Exhibit 10.9

 

SEVERANCE AGREEMENT

 

THIS SEVERANCE AGREEMENT (“Agreement”) is made and entered into effective this
                    , by and between COLUMBIA STATE BANK, a Washington banking
corporation (the “Bank”) and                                         
(“Executive”).

 

RECITALS

 

1. The Bank currently receives the exclusive services of Executive as its
Executive, and Executive desires that this employment relationship continue.

 

2. The Bank desires to provide a severance benefit to Executive (i) to encourage
Executive to continue employment with the Bank; (ii) to continue obtaining
Executive’s services in the event of a potential Change in Control (as defined
below) of Columbia Banking System, Inc. (“CBSI”), the parent holding company of
the Bank, that may be detrimental to the Executive; and (iii) to allow CBSI to
maximize the benefits obtainable by its shareholders from any Change in Control.

 

In consideration of the mutual promises, covenants, agreements and undertakings
contained in this Agreement, the parties hereby contract and agree as follows:

 

AGREEMENT

 

1. Term. The term of this Agreement (“Term”) shall commence as of the date first
above written and shall end on the earlier of the termination of Executive’s
employment in a manner that does not constitute a Termination Event or on the
fifth anniversary of the date first above written, unless extended in writing by
the parties.

 

2. Severance Benefit. In the case of a Termination Event, as defined in Section
4, (i) the Bank shall pay to Executive all salary and benefits earned through
the effective date of Executive’s termination and a severance benefit
(“Severance Benefit”) in an amount equal to «Number» times the amount of
Executive’s then-current annual base salary, and (ii) vesting of all stock
options and lapse of all restrictions with respect to restricted stock awards
shall occur. Payment of the Severance Benefit shall begin, and vesting and lapse
of restrictions described in the preceding sentence shall occur, (i) in the case
of a Termination Event described in paragraph 4.1, upon the effective date of
termination, and (ii) in the case of a Termination Event described in paragraph
4.2, upon the effective date of the Change of Control which is then pending (or
announced within sixty days of the date when the Executive’s employment
terminated). The Severance Benefit shall be paid over a «Number» year period in
equal regular periodic payments without interest on the same dates that other
salaried Executives of the Bank are paid.

 

3. Other Compensation and Terms of Employment. Except with respect to the
Severance Payment, this Agreement shall have no effect on the determination of
any compensation payable by the Bank to the Executive, or upon any of the other
terms of Executive’s employment with the Bank.

 

4. Termination Events. A Termination Event shall be deemed to occur upon, and
only upon, one or more of the following:

 

4.1 Termination of Executive’s employment by the Bank without Cause (as defined
below) or by Executive for Good Reason (as defined below) within 730 days
following the effective date of a Change of Control; or

 

4.2 Termination of Executive’s employment by the Bank without Cause prior to a
Change of Control if such termination occurs at any time from and after sixty
days prior to the public announcement by the CBSI or any other party of a
transaction which will result in a Change in Control; provided that the
effective date of the Change of Control occurs within eighteen (18) months of
Executive’s termination.

 

5. Restrictive Covenant.

 

5.1 Non-competition. Executive agrees that, during Executive’s employment with
the Bank or any of its affiliates and for a period of «Number» «Year» after
commencement of the payment to Executive of the Severance Benefit, Executive
will not directly or indirectly become interested in, as a principle
shareholder, director, or officer, any financial institution, now existing or
organized hereafter, that competes or will compete with CBSI, the Bank or any of
their affiliates (together the “Company”), including any successor, within any
county in which the Company does business; provided that Executive’s covenant

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not to compete shall terminate in the event Executive waives the right to
payment of any balance of the Severance Benefit then payable; and provided
further, that Executive shall not be deemed a “principle shareholder” unless (i)
Executive’s investment in such an institution exceeds 2% of the institution’s
outstanding voting securities or (ii) Executive is active in the Organization,
management or affairs of such institution. The provisions restricting
competition by Executive may be waived by action of the Board. Executive
recognizes and agrees that any breach of this covenant by Executive will cause
immediate and irreparable injury to the Company, and Executive hereby authorizes
recourse by the Bank or CBSI to injunction and/or specific performance, as well
as to other legal or equitable remedies to which either may be entitled.

 

5.2 Noninterference. During the non-competition period described in Section 5.1,
Executive shall not solicit or attempt to solicit any other Executive of the
Company to leave the employ of those companies, or in any way interfere with the
relationship between the Company and any other Executive of the Company.

 

5.3 Interpretation. If a court or any other administrative body with
jurisdiction over a dispute related to this Agreement should determine that the
restrictive covenant set forth in Section 5.1 above is unreasonably broad, the
parties hereby authorize and direct said court or administrative body to narrow
same so as to make it reasonable, given all relevant circumstances, and to
enforce same. The covenants in this paragraph shall survive termination of this
Agreement.

 

6. Definitions.

 

6.1. Cause. “Cause” shall mean only (i) willful misfeasance or gross negligence
in the performance of Executive’s duties, (ii) conduct demonstrably and
significantly harmful to the Bank (which would include willful violation of any
final cease and desist order applicable to the Bank), or (iii) conviction of a
felony.

 

6.2. Change of Control. “Change of Control” shall mean the occurrence of one or
more of the following events:

 

6.2.1. One person or entity acquiring or otherwise becoming the owner of
twenty-five percent (25%) or more of CBSI’s outstanding common stock;

 

6.2.2. Replacement of incumbent directors or election of newly-elected directors
constituting a majority of the Board of CBSI where such replacement or election
has not been supported by the Board; or

 

6.2.3. Dissolution, or sale of fifty percent (50%) or more in value of the
assets, of either CBSI or the Bank.

 

6.3. Good Reason. “Good Reason” shall mean (i) any reduction of Executive’s
salary or any reduction or elimination of any other compensation or benefit
plan, which reduction or elimination is not of general application to
substantially all Executives of the Bank or such Executives of any successor
entity or of any entity in control of the Bank, (ii) any changes in Executive’s
authority or duties substantially inconsistent with Executive’s then office
position; or (iii) any transfer to a location more than thirty miles from
Executive’s then office location.

 

7. Miscellaneous.

 

7.1 This Agreement contains the entire agreement between the parties with
respect to the subject matter, and is subject to modification or amendment only
upon amendment in writing signed by both parties.

 

7.2 This agreement shall bind and inure to the benefit of the heirs, legal
representatives, successors, and assign of the parties.

 

7.3 If any provision of this Agreement is invalid or otherwise unenforceable,
all other provisions shall remain unaffected and shall be enforceable to the
fullest extent permitted by law.

 

7.4 This Agreement is made with reference to and is intended to be construed in
accordance with the laws of the State of Washington. Venue for any action
arising out of or concerning this Agreement shall lie in Pierce County,
Washington. In the event of a dispute under this agreement, the disputes shall
be arbitrated pursuant to the Superior Court Mandatory Arbitration Rules (“MAR”)
adopted by the Washington State Supreme Court, irrespective of the amount in
controversy. This Agreement shall be deemed as stipulation to that effect
pursuant to MAR 1.2 and 8.1. The arbitrator, in his or her discretion, may award
attorney’s fees to the prevailing party or parties.

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7.5 Any notice required to be given under this Agreement to either party shall
be given by personal service or by depositing a copy thereof in the United
States registered or certified mail, postage prepaid, addressed to the following
address or such other address as addressee shall designate in writing:

 

Company:    Columbia Bank      1301 ‘A’ Street      Tacoma, WA 98402      Attn:
(Corporate Secretary) Executive:    Name      Street      City, State

 

IN WITNESS WHEREOF, the parties have executed this Agreement effective on the
date first above written.

 

    COLUMBIA STATE BANK    

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    Melanie J. Dressel     President and Chief Executive Officer    

EXECUTIVE

   

 

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    Name