UMPQUA HOLDINGS CORPORATION
EMPLOYMENT AGREEMENT
FOR

Andrew H. Ognall

Dated as of May 1, 2014

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

EMPLOYMENT AGREEMENT

This Employment Agreement (this “Agreement”) is entered into by and between
Umpqua Holdings Corporation (“Umpqua”) and Andrew H. Ognall (“Officer”),
effective as of May 1, 2014.

1.PURPOSE AND DURATION OF AGREEMENT. This purpose of this Agreement is to set
forth the terms of Officer’s employment with Umpqua and to provide Officer with
certain benefits where Officer’s employment is terminated. Unless sooner
terminated as set forth below, and except as set forth in Section 22.3, this
Agreement shall expire on December 31, 2018.

2.    EMPLOYMENT. Upon the Effective Date, Umpqua, either directly or through
its wholly owned subsidiary Umpqua Bank, shall employ the Officer and the
Officer hereby accepts that employment on the terms and conditions contained in
this Agreement.

3.    NO TERM OF EMPLOYMENT. Notwithstanding the term of this Agreement, Umpqua,
Umpqua Bank or Officer may terminate Officer’s employment at will, at any time
for any lawful reason or for no reason at all, subject to the provisions of this
Agreement.

4.    DUTIES; POSITION.

4.1    Position. Officer shall be employed as Executive Vice President/General
Counsel and will perform such duties as may be designated by Umpqua’s President
and Chief Executive Officer, to whom Officer will directly report (the
“Supervisor”). Officer will perform his duties primarily from Umpqua Bank Plaza,
One SW Columbia Street, Suite 1200, Portland, Oregon, but will be expected to
travel to other Umpqua locations.

4.2    Obligations of Officer.

(a)        Officer agrees that to the best of Officer’s ability and experience,
Officer will at all times loyally and conscientiously perform all of the duties
and obligations required of Officer pursuant to the express and implicit terms
of this Agreement and as directed by the President and Chief Executive Officer
or Umpqua’s Board of Directors (the “Board”).

(b)        Officer shall devote Officer’s entire working time, attention and
efforts to Umpqua’s business and affairs, shall faithfully and diligently serve
Umpqua’s interests and shall not engage in any business or employment activity
that is not on Umpqua’s behalf (whether or not pursued for gain or profit)
except for (i) activities approved in writing in advance by Umpqua and
(ii) passive investments that do not involve Officer providing any advice or
services to the businesses in which the investments are made.

091044.0041/5222763.1
1

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

5.    COMPENSATION.

5.1    Base Salary. For services performed under this Agreement, Officer shall
be entitled to $22,500.00 per month ($270,000.00 on annualized basis) (as in
effect from time to time, the “Base Salary”), which Umpqua may increase in its
sole discretion.

5.2    Benefits. Officer shall be entitled to participate, under the terms of
the respective plans and subject to periodic plan changes, in Umpqua’s group
health benefit package, long-term disability and life insurance, 401(k) plan,
and such other compensation or benefits as approved by the Board. Officer shall
be entitled to four weeks of vacation per year. Officer shall be entitled to
participate in Umpqua’s annual Executive Incentive Compensation Plan with a
target annual bonus opportunity of 60% of Officer’s annual Base Salary, subject
to the terms of such plan as revised from time to time. Officer will be entitled
to participate in Umpqua’s 2014 Supplemental Retirement (Top Hat) / Deferred
Compensation Plan.

5.3    Long Term Incentives. Subject to Compensation Committee approval, Officer
will be entitled receive, on or about the effective date of this Agreement, a
10,000 share restricted stock award under the 2013 Incentive Plan with
performance-based vesting conditions based on 12% OEPS accretion related to the
Sterling Financial merger.
        
6.    TERMINATION. Officer’s employment may be terminated before the expiration
of this Agreement as described in this Section 6, in which event Officer’s
compensation and benefits shall terminate except as otherwise provided in this
Agreement.

6.1    For Cause. Upon Umpqua’s termination of Officer’s employment for Cause
(as defined in Section 7.1) (“Termination For Cause”).

6.2    Without Cause. Upon Umpqua’s termination of employment of Officer without
Cause, with or without notice, at any time in Umpqua’s sole discretion, for any
reason (other than for Cause, death, or Disability) or for no reason
(“Termination Without Cause”).

6.3    For Good Reason. Upon Officer’s termination of employment for Good Reason
(as defined in Section 7.2) (“Termination For Good Reason”).

6.4    Death or Disability. Upon Officer’s death or Disability (as defined in
Section 7.3).

6.5    Resignation. Upon Officer’s Termination Upon Resignation (as defined in
Section 7.5).

7.    DEFINITIONS.

7.1    Cause. For the purposes of this Agreement, “Cause” for Officer’s
termination will exist upon the occurrence of one or more of the following
events:

091044.0041/5222763.1
2

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

(a)        Dishonest or fraudulent conduct by Officer with respect to the
performance of Officer’s duties with Umpqua;

(b)        Conduct by Officer that materially discredits Umpqua or any of its
subsidiaries or is materially detrimental to the reputation of Umpqua or any of
its subsidiaries, including but not limited to conviction or a plea of nolo
contendere of Officer of a felony or crime involving moral turpitude;

(c)        Officer’s willful misconduct or gross negligence in performance of
Officer’s duties under this Agreement, including but not limited to Officer’s
refusal to comply in any material respect with the legal directives of the Board
or the Supervisor, if such misconduct or negligence has not been remedied or is
not being remedied to Umpqua’s reasonable satisfaction within 30 days after
written notice, including a detailed description of the misconduct or
negligence, has been delivered to Officer;

(d)        An order or directive from a state or federal banking regulatory
agency requesting or requiring removal of Officer or a finding by any such
agency that Officer’s performance threatens the safety or soundness of Umpqua or
any of its subsidiaries;

(e)    Officer fails to maintain his license to practice law in at least one
state in which the Company has significant operations; or

(f)        A material breach of Officer’s fiduciary duties to Umpqua if such
breach has not been remedied or is not being remedied to Umpqua’s reasonable
satisfaction within 30 days after written notice, including a detailed
description of the breach, has been delivered to Officer.

7.2    Good Reason. For purposes of this Agreement, “Good Reason” for Officer’s
termination of employment will exist upon the occurrence of one or more of the
following events, without Officer’s consent, if Officer has informed Umpqua in
writing of the circumstances described below in this Section 7.2 that could give
rise to termination for Good Reason within 30 days following the initial
existence of such circumstances and Umpqua has not removed such circumstances
within 60 days of the written notice (or notified Officer that Umpqua disputes
that such circumstances qualify as Good Reason):

(a)    A material reduction of Officer’s Base Salary, unless the reduction is in
connection with, and commensurate with, reductions in the salaries of all or
substantially all senior officers of Umpqua; or

(b)    A requirement for Officer to relocate to a facility or location more than
30 miles from Umpqua Bank Plaza, One SW Columbia Street, Portland, Oregon.

In the event that the condition constituting Good Reason is not timely remedied,
Officer must terminate his employment, if at all, within 60 days following the
end of the cure period for such termination to constitute a Termination For Good
Reason.

091044.0041/5222763.1
3

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

7.3    Disability. For purposes of this Agreement, “Disability” means that
(i) Officer is unable to engage in any substantial gainful activity by reason of
any medically determinable physical or mental impairment that can be expected to
result in death or can be expected to last for a continuous period of not less
than 12 months, or (ii) Officer is, by reason of any medically determinable
physical or mental impairment that can be expected to result in death or can be
expected to last for a continuous period of not less than 12 months, receiving
income replacement benefits for a period of not less than three months under an
accident or health plan covering employees of Umpqua.

7.4    Change in Control. For purposes of this Agreement, a “Change in Control”
shall be deemed to have occurred when any of the following events take place:

(a)    Any person (including any individual or entity), or persons acting in
concert, become(s) the beneficial owner of voting shares representing fifty
percent (50%) or more of Umpqua;
(b)    A majority of the Board is removed from office by a vote of Umpqua’s
shareholders over the recommendation of the Board then serving; or

(c)    Umpqua is a party to a plan of merger or plan of exchange and upon
consummation of such plan, the shareholders of Umpqua immediately prior to the
transaction do not own or continue to own (i) at least forty percent (40%) of
the shares of the surviving company (if the then current CEO of Umpqua continues
as CEO of the surviving organization), or (ii) at least a majority of the shares
of the surviving organization (if the then current CEO of Umpqua does not
continue as CEO of the surviving organization).

7.5    Resignation. For purposes of this Agreement, “Termination Upon
Resignation” shall mean that Officer has given Umpqua 60 days prior written
notice of the date of his resignation or retirement, and Officer terminates his
employment on such date, provided, however, that no event listed above under the
definition of “Cause” exists at the time of such notice through the proposed
date of Termination Upon Resignation.

8.    PAYMENT UPON TERMINATION. Upon termination of Officer’s employment for any
of the reasons set forth in Section 6 above, Officer will receive payment for
all Base Salary and benefits earned (and payable under the terms of any
applicable plan) as of the date of Officer’s termination (“Earned
Compensation”), which shall be paid by the end of the business day following
termination or sooner if required by applicable law.

9.    SEVERANCE BENEFIT. In the event of Termination Without Cause or
Termination for Good Reason, in addition to receiving Earned Compensation,
Officer will receive a severance benefit equal to the greater of: (i) nine
months Base Salary, based on Officer’s Base Salary just prior to termination and
(ii) two weeks Base Salary for every year of employment with Umpqua (the
“Severance Benefit”). Subject to Section 12.3 below, the Severance Benefit shall
be paid in equal installments over the number of months of continued Base
Salary, starting on the next regular payday following termination. Receipt of
the Severance Benefit is conditioned on

091044.0041/5222763.1
4

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

Officer having executed the Separation and Release Agreement, in substantially
the form attached hereto as Exhibit A (the “Separation Agreement”) and the
revocation period having expired without Officer having revoked the Separation
Agreement. Receipt and continued receipt of the Severance Benefit is further
conditioned on Officer not being in violation of any material term of this
Agreement or in violation of any material term of the Separation Agreement.
Officer shall not be required to mitigate the amount of any payments under this
Section (whether by seeking new employment or otherwise) and no such payment
shall be reduced by earnings that Officer may receive from any other source.

10.    CHANGE IN CONTROL BENEFIT. After announcement of a proposed Change in
Control and for a period continuing for one year following the Change in
Control, in the event of Termination Without Cause or Termination For Good
Reason, instead of receiving the Severance Benefit set forth in Section 9 above,
Officer shall be entitled to receive 24 months Base Salary, based on Officer’s
Base Salary just prior to the termination of employment, as well as 200% of the
incentive compensation Officer received for services performed in the previous
year (the aforementioned Base Salary and incentive are collectively referred to
as the “Change in Control Benefit”). Subject to Section 12.3 below, the Change
in Control Benefit shall be paid in equal installments over twelve months,
starting on the next regular payday following termination. Receipt of the Change
in Control Benefit is conditioned on Officer having executed the Separation
Agreement in substantially the form attached hereto as Exhibit A and the
revocation period having expired without Officer having revoked the Separation
Agreement. Receipt and continued receipt of the Change in Control Benefit is
further conditioned on Officer not being in violation of any material term of
this Agreement or in violation of any material term of the Separation Agreement.
Officer shall not be required to mitigate the amount of any payments under this
Section (whether by seeking new employment or otherwise) and no such payment
shall be reduced by earnings that Officer may receive from any other source,
provided, however, that the provisions of Section 14.2 related to forfeiture of
payments under certain circumstances remain applicable.

11.    RESERVED.
12.    LIMITATION ON BENEFITS.
12.1    Code Section 280G Adjustment. If the benefit payments under this
Agreement, either alone or together with other payments to which the Officer is
entitled to receive from Umpqua, would constitute an “excess parachute payment”
as defined in Section 280G of the Internal Revenue Code of 1986, as amended (the
“Code”), such benefit payments shall be reduced to the largest amount that will
result in no portion of benefit payments under this Agreement being subject to
the excise tax imposed by Section 4999 of the Code. The determination of any
reduction in the benefit payments pursuant to the foregoing provisions, shall be
made by mutual agreement of Umpqua and Officer or if no agreement is possible,
by Umpqua’s accountants.

12.2    Limitation on Severance or Change in Control Benefit. Notwithstanding
any other provision in this Agreement, Umpqua shall make no payment of any
benefit provided

091044.0041/5222763.1
5

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

for herein to the extent that such payment would be prohibited by the provisions
of Part 359 of the regulations of the Federal Deposit Insurance Corporation (the
“FDIC”) as the same may be amended from time to time, and if such payment is so
prohibited, Umpqua shall use its best efforts to secure the consent of the FDIC
or other applicable banking agencies to make such payments in the highest amount
permissible, up to the amount provided for in this Agreement.

12.3    Code Section 409A.

(a)    It is intended that payments and benefits made or provided under this
Agreement shall comply with Section 409A of the Code or an exemption thereto.
Any payments that qualify for the “short-term deferral” exception, the
separation pay exception or another exception under Section 409A of the Code
shall be paid under the applicable exception. For purposes of the limitations on
nonqualified deferred compensation under Section 409A of the Code, each payment
of compensation under this Agreement shall be treated as a separate payment of
compensation for purposes of applying the exclusion under Section 409A of the
Code for short-term deferral amounts, the separation pay exception or any other
exception or exclusion under Section 409A of the Code. All payments to be made
upon a termination of employment under this Agreement may only be made upon a
“separation from service” under Section 409A of the Code to the extent necessary
in order to avoid the imposition of penalty taxes on Officer pursuant to Section
409A of the Code. In the event the payment of nonqualified deferred compensation
subject to Section 409A of the Code is contingent on execution of a release of
claims and the designated period to execute the release of claims crosses two
taxable years, payment of such nonqualified deferred compensation shall be made
in the second taxable year. In no event may Officer, directly or indirectly,
designate the calendar year of any payment under this Agreement.

(b)    Notwithstanding anything to the contrary in this Agreement, all
reimbursements and in-kind benefits provided under this Agreement that are
subject to Section 409A of the Code shall be made in accordance with the
requirements of Section 409A of the Code, including, where applicable, the
requirement that (i) any reimbursement is for expenses incurred during Officer’s
lifetime (or during a shorter period of time specified in this Agreement); (ii)
the amount of expenses eligible for reimbursement, or in-kind benefits provided,
during a calendar year may not affect the expenses eligible for reimbursement,
or in-kind benefits to be provided, in any other calendar year; (iii) the
reimbursement of an eligible expense will be made no later than the last day of
the calendar year following the year in which the expense is incurred; and (iv)
the right to reimbursement or in-kind benefits is not subject to liquidation or
exchange for another benefit.

(c)     Notwithstanding any other provision of this Agreement to the contrary,
if Officer is considered a “specified employee” for purposes of Section 409A of
the Code (as determined in accordance with the methodology established by Umpqua
as in effect on the date of Officer’s separation from service (as determined in
accordance with Section 409A of the Code)), any payment that constitutes
nonqualified deferred compensation within the meaning of Section 409A of the
Code that is otherwise due to Officer under this Agreement during the six-month
period immediately following Officer’s separation from service on account of the

091044.0041/5222763.1
6

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

Officer’s separation from service shall be accumulated and paid to Officer on
the first business day of the seventh month following his separation from
service (the “Delayed Payment Date”). If Officer dies during the postponement
period, the amounts and entitlements delayed on account of Section 409A of the
Code shall be paid either to Officer’s beneficiary or the personal
representative of his estate on the first to occur of the Delayed Payment Date
or 30 calendar days after the date of Officer’s death.

(d)     Despite any contrary provision of this Agreement, any references to
termination of employment or date of termination shall mean and refer to the
date of Officer’s “separation from service,” as that term is defined in Section
409A of the Code and Treasury regulation Section 1.409A-1(h).

13.    EXECUTIVE SEVERANCE PLAN.
 
13.1    In General. Those provisions of this Agreement (including this Section)
related to the Severance Benefit set forth in Section 9 and Change in Control
Benefit set forth in Section 10 constitute part of the terms of the Umpqua
Holdings Corporation Executive Severance Plan (the “Executive Severance Plan”)
with respect to the Officer, and such terms and the general terms of the
Executive Severance Plan, if any, established by Umpqua shall comprise the
entirety of the Executive Severance Plan as it applies to the Officer. Umpqua
intends for the Plan to be considered a welfare benefit plan within the meaning
of Section 3(1) of the Employee Retirement Income Security Act (“ERISA”), and a
plan which is unfunded and maintained by Umpqua solely for the purpose of
providing benefits for a select group of management or highly compensated
employees within the meaning of ERISA Regulation Section 2520.104-24. A copy of
the Executive Severance Plan (if an Executive Severance Plan separate from or in
addition to the terms of this Section 13 is established) will be furnished to
the Officer upon request.

13.2    Administration of Executive Severance Plan. Umpqua’s Chief Executive
Officer and Human Resources Director are each plan administrators (the “Plan
Administrator”) of the Executive Severance Plan and the Plan Administrator shall
have the discretionary authority to administer and construe the terms of the
Executive Severance Plan, including the authority to decide if Officer is
entitled to the Severance Benefit or Change in Control Benefit, and the
authority to determine if there is Termination For Cause or Termination For Good
Reason.

13.3    Claims Procedures. The Officer may file a claim for a payment under the
Executive Severance Plan by filing a written request for such a payment with the
Plan Administrator. If the Plan Administrator prescribes a form for such a
claim, the claim must be filed on such form. The claim should be sent to the
attention of the Plan Administrator of the Executive Severance Plan at the
address set forth for Umpqua in Section 20.

If the Plan Administrator denies the claim, in whole or in part, the Plan
Administrator shall notify the Officer within 90 days of the Plan
Administrator’s receipt of the claim, unless the Plan Administrator determines
that special circumstances require an extension of time for processing the
claim. If the Plan Administrator determines that an extension of time

091044.0041/5222763.1
7

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

is required, written notice of the extension shall be furnished to Officer prior
to the termination of the initial 90-day period. Such extension notice shall
indicate the special circumstances and the date by which the Plan Administrator
expects to issue a determination with respect to the claim. The period of the
extension will not exceed 90 days beyond the termination of the original 90-day
period. If the Plan Administrator does not provide written notice, Officer may
deem the claim denied and seek review according to the appeals procedures set
forth below.

The notice of denial of Officer’s claim shall state:

a.    the specific reasons for the denial;

b.    specific references to pertinent provisions of the Executive Severance
Plan on which the denial was based;

c.    a description of any additional material or information needed for Officer
to perfect his or her claim and an explanation of why the material or
information is needed; and

d.    a statement (1) that Officer may request a review upon written application
to the Plan Administrator, review or receive (free of charge) pertinent Plan
documents and records, and submit issues and comments in writing, (2) that any
appeal that Officer wishes to make of the adverse determination must be in
writing to the Plan Administrator within sixty (60) days after the Officer
receives notice of denial of benefits, and (3) that Officer may bring a civil
action under ERISA Section 502(a) following an adverse benefit determination
upon review.

The notice of denial of benefits shall specify that Officer must forward any
appeal to the Plan Administrator at the address provided in such notice. The
notice may state that failure to appeal the action to the Plan Administrator in
writing within the sixty (60) day period will render the determination final,
binding and conclusive.

If Officer appeals to the Plan Administrator, Officer may submit in writing
whatever issues and comments he or she believes to be pertinent. The Plan
Administrator shall reexamine all facts related to the appeal and make a final
determination about whether the denial of benefits is justified under the
circumstances. The Plan Administrator shall advise Officer in writing of:

a.    its decision on appeal;

b.    the specific reasons for the decision;

c.    the specific provisions of the Plan on which the decision is based; and

d.    Officer’s right to receive, upon request and free of charge, reasonable
access to, and copies of, all relevant documents and records.

091044.0041/5222763.1
8

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

Notice of the Plan Administrator’s decision shall be given within sixty (60)
days of Officer’s written request for review, unless additional time is required
due to special circumstances. In no event shall the Plan Administrator render a
decision on an appeal later than one hundred twenty (120) days after receiving a
request for a review. If the Plan Administrator fails to provide a decision with
respect to Officer’s appeal within the 60 (or, if applicable, 120) day period
Officer may deem his or her appeal denied and may pursue the arbitration remedy
set forth below.

In the event that Officer fails to pursue his or her administrative remedies as
set forth above within the specified periods, he or she shall have no further
right to the benefits subject to his or her claim and agrees by executing this
Agreement that he or she shall have no right to pursue such claim in arbitration
or in a court of law.

For purposes of this Claims Procedure under the Executive Severance Plan,
Officer may act through a representative authorized in writing to act on his or
her behalf, provided that such authorization is furnished to the Plan
Administrator.

In the event that Umpqua denies the Officer’s appeal of the denial of his or her
claim, in whole or in part, Umpqua and Officer’s may agree to submit the Plan
Administrator’s decision to binding arbitration in lieu of Officer’s right to
pursue his or her claim in any court of law.

14.    NONCOMPETITION.

14.1    Competition Restriction. During Officer’s employment with Umpqua and its
affiliates and for the period of time in which Officer is entitled to payment of
the Severance Benefit or Change in Control Benefit, Officer shall not engage in
any activity as an officer, director, owner (except for an ownership of less
than three percent (3%) of any publicly traded security), employee, consultant,
or otherwise of a financial services company (or, to Officer’s knowledge,
proposed to be) in competition with Umpqua or its affiliates with an office or
doing business within 50 miles of any office or branch of Umpqua or of any of
its subsidiaries in existence at the time of termination of Officer’s
employment. Umpqua acknowledges that Officer is licensed to practice law. It
shall not be a breach of this section 14 for Officer to provide legal services
in the private practice of law to a Potential Competitor or in association with
a firm that provides legal services to a Potential Competitor.

14.2    Breach. Notwithstanding any other provision of this Agreement, in the
event that Officer breaches any of the restrictive covenants contained in
Section 14.1, Officer shall forfeit, and Umpqua and its affiliates shall be
immediately released of their obligation to pay or provide, any unpaid Severance
Benefit or Change in Control Benefit, and Officer shall be required to
immediately return any compensation already paid in respect thereof.

14.3    Subsequent Employer Notification. Officer agrees to give Umpqua, at the
time of termination of employment, a declaration under penalty of perjury of the
name of Officer’s new employer, if known, or if not known, that subsequent
employer is not known. Officer further agrees to disclose to Umpqua, during the
period of payment of the Severance

091044.0041/5222763.1
9

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

Benefit or Change in Control Benefit, the name of any subsequent employer,
wherever located and regardless of whether such employer is a competitor of
Umpqua.

14.4    Acknowledgment of Notice. Officer acknowledges that he was informed in
writing received at least two weeks before the first day of employment that a
non-competition agreement is required as a condition of employment.

15.    NON-SOLICITATION. During Officer’s employment with Umpqua or its
affiliates and for a period of two years following termination of employment
(the “Restriction Period”), Officer shall not solicit any customer of Umpqua or
of any of its subsidiaries for services or products then provided by Umpqua or
any of its subsidiaries. For purposes of this Section, “customers” are defined
as (a) all customers serviced by Umpqua or any of Umpqua’s subsidiaries at any
time within 12 months before termination of Officer’s employment, (b) all
customers and potential customers whom Umpqua or any of Umpqua’s subsidiaries,
with the knowledge or participation of Officer, actively solicited at any time
within 12 months before termination of Officer’s employment, and (c) all
successors, owners, directors, partners and management personnel of the
customers just described in (a) and (b).

16.    NON-RAIDING OF EMPLOYEES. Officer recognizes that Umpqua’s workforce is a
vital part of its business; therefore, Officer agrees that for the Restriction
Period, Officer will not to directly or indirectly solicit any employee to leave
his or her employment with Umpqua or any of Umpqua’s subsidiaries. This includes
that Officer will not (a) disclose to any third party the names, backgrounds or
qualifications of any Umpqua or any of Umpqua subsidiary’s employees or
otherwise identify them as potential candidates for employment, or (b)
personally or through any other person approach, recruit, interview or otherwise
solicit employees of Umpqua or any of Umpqua’s subsidiaries to work for any
other employer. For purposes of this Section, employees include all employees
working for Umpqua or any of Umpqua’s subsidiaries at the time of termination of
Officer’s employment.

17.    CONFIDENTIAL INFORMATION. The parties acknowledge that in the course of
Officer’s duties, Officer will have access to and become familiar with certain
proprietary and confidential information of Umpqua and its subsidiaries not
known by its actual or potential competitors. Officer acknowledges that such
information constitutes valuable, special, and unique assets of Umpqua’s
business, even though such information may not be of a technical nature and may
not be protected under trade secret or related laws. Officer agrees to hold in a
fiduciary capacity and not use for Officer’s benefit, nor reveal, communicate,
or divulge during the period of Officer’s employment with Umpqua or at any time
thereafter, and in any manner whatsoever, any such data and confidential
information of any kind, nature, or description concerning any matters affecting
or relating to Umpqua’s business, its customers, or its services, including
information developed by Officer, alone or with others, or entrusted to Umpqua
by its customers or others, to any person, firm, entity, or company other than
Umpqua or persons, firms, entities, or companies designated by Umpqua. Officer
agrees that all memoranda, notes, records, papers, customer files, and other
documents, and all copies thereof relating to Umpqua’s operations or business,
or matters related to any of Umpqua’s customers, some of which may be prepared
by Officer, and all objects associated therewith in any way obtained by Officer,
shall be

091044.0041/5222763.1
10

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

Umpqua’s property (“Umpqua Property”). Upon termination or at Umpqua’s request,
Officer shall promptly return all Umpqua Property to Umpqua.

18.    REASONABLENESS OF RESTRICTION PERIOD; EQUITABLE RELIEF. Officer agrees
that Umpqua would not have entered into this Agreement but for the agreements
and covenants contained in this Sections 14, 15, 16 and 17, and the agreements
and covenants contained in Sections 14, 15, 16 and 17 are essential to protect
the goodwill and the business of Umpqua. Officer acknowledges and agrees that
the restrictive covenants in Sections 14, 15, 16, and 17 are fair and reasonable
and are the result of negotiation between Umpqua and Officer (and Officer’s
counsel, if Officer has sought the benefit of counsel). Officer further
acknowledges and agrees that the covenants and obligations in this Agreement
relate to special, unique, and extraordinary matters and that a violation of any
of the terms of the covenants and obligations will cause irreparable injury to
Umpqua, for which adequate remedies are not available at law. Therefore, Officer
agrees that Umpqua shall be entitled to an injunction, restraining order, or
such other equitable relief as a court of competent jurisdiction may deem
necessary or appropriate to restrain the Officer from committing any violation
of the covenants and obligations set forth in Sections 14, 15, 16 and 17 of this
Agreement. These injunctive remedies are cumulative and are in addition to any
other rights and remedies Umpqua may have at law or in equity. If Umpqua
institutes an action to enforce the provisions hereof, Officer hereby waives the
claim or defense that an adequate remedy at law is available, and Officer agrees
not to urge in any such action the claim or defense that an adequate remedy at
law exists.

19.     DISPUTE RESOLUTION.

19.1    Arbitration. Except where such matters are deemed governed by ERISA and
are the subject to Section 13 above, the parties agree to submit any dispute
arising under this Agreement to final, binding, private arbitration in Portland,
Oregon. The disputes subject to arbitration include not only disputes involving
the meaning or performance of the Agreement, but disputes about its negotiation,
drafting, or execution. The dispute will be determined by a single arbitrator
and governed by then-existing rules of arbitration procedure in Multnomah County
Circuit Court except as set forth herein. Instead of filing of a civil complaint
in Multnomah County Circuit Court, a party will commence the arbitration process
by noticing the other party. The parties will choose an arbitrator who
specializes in employment conflicts from the arbitration list for Multnomah
County Circuit Court. If the parties are unable to agree on an arbitrator within
ten (10) days of receipt of the list of arbitrators, each party will select one
attorney from the list, and those two attorneys shall select the arbitrator from
the list (with each of the two selecting attorneys then concluding their
services and each being compensated by the party selecting each attorney,
subject to recovery of such fees under Section 19.2). The arbitrator may charge
his or her standard arbitration fees rather than the fees prescribed in the
Multnomah County Circuit Court arbitration procedures. The arbitrator will have
full authority to determine all issues, including arbitrability, to award any
remedy, including permanent injunctive relief, and to determine any request for
attorneys’ fees, costs and expenses in accordance with Section 19.2. There shall
be no right of review in court. The arbitrator’s award may be reduced to final
judgment or decree in Multnomah County Circuit Court.

091044.0041/5222763.1
11

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

19.2    Expenses/Attorneys’ Fees. The prevailing party shall be awarded all
costs and expenses of the proceeding, including, but not limited to, attorneys’
fees, filing and service fees, witness fees, and arbitrators’ fees. If
arbitration is commenced, the arbitrator will have full authority and complete
discretion to determine the “prevailing party” and the amount of costs and
expenses to be awarded.

19.3    Injunctive Relief. Notwithstanding any other provision of this
Agreement, an aggrieved party may seek a temporary restraining order or
preliminary injunction in Multnomah County Circuit Court to preserve the status
quo during the arbitration proceeding, provided however, that the party seeking
relief agrees that ultimate resolution of the dispute will still be determined
through arbitration and not through court process. The filing of the court
action for injunctive relief shall not hinder or delay the arbitration process.

20.     NOTICES. All notices, requests, demands, and other communications
provided for by this Agreement will be in writing and shall be deemed sufficient
upon receipt, when delivered personally or by a nationally-recognized delivery
service (such as Federal Express), or three (3) business days after being
deposited in the U.S. mail as certified mail, return receipt requested, with
postage prepaid, if such notice is properly addressed. Unless otherwise changed
in writing, notice shall be properly addressed to Officer if addressed to the
address of Officer on Umpqua’s books and records at the time of mailing of such
notice, and properly addressed to Umpqua if addressed to Umpqua Holdings
Corporation, One SW Columbia, Suite 1200, Portland, Oregon 97258, Attention:
Chief Executive Officer.

21.    BENEFICIARIES.

21.1    Beneficiary Designations. The Officer shall designate a beneficiary by
filing a written designation with Umpqua. The Officer may revoke or modify the
designation at any time by filing a new designation. However, designations will
only be effective if signed by the Officer and received by Umpqua during the
Officer’s lifetime. The Officer’s beneficiary designation shall be deemed
automatically revoked if the beneficiary predeceases the Officer or if the
Officer names a spouse as beneficiary and the marriage is subsequently
dissolved. If the Officer dies without a valid beneficiary designation, all
payments shall be made to the Officer’s estate. If Officer dies after the right
to receive a Severance Benefit or a Change in Control Benefit arises, but before
such benefits are fully paid, the remaining benefits that would otherwise have
been payable to Officer shall be paid to Officer’s designated beneficiary or, if
there is no such designation, to Officer’s estate, or as otherwise required by
applicable law.
21.2    Facility of Payment. If a benefit is payable to a minor, to a person
declared incompetent, or to a person incapable of handling the disposition of
his or her property, Umpqua may pay such benefit to the guardian, legal
representative or person having the care or custody of such minor, incompetent
person or incapable person. Umpqua may require proof of incompetence, minority
or guardianship as it may deem appropriate prior to distribution of the benefit.
Such distribution shall completely discharge Umpqua from all liability with
respect to such benefit.

091044.0041/5222763.1
12

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

22.     GENERAL PROVISIONS.

22.1    Governing Law. The validity, interpretation, construction and
performance of this Agreement shall be governed by federal ERISA, as it relates
to the Severance Benefit and Change in Control Benefit as discussed in Section
13 above, and otherwise by the laws of the State of Oregon.

22.2    Saving Provision. If any part of this Agreement is held to be
unenforceable, it shall not affect any other part. If any part of this Agreement
is held to be unenforceable as written, it shall be enforced to the maximum
extent allowed by applicable law.

22.3    Survival Provision. If any benefits provided in Sections 9 or 10 of this
Agreement are still owed, or claims pursuant to Section 13 are still pending, at
the time of termination of this Agreement, this Agreement shall continue in
force, with respect to those obligations or claims, until such benefits are paid
in full or claims are resolved in full. The noncompetition, non-solicitation,
non-raiding, confidential information, and dispute resolution provisions of this
Agreement (Sections 13 through 19) shall survive after termination of this
Agreement, and shall be enforceable regardless of any claim Officer may have
against Umpqua.

22.4    Counterparts. This Agreement may be executed in counterparts, each of
which shall be deemed an original, but all of which together will constitute one
and the same instrument.

22.5    Entire Agreement. This Agreement constitutes the sole agreement of the
parties regarding Officer’s benefits in the event of termination or Change in
Control and together with Umpqua’s employee handbook governs the terms of
Officer’s employment. Where there is a conflict between the employee handbook
and this Agreement, the terms of this Agreement shall govern.

22.6    Previous Agreements. This Agreement supersedes all prior oral and
written agreements between the Officer and Umpqua, Sterling or any of their
respective affiliates or representatives of Umpqua regarding the subject matters
set forth herein, including, without limitation, any benefits for which Officer
was eligible under the Sterling CIC Plan and Officer’s participation agreement
thereunder.

22.7    Waiver/Amendment. No waiver of any provision of this Agreement shall be
valid unless in writing, signed by the party against whom the waiver is sought
to be enforced. The waiver of any breach of this Agreement or failure to enforce
any provision of this Agreement shall not waive any later breach. This Agreement
may only be amended by a writing signed by the parties.

22.8    Assignment. Officer shall not assign or transfer any of Officer’s rights
pursuant to this Agreement, wholly or partially, to any other person or to
delegate the performance of its duties under the terms of this Agreement. The
rights and obligations of Umpqua under this Agreement shall inure to the benefit
of and be binding in each and every

091044.0041/5222763.1
13

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

respect upon the direct and indirect successors and assigns of Umpqua,
regardless of the manner in which the successors or assigns succeed to the
interests or assets of Umpqua. This Agreement shall not be terminated by the
voluntary or involuntary dissolution of Umpqua, by any merger, consolidation or
acquisition where Umpqua is not the surviving corporation, by any transfer of
all or substantially all of Umpqua’s assets, or by any other change in Umpqua’s
structure or the manner in which Umpqua’s business or assets are held. Officer’s
employment shall not be deemed terminated upon the occurrence of one of the
foregoing events. In the event of any merger, consolidation or transfer of
assets, this Agreement shall be binding upon and shall inure to the benefit of
the surviving corporation or the corporation to which the assets are
transferred.

23.    ADVICE OF COUNSEL. Officer acknowledges that, in executing this
Agreement, Officer has had the opportunity to seek the advice of independent
legal counsel, and has read and understood all of the terms and provisions of
this Agreement. This Agreement shall not be construed against any party by
reason of the drafting or preparation hereof.

UMPQUA HOLDINGS CORPORATION

By:                        
Raymond P. Davis, Chief Executive Officer

OFFICER

                                        
Andrew H. Ognall

091044.0041/5222763.1
14

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

EXHIBIT A

SEPARATION AND RELEASE AGREEMENT
For mutual and valuable consideration, Umpqua Bank and its affiliates and
subsidiaries (“Company”) and ______________ (“Employee”) agree as follows:
1.    Employment Termination.  Employee’s employment will terminate with Company
effective _______________.
2.    Payment.  In addition to Employee’s final paycheck, Company will pay
Employee either the Severance Benefit or the Change in Control Benefit (as such
terms are defined in the Employment Agreement between the Company and the
Employee (the “Employment Agreement”)), less applicable federal and state
payroll deductions (the “Payment”).  The Payment consists of a $________ per
month for ___ months (the “Severance Payment”).  [The Severance Payment
represents ___ weeks of Employee’s current salary.]  The Payment will be paid as
specified in paragraph 10.  Company shall withhold customary and required
deductions from the severance amount, and will issue to Employee an IRS Form
1099, W-2 or whatever appropriate tax form may be required by state or federal
law for this amount.
3.    Release of All Claims.  Employee releases and forever discharges Company
and its respective partners, shareholders, owners, parents, subsidiaries,
divisions, related corporations, joint venture partnerships, lessees and
lessors, predecessors, directors, servants, officers, agents, employees,
affiliates, successors, and assigns (collectively referred to as “Company”) of
and from any and all rights of actions, claims, demands, wage claims, contract
claims, statutory claims, debts, attorneys’ fees, costs, and other expenses,
known and unknown, which Employee ever had or now has arising out of Employee’s
relationship with Company or the termination of that relationship.  Included in
the foregoing, but not in limitation thereof, Employee specifically releases
Company from any and all claims, arising under federal, state, and local laws,
or any other authority, pertaining to conditions of employment, wages, or
discrimination in employment based on age, sex, disability, pregnancy, race,
color, national origin, religion, family or medical leave, or veteran status,
including Title VII of the Civil Rights Act of 1964, the Civil Rights Act of
1991, the Family and Medical Leave Act, the Oregon Family Leave Act, the
Americans with Disabilities Act, the Age Discrimination in Employment Act, Older
Workers’ Benefit Protection Act, the Equal Pay Act of 1963, the Fair Labor
Standards Act, the Occupational Safety and Health Act, the Rehabilitation Act of
1973, the Uniformed Services Employment and Reemployment Rights Act, ORS
Chapters 652, 653, 654, 656, 659, and 659A and Oregon common law, and from any
and all claims statutory or common law arising out of his or her employment by
Company and any legal restrictions on an employer’s right to discharge an
employee, including but not limited to intentional infliction of emotional
distress and wrongful discharge.  Employee understands that this is a general
and complete release and that he or she retains no right to pursue any claim
against any other person or entity for the injuries and/or damages claimed to
arise from the employment relationship with Company.
4.    Covenant Not to Sue or Disparage.  Employee agrees not to lodge, file, or
bring any suit, charge, complaint, or any other form of action against Company
relating in any way

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

whatsoever to any matters released herein.  Employee shall not take any action
or make any statement that disparages Company, its operation, business,
employees, or reputation, and shall not encourage or induce any third parties to
disparage such persons or to undertake any “Disparaging Acts” as defined
herein.  “Disparaging Acts” means any statement, communication, or publication,
oral or written, regardless of whether such statement, communication, or
publication is true, made about Company, its operations, business interests, or
reputation that is vilifying or derogatory in nature and that reasonably would
be expected to result in a negative perception of Company, its operations or
business interests, or reputation, or that otherwise may have a material adverse
effect on Company, its operations, business interests, or reputation.
5.    No Admission of Liability.  It is expressly understood that this
agreement, and any consideration for it, do not in any way constitute an
admission of liability or wrongdoing on the part of Company.  Any such liability
is expressly denied.
6.    No Right to Reemployment.  In further consideration of the payment of the
foregoing sum, Employee agrees that he or she will have no right of employment,
reemployment, or reinstatement with Company or any of its affiliated companies.
7.    Confidentiality.  As an employee of Company, Employee received
proprietary, confidential, and trade secret information of Company and/or its
parent or affiliated companies during the course of Employee’s employment with
Company, including information relating to Company’s customers and prospects. 
Employee represents that Employee has not improperly disclosed such information
to any third party outside of Company and further agrees to keep all such
information confidential and to not use the same in the course of Employee’s
future endeavors.  In further consideration of the payment of the foregoing sum,
Employee agrees that he or she shall keep the terms and provisions of this
agreement in strict confidence.  Specifically, the payment involved in this
agreement shall not be published, displayed, discussed, disclosed, or revealed
in any way by Employee or anyone on behalf of Employee without written
permission of Company or as required by court order, except that Employee may
discuss the fact of settlement and its terms with his or her spouse, attorney,
and tax preparer or accountant.  Prior to disclosing these terms to any of the
above-referenced persons, Employee shall inform them of their obligations not to
disclose the terms further.  Disclosure of the terms of this agreement by anyone
to whom Employee discloses them shall be an unauthorized disclosure by
Employee.  Within one year following the execution of this release Employee will
not directly or indirectly solicit employees to leave the employment of Company.
8.    Return of Company Property.  All records, files, lists, computer-generated
lists, documents, and equipment provided to Employee by Company and similar
items relating to Company business, whether Employee prepared them or received
them from Company, are the Company’s sole and exclusive property.  Employee must
return to Company all company property in Employee’s possession, including
without limitation all Company financial documents and information.  By signing
this agreement, Employee represents that he or she has returned all company
property, including documents and all copies, whether in hard copy or stored on
a computer, of documents or other materials originating with or belonging to
Company and that Employee has retained no copies, whether electronic or
otherwise.

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

9.    Knowing Release.  Employee declares that he or she fully understands the
terms and provisions of this agreement and voluntarily accepts the above terms
and provisions for the purpose of making a compromise and settlement regarding
the termination of his or her employment.  Employee acknowledges that prior to
the execution of this agreement he or she apprised himself or herself of
sufficient relevant information and had a sufficient opportunity to consult with
his or her attorney in order that he or she might intelligently exercise his or
her own judgment in deciding whether to execute this agreement.
10.    Release of ADEA Claims.  This agreement includes a release of all claims
under the Age Discrimination in Employment Act (the “ADEA”), and therefore
pursuant to the requirements of the ADEA and the Older Workers Benefit
Protection Act, Employee acknowledges that:  (a) this release includes, but is
not limited to, all rights and claims arising under the ADEA up to and including
the date of execution of this release; (b) Company advises Employee to consult
an attorney before signing this release concerning his or her rights and
obligations under this release; (c) Employee is being given 21 days within which
to consider this release before signing; (d) this release was first presented to
Employee for consideration on [DATE GIVEN TO EMPLOYEE]; (e) Employee may revoke
this release within seven days following its execution by delivering written
notification to the Company at 20085 NW Tanasbourne Drive, Hillsboro, Oregon
97124, Attn.:  EVP—Cultural Enhancement; and (f) this release will not be
effective and enforceable until such seven-day period has expired. Company shall
pay the Payment specified in paragraph 1 to Employee commencing within 30 days
following expiration of the seven-day period when this release becomes effective
and enforceable. This offer expires on the last day of the notification period
and cannot be accepted after that time without the express written approval of
the Company’s Chief Executive Officer or the Executive Vice President of
Cultural Enhancement.
11.    Entire Agreement.  This agreement, [and Sections __ and __ of the
Employment Agreement], contain the entire agreement between the parties hereto
and the terms and provisions of this release are contractual and not a mere
recital.  The laws of the state of Oregon shall govern this agreement.
12.    Mediation/Arbitration.  Any disputes of whatever nature arising in
connection with the execution and operation of this agreement shall be submitted
to a mediator agreed upon by the parties for non-binding, confidential
mediation.  If the matter cannot be resolved with the aid of a mediator, it
shall be submitted to final and binding, confidential arbitration pursuant to
Section 19 of the Employment Agreement, or such other rules as agreed to by the
parties.  The decision of the arbitrator shall be final and binding on all
parties.  Company shall pay the arbitrator's administrative fees.  Each party
shall pay one-half of the arbitrator’s fees and each party shall pay his, her or
its own attorney fees, except that the arbitrator shall retain the discretion to
award attorney fees where authorized by statute or other binding authority.  Any
arbitration hearing shall be conducted in Portland, Oregon.  Both parties agree
that the procedures outlined in this paragraph are the exclusive methods of
dispute resolution.
[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]

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

EMPLOYEE STATES THAT HE HAS CAREFULLY READ THIS RELEASE AGREEMENT IN ITS
ENTIRETY, THAT NO PROMISE, INDUCEMENT OR AGREEMENT NOT HEREIN EXPRESSED HAS BEEN
MADE TO HIM, AND THAT HE VOLUNTARILY AND KNOWINGLY ACCEPTS ITS TERMS AND
PROVISIONS.
EMPLOYEE:

_________________________________________
Print name:               

Date: ______________________________
COMPANY:

_________________________________________
By:                
Print Title:             

Date: ______________________________

Note:          Not to be signed prior to last day worked.
Return to:          Umpqua Bank
Attn: Cultural Enhancement Department
20085 NW Tanasbourne Drive
Hillsboro, OR 97124

___________________________    Date:___________

       

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

BENEFICIARY DESIGNATION

for
UMPQUA HOLDINGS CORPORATION
EMPLOYMENT AGREEMENT

If any payment or other benefits under my Employment Agreement are payable
following my death I designate the following as beneficiary thereof:

Primary:
___________________________________________________________________________

Contingent:_________________________________________________________________________

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

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

Signature: ______________________________

Printed Name: ___________________________    

Date: _____________________________

Received by Umpqua this _________ day of ___________________, ______________.

By: ________________________________
Name: _____________________________
Title: ______________________________