under this Section 3.1 shall be the
amount specified in Section 2.1.1 and shall be payable as provided in Section
2.1.2, commencing on the first day of the month following the date of the
Executive's death.

         3.2      Death During Benefit Period. If the Executive dies after any
benefit payments provided pursuant to Article 2 have commenced under this
Agreement but before receiving all such payments, the Bank shall pay to the
Executive's beneficiary, in lieu of any other benefits under this Agreement, the
benefit set forth in Section 2.1 as if the Termination of Employment occurred on
the date he would have attained the Normal Retirement Age. The annual benefit
under this Section 3.2 shall be the amount specified in Section 2.1.1 and shall
be payable as provided in Section 2.1.2, commencing on the first day of the
month following the date of the Executive's death and continuing for the
remaining number of payment periods after taking into account the number of
benefit payments the Executive received prior to his death.

         3.3      Death After Termination of Employment But Before Benefit
Payments Commence. If the Executive is entitled to any benefit payments under
Article 2 of this Agreement, but dies prior to the commencement of the benefit
payments, the Bank shall pay to the Executive's beneficiary, in lieu of any
other benefit under this Agreement, the benefit set forth in Section 2.1 as if
the Termination of Employment occurred on the date he would have attained the
Normal Retirement Age. The annual benefit under this Section 3.3 shall be the
amount specified in Section 2.1.1 and shall be payable as provided in Section
2.1.2, commencing on the first day of the month following the date of the
Executive's death.

                                    Article 4
                                  Beneficiaries

         4.1      Beneficiary Designations. The Executive shall designate a
beneficiary by filing a written designation with the Bank. The Executive may
revoke or modify the designation at any time by filing a new designation.
However, designations will only be effective if signed by the Executive and
accepted by the Bank during the Executive's lifetime. The Executive's
beneficiary designation shall be deemed automatically revoked if the beneficiary
predeceases the Executive, or if the Executive names a spouse as beneficiary and
the marriage is subsequently dissolved. If the Executive dies without a valid
beneficiary designation, all payments shall be made to the Executive's estate.

         4.2      Facility of Payment. If a benefit is payable to a minor, to a
person declared incapacitated, or to a person incapable of handling the
disposition of his or her property, the Bank may pay such benefit to the
guardian, legal representative or person having the care or custody of such
minor, incapacitated person or incapable person. The Bank may require proof of
incapacity, minority or guardianship as it may deem appropriate before
distribution of the benefit. Distribution shall completely discharge the Bank
from all liability for the benefit.

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                                    Article 5
                               General Limitations

         5.1      Termination for Cause. Notwithstanding any provision of this
Agreement to the contrary, the Bank shall not pay any benefit under this
Agreement if the Executive ceases to be employed by the Bank as a result of a
Termination for Cause.

         5.2      Suicide or Misstatement. The Bank shall not pay any benefit
under this Agreement if the Executive commits suicide within two (2) years after
the date of this Agreement, or if the Executive has made any material
misstatement of fact on any application for life insurance purchased by the
Bank.

         5.3      Insolvency. If the California Commissioner of Financial
Institutions appoints the Federal Deposit Insurance Corporation as receiver for
the Bank, all obligations under this Agreement shall terminate as of the date
that the Bank is declared insolvent, subject to any vested rights of the
Executive under applicable law.

         5.4      FDIC Open-Bank Assistance. All obligations under this
Agreement shall be terminated, subject to any vested rights of the Executive
under applicable law, except to the extent it is determined that continuation of
the contract is necessary for the continued operation of the Bank, at the time
the Federal Deposit Insurance Corporation enters into an agreement to provide
assistance to or on behalf of the Bank under the authority contained in Section
13(c) of the Federal Deposit Insurance Act [12 U.S.C. ss.1823(c)].

                                    Article 6
                          Claims and Review Procedures

         6.1      Claims Procedure. A person or beneficiary ("claimant") who has
not received benefits under the Agreement that he or she believes should be paid
shall make a claim for such benefits as follows

         6.1.1    Initiation - Written Claim. The claimant initiates a claim by
submitting to the Bank a written claim for the benefits.

         6.1.2    Timing of Bank Response. The Bank shall respond to such
claimant within 90 days after receiving the claim. If the Bank determines that
special circumstances require additional time for processing the claim, the Bank
can extend the response period by an additional 90 days by notifying the
claimant in writing, prior to the end of the initial 90-day period, that an
additional period is required. The notice of extension must set forth the
special circumstances and the date by which the Bank expects to render its
decision.

         6.1.3    Notice of Decision. If the Bank denies part or all of the
claim, the Bank shall notify the claimant in writing of such denial. The Bank
shall write the notification in a manner calculated to be understood by the
claimant. The notification shall set forth the following:

         6.1.3.1  The specific reasons for the denial;

         6.1.3.2  A reference to the specific provisions of the Agreement on
which the denial is based;

         6.1.3.3  A description of any additional information or material
necessary for the claimant to perfect the claim and an explanation of why it is
needed;

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         6.1.3.4  An explanation of the Agreement's review procedures and the
time limits applicable to such procedures; and

         6.1.3.5  A statement of the claimant's right to bring a civil action
under ERISA Section 502(a) following an adverse benefit determination on review.

         6.2      Review Procedure. If the Bank denies part or all of the claim,
the claimant shall have the opportunity for a full and fair review by the Bank
of the denial, as follows:

         6.2.1    Initiation - Written Request. To initiate the review, the
claimant, within 60 days after receiving the Bank's notice of denial, must file
with the Bank a written request for review.

         6.2.2    Additional Submissions - Information Access. The claimant
shall then have the opportunity to submit written comments, documents, records
and other information relating to the claim. The Bank shall also provide the
claimant, upon request and free of charge, reasonable access to, and copies of,
all documents, records and other information relevant (as defined in applicable
ERISA regulations) to the claimant's claim for benefits.

         6.2.3    Considerations on Review. In considering the review, the Bank
shall take into account all materials and information the claimant submits
relating to the claim, without regard to whether such information was submitted
or considered in the initial benefit determination.

         6.2.4    Timing of Bank Response. The Bank shall respond in writing to
such claimant within 60 days after receiving the request for review. If the Bank
determines that special circumstances require additional time for processing the
claim, the Bank can extend the response period by an additional 60 days by
notifying the claimant in writing, prior to the end of the initial 60-day
period, that an additional period is required. The notice of extension must set
forth the special circumstances and the date by which the Bank expects to render
its decision.

         6.2.5    Notice of Decision. The Bank shall notify the claimant in
writing of its decision on review. The Bank shall write the notification in a
manner calculated to be understood by the claimant. The notification shall set
forth the following:

         6.2.5.1  The specific reason for the denial;

         6.2.5.2  A reference to the specific provisions of the Agreement on
which the denial is based;

         6.2.5.3  A statement that the claimant is entitled to receive, upon
request and free of charge, reasonable access to, and copies of, all documents,
records and other information relevant (as defined in applicable ERISA
regulations) to the claimant's claim for benefits; and

         6.2.5.4  A statement of the claimant's right to bring a civil action
under ERISA Section 502(a).

                                    Article 7
                                  Miscellaneous

         7.1      Amendments and Termination. This Agreement may be amended or
terminated only by a written agreement signed by the Bank and the Executive.

         7.2      Binding Effect. This Agreement shall bind the Executive, the
Bank, and their beneficiaries, survivors, executors, successors, administrators
and transferees.

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         7.3      No Guarantee of Employment. This Agreement is not an
employment policy or contract. It does not give the Executive the right to
remain an employee of the Bank, nor does it interfere with the Bank's right to
discharge the Executive. It also does not require the Executive to remain an
employee nor interfere with the Executive's right to terminate employment at any
time.

         7.4      Non-Transferability. Benefits under this Agreement cannot be
sold, transferred, assigned, pledged, attached or encumbered in any manner.

         7.5      Successors; Binding Agreement. The Bank will require any
successor (whether direct or indirect, by purchase, merger, consolidation or
otherwise) to all or substantially all of the business and/or assets of the
Bank, by an assumption agreement in form and substance satisfactory to the
Executive, to expressly assume and agree to perform this Agreement in the same
manner and to the same extent that the Bank would be required to perform this
Agreement if no such succession had occurred. The Bank's failure to obtain an
assumption agreement before effectiveness of any such succession shall be a
breach of this Agreement and shall entitle the Executive to the Change in
Control Benefit provided in Section 2.4.

         7.6      Tax Withholding. The Bank shall withhold any taxes that are
required to be withheld from the benefits provided under this Agreement.

         7.7      Applicable Law. This 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.

         7.8      Unfunded Arrangement. The Executive and beneficiary are
general unsecured creditors of the Bank for the payment of benefits under this
Agreement. The benefits represent the mere promise by the Bank to pay the
benefits. Rights to benefits are not subject in any manner to anticipation,
alienation, sale, transfer, assignment, pledge, encumbrance, attachment, or
garnishment by creditors. Any insurance on the Executive's life purchased by the
Bank is a general asset of the Bank as to which the Executive and beneficiary
have no preferred or secured claim, or any right, title or interest.

         7.9      Entire Agreement. This Agreement constitutes the entire
agreement between the Bank and the Executive as to the subject matter hereof. No
rights are granted to the Executive by virtue of this Agreement other than those
specifically set forth herein.

         7.10     Administration. The Bank shall have the power to administer
this Agreement, including but not limited to the power to:

                  (a)      Interpret the provisions of the Agreement;

                  (b)      Establish and revise the method of accounting for the
                           Agreement;

                  (c)      Maintain a record of benefit payments; and

                  (d)      Establish rules and prescribe any forms necessary or
                           desirable to administer the Agreement.

         7.11     Named Fiduciary. The Bank shall be the named fiduciary and
plan administrator under the Agreement. The named fiduciary may delegate to
others certain aspects of the management and operation responsibilities of the
plan including the employment of advisors and the delegation of ministerial
duties to qualified individuals.

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         7.12     Severability. If for any reason any provision of this
Agreement is determined by the Bank's Board of Directors, acting in good faith
on advice of counsel or other advisors, or is held by a court, arbiter or other
tribunal of competent jurisdiction, to be invalid, unenforceable or in violation
of any applicable law, rule or regulation, then this Agreement shall be modified
to the minimum extent necessary to render it valid, enforceable and in
compliance with applicable laws, rules and regulations, and as so modified, this
Agreement shall continue in full force and effect.

         7.13     Headings. Caption headings and subheadings herein are included
solely for convenience of reference and shall not affect the meaning or
interpretation of any provision of this Agreement.

         7.14     Notices. Any notices to be given hereunder shall be in writing
and may be transmitted by personal delivery or by U.S. mail, registered or
certified, postage prepaid with return receipt requested. Mailed notices shall
be addressed to the Executive at the address listed in the Bank's personnel file
and to the Bank at its principal business office located at 1545 River Park
Drive, Suite 107, Sacramento, CA 95815. A party may change the address for
receipt of notices by written notice in accordance with this paragraph 7.14.
Notices delivered personally shall be deemed communicated as of the date of
actual receipt; mailed notices shall be deemed communicated as of three (3) days
after the date of mailing.

         7.15     Arbitration. All claims, disputes and other matters in
question arising out of or relating to this Agreement or the breach or
interpretation thereof, other than those matters which are to be determined by
the Bank in its sole and absolute discretion, shall be resolved by binding
arbitration before a representative member, selected by the mutual agreement of
the parties, of the Judicial Arbitration and Mediation Services, Inc. ("JAMS"),
in accordance with the rules and procedures of JAMS then in effect. In the event
JAMS is unable or unwilling to conduct such arbitration, or has discontinued its
business, the parties agree that a representative member, selected by the mutual
agreement of the parties, of the American Arbitration Association ("AAA"), shall
conduct such binding arbitration in accordance with the rules and procedures of
the AAA then in effect. Notice of the demand for arbitration shall be filed in
writing with the other party to this Agreement and with JAMS (or AAA, if
necessary). In no event shall the demand for arbitration be made after the date
when institution of legal or equitable proceedings based on such claim, dispute
or other matter in question would be barred by the applicable statute of
limitations. Any award rendered by JAMS or AAA shall be final and binding upon
the parties, and as applicable, their respective heirs, beneficiaries, legal
representatives, agents, successors and assigns, and may be entered in any court
having jurisdiction thereof. The obligation of the parties to arbitrate pursuant
to this clause shall be specifically enforceable in accordance with, and shall
be conducted consistently with, the provisions of Title 9 of Part 3 of the
California Code of Civil Procedure. Any arbitration hereunder shall be conducted
in Sacramento, California, unless otherwise agreed to by the parties.

         7.16     Attorneys' Fees and Costs. In the event of litigation,
arbitration or any other action or proceeding between the parties to interpret
or enforce this Agreement or any part thereof or otherwise arising out of or
relating to this Agreement, the prevailing party shall be entitled to recover
its costs related to any such action or proceeding and its reasonable fees of
attorneys, accountants and expert witnesses incurred by such party in connection
with any such action or proceeding. The prevailing party shall be deemed to be
the party which obtains substantially the relief sought by final resolution,
compromise or settlement, or as may otherwise be determined by order of a court
of competent jurisdiction in the event of litigation, an award or decision of
one or more arbitrators in the event of arbitration, or a decision of a
comparable official in the event of any other action or proceeding. Any
obligation to indemnify under this Agreement includes the obligation to pay
reasonable fees of attorneys, accountants and expert witnesses incurred by the
indemnified party in connection with matters subject to indemnification.

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         7.17     Internal Revenue Code Section 280G. If all or any portion of
the amounts payable to the Executive pursuant to this Agreement alone or
together with other payments which the Executive has the right to receive from
the Bank, constitute "excess parachute payments" within the meaning of Section
280G of the Internal Revenue Code of 1986, as amended (the "Code"), that are
subject to the excise tax imposed by Section 4999 of the Code (or similar tax
and/or assessment), such amounts payable hereunder shall be reduced to the
extent necessary, after first applying any similar reduction in payments to be
received from any other plan or program sponsored by the Bank from which the
Executive has a right to receive payments subject to Sections 280G and 4999 of
the Code, including without limitation any employment agreement made between the
Bank and the Executive, so as to cause a reduction of any excise tax pursuant to
Section 4999 of the Code to equal "zero".

         7.18     Review Procedure. Not less frequently than every three (3)
years during the term of this Agreement prior to the Executive commencing to
receive any benefits hereunder, the Bank will review this Agreement and the
benefits that may become payable hereunder to determine whether to maintain the
benefits at the amounts specified in this Agreement or to increase the benefits.
If the Bank determines, in its sole discretion, to increase the benefits,
Schedule A shall be appropriately modified.

                                       163
<PAGE>

         IN WITNESS WHEREOF, the Executive and a duly authorized officer of the
Bank have executed this Salary Continuation Agreement in the City of Sacramento,
State of California, as of the day and year first written above.

EXECUTIVE:                             BANK:

                                       AMERICAN RIVER BANK

/s/ DOUGLAS E. TOW                     By: /s/ CHARLES D. FITE
------------------------------------       -------------------------------------
Douglas E. Tow                             Charles D. Fite
                                           Chairman of the Board

                                       164
<PAGE>

                             BENEFICIARY DESIGNATION

                               AMERICAN RIVER BANK

                          SALARY CONTINUATION AGREEMENT

         I, Douglas E. Tow, designate the following as beneficiary of any
benefits to which I may be entitled under my Salary Continuation Agreement with
the Bank dated August 22, 2003:

Primary:      Kathy E. Tow
           -----------------------------

Contingent:   Estate of Douglas E. Tow
           -----------------------------

         Note: To name a trust as beneficiary, please provide the name of the
trustee(s) and the exact name and date of the trust agreement.

         I understand that I may change these beneficiary designations by filing
a new written designation with the Bank. I further understand that the
designations will be automatically revoked if the beneficiary predeceases me, or
if I have named my spouse as beneficiary and our marriage is subsequently
dissolved.

Signature: /s/ DOUGLAS E. TOW
           -----------------------------

Date:      August 22, 2003
           -----------------------------

Accepted by the Bank this 26 day of August, 2003
                         ----

By: /s/ CHARLES D. FITE
    ------------------------------------
    Charles D. Fite
    Chairman of the Board

                                       165
<PAGE>
<TABLE>
<CAPTION>

                                   SCHEDULE A

                               AMERICAN RIVER BANK

                          SALARY CONTINUATION AGREEMENT

                               FOR DOUGLAS E. TOW

---------- -------------- ----------  ----------  ----------  ------------  ------------
                             Age At                 Early
                              Plan                Termination   Disability   Change in
   Plan      Plan Year        Year       Accrual    Benefit      Benefit      Control
   Year       Ending          End        Balance   Payable(1)   Payable(2)   Benefit(3)
---------- -------------- ----------  ----------  ----------  ------------  ------------
<S>                  <C>          <C> <C>         <C>         <C>           <C>
    1                2004         50  $   11,038  $        0  $      1,133  $     32,485
---------- -------------- ----------  ----------  ----------  ------------  ------------
    2                2005         51  $   23,622  $        0  $      2,424  $     32,485
---------- -------------- ----------  ----------  ----------  ------------  ------------
    3                2006         52  $   37,913  $        0  $      3,890  $     32,485
---------- -------------- ----------  ----------  ----------  ------------  ------------
    4                2007         53  $   54,089  $        0  $      5,550  $     32,485
---------- -------------- ----------  ----------  ----------  ------------  ------------
    5                2008         54  $   72,344  $        0  $      7,423  $     32,485
---------- -------------- ----------  ----------  ----------  ------------  ------------
    6                2009         55  $   92,889  $        0  $      9,532  $     32,485
---------- -------------- ----------  ----------  ----------  ------------  ------------
    7                2010         56  $  115,957  $        0  $     11,899  $     32,485
---------- -------------- ----------  ----------  ----------  ------------  ------------
    8                2011         57  $  141,799  $        0  $     14,550  $     32,485
---------- -------------- ----------  ----------  ----------  ------------  ------------
    9                2012         58  $  170,690  $        0  $     17,515  $     32,485
---------- -------------- ----------  ----------  ----------  ------------  ------------
   10                2013         59  $  202,932  $        0  $     20,823  $     32,485
---------- -------------- ----------  ----------  ----------  ------------  ------------
   11                2014         60  $  238,851  $        0  $     24,509  $     32,485
---------- -------------- ----------  ----------  ----------  ------------  ------------
   12                2015         61  $  278,804  $        0  $     28,609  $     32,485
---------- -------------- ----------  ----------  ----------  ------------  ------------
   13                2016         62  $  323,180  $   33,162  $     33,162  $     32,485
---------- -------------- ----------  ----------  ----------  ------------  ------------
   14                2017         63  $  372,403  $   38,213  $     38,213  $     32,485
---------- -------------- ----------  ----------  ----------  ------------  ------------
   15                2018         64  $  426,933  $   43,808  $     43,808  $     32,485
---------- -------------- ----------  ----------  ----------  ------------  ------------
   16                2019         65  $  487,273  $   50,000  $     50,000  $     32,485
---------- -------------- ----------  ----------  ----------  ------------  ------------
</TABLE>

(1)  The total annual benefit for 15 years following Termination of Employment
     using an assumed rate of return of 7%.
(2)  The total annual benefit for 15 years following Termination of Employment
     due to Disability using an assumed rate of return of 7%.
(3)  The total annual benefit for 15 years following Change in Control using an
     assumed rate of return of 0%.

                                      166Exhibit 10.36

                               AMERICAN RIVER BANK

                          SALARY CONTINUATION AGREEMENT

         THIS SALARY CONTINUATION AGREEMENT (this "Agreement") is made and
entered into this day of August 22, 2003, by and between American River Bank, a
California chartered, FDIC-insured bank with its main office in Sacramento,
California (the "Bank") and William L. Young (the "Executive").

         WHEREAS, the Bank is a wholly-owned subsidiary of American River
Holdings, a California corporation and bank holding company registered under the
Bank Holding Company Act of 1956, as amended, ("ARH");

         WHEREAS, the Executive has contributed substantially to the success of
the Bank, and the Bank desires that the Executive continue in its employ;

         WHEREAS, to encourage the Executive to remain an employee of the Bank,
the Bank is willing to provide salary continuation benefits to the Executive,
which the Bank will pay from its general assets;

         WHEREAS, none of the conditions or events included in the definition of
the term "golden parachute payment" that is set forth in ss.18(k)(4)(A) of the
Federal Deposit Insurance Act [12 U.S.C. ss.1828(k)(4)(A)] exists or, to the
best knowledge of the Bank, is contemplated by this Agreement insofar as the
Bank is concerned;

         WHEREAS, the Bank and its Board of Directors have consulted with and
have been advised by representatives of Meyer-Chatfield Corporation regarding
compliance with applicable requirements of bank regulatory agencies having
jurisdiction over the Bank pertaining to this Agreement including the Bank's
acquisition, ownership, control and title to and all rights and benefits under
one or more policies of insurance that the Bank may elect to purchase in
connection with this Agreement, including, without limitation, Bulletin 2000-23
issued by the Office of the Comptroller of the Currency and pronouncements by
the Board of Governors of the Federal Reserve System and the Federal Deposit
Insurance Corporation related thereto;

         WHEREAS, it is the intent of the parties hereto that this Agreement be
considered an unfunded arrangement maintained primarily to provide supplemental
retirement benefits for the Executive, and to be considered a nonqualified
benefit plan for purposes of the Employee Retirement Income Security Act of
1974, as amended ("ERISA"); and

         WHEREAS, the Executive is fully advised of the Bank's financial status
and the fact that the Executive has no interest in or rights under any insurance
policies the Bank may elect to purchase in connection with this Agreement.

         NOW, THEREFORE, in consideration of the foregoing premises and other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Executive and the Bank hereby agree as follows:

                                       167
<PAGE>

                                    Article 1
                                   Definitions

         The following words and phrases used in this Agreement have the
meanings specified:

         1.1      "Accrual Balance" means the amount required to be accrued by
the Bank as required under generally accepted accounting principles to account
for benefits that may become payable to the Executive under this Agreement.

         1.2      "Change in Control" means the occurrence of any of the
following events with respect to the Bank:

                  (a)      a change in control of a nature that would be
required to be reported in response to Item 6(e) of Schedule 14A of Regulation
14A promulgated under the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), or in response to any other form or report to the regulatory
agencies or governmental authorities having jurisdiction over the Bank or ARH,
or any stock exchange on which ARH's shares are listed which requires the
reporting of a change in control;

                  (b)      any merger, consolidation or reorganization of the
Bank or ARH in which the Bank or ARH does not survive;

                  (c)      any sale, lease, exchange, mortgage, pledge, transfer
or other disposition (in one transaction or a series of transactions) of any
assets of the Bank or ARH having an aggregate fair market value of fifty percent
(50%) of the total value of the assets of the Bank or ARH, reflected in the most
recent balance sheet of the Bank or ARH;

                  (d)      a transaction whereby any "person" (as such term is
used in the Exchange Act) or any individual, corporation, partnership, trust or
any other entity is or becomes the beneficial owner, directly or indirectly, of
securities of the Bank or ARH representing twenty-five percent (25%) or more of
the combined voting power of the Bank's or ARH's then outstanding securities;

                  (e)      a situation where, in any one-year period,
individuals who at the beginning of such period constitute the Board of
Directors of the Bank or ARH cease for any reason to constitute at least a
majority thereof, except in the cases of retirement, disability or death and
unless the election, or the nomination for election by the Bank's or ARH's
shareholder(s), of each new director is approved by a vote of at least
three-quarters (3/4) of the directors then still in office who were directors at
the beginning of the period; or

                  (f)      the shareholder(s) of the Bank or ARH approve the
sale or transfer of substantially all of the Bank's or ARH's assets to parties
that are not within a "controlled group of corporations" (as that term is
defined in section 1563 of the Code) in which the Bank or ARH is a member.

         Notwithstanding the foregoing or anything else contained herein to the
contrary, there shall not be a Change in Control for purposes of this Agreement
if the event which would otherwise come within the meaning of the term Change in
Control involves (i) an Employee Stock Ownership Plan sponsored by ARH which
plan is the party that acquires "control" or is the principal participant in the
transaction constituting a "change in control," as described above, or (ii) a
reorganization in which the Bank is merged with and into another wholly-owned
bank subsidiary of ARH to consolidate operations under the charter of such other
bank subsidiary, or (iii) if the individuals who constitute the directors of the
Bank or ARH at the time a specific transaction described in Section 1.2(b) or
1.2(f) is first presented or disclosed to the Board of Directors of the Bank or

                                       168
<PAGE>

ARH will, according to the terms of the definitive agreement for the
transaction, constitute a majority of the members of the board of directors of
the resulting corporation or acquiring person immediately after the transaction,
then, before an event that would otherwise constitute a Change in Control shall
be deemed to have occurred, such Board of Directors of the Bank or ARH may
determine by majority vote that the specific transaction does not constitute a
Change in Control under Section 1.2(b) or 1.2(f).

         1.3      "Code" means the Internal Revenue Code of 1986, as amended.

         1.4      "Disability" shall have the same meaning given such term in
any policy of disability insurance maintained by the Bank for the benefit of
employees including the Executive. In the absence of such a policy, the term
shall mean bodily injury or disease (mental or physical) which wholly and
continuously prevents the performance of the Executive's duties to the Bank for
at least ninety (90) consecutive days.

         1.5      "Early Termination" means the Termination of Employment before
Normal Retirement Age for reasons other than death, Disability, Termination for
Cause or following a Change in Control.

         1.6      "Early Termination Date" means the month, day and year in
which Early Termination occurs.

         1.7      "Effective Date" means August 22, 2003.

         1.8      Intentional," shall mean an act or failure to act on the
Executive's part that is not in good faith and is without a reasonable belief
that the action or failure to act is in the best interests of the Bank. No act
or failure to act on the part of the Executive shall be deemed to have been
intentional if it was due primarily to an error in judgment or negligence.

         1.9      "Normal Retirement Age" means the Executive's 67th birthday.

         1.10     "Normal Retirement Date" means the date on which the
Termination of Employment occurs after the Executive attains the Normal
Retirement Age.

         1.11     "Plan Year" means a twelve-month period commencing on August
1st, and ending on the last day of July of each year. The initial Plan Year
shall commence on the Effective Date of this Agreement.

         1.12     "Termination for Cause" shall mean the occurrence of any one
or more of the following:

                  (a)      the willful, intentional and material breach of duty
by the Executive in the course of his employment;

                  (b)      the habitual and continued neglect by the Executive
of his employment duties and obligations under this Agreement;

                  (c)      the Executive's willful and intentional violation of
any State of California or federal banking laws, or of the Bylaws, rules,
policies or resolutions of Bank or ARH and their respective subsidiaries, or of
the rules or regulations of the Board of Governors of the Federal Reserve
System, California Department of Financial Institutions or the Federal Deposit
Insurance Corporation, or other regulatory agency or governmental authority
having jurisdiction over Bank or ARH;

                                       169
<PAGE>

                  (d)      the determination by a state or federal banking
agency or governmental authority having jurisdiction over Bank or ARH that the
Executive is not suitable to act in the capacity for which he is employed by
Bank;

                  (e)      the Executive is convicted of any felony or a crime
involving moral turpitude or commits a fraudulent or dishonest act;

                  (f)      the Executive discloses without authority any secret
or confidential information concerning Bank, ARH or their respective
subsidiaries or takes any action which the Bank's Board of Directors determines,
in its sole discretion and subject to good faith, fair dealing and
reasonableness, constitutes unfair competition with or induces any customer to
breach any contract with Bank, ARH or their respective subsidiaries; or

                  (g)      the Executive breaches the terms or provisions of
this Agreement.

         1.13     "Termination of Employment" means that the Executive ceases to
be employed by the Bank or any affiliate of the Bank for any reason whatsoever,
other than by reason of a leave of absence approved by the Bank or such
affiliate.

                                    Article 2
                                Lifetime Benefits

         2.1      Normal Retirement Benefit. Upon Termination of Employment on
or after the Normal Retirement Age for reasons other than death, the Bank shall
pay to the Executive the benefit described in this Section 2.1 in lieu of any
other benefit under this Agreement.

         2.1.1    Amount of Benefit. The annual benefit under this Section 2.1
is Fifty Thousand Dollars ($50,000). The Bank's Board of Directors, in its sole
discretion, may increase the annual benefit under this Section 2.1.1. However,
any increase shall require the recalculation of Schedule A to this Agreement.

         2.1.2    Payment of Benefit. The Bank shall pay the annual benefit to
the Executive in 12 equal monthly installments payable on the first day of each
month commencing with the month following the Executive's Normal Retirement
Date. The annual benefit shall be paid to the Executive for 15 years.

         2.2      Early Termination Benefit. Upon Early Termination and provided
that the Executive has attained age 64, the Bank shall pay to the Executive the
benefit described in this Section 2.2 in lieu of any other benefit under this
Agreement.

         2.2.1    Amount of Benefit. The benefit under this Section 2.2 is the
Early Termination Annual Benefit amount set forth on Schedule A for the Plan
Year ending immediately prior to the Early Termination Date. The Bank's Board of
Directors, in its sole discretion, may increase the annual benefit under this
Section 2.2.1. However, any increase shall require the recalculation of Schedule
A.

         2.2.2    Payment of Benefit. Provided that the Executive's Early
Termination Date occurs after the Executive's 64th birthday, the Bank shall pay
the annual benefit to the Executive in 12 equal monthly installments payable on
the first day of each month commencing with the first day of the month following
the Early Termination Date. The annual benefit shall be paid to the Executive
for 15 years.

                                       170
<PAGE>

         2.3      Disability Benefit. If the Executive terminates employment due
to Disability before Normal Retirement Age, the Bank shall pay to the Executive
the benefit described in this Section 2.3 in lieu of any other benefit under
this Agreement.

         2.3.1    Amount of Benefit. The benefit under this Section 2.3 is the
Disability Annual Benefit amount set forth on Schedule A for the Plan Year
ending immediately prior to the date on which the Termination of Employment
occurs (except during the first Plan Year, the benefit is the amount set forth
for Plan Year 1). The Bank's Board of Directors, in its sole discretion, may
increase the annual benefit under this Section 2.3.1. However, any increase
shall require the recalculation of Schedule A.

         2.3.2    Payment of Benefit. The Bank shall pay the Disability Annual
Benefit amount to the Executive in 12 equal monthly installments payable on the
first day of each month commencing with the month following Termination of
Employment due to Disability. The annual benefit shall be paid to the Executive
for 15 years.

         2.4      Change in Control Benefit. If a Change in Control occurs
during the active service of the Executive with the Bank, and within a period of
two (2) years following consummation of such a Change in Control (i) there
occurs a Termination of Employment; or (ii) without the Executive's consent
there occurs (A) any adverse change in the nature and scope of Executive's
salary or benefits, or (B) any event which reasonably constitutes a constructive
termination (by resignation or otherwise) of the Executive's employment, then
the Executive shall be entitled to receive and the Bank shall pay to the
Executive the benefit described in this Section 2.4 in lieu of any other benefit
under this Agreement.

         2.4.1    Amount of Benefit: The benefit under this Section 2.4 is the
Normal Retirement Age Accrual Balance of Four Hundred Eighty-Seven Thousand Two
Hundred Seventy-Three Dollars ($487,273) required by Section 2.1. In its sole
discretion, the Bank's Board of Directors may increase the benefit under this
Section 2.4.1. However, any increase shall require the recalculation of Schedule
A.

         2.4.2    Payment of Benefit: The Bank shall pay the Change in Control
benefit under Section 2.4 of this Agreement to the Executive in 12 equal monthly
installments payable on the first day of each month commencing with the month
following the occurrence of any event described in clause (i) or (ii) of Section
2.4. The annual benefit shall be paid to the Executive for 15 years.

         2.5      Contradiction in Terms of Agreement and Exhibits. If there is
a contradiction in the terms of this Agreement and the Schedule A attached
hereto with the actual amount of a particular amount due the Executive pursuant
to Section 2.2, 2.3 or 2.4 hereof, then the actual amount of said benefit set
forth in this Agreement shall control.

         2.6      Revisions to Schedule A. In the event that (i) the Bank's
Board of Directors elects to increase the benefits specified in this Article 2,
(ii) the Executive commences to receive benefits other than on the date he
attains the Normal Retirement Age, or (iii) if this Agreement is modified as
provided in Section 7.12 in order to conform to applicable law, rules or
regulations, then Schedule A shall be appropriately modified.

                                       171
<PAGE>

                                    Article 3
                                 Death Benefits

         3.1      Death During Active Service. If the Executive dies before the
Normal Retirement Age while in the active service of the Bank, the Bank shall
pay to the Executive's beneficiary the benefit set forth in Section 2.1 as if
the Termination of Employment occurred on the date he would have attained the
Normal Retirement Age. The annual benefit under this Section 3.1 shall be the
amount specified in Section 2.1.1 and shall be payable as provided in Section
2.1.2, commencing on the first day of the month following the date of the
Executive's death.

         3.2      Death During Benefit Period. If the Executive dies after any
benefit payments provided pursuant to Article 2 have commenced under this
Agreement but before receiving all such payments, the Bank shall pay to the
Executive's beneficiary, in lieu of any other benefits under this Agreement, the
benefit set forth in Section 2.1 as if the Termination of Employment occurred on
the date he would have attained the Normal Retirement Age. The annual benefit
under this Section 3.2 shall be the amount specified in Section 2.1.1 and shall
be payable as provided in Section 2.1.2, commencing on the first day of the
month following the date of the Executive's death and continuing for the
remaining number of payment periods after taking into account the number of
benefit payments the Executive received prior to his death.

         3.3      Death After Termination of Employment But Before Benefit
Payments Commence. If the Executive is entitled to any benefit payments under
Article 2 of this Agreement, but dies prior to the commencement of the benefit
payments, the Bank shall pay to the Executive's beneficiary, in lieu of any
other benefit under this Agreement, the benefit set forth in Section 2.1 as if
the Termination of Employment occurred on the date he would have attained the
Normal Retirement Age. The annual benefit under this Section 3.3 shall be the
amount specified in Section 2.1.1 and shall be payable as provided in Section
2.1.2, commencing on the first day of the month following the date of the
Executive's death.

                                    Article 4
                                  Beneficiaries

         4.1      Beneficiary Designations. The Executive shall designate a
beneficiary by filing a written designation with the Bank. The Executive may
revoke or modify the designation at any time by filing a new designation.
However, designations will only be effective if signed by the Executive and
accepted by the Bank during the Executive's lifetime. The Executive's
beneficiary designation shall be deemed automatically revoked if the beneficiary
predeceases the Executive, or if the Executive names a spouse as beneficiary and
the marriage is subsequently dissolved. If the Executive dies without a valid
beneficiary designation, all payments shall be made to the Executive's estate.

         4.2      Facility of Payment. If a benefit is payable to a minor, to a
person declared incapacitated, or to a person incapable of handling the
disposition of his or her property, the Bank may pay such benefit to the
guardian, legal representative or person having the care or custody of such
minor, incapacitated person or incapable person. The Bank may require proof of
incapacity, minority or guardianship as it may deem appropriate before
distribution of the benefit. Distribution shall completely discharge the Bank
from all liability for the benefit.

                                       172

<PAGE>

                                    Article 5
                               General Limitations

         5.1      Termination for Cause. Notwithstanding any provision of this
Agreement to the contrary, the Bank shall not pay any benefit under this
Agreement if the Executive ceases to be employed by the Bank as a result of a
Termination for Cause.

         5.2      Suicide or Misstatement. The Bank shall not pay any benefit
under this Agreement if the Executive commits suicide within two (2) years after
the date of this Agreement, or if the Executive has made any material
misstatement of fact on any application for life insurance purchased by the
Bank.

         5.3      Insolvency. If the California Commissioner of Financial
Institutions appoints the Federal Deposit Insurance Corporation as receiver for
the Bank, all obligations under this Agreement shall terminate as of the date
that the Bank is declared insolvent, subject to any vested rights of the
Executive under applicable law.

         5.4      FDIC Open-Bank Assistance. All obligations under this
Agreement shall be terminated, subject to any vested rights of the Executive
under applicable law, except to the extent it is determined that continuation of
the contract is necessary for the continued operation of the Bank, at the time
the Federal Deposit Insurance Corporation enters into an agreement to provide
assistance to or on behalf of the Bank under the authority contained in Section
13(c) of the Federal Deposit Insurance Act [12 U.S.C. ss.1823(c)].

                                    Article 6
                          Claims and Review Procedures

         6.1      Claims Procedure. A person or beneficiary ("claimant") who has
not received benefits under the Agreement that he or she believes should be paid
shall make a claim for such benefits as follows

         6.1.1    Initiation - Written Claim. The claimant initiates a claim by
submitting to the Bank a written claim for the benefits.

         6.1.2    Timing of Bank Response. The Bank shall respond to such
claimant within 90 days after receiving the claim. If the Bank determines that
special circumstances require additional time for processing the claim, the Bank
can extend the response period by an additional 90 days by notifying the
claimant in writing, prior to the end of the initial 90-day period, that an
additional period is required. The notice of extension must set forth the
special circumstances and the date by which the Bank expects to render its
decision.

         6.1.3    Notice of Decision. If the Bank denies part or all of the
claim, the Bank shall notify the claimant in writing of such denial. The Bank
shall write the notification in a manner calculated to be understood by the
claimant. The notification shall set forth the following:

         6.1.3.1  The specific reasons for the denial;

         6.1.3.2  A reference to the specific provisions of the Agreement on
which the denial is based;

         6.1.3.3  A description of any additional information or material
necessary for the claimant to perfect the claim and an explanation of why it is
needed;

                                       173
<PAGE>

         6.1.3.4  An explanation of the Agreement's review procedures and the
time limits applicable to such procedures; and

         6.1.3.5  A statement of the claimant's right to bring a civil action
under ERISA Section 502(a) following an adverse benefit determination on review.

         6.2      Review Procedure. If the Bank denies part or all of the claim,
the claimant shall have the opportunity for a full and fair review by the Bank
of the denial, as follows:

         6.2.1    Initiation - Written Request. To initiate the review, the
claimant, within 60 days after receiving the Bank's notice of denial, must file
with the Bank a written request for review.

         6.2.2    Additional Submissions - Information Access. The claimant
shall then have the opportunity to submit written comments, documents, records
and other information relating to the claim. The Bank shall also provide the
claimant, upon request and free of charge, reasonable access to, and copies of,
all documents, records and other information relevant (as defined in applicable
ERISA regulations) to the claimant's claim for benefits.

         6.2.3    Considerations on Review. In considering the review, the Bank
shall take into account all materials and information the claimant submits
relating to the claim, without regard to whether such information was submitted
or considered in the initial benefit determination.

         6.2.4    Timing of Bank Response. The Bank shall respond in writing to
such claimant within 60 days after receiving the request for review. If the Bank
determines that special circumstances require additional time for processing the
claim, the Bank can extend the response period by an additional 60 days by
notifying the claimant in writing, prior to the end of the initial 60-day
period, that an additional period is required. The notice of extension must set
forth the special circumstances and the date by which the Bank expects to render
its decision.

         6.2.5    Notice of Decision. The Bank shall notify the claimant in
writing of its decision on review. The Bank shall write the notification in a
manner calculated to be understood by the claimant. The notification shall set
forth the following:

         6.2.5.1  The specific reason for the denial;

         6.2.5.2  A reference to the specific provisions of the Agreement on
which the denial is based;

         6.2.5.3  A statement that the claimant is entitled to receive, upon
request and free of charge, reasonable access to, and copies of, all documents,
records and other information relevant (as defined in applicable ERISA
regulations) to the claimant's claim for benefits; and

         6.2.5.4  A statement of the claimant's right to bring a civil action
under ERISA Section 502(a).

                                    Article 7
                                  Miscellaneous

         7.1      Amendments and Termination. This Agreement may be amended or
terminated only by a written agreement signed by the Bank and the Executive.

         7.2      Binding Effect. This Agreement shall bind the Executive, the
Bank, and their beneficiaries, survivors, executors, successors, administrators
and transferees.

                                       174
<PAGE>

         7.3      No Guarantee of Employment. This Agreement is not an
employment policy or contract. It does not give the Executive the right to
remain an employee of the Bank, nor does it interfere with the Bank's right to
discharge the Executive. It also does not require the Executive to remain an
employee nor interfere with the Executive's right to terminate employment at any
time.

         7.4      Non-Transferability. Benefits under this Agreement cannot be
sold, transferred, assigned, pledged, attached or encumbered in any manner.

         7.5      Successors; Binding Agreement. The Bank will require any
successor (whether direct or indirect, by purchase, merger, consolidation or
otherwise) to all or substantially all of the business and/or assets of the
Bank, by an assumption agreement in form and substance satisfactory to the
Executive, to expressly assume and agree to perform this Agreement in the same
manner and to the same extent that the Bank would be required to perform this
Agreement if no such succession had occurred. The Bank's failure to obtain an
assumption agreement before effectiveness of any such succession shall be a
breach of this Agreement and shall entitle the Executive to the Change in
Control Benefit provided in Section 2.4.

         7.6      Tax Withholding. The Bank shall withhold any taxes that are
required to be withheld from the benefits provided under this Agreement.

         7.7      Applicable Law. This 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.

         7.8      Unfunded Arrangement. The Executive and beneficiary are
general unsecured creditors of the Bank for the payment of benefits under this
Agreement. The benefits represent the mere promise by the Bank to pay the
benefits. Rights to benefits are not subject in any manner to anticipation,
alienation, sale, transfer, assignment, pledge, encumbrance, attachment, or
garnishment by creditors. Any insurance on the Executive's life purchased by the
Bank is a general asset of the Bank as to which the Executive and beneficiary
have no preferred or secured claim, or any right, title or interest.

         7.9      Entire Agreement. This Agreement constitutes the entire
agreement between the Bank and the Executive as to the subject matter hereof. No
rights are granted to the Executive by virtue of this Agreement other than those
specifically set forth herein.

         7.10     Administration. The Bank shall have the power to administer
this Agreement, including but not limited to the power to:

                  (a)      Interpret the provisions of the Agreement;

                  (b)      Establish and revise the method of accounting for the
                           Agreement;

                  (c)      Maintain a record of benefit payments; and

                  (d)      Establish rules and prescribe any forms necessary or
                           desirable to administer the Agreement.

         7.11     Named Fiduciary. The Bank shall be the named fiduciary and
plan administrator under the Agreement. The named fiduciary may delegate to
others certain aspects of the management and operation responsibilities of the
plan including the employment of advisors and the delegation of ministerial
duties to qualified individuals.

                                       175
<PAGE>

         7.12     Severability. If for any reason any provision of this
Agreement is determined by the Bank's Board of Directors, acting in good faith
on advice of counsel or other advisors, or is held by a court, arbiter or other
tribunal of competent jurisdiction, to be invalid, unenforceable or in violation
of any applicable law, rule or regulation, then this Agreement shall be modified
to the minimum extent necessary to render it valid, enforceable and in
compliance with applicable laws, rules and regulations, and as so modified, this
Agreement shall continue in full force and effect.

         7.13     Headings. Caption headings and subheadings herein are included
solely for convenience of reference and shall not affect the meaning or
interpretation of any provision of this Agreement.

         7.14     Notices. Any notices to be given hereunder shall be in writing
and may be transmitted by personal delivery or by U.S. mail, registered or
certified, postage prepaid with return receipt requested. Mailed notices shall
be addressed to the Executive at the address listed in the Bank's personnel file
and to the Bank at its principal business office located at 1545 River Park
Drive, Suite 107, Sacramento, CA 95815. A party may change the address for
receipt of notices by written notice in accordance with this paragraph 7.14.
Notices delivered personally shall be deemed communicated as of the date of
actual receipt; mailed notices shall be deemed communicated as of three (3) days
after the date of mailing.

         7.15     Arbitration. All claims, disputes and other matters in
question arising out of or relating to this Agreement or the breach or
interpretation thereof, other than those matters which are to be determined by
the Bank in its sole and absolute discretion, shall be resolved by binding
arbitration before a representative member, selected by the mutual agreement of
the parties, of the Judicial Arbitration and Mediation Services, Inc. ("JAMS"),
in accordance with the rules and procedures of JAMS then in effect. In the event
JAMS is unable or unwilling to conduct such arbitration, or has discontinued its
business, the parties agree that a representative member, selected by the mutual
agreement of the parties, of the American Arbitration Association ("AAA"), shall
conduct such binding arbitration in accordance with the rules and procedures of
the AAA then in effect. Notice of the demand for arbitration shall be filed in
writing with the other party to this Agreement and with JAMS (or AAA, if
necessary). In no event shall the demand for arbitration be made after the date
when institution of legal or equitable proceedings based on such claim, dispute
or other matter in question would be barred by the applicable statute of
limitations. Any award rendered by JAMS or AAA shall be final and binding upon
the parties, and as applicable, their respective heirs, beneficiaries, legal
representatives, agents, successors and assigns, and may be entered in any court
having jurisdiction thereof. The obligation of the parties to arbitrate pursuant
to this clause shall be specifically enforceable in accordance with, and shall
be conducted consistently with, the provisions of Title 9 of Part 3 of the
California Code of Civil Procedure. Any arbitration hereunder shall be conducted
in Sacramento, California, unless otherwise agreed to by the parties.

         7.16     Attorneys' Fees and Costs. In the event of litigation,
arbitration or any other action or proceeding between the parties to interpret
or enforce this Agreement or any part thereof or otherwise arising out of or
relating to this Agreement, the prevailing party shall be entitled to recover
its costs related to any such action or proceeding and its reasonable fees of
attorneys, accountants and expert witnesses incurred by such party in connection
with any such action or proceeding. The prevailing party shall be deemed to be
the party which obtains substantially the relief sought by final resolution,
compromise or settlement, or as may otherwise be determined by order of a court
of competent jurisdiction in the event of litigation, an award or decision of
one or more arbitrators in the event of arbitration, or a decision of a
comparable official in the event of any other action or proceeding. Any
obligation to indemnify under this Agreement includes the obligation to pay
reasonable fees of attorneys, accountants and expert witnesses incurred by the
indemnified party in connection with matters subject to indemnification.

                                       176
<PAGE>

         7.17     Internal Revenue Code Section 280G. If all or any portion of
the amounts payable to the Executive pursuant to this Agreement alone or
together with other payments which the Executive has the right to receive from
the Bank, constitute "excess parachute payments" within the meaning of Section
280G of the Internal Revenue Code of 1986, as amended (the "Code"), that are
subject to the excise tax imposed by Section 4999 of the Code (or similar tax
and/or assessment), such amounts payable hereunder shall be reduced to the
extent necessary, after first applying any similar reduction in payments to be
received from any other plan or program sponsored by the Bank from which the
Executive has a right to receive payments subject to Sections 280G and 4999 of
the Code, including without limitation any employment agreement made between the
Bank and the Executive, so as to cause a reduction of any excise tax pursuant to
Section 4999 of the Code to equal "zero".

         7.18     Review Procedure. Not less frequently than every three (3)
years during the term of this Agreement prior to the Executive commencing to
receive any benefits hereunder, the Bank will review this Agreement and the
benefits that may become payable hereunder to determine whether to maintain the
benefits at the amounts specified in this Agreement or to increase the benefits.
If the Bank determines, in its sole discretion, to increase the benefits,
Schedule A shall be appropriately modified.

                                       177
<PAGE>

         IN WITNESS WHEREOF, the Executive and a duly authorized officer of the
Bank have executed this Salary Continuation Agreement in the City of Sacramento,
State of California, as of the day and year first written above.

EXECUTIVE:                             BANK:

                                       AMERICAN RIVER BANK

/s/ WILLIAM L. YOUNG                   By: /s/ CHARLES D. FITE
------------------------------------       -------------------------------------
William L. Young                           Charles D. Fite
                                           Chairman of the Board

                                       178
<PAGE>

                             BENEFICIARY DESIGNATION

                               AMERICAN RIVER BANK

                          SALARY CONTINUATION AGREEMENT

         I, William L. Young, designate the following as beneficiary of any
benefits to which I may be entitled under my Salary Continuation Agreement with
the Bank dated August 22, 2003:

Primary:  William Larry Young and Eleanor Carol Young,
          Trustees for the "Young Family Trust" Dated  September 21, 1992
        ------------------------------------------------------------------

Contingent: ________________________________________

         Note: To name a trust as beneficiary, please provide the name of the
trustee(s) and the exact name and date of the trust agreement.

         I understand that I may change these beneficiary designations by filing
a new written designation with the Bank. I further understand that the
designations will be automatically revoked if the beneficiary predeceases me, or
if I have named my spouse as beneficiary and our marriage is subsequently
dissolved.

Signature: /s/ WILLIAM L. YOUNG
           ----------------------------

Date:      August 25, 2003
           ----------------------------

Accepted by the Bank this 26 day of August, 2003
                         ----

By: /s/ CHARLES D. FITE
    -----------------------------------
    Charles D. Fite
    Chairman of the Board

                                       179
<PAGE>
<TABLE>
<CAPTION>

                                   SCHEDULE A

                               AMERICAN RIVER BANK

                          SALARY CONTINUATION AGREEMENT

                              FOR WILLIAM L. YOUNG

---------- -------------- ----------  ----------  ----------  ------------  ------------
                             Age At                 Early
                              Plan                Termination   Disability   Change in
   Plan      Plan Year        Year       Accrual    Benefit      Benefit      Control
   Year       Ending          End        Balance   Payable(1)   Payable(2)   Benefit(3)
---------- -------------- ----------  ----------  ----------  ------------  ------------
<S>                  <C>          <C> <C>         <C>         <C>           <C>
    1                2004         63  $   74,348  $        0  $      7,629  $     32,485
---------- -------------- ----------  ----------  ----------  ------------  ------------
    2                2005         64  $  159,104  $   16,326  $     16,326  $     32,485
---------- -------------- ----------  ----------  ----------  ------------  ------------
    3                2006         65  $  255,362  $   26,203  $     26,203  $     32,485
---------- -------------- ----------  ----------  ----------  ------------  ------------
    4                2007         66  $  364,317  $   37,383  $     37,383  $     32,485
---------- -------------- ----------  ----------  ----------  ------------  ------------
    5                2008         67  $  487,273  $   50,000  $     50,000  $     32,485
---------- -------------- ----------  ----------  ----------  ------------  ------------
</TABLE>

(1)  The total annual benefit for 15 years following Termination of Employment
     using an assumed rate of return of 7%.
(2)  The total annual benefit for 15 years following Termination of Employment
     due to Disability using an assumed rate of return of 7%.
(3)  The total annual benefit for 15 years following Change in Control using an
     assumed rate of return of 0%.

                                       180

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