FIRST NORTHERN COMMUNITY BANCORP (Form: 10-Q, Received: 05/09/2018 14:13:03)

Exhibit 10.29

PARTICIPATION AGREEMENT

FOR

Jeremiah Smith

This Participation Agreement is entered into as of this 1st day of June, 2011, by and between First Northern Bank of Dixon, a California-chartered, FDIC-insured bank with it main office in Dixon, California ("Company") and Jeremiah Smith (the "Executive").

Whereas, the Executive has contributed substantially to the success of the Company and its parent corporation, First Northern Community Bancorp, and the Company desires that the Executive continue its employ,

Whereas, the Board has in accordance with Section 3.1 of the First Northern Bank of Dixon Supplemental Executive Retirement Plan (the "Plan") nominated the Executive for Eligibility in such Plan,

Whereas, the Executive wishes to accept Participation in the Plan,

Whereas, the Company wishes, for the benefit of the Executive, to amend certain provisions of the Plan as they apply to the Executive through the execution of this Participation Agreement and acknowledges that this Participation Agreement shall be terminated or amended only by a written agreement signed by the Company and the Executive except as specified in 3.1 below,

Now Therefore, in consideration of the foregoing premises and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree that the Executive is a Participant in the Plan and further agree as follows:

SECTION 1

DEFINITIONS

Terms used in this Participation Agreement are used as defined in the Plan. In addition, the following terms shall have the meanings given in this Participation Agreement.

1.1	Change-in-Control . "Change-in-Control" means the first to occur of any of the following events:

(a)

Merger - First Northern Community Bancorp merges into or consolidates with another corporation, or merges another corporation into First Northern Community Bancorp, and as a result less than 50% of the combined voting power of the resulting corporation immediately after the merger or consolidation is held by persons who were stockholders of First Northern Community Bancorp immediately before the merger or consolidation,

(b) Acquisition of Significant Share Ownership -A report on Schedule 13D or another form or schedule (other than Schedule 13G) is filed or is required to be filed under Sections 13(d) or 14(d) of the Securities Exchange Act of 1934, if the schedule discloses that the filing person

or persons acting in concert has or have become the beneficial owner of 20% or more of a class of First Northern Community Bancorp's voting securities, but this clause (b) shall not apply to beneficial ownership of First Northern Community Bancorp voting shares held in a fiduciary capacity by an entity of which First Northern Community Bancorp directly or indirectly beneficially owns 50% or more of its outstanding voting securities or voting shares held by an employee benefit plan maintained for the benefit of First Northern Bank of Dixon's employees, or

(c)

Change in Board Composition - During any period of two consecutive years, individuals who constitute First Northern Community Bancorp's Board of Directors at the beginning of the two-year period cease for any reason to constitute at least a majority of First Northern Community Bancorp's Board of Directors; provided, however, that - for purposes of this clause (c) - each director who is first elected by the board (or first nominated by the board for

election by stockholders) by a vote of at least two-thirds of the directors who were directors at the beginning of the period shall be deemed to have been a director at the beginning of the

two-year period.

1.2	Good Reason . "Good Reason" shall be defined as any of the following:

(a)	A material reduction in the Executive's title or responsibilities; or

(b)	A reduction in base salary as in effect on the date of Change in Control; or

(c)	The relocation of the Executive's principal executive office so that Executive's one-way commute distance from Executive's residence is increased by more than forty (40) miles; or

(d)	The adverse and substantial alternation in the nature and quality of the office space within which the Executive performs duties on behalf of the Company, including the size and location thereof, as well as the secretarial and administrative support provided to the Executive; or

(e)

The failure by the Company to continue to provide the Executive with compensation and benefits substantially similar to those provided under any of the employee benefit plans in which the Executive becomes a participant, or the taking of any action by the Company which would directly or indirectly materially reduce any of such benefits or deprive the Executive of any material fringe benefit enjoyed at the time of Change in Control; or

(f)	The failure of the Company to obtain a satisfactory agreement from any successor or assign of the Company to assume and agree to perform this Agreement.

SECTION 2 AMENDMENTS

This section, solely for the purpose of benefits earned by this Executive, amends certain sections of the First Northern Bank Supplemental Executive Retirement Plan.

2.1

Amendments Following a Change in Control - If the Executive's employment with the Bank terminates within 24 months after any Change in Control or in the event the Executive terminates employment voluntarily for Good Reason within 24 months after any Change-in-Control, the following benefit shall be payable to the Executive in lieu of any other benefits payable under the Plan :

Change in Control Benefit -the benefit payable to the Executive shall be the greater of the payments described in (1) and (2) below:

1.	A lump sum payment Actuarially Equivalent to the benefit determined under Section

4.1 of the Plan with the following changes: (a) the Target Retirement Percentage used shall be the Target Retirement Percentage assuming Service to age 65, and (b) the Profit Sharing Benefit and Social Security Benefit shall be determined as of the 1st of the year of termination. The lump sum payment shall be determined using the Treasury Rate in effect on the date of termination and shall be discounted for the period of time the lump sum payment precedes the date the Participant attains age 65.

2.	A lump sum payment Actuarially Equivalent to the benefit the Participant would receive from the Plan without regard to this Section 2.1. The lump sum payment shall be determined using the Treasury Rate in effect on the date of termination.

The Company shall pay this Change in Control Benefit to the Executive within three days after the Executive's Separation from Service. If when the Participant's Separation from Service occurs the Participant is a specified employee within the meaning of Code

section 409A, the lump-sum benefit shall be delayed and shall instead be paid on the first day of the seventh month after the month in which Separation from Service occurs, with interest to the payment date using the Treasury Rate.

2.2

One Benefit Only. Despite anything to the contrary in the Plan or in this Participation Agreement, the Executive and Beneficiary are entitled to one benefit only, which shall be determined by the first event to occur that is dealt with by the Plan and this Participation Agreement. Subsequent occurrence of events dealt with by the Plan and this Participation Agreement shall not entitle the Executive or Beneficiary to other or additional benefits under the Plan or this Participation Agreement.

2.3	Amendment of Death Benefit. If the Executive dies while actively employed and before the attainment of Normal Retirement Age, the benefit payable to the Executive's beneficiary shall be the greater of (1) and

(2)

below:

(I)

$10,000 per month paid each month for 120 months plus 6 months for each full year of Service over 10 years (limited to 180 months total). This benefit shall be limited in present value to the net amount at risk of all insurance policies owned by First Northern Bank as of the Executive's date of death on the life of the Executive and under which First Northern Bank is the sole beneficiary. This present value limitation shall be determined using a 5% discount rate.

(2) the benefit that the Executive's beneficiary would have received had the Executive retired under Section 4.2 of the Plan on the day of the Executive's death, commenced Early Retirement Benefits, and died before receiving the first payment.

This benefit shall commence as soon as administratively feasible.

If the Executive dies while actively employed and on or after attainment of Normal Retirement Age, the benefit payable to the Executive's beneficiary shall be the same benefit the beneficiary would have received had the Executive retired on the date of death, commenced Normal Retirement Benefits and died before receiving the first payment.

If a participant dies after termination of employment, the Participant's Beneficiary shall be entitled to receive benefits in the same amount and for the same duration that the Participant would have received had the Participant survived to receive all payments due. The benefit shall be paid to the Beneficiary at the same time the benefit would have been paid to the Participant, disregarding the potential six-month delay required under Code section 409A for separation-from-service benefits paid to a specified employee.

The benefit payable under this section 2.3 shall be paid in lieu of any other benefit payable under the Plan or this Participation Agreement

SECTION 3 MISCELLANEOUS

3.1

Amendments and Termination . This Participation Agreement may be amended or terminated only by a written agreement signed by the Bank and the Executive. For the purpose of determining benefits for the Executive, any amendment or termination of the Plan shall be effective for the Executive only by a written agreement signed by the Company and the Executive. However, the Executive and Company agree that the Company, in its sole discretion, may amend the Plan and this Participation Agreement to reduce the impact on the Company's earnings of any changes made by the Financial Accounting Standards Board to pension accounting standards. The Company may change the manner of benefit accrual for the Executive if, in the opinion of the Company, the changes to the Plan and this Participation Agreement produce an expense recognition pattern closer to the pattern of expense recognition expected prior to the change in accounting standards. In no event will the benefit provided to the Executive at Normal Retirement Age be reduced.

3.2	Binding Effect . This Participation Agreement shall bind the Executive and the Company, and their beneficiaries, survivors, executors, successors, administrators and trustees.

3.3

Agreement To Insure . The Company may, in its sole discretion, decide to purchase a life insurance policy or policies on the life of the Executive in order to informally fund or otherwise offset the costs incurred by the Plan. The Executive agrees to complete all forms and undergo any insurance underwriting that the Company may request from time to time during the Executive's active employment. In addition, the Executive hereby acknowledges that the Executive, Beneficiaries, or the Executive's estate hold no claim to any part of the value of or rights provided by such policies.

In Witness Whereof, the Executive and a duly authorized Company officer have signed this Participation Agreement as of the day and year shown below.

The Executive: The Company:

First Northern Bank of Dixon

/s/ Jeremiah Z. Smith

By: /s/ Louise Walker

Its: Chief Executive Officer

Exhibit 10.34

THIRD AMENDMENT TO

SALARY CONTINUATION AGREEMENT

This Third Amendment to Salary Continuation Agreement ("Amendment") is made effective as of January 1, 2009, and is entered into by and between First Northern Bank of Dixon, a California-chartered, FDIC-insured bank with its main office in Dixon, California ("Bank") and Bruce A. Orris, Vice President ("Executive"), each a "Party" and together the "Parties."

RECITALS

A.	The Parties entered into that certain Salary Continuation Agreement dated January 1, 2002, which was amended effective December 31, 2004 and February 15, 2007 (as amended, the Agreement").

B.	Code Section 409A generally became effective on January . 1, 2005. The Treasury issued

final regulations on April 17, 2007, which are generally effective on January 1, 2009. IRS Notice 2007-86 (along with prior IRS guidance) generally permits nonqualified deferred compensation plans that are subject to Code Section 409A to be amended on or before December 31, 2008, to comply with the statute and final regulations, so long as such plans were operated in good faith compliance with the statute and published guidance in the interim.

The Employer has administered the Agreement in compliance with its terms, consistent with Code Section 409A and guidance published by the IRS (including IRS Notice 2005-1 and proposed and final regulations under section 409A), applying a good faith reasonable interpretation, to the extent necessary.

D.	In reliance upon IRS Notice 2007-86 and prior IRS notices, the Parties now desire to amend the Agreement effective January 1, 2009, to fully comply with final regulations under Code Section 409 A.

AGREEMENT

In consideration of the mutual promises, covenants, and agreements contained herein and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the Parties agree as follows:

1.	Change in Control . Section 1.2 of the Agreement is amended in its entirety to read as follows:

1.2	"Change in Control" means the occurrence of any of the following events with respect to the Bank or its parent holding Company, First Northern Community Bancorp ("Bancorp"):

(a)	Merger: A merger into or consolidation with another corporation, or merger of another corporation into Bank or Bancorp, and as a result less than 50% of the combined voting power of the resulting corporation

immediately after the merger or consolidation is held by persons who were stockholders of Bank or Bancorp immediately before the merger or consolidation;

(b)	Acquisition of Significant Share Ownership: One person, or more than one person acting as a group, acquires (or has acquired during the twelve

(12) month period ending on the date of the most recent acquisition by such person or persons) ownership of stock possessing thirty percent (30%) or more of the total voting power of the stock of Bank or Bancorp (this constitutes acquisition of "Effective Control"). No Change in Control shall occur if additional voting shares are acquired by a person or persons who possessed Effective Control prior to acquiring additional shares. This subpart (b) shall not apply to beneficial ownership of voting shares held in a fiduciary capacity by an entity of which Bank or Bancorp directly or indirectly beneficially owns 50% or more of the outstanding voting securities, or voting shares held by an employee benefit plan maintained for the benefit of the Bank's employees.

(c)

Change in Board Composition: A majority of the members of the Board of Directors of Bank or Bancorp is replaced during any 12-month period by directors whose appointment or election is not endorsed by a majority of the members of the Board of Directors of Bank or Bancorp before the date of the appointment or election. This subparagraph shall only apply with respect to Bancorp if no other corporation is a majority shareholder of Bancorp.

A Change in Control shall only occur with respect to Bancorp if Bancorp (i) is a majority shareholder of the Bank; (ii) is a majority shareholder of any corporation in a chain of corporations in which each corporation is a majority shareholder of another corporation in the chain, ending in the Bank; or (iii) is otherwise a "Relevant Corporation" as that term is used and defined in Section 409A. For purposes of this section, majority shareholder means a shareholder owning more than 50% of the total fair market value and total voting power of the Bank, Bancorp, or a corporation in the chain referenced above. No Change in Control shall occur unless the event constitutes a "Change in the Ownership of a Corporation" or a "Change in the Effective Control of a Corporation" as defined under Section 409A.

2.	Disability . Section 1.3 of the Agreement is amended in its entirety to read as follows:

1.3

"Disabled" or "Disability" means that the Executive is (a) unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than twelve months; or (b) by reason of any medically determinable physical or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than

twelve months, receiving income replacement benefits for a period of not less than three months under an accident and health plan covering the Bank's employees. The Bank may, in its discretion, rely on a determination by the Social Security Administration or an insurance carrier (if the definition of "disability" applied by the carrier is consistent with this section) in determining whether an Executive is Disabled, and may require the Executive to submit proof of such determination as a condition to becoming eligible for Disability Benefits under this Agreement. The terms "Disabled" and "Disability" shall be interpreted consistently with Section 409A.

3.	Specified Employee Definition . A new section 1.14 is added to read as follows:

1.14

"Specified Employee" – If the Executive is a Key Employee (defined below) of the Bank or any entity that is aggregated with the Bank under Code section 414(b) or (c) as of December 31st of any year (the "Determination Date"), and the Bank (or any entity that is aggregated with the Bank under Code section 414(b) or (c)) has stock that is publicly traded on an established securities market or otherwise, the Executive shall be treated as a Specified Employee during the 12-month period beginning on the April 1st following the Determination Date. An Executive is a Key Employee as of a Determination Date if the Executive meets the requirements of Code section 416(i)(l)(A)(i), (ii), or (iii) (applied in accordance with the regulations thereunder and disregarding section 416(i)(5)) at any time during the twelve months preceding the Determination Date.

4.	Termination of Employment . Section 1.14 of the Agreement is renumbered as section

1.15	and is amended in its entirety to read as follows:

1.15

"Termination of Employment" means that the Executive shall have ceased to be employed by the Bank for any reason whatsoever and that the Executive actually separates from service with the Bank and does not continue in his or her prior capacity. Notwithstanding the foregoing, Executive's employment shall be deemed to have terminated, and Executive shall have suffered a Termination of Employment, when the Executive and the Bank reasonably anticipate that the Executive will have a permanent reduction in the level of bona fide services provided to the Bank to a level of service that is less than fifty percent (50%) of the average level of bona fide services provided by the Executive in the immediately preceding thirty-six (36) month period. Termination of Employment does not include the Executive's military leave, sick leave or other bona fide leave of absence (such as temporary employment with the government) if the period of leave does not exceed six months, or if longer, so long as the Executive's right to reemployment with the Bank is provided either in contract or statute. Notwithstanding anything to the contrary, the terms "termination of employment," "terminates employment" and "employment termination" shall be interpreted consistently with Section 409A.

5.	Normal Retirement Benefit . A new subsection 2.1.3 is added to read as follows:

2.1.3

Delayed Payments to Specified Employees. If the Executive is a Specified Employee (as defined in section 1.14) as of the date of Termination of Employment, benefit payments under this section shall be delayed and shall not begin prior to the date that is six months after Termination of Employment (or, if earlier than the end of the six-month period, the date of death of the Executive). Payments to which the Executive would otherwise be entitled during the first six months following Termination of Employment, but for this provision, shall be accumulated and paid on the first day of the seventh month following Termination of Employment.

6.	Early Termination Benefit . A new subsection 2.2.3 is added to read as follows:

2.2.3 Delayed Payments to Specified Employees. If the Executive is a Specified Employee (as defined in section 1.14) as of the date of Termination of Employment, benefit payments under this section shall be delayed and shall not begin prior to the date that is six months after Termination of Employment (or, if earlier than the end of the six-month period, the date of death of the Executive). Payments to which the Executive would otherwise be entitled during the first six months following Termination of Employment, but for this provision, shall be accumulated and paid on the first day of the seventh month following Termination of Employment.

7.	Disability B enefit. A new subsection 2.3.3 is added to read as follows:

2.3.3

8.	Change in Control Benefit . A new subsection 2.4.3 is added to read as follows:

2.4.3

Employment, but for this provision, shall be accumulated and paid on the first day of the seventh month following Termination of Employment.

9.	Petition for Payment . Section 2.5 of the Agreement, entitled "Petition for Payment of Vested Normal Retirement Benefit, Vested Early Termination Benefit or Vested Disability Benefit," is hereby deleted in its entirety.

10.	Claims Procedure . Subsection 6.1.2 of the Agreement is amended in its entirety to read as follows:

6.1.2

Timing of Bank Response. The Bank shall respond to 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.

Notwithstanding the foregoing, the Bank shall respond to any claim for Disability Benefits within 45 days after receiving the claim. This period may be extended for up to 30 days, provided that the Bank determines that such an extension is necessary due to matters beyond the control of the plan and notifies the claimant, prior to the expiration of the initial 45-day period, of the circumstances requiring the extension of time and the date by which the Bank expects to render a decision. If , prior to the end of the first 30-day extension period, the Bank determines that, due to matters beyond the control of the plan, a decision cannot be rendered within that extension period, the period for making the determination may be extended for up to an additional 30 days, provided that the Bank notifies the claimant, prior to the expiration of the first 30-day extension period, of the circumstances requiring the extension and the date as of which the Bank expects to render a decision. Any notice of extension shall specifically explain the standards on which entitlement to a benefit is based, the unresolved issues that prevent a decision on the claim, and the additional information needed to resolve those issues, and the claimant shall be afforded at least 45 days within which to provide the specified information.

11.	Review Procedure . Subsections 6.2.1, 6.2.3 and 6.2.4 of the Agreement are amended in their entirety to read as follows:

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

may file a request for review of a denied claim for Disability Benefits up to 180 days after receiving the Bank's notice of denial.

6.2.3

Consideration on Review. On 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.

In the review of a claim for Disability Benefits, the Bank shall not give deference to the initial adverse benefit determination and the review shall be conducted by an appropriate fiduciary who is neither the individual who made the adverse benefit determination that under review, nor the subordinate of such individual.

6.2.4

Timing of Bank Response. The Bank shall respond in writing to the 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.

Notwithstanding the foregoing, the Bank shall respond in writing to any claim for Disability benefits within 45 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 45 days by notifying the claimant in writing, prior to the end of the initial 45-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.

12.	Status of Agreement for Tax Law and ERISA Purposes . Section 7.8 of the Agreement is amended in its entirety to read as follows:

7.8

Unfunded Arrangement. The Executive and his beneficiary(ies) are general unsecured creditors of the Bank for the payment of benefits under this Agreement. The benefits represent a promise to pay by the Bank. The 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 that may be purchased by the Bank is a general asset of the Bank to which the Executive and beneficiary have no preferred or secured claim.

This Agreement is intended to constitute an unfunded arrangement maintained by the Bank primarily for the purpose of providing deferred compensation for a member of a select group of management or highly compensated employees, as

described in sections 201(2), 301(a)(3) and 401(a)(l) of the Employee Retirement Income Security Act of 1974 (ERISA). This Agreement shall at all times be construed and interpreted consistently with ERISA to be such an arrangement and consistently with the requirements of Section 409A, as amended from time to time.

13 . No Changes to Benefit Payments . A new section 7.17 is added to read as follows:

7.17

Prohibition Against Changes to Time and Form of Payment. Notwithstanding anything in this Agreement to the contrary, the payment date(s) and form(s) of payment for benefits payable at a specific time, upon the occurrence of a specified event, or in a specified form may not be changed unless such change is expressly permitted under this Agreement, Section 409A, and other applicable law.

14.

Advice of Counsel . Before signing this Amendment, Executive either (a) consulted with and obtained advice from Executive's independent legal counsel with respect to the legal nature and operation of the Agreement as amended, including the impact of the Amendment on the Executive's rights, privileges and obligations, or (b) freely and voluntarily decided not to consult with legal counsel.

15.	No Other Amendments or Changes . Except as expressly amended or modified by this Amendment, all of the terms and conditions of the Agreement shall remain unchanged and in full force and effect.

Signed on this 30 ^th day of December, 2008.

FIRST NORTHERN BANK OF DIXON, EXECUTIVE

a California-chartered, FDIC-insured bank /s/ Bruce A. Orris

By: /s/ Jeremiah Z. Smith

Title: AVP/Assistant Controller

First Northern Bank of Dixon

Salary Continuation Agreement

Amendments

Whereas, First Northern Bank of Dixon("Bank") and Bruce A. Orris ("Executive") desire to amend the First Northern Bank Salary Continuation Agreement and amendments thereto ("Agreement") entered into between the Bank and Executive,

Whereas, Article 7.2 of the Agreement requires that any such amendment be written and signed by both the Bank and Executive,

Whereas, before signing this agreement both the Bank and Executive either (1) consulted and obtained independent legal and financial counsel with respect to the legal operations and financial impact of this amendment to the Agreement, or (2) freely and voluntarily decided not to have such consultation and advice,

A.	Revised Schedule A

The attached Schedule A dated February 15 , 2007, shall replace the original Schedule A referenced in the Agreement.

B.	Amendments

The Bank and Executive agree that the Agreement shall be modified as follows:

•	Article 2.1.1 shall be modified by replacing $50,000 with $60,000.

•	Article 2.4.1 shall be modified by replacing $345,712 with $414,855.

In Witness Whereof, the Executive and a duly authorized Bank officer have signed this agreement to amend the Agreements as of February 15 , 2007.

The Executive:

/s/ Bruce A. Orris

The Bank:

First Northern Bank of Dixon

By: /s/ Louise A. Walker

Schedule A

First Northern Bank of Dixon Salary Continuation Agreement

Amended February 15, 2007

Bruce A. Orris

Plan year ending December 31 ,	Early Termination Annual Benefit	Disability Annual Benefit
2006	-	3,821
2007	-	4,966
2008	-	6,274
2009	-	7,766
2010	-	9,462
2011	21,386	21,386
2012	23,564	23,564
2013	26,025	26,025
2014	28,801	28,801
2015	31,928	31,928
2016	35,444	35,444
2017	39,393	39,393
2018	43,822	43,822
2019	48,784	48,784
2020	54,337	54,337

First Northern Bank of Dixon

Salary Continuation Agreement and Related Death Benefits

Amendments

Whereas, First Northern Bank of Dixon("Bank") and Bruce Orris ("Executive") desire to amend (1) the First Northern Bank Salary Continuation Agreement, (2) Addendum A First Northern Bank of Dixon Split Dollar Agreement, and (3) Split Dollar Policy Endorsement First Northern Bank of Dixon Split Dollar Agreement (collectively "Agreements") entered into between the Bank and Executive,

Whereas, Article 7.2 of the First Northern Bank Salary Continuation Agreement and Article 7.1 of Addendum A First Northern Bank of Dixon Split Dollar Agreement require that any such amendments be written and signed by both the Bank and Executive,

Whereas, before signing this agreement amending the Agreements both the Bank and Executive either

(1) consulted and obtained independent legal and financial counsel with respect to the legal operations and financial impact of the amendments to the Agreements, or (2) freely and voluntarily decided not to have such consultation and advice,

A.	First Northern Bank Salary Continuation Agreement

The Bank and Executive agree that the First Northern Bank of Dixon Salary Continuation Agreement shall be modified as follows:

•	Replace the entirety of Article 3 with the following:

Article 3

Death Benefits

If the Executive's Termination of Employment is due to the Executive's death, then the Executive's beneficiary(ies) shall be entitled to a death benefit as described in the Executive's Split Dollar Agreement and Endorsement (as amended) in lieu of any other benefit payable hereunder.

If the Executive's Termination of Employment is not due to the Executive's death, then

(a) the Executive's beneficiary(ies) shall not be entitled to a death benefit as a result of the Executive's Split Dollar Agreement and Endorsement, and (b) the Bank shall continue to pay to the Executive's beneficiary(ies) the benefit payable to Executive as a result of Article 2.1, 2.2, 2.3, or 2.4, as applicable at Termination of Employment, until the entire benefit due to Executive (assuming the Executive had not died prior to full payment of benefits) is paid by the Bank.

B.	Addendum A – First Northern Bank of Dixon Split Dollar Agreement

The Bank and Executive agree that the First Northern Bank of Dixon Split Dollar Agreement shall be modified as follows:

•	Replace the entirety of Section 2.2 with the following:

"2.2 Executive's Interest - The Executive shall have the right to designate the beneficiary(ies) of death proceeds of only the portion of the death proceeds payable to the Executive's beneficiary(ies) as defined in this section. If Termination of Employment occurs because of the Insured's death, then the Insured's Beneficiary(ies), designated in accordance with the Split Dollar Policy Endorsement, shall be entitled to an amount equal to the amount set forth in Exhibit A that corresponds to the age of the Insured at the time of the Insured's death, or one hundred percent (100%) of the total proceeds less cash value of the Policy, whichever is less. The Executive shall also have the right to elect and change settlement options specified in the Policy for this portion of the proceeds."

•	Delete the entirety of Sections 2.3 and 2.4.

•	Replace the entirety of Section 7.2 with the following:

"7.2 Termination of Agreement. This Split Dollar Agreement shall terminate upon the occurrence of any one of the following:

(a)	Termination of Employment of the Insured for reason other than death, or

(b)	Surrender, lapse, or other termination of the Policy by the Bank, or

(c)	Distribution of the death proceeds in accordance with Section 2.2 above."

C.	Split Dollar Policy Endorsement First Northern Bank of Dixon Split Dollar Agreement

The Bank and Executive agree that the Split Dollar Policy Endorsement shall be modified as follows:

•	Replace the entirety of paragraph 2 with the following:

"2 The Insured shall designate the beneficiary(ies) of death proceeds. Provided that the Insured's Termination of Employment (as defined in the January 1, 2002 Salary Continuation Agreement between the Bank and the Insured (the "Salary Continuation Agreement")) was due to the Insured's death, then the Insured's beneficiary(ies) designated in accordance with this Split Dollar Endorsement shall be entitled to an amount equal to the amount set forth in Exhibit A that corresponds to the age of the Insured at the time of death, or one hundred percent (100%) of the total proceeds less cash value of the Policy, whichever is less."

•	Replace the entirety of paragraph 4 with the following:

"4 The Insured shall have the right to exercise all settlement options with respect to that portion of the death proceeds designated in paragraph (2) of this endorsement."

In Witness Whereof, the Executive and a duly authorized Bank officer have signed this agreement to amend the Agreements as of December 31, 2004.

The Executive:

/s/ Bruce A. Orris

The Bank:

First Northern Bank of Dixon

By: /s/ Louise A. Walker

Its: Chief Financial Officer

FIRST NORTHERN BANK OF DIXON SALARY CONTINUATION AGREEMENT

THIS SALARY CONTINUATION AGREEMENT is entered into as of this 1st day of January, 2002, by and between First Northern Bank of Dixon, a California-chartered, FDIC-insured bank with its main office in Dixon, California (the "Bank"), and Bruce A. Orris, Vice President (the "Executive").

WHEREAS, the Executive has contributed substantially to the success of the Bank and its parent corporation, First Northern Community Bancorp, 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, payable out of the Bank's. general assets,

WHEREAS, none of the conditions or events included in the definition of the term "golden parachute payment" that is set forth in §18(k)(4)(A)(ii) of the Federal Deposit Insurance Act (12 U.S.C. 1828(k)(4)(A)(ii)] and in Federal Deposit Insurance Corporation Rule 359.l(f)(l)(ii) [12 CFR

359. l(f)(l)(ii)] exists or, to the best knowledge of the Bank, is contemplated insofar as the Bank is concerned.

Now THEREFORE, in consideration of the foregoing premises and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

ARTICLE 1

DEFINITIONS

Whenever used in this Agreement, the following terms shall have the meanings specified:

1.1	"Accrual Balance" means the amount reflected in Schedule A, which is the amount required to be accrued by the Bank under generally accepted accounting principles to account for benefits that may become payable to the Executive under this Agreement.

1.2	"Cause" shall have the meaning set forth in Section 5.1

1.3	"Change in Control" means any of the following events occurs:

(a)

Merger: First Northern Community Bancorp merges into or consolidates with another corporation, or merges another corporation into First Northern Community Bancorp, and as a result less than 50% of the combined voting power of the resulting corporation immediately after the merger or consolidation is held by persons who were stockholders of First Northern Community Bancorp immediately before the merger or consolidation,

(b)

Acquisition of Significant Share Ownership: a report on Schedule 13D or another form or schedule (other than Schedule 130) is filed or is required to be filed under Sections 13(d) or 14(d) of the Securities Exchange Act of 1934, if the schedule discloses that the filing person or persons acting in concert has or have become the beneficial owner of 20% or more of a class of First Northern Community Bancorp's voting securities, but this clause (b) shall not apply to beneficial ownership of First Northern Community Bancorp voting shares held in a fiduciary

capacity by an entity of which First Northern Community Bancorp directly or indirectly beneficially owns 50% or more of its outstanding voting securities or voting shares held by an employee benefit plan maintained for the benefit of First Northern Bank of Dixon's employees, or

(c)

Change in Board Composition: during any period of two consecutive years, individuals who constitute First Northern Community Bancorp's Board of Directors at the beginning of the two-year period cease for any reason to constitute at least a majority of First Northern Community Bancorp's Board of Directors; provided, however, that - for purposes of this clause (c) - each director who is first elected by the board (or first nominated by the board for election by stockholders) by a vote of at least two-thirds of the directors who were directors at the beginning of the period shall be deemed to have been a director at the beginning of the two- year period.

1.4

"Disability" means the Executive suffers a sickness, accident or injury which has been determined by the carrier of any individual or group disability insurance policy covering the Executive, or by the Social Security Administration, to be a disability rendering the Executive totally and permanently disabled. The Executive must submit proof to the Bank of the carrier's or Social Security

Administration's determination upon the request of the Bank.

1.5 "Early Retirement Age" means the later of the Executive's 55th birthday or the

date which the Executive has at least 10 years of service with the Bank. If the Executive does not have 10 years of service with the Bank by the date of his 55th birthday, the Executive's Early Retirement Age means the date on which the Executive has 10 years of service with the Bank.

1.6	"Early Termination" means termination of the Executive's employment with the Bank before Normal Retirement Age for reasons other than death, disability, termination for cause or within 24 months after a Change in Control.

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

1.8	"Effective Date" means the date and year first written above.

1.9	"Good Reason " for purposes of this Agreement shall be defined as:

(a)	a material reduction in Executive's title or responsibilities;

(b)	a reduction in base salary as in effect on the date of a Change in Control of the Bank;

(c)	the relocation of the Executive's principal executive office so that Executive's one-way commute distance from Executive's residence is increased by more than forty (40) miles;

(d)	the adverse and substantial alteration in the nature and quality of the office space within which the Executive performs his duties, including the size and location thereof, as well as the secretarial and administrative support provided to the Executive;

(e)	the failure by the Bank to continue to provide the Executive with compensation and benefits substantially similar to those provided to him under any of the employee benefit plans in which the Executive becomes a participant, or the taking of any action by the Bank

which would directly or indirectly materially reduce any of such benefits or deprive the Executive of any material fringe benefit enjoyed by him at the time of the Change in Control; or

(f)	the failure of the Bank to obtain a satisfactory agreement from any successor or assign of the Bank to assume and agree to perform this Agreement, as contemplated in Section

7.5 hereof.

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

1.11	"Normal Retirement Date "means the later of the Normal Retirement Age or the Executive's Termination of Employment with the Bank.

1.12	"Person" means an individual, corporation, partnership, trust, association, joint venture, pool, syndicate, sole proprietorship, unincorporated organization or other entity.

1.13	"Plan Year" means the calendar year ending on December 31.

1.14

"Termination of Employment" means that the Executive shall have ceased to be employed by the Bank for any reason whatsoever, excepting a leave of absence approved by the Bank. For purposes of this Agreement, if there is a dispute over the employment status of the Executive or the date of termination of the Executive's employment, the Bank shall have the sole and absolute right to decide the dispute, unless a Change in Control shall have occurred within 24 months before termination of employment.

ARTICLE 2 LIFETIME BENEFITS

2.1	Normal Retirement Benefit. Upon the Executive's 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 instead of any other benefit under this Agreement.

2.1.1

Amount of Benefit. The annual benefit under this Section 2.1 is $50,000. The Bank's Board of Directors may, in its sole discretion, increase the annual benefit under this Section 2.1.1, but any increase shall require recalculation of Schedule A. The benefits reflected in Schedule A are based on the assumption that the Executive retires at age 65. If the Executive instead continues to serve as an officer of the Bank after the Normal Retirement Age, the benefits reflected in Schedule A shall be recalculated annually until the Executive's Normal Retirement Date, using the same discount rate reflected in Schedule A.

2.1.2

Payment of Benefit. Beginning with the month after the Executive's Normal Retirement Date, the Bank shall pay the annual benefit to the Executive in 12 equal monthly installments on the first day of each month. The annual benefit shall be paid to the Executive for 10 years.

2.2	Early Termination Benefit. Upon Early Termination on or after Early Retirement Age, the Bank shall pay to the Executive the benefit described in this Section 2.2 instead 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 in Schedule A for the Plan Year ending immediately before the Early Termination Date. The Bank's Board of Directors may, in its sole discretion, increase the annual benefit under this Section 2.2.1, but any increase shall require recalculation of Schedule A.

2.2.2

Payment of Benefit. The Bank shall pay the annual benefit to the Executive in 12 equal monthly installments on the first day of each month commencing with the month after the Early Termination Date. The annual benefit shall be paid to the Executive for 10 years.

2.3	Disability Benefit. If the Executive terminates employment because of Disability before the Normal Retirement Age, the Bank shall pay to the Executive the benefit described in this Section 2.3 instead 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 in Schedule A for the Plan Year ending immediately before the date on which termination of the Executive's employment occurs. The Bank's Board of Directors may, in its sole discretion, increase the annual benefit under this Section 2.3.1, but any increase shall require recalculation of Schedule A.

2.3.2

Payment of Benefit. Beginning with the month after Termination of Employment due to Disability, the Bank shall pay the Disability Annual Benefit amount to the Executive in 12 equal monthly installments on the first day of each month. The annual benefit shall be paid to the Executive for 10 years.

2.4

Change-in-Control Benefit. If the Executive's employment with the Bank terminates involuntarily within 24 months after the first occurrence of a Change in Control or in the event the Executive terminates employment voluntarily for Good Reason within 24 months of such Change in Control, the Bank shall pay to the Executive the benefit described in this Section 2.4 instead of any other benefit under this Agreement. However, no benefits shall be payable under this Agreement if the Executive's employment is terminated under Article 5 of this Agreement.

2.4.1

Amount of Benefit: The Change-in-Control Benefit under this Section 2.4 is determined by vesting the Executive in $345,712 (the Normal Retirement Age Accrual Balance described in Section 2.1) calculating the present value of said benefit using a discount rate equal to the 10-year US Treasury bill rate at the Plan Year ending immediately before the date on which the Termination of Employment occurs. For example, assume that a Change in Control occurs on January 15, 2003 and the Executive is involuntarily terminated from employment with the Bank on January 30, 2003. The Executive's Change-in-Control benefit would be determined by discounting $345,712 by the 10-year

U.S. Treasury bill rate at December 31, 2002 (the Plan Year ending immediately before the date on which the Termination of Employment occurs). Assuming solely for illustration the 10-year U.S. Treasury bill rate on December 31, 2002 were 4.8%, the Executive's Change-in-Control benefit would be $140,248. This example is provided for illustrative purposes only. The Bank's Board of Directors may, in its sole discretion,

increase the benefit under this Section 2.4.1, but any increase shall require 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 one lump sum within three days after the Executive's Termination of Employment.

2.5	Petition for Payment of Vested Normal Retirement Benefit, Vested Early Termination Benefit or Vested Disability Benefit. If the Executive is entitled to the normal retirement

benefit provided by Section 2.1, the Early Termination benefit provided by Section 2.2, or the Disability benefit provided by Section 2.3, the Executive may petition the Board of Directors to have the Accrual Balance amount corresponding to that particular benefit paid to the Executive in a single lump sum after

(a) deduction of any normal retirement benefits, Early Termination benefits or Disability benefits already paid and (b) addition of interest at the rate of 8.0% on the Accrual Balance not yet paid for the period from Termination of Employment to payment of the lump sum amount. The Board of Directors shall have sole and absolute discretion about whether to pay the remaining Accrual Balance in a lump sum. If payment of the remaining Accrual Balance is paid in a single lump sum, the Bank shall have no further obligations under this Agreement.

2.6

Change-in-Control Payout of Vested Normal Retirement Benefit, Vested Early Termination Benefit or Vested Disability Benefit Being Paid to the Executive at the Time of a Change in Control. If a Change in Control occurs at any time during the entire 10-year salary continuation benefit payment period and if at the time of that Change in Control the Executive is receiving the benefit provided by Section 2.1.2, Section 2.2.2 or Section 2.3.2, the Bank shall pay the remaining salary continuation benefits to the Executive, his beneficiaries, or estate in a lump sum within three days after

the Change in Control. The lump-sum payment due to the Executive, his beneficiaries or estate as a result of a Change in Control shall be an amount equal to the Accrual Balance amount corresponding to that particular benefit then being paid to the Executive, his estate or beneficiaries pursuant to Section 2.1.2, Section 2.2.2 or Section 2.3.2 after (a) deduction of any normal retirement benefits, Early Termination benefits or Disability benefits already paid and (b) addition of interest at the rate of 8.0% on the Accrual Balance not yet paid for the period from Termination of Employment to payment of the lump sum amount. If payment of the remaining Accrual Balance is paid in a single lump sum, the Bank shall have no further obligations under this Agreement.

2.7	Contradiction in Terms of Agreement and Schedule A. If there is a contradiction

in the terms of this Agreement and the Schedule A attached hereto with the actual amount of a particular benefit 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 the Agreement shall control.

ARTICLE 3 DEATH BENEFITS

After the Executive's death, whether before or after Termination of Employment at Early Retirement Age or Normal Retirement Age, the Bank shall pay to the Executive's beneficiary(ies) the benefit described in the Split Dollar Agreement and Endorsement, attached to this Agreement as Addendum A, between the Bank and the Executive in lieu of any other benefit payable hereunder, in accordance with the terms and conditions of the Split Dollar Agreement and Endorsement.

ARTICLE 4 BENEFICIARIES

4.1

Beneficiary Designations. The Executive shall designate a beneficiary or beneficiaries 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 be effective only 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 such proof of incapacity, minority or guardianship as the Bank deems appropriate before distribution of the benefit. Distribution shall completely discharge the Bank from all liability for such benefit.

ARTICLE 5 GENERAL LIMITATIONS

5.1	Termination/or Cause. Notwithstanding any provision of this Agreement to the contrary, the Bank shall not pay any benefit under this Agreement if the Bank terminates the Executive's employment for:

(a)	Gross negligence or gross neglect of duties,

(b)	Commission of a felony or commission of a misdemeanor involving moral turpitude, or

(c)	Fraud, disloyalty, dishonesty, or willful violation of any law or significant Bank policy committed in connection with the Executive's employment and, in the Bank's sole judgment, resulting in an adverse effect on the Bank.

5.2

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

5.3

Removal. If the Executive is removed from office or permanently prohibited from participating in the conduct of the Bank's affairs by an order issued under Section 8(e)(4) or (g)(l) of the Federal Deposit Insurance Act, 12 U.S.C. §1818(e)(4) or (g)(l), all obligations of the Bank under this Agreement shall terminate as of the effective date of the order.

5.4

Insolvency. If the Commissioner of the California Department of Financial Institutions appoints the Federal Deposit Insurance Corporation as receiver for the Bank under California Financial Code §3220-3225, all obligations under this Agreement shall terminate as of the date of the Bank's declared insolvency.

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:

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,

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 BRISA 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 BRISA 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:

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

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

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. By an assumption agreement in form and substance satisfactory to the Executive, the Bank will require any successor (whether direct or indirect, by purchase,

merger, consolidation or otherwise) to all or substantially all of the business or assets of the Bank 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 such an assumption agreement before the succession becomes effective shall be considered 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. Except to the extent preempted by the laws of the United States of America, the validity, interpretation, construction, and performance of this Agreement shall be governed by and construed in accordance with the laws of the State of California, without giving effect to the principles of conflict of laws of such state.

7.8

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

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 powers that are necessary 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 forms necessary or desirable to administer the Agreement.

7.11

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

7.12

Severability. If for any reason any provision of this Agreement is held invalid, such invalidity shall not affect any other provision of this Agreement not held so invalid, and each such other provision shall, to the full extent consistent with the law, continue in full force and effect. If any provision of this Agreement shall be held invalid in part, such invalidity shall in no way affect the remainder of such provision, not held so invalid, and the remainder of such provision, together with all other provisions of this Agreement shall, to the full extent consistent with the law, continue in full force and effect.

7.13 Headings . The headings of Sections herein are included solely for convenience of referecene and shall not affect the meaning or interpretation of any provision of this Agreement.

7.14

Notices. All notices, requests, demands and other communications hereunder shall be in writing and shall be deemed to have been duly given if delivered by hand or mailed, certified or registered mail, return receipt requested, with postage prepaid, to the following addresses or to such other address as either party may designate by like notice.

(a)	If to the Bank, to: Board of Directors

First Northern Bank of Dixon 195 North First Street

P.O. Box 547

Dixon, California 95620

(b)	If to the Executive, to:

Bruce A. Orris

and to such other or additional person or persons as either party shall have designated to the other party in writing by like notice.

7.15

Termination or Modification of Agreement by Reason of Changes in the Law, Rules or Regulations. The Bank is entering into this agreement upon the assumption that certain existing tax laws, rules and regulations will continue in effect in their current form. If said assumptions should materially change and said change has a material detrimental effect on this Agreement, then the Bank reserves the right to terminate or modify this Agreement accordingly, subject to obtaining the written consent of the Executive, which shall not be unreasonably withheld.

7.16

Advice of Counsel. Before signing this Agreement, Executive either (i) consulted with and obtained advice from Executive's independent legal counsel in respect to the legal nature and operations of this Agreement, including its impact on Executive's rights, privileges and obligations, or (ii) freely and voluntarily decided not to have the benefit of such consultation and advice with legal counsel.

IN WITNESS WHEREOF, the Executive and a duly authorized Bank officer have signed this Agreement as of the day and year first written above.

THE EXECUTIVE: THE BANK:

/s/ Bruce A. Orris FIRST NORTHERN BANK OF DIXON

By: /s/ Owen J. Onsum

Its: President/CEO

SCHEDULE A

FIRST NORTHERN BANK OF DIXON

SALARY CONTINUATION AGREEMENT

Bruce A. Orris

Plan Year		Plan year ending December 31,		Executive's Age at Plan Year End		Accrual balance @ 8.0% ¹		Early Termination vesting schedule			Vested accrual balance		Early Termination Annual Benefit payable for Early Termination during Indicated Plan Year ²		Disability Annual Benefit payable for Disability Occurring During Indicated Plan Year
	1		-		46	$	3,841		0	%	$	3,841	$	0	$	556
	2		-		47	$	8,320		0	%	$	8,320	$	0	$	1,203
	3		-		48	$	13,515		0	%	$	13,515	$	0	$	1,955
	4		-		49	$	19,516		0	%	$	19,516	$	0	$	2,823
	5		2006		50	$	26,420		0	%	$	26,420	$	0	$	3,821
	6		2007		51	$	34,335		0	%	$	34,335	$	0	$	4,966
	7		2008		52	$	43,382		0	%	$	43,382	$	0	$	6,274
	8		2009		53	$	53,695		0	%	$	53,695	$	0	$	7,766
	9		2010		54	$	65,421		0	%	$	65,421	$	0	$	9,462
	10		2011		55	$	78,723		100	% ³	$	78,723	$	11,386	$	11,386
	11		2012		56	$	93,783		100	%	$	93,783	$	13,564	$	13,564
	12		2013		57	$	110,800		100	%	$	110,800	$	16,025	$	16,025
	13		2014		58	$	129,996		100	%	$	129,996	$	18,801	$	18,801
	14		2015		59	$	151,615		100	%	$	151,615	$	21,928	$	21,928
	15		2016		60	$	175,928		100	%	$	175,928	$	25,444	$	25,444
	16		2017		61	$	203,231		100	%	$	203,231	$	29,393	$	29,393
	17		2018		62	$	233,856		100	%	$	233,856	$	33,822	$	33,822
	18		2019		63	$	268,164		100	%	$	268,164	$	38,784	$	38,784
	19		2020		64	$	306,556		100	%	$	306,556	$	44,337	$	44,337
	20		2021		65	$	343,823				$	343,823
	21		2022		66	$	320,139				$	320,139
	22		2023		67	$	294,490				$	294,490
	23		2024		68	$	266,712				$	266,712
	24		2025		69	$	236,629				$	236,629
	25		2026		70	$	204,048				$	204,048
	26		2027		71	$	168,763				$	168,763
	27		2028		72	$	130,550				$	130,550
	28		2029		73	$	89,165				$	89,165
	29		2030		74	$	44,345				$	44,345
	30		2031		75	$	0				$	0

¹ The Accrual Balance reflects payment at the beginning of each month during retirement, with the first payment occurring during December 2021.

² Benefit is based on present value of the current payment stream of the vested accrual balance using a standard discount rate (8.00%).

³ Bruce A. Orris satisfies the Early Retirement Age definition of §1.5 on his birthday on November 21, 2011, and thus is vested in his Early Termination Benefit as of his 55th birthday. Mr. Orris was hired by the Bank on July 18, 1983 and thus will have 10 years of service by the time of his 55 ^th birthday.

California		68-0450397
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification Number)

195 N. First Street, Dixon, California		95620
(Address of principal executive offices)		(Zip Code)

Large accelerated filer 	Accelerated filer 
Non-accelerated filer  (Do not check if a smaller reporting company)	Smaller reporting company 

	Page
PART I – Financial Information

ITEM I. – Financial Statements (Unaudited)	3

Condensed Consolidated Balance Sheets (Unaudited)	3

Condensed Consolidated Statements of Income (Unaudited)	4

Condensed Consolidated Statements of Comprehensive Income (Unaudited)	5

Condensed Consolidated Statement of Stockholders' Equity (Unaudited)	6

Condensed Consolidated Statements of Cash Flows (Unaudited)	7

Notes to Condensed Consolidated Financial Statements	8

ITEM 2. – MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	30

ITEM 3. – QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	45

ITEM 4. – CONTROLS AND PROCEDURES	45

PART II – OTHER INFORMATION	45

ITEM 1. – LEGAL PROCEEDINGS	45

ITEM 1A. – RISK FACTORS	45

ITEM 2. – UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS	47

ITEM 3. – DEFAULTS UPON SENIOR SECURITIES	47

ITEM 4. – MINE SAFETY DISCLOSURES	47

ITEM 5. – OTHER INFORMATION	47

ITEM 6. – EXHIBITS	47

SIGNATURES	48

(in thousands, except shares amounts)	March 31, 2018			December 31, 2017

Assets

Cash and cash equivalents	$	148,511		$	152,892
Certificates of deposit		1,984			1,984
Investment securities – available-for-sale		291,166			280,741
Loans, net of allowance for loan losses of $11,715 at March 31, 2018 and $11,133 at December 31, 2017		720,559			739,112
Loans held-for-sale		430			1,040
Stock in Federal Home Loan Bank and other equity securities, at cost		5,567			5,567
Premises and equipment, net		6,077			6,248
Interest receivable and other assets		29,975			30,074

Total Assets	$	1,204,269		$	1,217,658

Liabilities and Stockholders' Equity

Liabilities:

Demand deposits	$	382,166		$	382,157
Interest-bearing transaction deposits		307,155			312,569
Savings and MMDA's		333,669			336,592
Time, $250,000 or less		51,287			54,531
Time, over $250,000		18,517			18,891
Total deposits		1,092,794			1,104,740

Interest payable and other liabilities		10,411			12,874

Total Liabilities		1,103,205			1,117,614

Stockholders' Equity:
Common stock, no par value; 16,000,000 shares authorized; 11,661,857 shares issued and outstanding at March 31, 2018 and 11,630,129 shares issued and outstanding at December 31, 2017		85,931			85,583
Additional paid-in capital		977			977
Retained earnings		20,364			17,881
Accumulated other comprehensive loss, net		(6,208	)		(4,397	)
Total Stockholders' Equity		101,064			100,044

Total Liabilities and Stockholders' Equity	$	1,204,269		$	1,217,658

(in thousands, except per share amounts)	Three months ended March 31, 2018		Three months ended March 31, 2017
Interest and dividend income:
Loans	$	8,806	$	7,961
Due from banks interest bearing accounts		517		332
Investment securities
Taxable		1,308		1,102
Non-taxable		39		75
Other earning assets		105		108
Total interest and dividend income		10,775		9,578
Interest expense:
Deposits		263		265
Total interest expense		263		265
Net interest income		10,512		9,313
Provision for loan losses		525		600
Net interest income after provision for loan losses		9,987		8,713
Non-interest income:
Service charges on deposit accounts		488		418
Gains on sales of loans held-for-sale		69		147
Investment and brokerage services income		161		143
Mortgage brokerage income		6		13
Loan servicing income		106		150
Fiduciary activities income		156		125
Debit card income		502		467
Losses on sales/calls of available-for-sale securities		—		(16	)
Gain on sale-leaseback of real estate		—		1,187
Other income		316		211
Total non-interest income		1,804		2,845
Non-interest expenses:
Salaries and employee benefits		5,317		4,751
Occupancy and equipment		715		696
Data processing		530		402
Stationery and supplies		99		70
Advertising		88		66
Directors' fees		65		59
Other real estate owned recovery		—		(1	)
Other expense		1,180		1,460
Total non-interest expenses		7,994		7,503
Income before provision for income taxes		3,797		4,055
Provision for income taxes		1,064		1,542

Net income	$	2,733	$	2,513

Basic earnings per common share	$	0.24	$	0.22
Diluted earnings per common share	$	0.23	$	0.22

(in thousands)	Three months ended March 31, 2018			Three months ended March 31, 2017
Net income	$	2,733		$	2,513
Other comprehensive loss, net of tax:
Unrealized holding (losses) gains on securities:
Unrealized holding (losses) gains arising during the period, net of tax effect of $(731) and $6 for the three-month periods ended March 31, 2018 and March 31, 2017, respectively		(1,811	)		10
Less: reclassification adjustment due to losses realized on sales of securities, net of tax effect of $0 and $6 for the three-month periods ended March 31, 2018 and March 31, 2017, respectively		—			10
Directors' and officer's retirement plan equity adjustments, net of tax effect of $0 and $(31) for the three-month periods ended March 31, 2018 and March 31, 2017, respectively		—			(46	)
Other comprehensive loss	$	(1,811	)	$	(26	)
Comprehensive income	$	922		$	2,487

	Common Stock
	Shares			Amounts		Additional Paid-in Capital		Retained Earnings			Accumulated Other Comprehensive Loss			Total

Balance at December 31, 2016		11,148,446		$	79,114	$	977	$	14,557		$	(2,350	)	$	92,298
Net income									8,748						8,748
Other comprehensive loss, net of tax												(1,448	)		(1,448	)
Stock dividend adjustment		289			207				(207	)					—
Tax rate change reclassification									599			(599	)		—
4% stock dividend declared in 2018		447,312			5,806				(5,806	)					—
Cash in lieu of fractional shares		(129	)						(10	)					(10	)
Stock-based compensation					378										378
Common shares issued related to restricted stock grants, net of restricted stock reversals		34,211			78										78
Balance at December 31, 2017		11,630,129		$	85,583	$	977	$	17,881		$	(4,397	)	$	100,044
Net income									2,733						2,733
Other comprehensive loss, net of tax												(1,811	)		(1,811	)
Stock dividend adjustment		628			240				(240	)					—
Cash in lieu of fractional shares		(159	)						(10	)					(10	)
Stock-based compensation					108										108
Common shares issued related to restricted stock grants		25,281			—										—
Stock options exercised, net		5,978			—										—
Balance at March 31, 2018		11,661,857		$	85,931	$	977	$	20,364		$	(6,208	)	$	101,064

(in thousands)	Amortized cost		Unrealized gains		Unrealized losses			Estimated fair value

Investment securities available-for-sale:
U.S. Treasury Securities	$	25,444	$	—	$	(219	)	$	25,225
Securities of U.S. government agencies and corporations		35,326		—		(342	)		34,984
Obligations of states and political subdivisions		21,942		137		(181	)		21,898
Collateralized mortgage obligations		67,219		—		(2,338	)		64,881
Mortgage-backed securities		147,983		50		(3,855	)		144,178
Total debt securities	$	297,914	$	187	$	(6,935	)	$	291,166

	Less than 12 months					12 months or more					Total
(in thousands)	Fair Value		Unrealized losses			Fair Value		Unrealized losses			Fair Value		Unrealized losses

U.S. Treasury securities	$	16,811	$	(59	)	$	8,414	$	(160	)	$	25,225	$	(219	)
Securities of U.S. government agencies and corporations		19,960		(119	)		15,024		(223	)		34,984		(342	)
Obligations of states and political subdivisions		5,610		(50	)		7,273		(131	)		12,883		(181	)
Collateralized Mortgage obligations		28,440		(776	)		36,441		(1,562	)		64,881		(2,338	)
Mortgage-backed securities		48,802		(915	)		89,836		(2,940	)		138,638		(3,855	)
Total	$	119,623	$	(1,919	)	$	156,988	$	(5,016	)	$	276,611	$	(6,935	)

($ in thousands)	March 31, 2018			December 31, 2017

Commercial	$	130,749		$	135,015
Commercial Real Estate		393,910			398,346
Agriculture		104,104			113,555
Residential Mortgage		44,788			42,081
Residential Construction		20,754			21,299
Consumer		36,930			38,900
		731,235			749,196
Allowance for loan losses		(11,715	)		(11,133	)
Net deferred origination fees and costs		1,039			1,049
Loans, net	$	720,559		$	739,112

($ in thousands)	Current & Accruing		30-59 Days Past Due & Accruing		60-89 Days Past Due & Accruing		90 Days or more Past Due & Accruing		Nonaccrual		Total Loans
March 31, 2018
Commercial	$	129,831	$	39	$	—	$	—	$	879	$	130,749
Commercial Real Estate		392,137		97		—		—		1,676		393,910
Agriculture		104,104		—		—		—		—		104,104
Residential Mortgage		44,080		—		—		—		708		44,788
Residential Construction		20,754		—		—		—		—		20,754
Consumer		36,406		212		—		—		312		36,930
Total	$	727,312	$	348	$	—	$	—	$	3,575	$	731,235

December 31, 2017
Commercial	$	133,913	$	—	$	—	$	45	$	1,057	$	135,015
Commercial Real Estate		396,521		101		—		—		1,724		398,346
Agriculture		113,555		—		—		—		—		113,555
Residential Mortgage		40,354		349		597		—		781		42,081
Residential Construction		21,299		—		—		—		—		21,299
Consumer		38,656		1		38		—		205		38,900
Total	$	744,298	$	451	$	635	$	45	$	3,767	$	749,196

($ in thousands)	Unpaid Contractual Principal Balance		Recorded Investment with no Allowance		Recorded Investment with Allowance		Total Recorded Investment		Related Allowance
March 31, 2018
Commercial	$	3,420	$	879	$	2,312	$	3,191	$	47
Commercial Real Estate		2,088		1,676		270		1,946		36
Agriculture		—		—		—		—		—
Residential Mortgage		2,424		708		1,484		2,192		309
Residential Construction		644		—		644		644		71
Consumer		523		312		211		523		4
Total	$	9,099	$	3,575	$	4,921	$	8,496	$	467

December 31, 2017
Commercial	$	3,882	$	1,057	$	2,603	$	3,660	$	53
Commercial Real Estate		2,114		1,724		272		1,996		36
Agriculture		—		—		—		—		—
Residential Mortgage		2,628		781		1,496		2,277		302
Residential Construction		651		—		650		650		76
Consumer		418		205		213		418		3
Total	$	9,693	$	3,767	$	5,234	$	9,001	$	470

($ in thousands)	Pass		Special Mention		Substandard		Doubtful		Loss		Total
March 31, 2018
Commercial	$	126,596	$	3,022	$	1,131	$	—	$	—	$	130,749
Commercial Real Estate		363,867		16,733		13,310		—		—		393,910
Agriculture		101,887		2,217		—		—		—		104,104
Residential Mortgage		42,534		1,533		721		—		—		44,788
Residential Construction		20,754		—		—		—		—		20,754
Consumer		35,635		945		350		—		—		36,930
Total	$	691,273	$	24,450	$	15,512	$	—	$	—	$	731,235

December 31, 2017
Commercial	$	132,846	$	1,050	$	1,119	$	—	$	—	$	135,015
Commercial Real Estate		378,632		16,101		3,613		—		—		398,346
Agriculture		110,370		3,140		45		—		—		113,555
Residential Mortgage		39,142		2,147		792		—		—		42,081
Residential Construction		21,299		—		—		—		—		21,299
Consumer		38,157		500		243		—		—		38,900
Total	$	720,446	$	22,938	$	5,812	$	—	$	—	$	749,196

Three months ended March 31, 2018
($ in thousands)	Commercial			Commercial Real Estate			Agriculture			Residential Mortgage			Residential Construction			Consumer			Unallocated		Total
Balance as of December 31, 2017	$	2,625		$	5,460		$	1,547		$	628		$	360		$	342		$	171	$	11,133
Provision for (reversal of) loan losses		(85	)		(46	)		(124	)		(1	)		(13	)		(68	)		862		525

Charge-offs		—			—			—			—			—			(6	)		—		(6	)
Recoveries		9			—			—			16			1			37			—		63
Net charge-offs		9			—			—			16			1			31			—		57
Balance as of March 31, 2018	$	2,549		$	5,414		$	1,423		$	643		$	348		$	305		$	1,033	$	11,715
Period-end amount allocated to:
Loans individually evaluated for impairment		47			36			—			309			71			4			—		467
Loans collectively evaluated for impairment		2,502			5,378			1,423			334			277			301			1,033		11,248
Balance as of March 31, 2018	$	2,549		$	5,414		$	1,423		$	643		$	348		$	305		$	1,033	$	11,715

	March 31, 2018			December 31, 2017

Constant prepayment rate		9.50	%		10.80	%
Discount rate		10.02	%		10.02	%
Weighted average life (years)		6.56			6.02

	Method	Assumption Inputs

Impaired loans	Collateral, market, income, enterprise, liquidation and discounted Cash Flows	External appraised values, management assumptions regarding market trends or other relevant factors; selling costs ranging from 6% to 7%.

(in thousands)	March 31, 2018		December 31, 2017

Undisbursed loan commitments	$	213,079	$	220,882
Standby letters of credit		3,093		2,635
Commitments to sell loans		2,484		1,283
	$	218,656	$	224,800

Three months ended March 31, 2017
($ in thousands)	Commercial		Commercial Real Estate		Agriculture		Residential Mortgage		Residential Construction		Consumer			Unallocated			Total
Balance as of December 31, 2016	$	3,571	$	3,910	$	1,262	$	660	$	440	$	498		$	558		$	10,899
Provision for (reversal of) loan losses		235		813		25		41		13		(114	)		(413	)		600

Charge-offs		—		—		—		—		—		(11	)		—			(11	)
Recoveries		2		—		—		—		1		8			—			11
Net charge-offs		2		—		—		—		1		(3	)		—			—
Balance as of March 31, 2017	$	3,808	$	4,723	$	1,287	$	701	$	454	$	381		$	145		$	11,499
Period-end amount allocated to:
Loans individually evaluated for impairment		1,341		38		—		578		98		24			—			2,079
Loans collectively evaluated for impairment		2,467		4,685		1,287		123		356		357			145			9,420
Balance as of March 31, 2017	$	3,808	$	4,723	$	1,287	$	701	$	454	$	381		$	145		$	11,499

Year ended December 31, 2017
($ in thousands)	Commercial			Commercial Real Estate		Agriculture		Residential Mortgage			Residential Construction			Consumer			Unallocated			Total
Balance as of December 31, 2016	$	3,571		$	3,910	$	1,262	$	660		$	440		$	498		$	558		$	10,899
Provision for (reversal of) loan losses		(567	)		1,550		285		(7	)		(85	)		(189	)		(387	)		600

Charge-offs		(681	)		—		—		(121	)		—			(33	)		—			(835	)
Recoveries		302			—		—		96			5			66			—			469
Net charge-offs		(379	)		—		—		(25	)		5			33			—			(366	)
Ending Balance		2,625			5,460		1,547		628			360			342			171			11,133
Period-end amount allocated to:
Loans individually evaluated for impairment		53			36		—		302			76			3			—			470
Loans collectively evaluated for impairment		2,572			5,424		1,547		326			284			339			171			10,663
Balance as of December 31, 2017	$	2,625		$	5,460	$	1,547	$	628		$	360		$	342		$	171		$	11,133

	(in thousands)
	December 31, 2017			Additions			Reductions				March 31, 2018

Mortgage servicing rights		$	1,712		$	40		$	(73	)		$	1,679
Valuation allowance			—			—			—				—
Mortgage servicing rights, net of valuation allowance		$	1,712		$	40		$	(73	)		$	1,679

	(in thousands)
December 31, 2017	Carrying Value			Level 1			Level 2			Level 3
Impaired loans		$	1,468		$	—		$	—		$	1,468
Total assets at fair value		$	1,468		$	—		$	—		$	1,468

			March 31, 2018				December 31, 2017
	Level		Carrying amount		Fair value		Carrying amount		Fair value

Financial assets:
Cash and cash equivalents		1	$	148,511	$	148,511	$	152,892	$	152,892
Certificates of deposit		2		1,984		1,981		1,984		1,983
Stock in Federal Home Loan Bank and other equity securities		3		5,567		5,567		5,567		5,567
Loans receivable:
Net loans		3		720,559		679,423		739,112		736,292
Loans held-for-sale		2		430		443		1,040		1,060
Interest receivable		2		3,917		3,917		4,117		4,117
Mortgage servicing rights		3		1,679		2,040		1,712		1,876
Financial liabilities:
Deposits		3		1,092,794		963,567		1,104,740		993,425
Interest payable		2		75		75		72		72

	Number of Shares			Weighted Average Exercise Price		Aggregate Intrinsic Value		Weighted Average Remaining Contractual Term (in years)
Options outstanding at Beginning of Period		260,592		$	7.42
Granted		69,868		$	13.03
Expired		(3,412	)	$	11.90
Cancelled / Forfeited		—			—
Exercised		(13,539	)	$	7.05
Options outstanding at End of Period		313,509		$	8.64	$	1,488,836		7.52
Exercisable (vested) at End of Period		154,508		$	6.32	$	1,091,848		6.02

	Three Months Ended March 31, 2018
Risk Free Interest Rate		2.57	%

Expected Dividend Yield		0.00	%

Expected Life in Years		5

Expected Price Volatility		14.44	%

	Number of Shares			Weighted Average Grant-Date Fair Value		Aggregate Intrinsic Value		Weighted Average Remaining Contractual Term (in years)
Non-vested Restricted stock outstanding at Beginning of Period		111,848		$	7.85
Granted		25,769		$	13.03
Cancelled / Forfeited		—			—
Exercised/Released/Vested		(23,908	)	$	6.22
Non-vested restricted stock outstanding at End of Period		113,709		$	9.37	$	1,522,564		3.07

	Three Months Ended March 31, 2018
Risk Free Interest Rate		1.61%

Expected Dividend Yield		0.00%

Expected Life in Years		1.00

Expected Price Volatility		12.50%

($ in thousands)	Unrealized Gains (losses) on Securities			Officers' retirement plan			Directors' retirement plan		Accumulated Other Comprehensive Loss
Balance as of December 31, 2017	$	(2,997	)	$	(1,403	)	$	3	$	(4,397	)
Current period other comprehensive income/(loss)		(1,811	)		—			—		(1,811	)
Balance as of March 31, 2018	$	(4,808	)	$	(1,403	)	$	3	$	(6,208	)

	Three months ended March 31,
	2018		2017
Basic earnings per share:
Net income	$	2,733	$	2,513

Weighted average common shares outstanding		11,532,769		11,496,082
Basic EPS	$	0.24	$	0.22

Diluted earnings per share:
Net income	$	2,733	$	2,513

Weighted average common shares outstanding		11,532,769		11,496,082
Effect of dilutive shares		162,654		143,263
Adjusted weighted average common shares outstanding		11,695,423		11,639,345
Diluted EPS	$	0.23	$	0.22

	Three months ended March 31, 2018				Three months ended March 31, 2017

(in thousands except for per share amounts)
For the Period:
Net Income		$	2,733			$	2,513
Basic Earnings Per Common Share		$	0.24			$	0.22
Diluted Earnings Per Common Share		$	0.23			$	0.22
Net Income to Average Assets (annualized)			0.91	%			0.87	%
Net Income to Average Equity (annualized)			10.85	%			10.64	%
Average Equity to Average Assets			8.39	%			8.13	%

	March 31, 2018				December 31, 2017

(in thousands except for ratios)
At Period End:
Total Assets		$	1,204,269			$	1,217,658
Total Investment Securities		$	291,166			$	280,741
Total Loans, Net (including loans held-for-sale)		$	720,989			$	740,152
Total Deposits		$	1,092,794			$	1,104,740
Loan-To-Deposit Ratio			66.0	%			67.0	%

	Three months ended March 31, 2018							Three months ended March 31, 2017
	Average Balance		Interest		Yield/ Rate (4)			Average Balance		Interest		Yield/ Rate (4)
Assets
Interest-earning assets:
Loans (1)	$	717,675	$	8,806		4.98	%	$	660,028	$	7,961		4.89	%
Certificates of deposit		1,984		6		1.23	%		16,161		36		0.90	%
Interest bearing due from banks		123,235		511		1.68	%		139,768		296		0.86	%
Investment securities, taxable		280,552		1,308		1.89	%		263,729		1,102		1.69	%
Investment securities, non-taxable (2)		12,259		39		1.29	%		19,108		75		1.59	%
Other interest earning assets		5,567		105		7.65	%		4,409		108		9.93	%
Total average interest-earning assets		1,141,272		10,775		3.83	%		1,103,203		9,578		3.52	%
Non-interest-earning assets:
Cash and due from banks		24,267							24,451
Premises and equipment, net		6,154							6,095
Interest receivable and other assets		29,683							27,773
Total average assets		1,201,376							1,161,522

Liabilities and Stockholders' Equity:
Interest-bearing liabilities:
Interest-bearing transaction deposits		303,755		67		0.09	%		288,923		60		0.08	%
Savings and MMDA's		337,901		129		0.15	%		334,643		127		0.15	%
Time, $250,000 and under		52,184		47		0.37	%		58,717		59		0.41	%
Time, over $250,000		18,841		20		0.43	%		19,866		19		0.39	%
Total average interest-bearing liabilities		712,681		263		0.15	%		702,149		265		0.15	%
Non-interest-bearing liabilities:
Non-interest-bearing demand deposits		376,428							354,759
Interest payable and other liabilities		11,486							10,128
Total liabilities		1,100,595							1,067,036
Total average stockholders' equity		100,781							94,486
Total average liabilities and stockholders' equity	$	1,201,376						$	1,161,522
Net interest income and net interest margin (3)			$	10,512		3.74	%			$	9,313		3.42	%

	Three months ended March 31, 2018							Three months ended December 31, 2017
	Average Balance		Interest		Yield/ Rate (4)			Average Balance		Interest		Yield/ Rate (4)
Assets
Interest-earning assets:
Loans (1)	$	717,675	$	8,806		4.98	%	$	699,547	$	8,549		4.85	%
Certificates of deposit		1,984		6		1.23	%		2,890		9		1.24	%
Interest bearing due from banks		123,235		511		1.68	%		149,960		449		1.19	%
Investment securities, taxable		280,552		1,308		1.89	%		281,377		1,217		1.72	%
Investment securities, non-taxable (2)		12,259		39		1.29	%		13,811		48		1.38	%
Other interest earning assets		5,567		105		7.65	%		5,567		99		7.06	%
Total average interest-earning assets		1,141,272		10,775		3.83	%		1,153,152		10,371		3.57	%
Non-interest-earning assets:
Cash and due from banks		24,267							26,163
Premises and equipment, net		6,154							6,344
Interest receivable and other assets		29,683							29,321
Total average assets		1,201,376							1,214,980

Liabilities and Stockholders' Equity:
Interest-bearing liabilities:
Interest-bearing transaction deposits		303,755		67		0.09	%		299,706		63		0.08	%
Savings and MMDA's		337,901		129		0.15	%		350,341		152		0.17	%
Time, $250,000 and under		52,184		47		0.37	%		55,740		57		0.41	%
Time, over $250,000		18,841		20		0.43	%		19,310		15		0.31	%
Total average interest-bearing liabilities		712,681		263		0.15	%		725,097		287		0.16	%
Non-interest-bearing liabilities:
Non-interest-bearing demand deposits		376,428							375,570
Interest payable and other liabilities		11,486							12,141
Total liabilities		1,100,595							1,112,808
Total average stockholders' equity		100,781							102,172
Total average liabilities and stockholders' equity	$	1,201,376						$	1,214,980
Net interest income and net interest margin (3)			$	10,512		3.74	%			$	10,084		3.47	%

	Three Months Ended March 31, 2018 Over Three Months Ended March 31, 2017									Three Months Ended March 31, 2018 Over Three Months Ended December 31, 2017
	Volume			Interest Rate			Change			Volume			Interest Rate			Change

Increase in Interest Income:

Loans	$	711		$	134		$	845		$	126		$	131		$	257
Certificates of Deposit		(40	)		10			(30	)		(3	)		—			(3	)
Due From Banks		(40	)		255			215			(93	)		155			62
Investment Securities - Taxable		74			132			206			(4	)		95			91
Investment Securities - Non-taxable		(24	)		(12	)		(36	)		(5	)		(4	)		(9	)
Other Assets		25			(28	)		(3	)		—			6			6

	$	706		$	491		$	1,197		$	21		$	383		$	404

Increase (Decrease) in Interest Expense:

Deposits:
Interest-Bearing Transaction Deposits	$	2		$	5		$	7		$	—		$	4		$	4
Savings & MMDAs		2			—			2			(5	)		(18	)		(23	)
Time Certificates		(11	)		—			(11	)		(11	)		6			(5	)

	$	(7	)	$	5		$	(2	)	$	(16	)	$	(8	)	$	(24	)

Increase in Net Interest Income:	$	713		$	486		$	1,199		$	37		$	391		$	428

	At March 31, 2018									At December 31, 2017
	Gross			Guaranteed			Net			Gross			Guaranteed			Net
(dollars in thousands)

Commercial		$	879		$	316		$	563		$	1,057		$	32		$	1,025
Commercial real estate			1,676			129			1,547			1,724			70			1,654
Agriculture			—			—			—			—			—			—
Residential mortgage			708			—			708			781			—			781
Residential construction			—			—			—			—			—			—
Consumer			312			—			312			205			—			205
Total non-accrual loans		$	3,575		$	445		$	3,130		$	3,767		$	102		$	3,665

	Three months ended March 31,						Year ended December 31,
	2018			2017			2017

Balance at beginning of period	$	11,133		$	10,899		$	10,899
Provision for loan losses		525			600			600
Loans charged-off:
Commercial		—			—			(681	)
Commercial Real Estate		—			—			—
Agriculture		—			—			—
Residential Mortgage		—			—			(121	)
Residential Construction		—			—			—
Consumer		(6	)		(11	)		(33	)
Total charged-off		(6	)		(11	)		(835	)

Recoveries:
Commercial		9			2			302
Commercial Real Estate		—			—			—
Agriculture		—			—			—
Residential Mortgage		16			—			96
Residential Construction		1			1			5
Consumer		37			8			66
Total recoveries		63			11			469

Net charge-offs		57			—			(366	)

Balance at end of period	$	11,715		$	11,499		$	11,133

Ratio of net charge-offs to average loans outstanding during the period (annualized)		0.03	%		0.00	%		(0.05	%)
Allowance for loan losses
To total loans at the end of the period		1.60	%		1.73	%		1.49	%
To non-performing loans, net of guarantees at the end of the period		374.3	%		280.2	%		300.1	%

	(amounts in thousands except percentage amounts)
	Actual						Well Capitalized Ratio Requirement
	Capital			Ratio			Well Capitalized Ratio Requirement
Leverage		$	104,401		8.69	%		5.0	%
Common Equity Tier 1		$	104,401		12.43	%		6.5	%
Tier 1 Risk-Based		$	104,401		12.43	%		8.0	%
Total Risk-Based		$	114,922		13.69	%		10.0	%

Exhibit Number		Description of Document

10.29		Form of Supplemental Executive Retirement Plan Agreement between First Northern Bank of Dixon and Jeremiah Z. Smith, Senior Executive Vice President and Chief Operating Officer.

10.30		Form of Supplemental Executive Retirement Plan Agreement between First Northern Bank of Dixon and Kevin Spink, Executive Vice President and Chief Financial Officer.

10.31		Change of Control Agreement between First Northern Bank of Dixon and Joe Danelson, Executive Vice President and Chief Credit Officer.

10.32		Change of Control Agreement between First Northern Bank of Dixon and Jeffrey Adamski, Executive Vice President and Senior Loan Officer.

10.33		Executive Retirement/Retention Participation Agreement for Jeffrey Adamski, Executive Vice President and Senior Loan Officer.

10.34		Amended Form of Salary Continuation Agreement between First Northern Bank of Dixon and Bruce Orris, Executive Vice President and Chief Information Officer.

31.1		Rule 13a — 14(a) Certification of Chief Executive Officer

31.2		Rule 13a — 14(a) Certification of Chief Financial Officer

32.1*		Statement of the Chief Executive Officer under Section 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. Section 1350)

32.2*		Statement of the Chief Financial Officer under Section 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. Section 1350)

101		Pursuant to Rule 405 of Regulation S-T, the following financial information from the Registrant's Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2018, is formatted in XBRL interactive data files: (i) Condensed Consolidated Balance Sheets; (ii) Condensed Consolidated Statements of Income; (iii) Condensed Consolidated Statements of Comprehensive (Loss) Income (iv) Condensed Consolidated Statement of Stockholders' Equity; (v) Condensed Consolidated Statements of Cash Flows; and (vi) Notes to Condensed Consolidated Financial Statements.