Bank of the Cascades


Supplemental Employee Retirement
Plan


 


BANK OF THE CASCADES


SUPPLEMENTAL EMPLOYEE RETIREMENT PLAN


 


This SUPPLEMENTAL EMPLOYEE
RETIREMENT PLAN (this “Agreement”) is adopted this 28th day of February, 2008, by and between BANK OF THE CASCADES,
an Oregon corporation located in Bend, Oregon (the “Bank”), and Patricia L. Moss (the “Executive”).


 


This Agreement amends
and restates the prior Salary Continuation Agreement dated October 1, 1995 and Supplemental Employee Retirement Plan, dated March
9, 2004, between the Bank and the Executive (the “Prior Agreements”). The parties intend this Agreement to be a material
modification of the Prior Agreements such that all amounts earned and vested prior to December 31, 2004 shall be subject to the
provisions of Code Section 409A.


 


The purpose of this
Agreement is to provide specified benefits to the Executive, a member of a select group of management or highly compensated employees
who contribute materially to the continued growth, development and future business success of the Bank. This Agreement shall be
unfunded for tax purposes and for purposes of Title I of the Employee Retirement Income Security Act of 1974 (“ERISA”),
as amended from time to time.


 


Article 1


Definitions


 


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


 


1.1         “Bancorp”
means Cascade Bancorp.


 


1.2         “Account
Value” means the amount shown on Schedule A under the heading Account Value. The parties expressly acknowledge that the
Account Value may be different than the liability that should be accrued by the Bank under Generally Accepted Accounting Principles
for the Bank’s obligation to the Executive under this Agreement.


 


1.3         “Beneficiary”
means each designated person or entity, or the estate of the deceased Executive, entitled to any benefits upon the death of the
Executive pursuant to Article 4.


 


1.4         “Beneficiary
Designation Form” means the form established from time to time by the Plan Administrator that the Executive completes,
signs and returns to the Plan Administrator to designate one or more Beneficiaries.


 


1.5         “Board”
means the Board of Directors of the Bank as from time to time constituted.


 


1.6         “Change
in Control” means the occurrence of any of the following events:


 



    	 



    	 



    

 


Bank of the Cascades


Supplemental Employee Retirement
Plan


 


(a)          Any
person acting individually or as a “group” for purposes of Section 13(d) of the Securities Exchange Act of 1934, as
amended (the “Exchange Act”) becomes the “beneficial owner” (as defined in Rule 13d(3) of the Exchange
Act), directly or indirectly, of securities of Bancorp representing fifty percent (50%) or more of the total voting power represented
by Bancorp’s then outstanding voting securities; 


(b)          The
consummation of the sale, liquidation or disposition by Bancorp of all or substantially all of Bancorp’s or the Bank’s
assets; or 


(c)          The
consummation of a share exchange, merger or consolidation of Bancorp or the Bank with any other corporation, other than a share
exchange, merger or consolidation which would result in the voting securities of Bancorp outstanding immediately prior thereto
continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity or
its parent) at least fifty percent (50%) of the total voting power represented by the voting securities of Bancorp or such surviving
entity or its parent outstanding immediately after such share exchange, merger or consolidation.


 


Notwithstanding the foregoing,
for the purposes of this Agreement, no transaction, series of transactions or change in the composition of the Board or of the
board of directors of Bancorp shall be considered a Change in Control unless it meets the requirements of Code Section 409A(a)(2)(A)(v).


 


1.7         “Code”
means the Internal Revenue Code of 1986, as amended.


 


1.8         “Early
Retirement” means Separation from Service after the Executive attains age fifty (50)
and completes fifteen (15) Years of Service except when such Separation from Service occurs within eighteen
(18) months following a Change in Control.


 


1.9         “Normal
Retirement Age” means the Executive attaining age fifty-nine (59).


 


1.10       “Plan
Administrator” means the Board or such committee or person as the Board shall appoint.


 


1.11       “Plan
Year” means each twelve (12) month period commencing on January 1 and ending on December 31 of each year.


 


1.12       “Schedule
A” means the schedule attached to this Agreement and made a part hereof. Schedule A shall be updated upon a change in
any of the benefits under Articles 2 or 3.


 


1.13       “Separation
from Service” means termination of the Executive’s employment
with the Bank for reasons other than death. Whether a Separation from Service has occurred is determined in
accordance with the requirements of Code Section 409A based on whether the facts and circumstances indicate that the Bank
and Executive reasonably anticipated that no further services would be performed after a certain date or that the level of bona
fide services the Executive would perform after such date would permanently decrease to no more than twenty percent (20%) of the
average level of bona fide services performed (as an employee or thirty-three percent (33%) of the average level of bona fide services
performed as an independent contractor) over the immediately preceding thirty-six (36) month period (or the full period of services
to the Bank if the Executive has been providing services to the Bank less than thirty-six (36) months).


 



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Bank of the Cascades


Supplemental Employee Retirement
Plan


 


1.14        “Specified
Employee” means an employee who at the time of Separation from Service is a key employee of the Bank, if any stock of
the Bank is publicly traded on an established securities market or otherwise. For purposes of this Agreement, an employee is a
key employee if the employee meets the requirements of Code Section 416(i)(1)(A)(i), (ii), or (iii) (applied in accordance with
the regulations thereunder and disregarding section 416(i)(5)) at any time during the twelve (12) month period ending on December
31 (the “identification period”). If the employee is a key employee during an identification period, the employee is
treated as a key employee for purposes of this Agreement during the twelve (12) month period that begins on the first day of April
following the close of the identification period.


 


1.15       “Termination
for Cause” means Separation from Service for:


 





(a)          a
material violation of any key policy or guideline of the Bank or Bancorp that has a material adverse effect on the Bank or Bancorp
or the reputation of Bank or Bancorp;


 


(b)          Executive
fails to materially comply with any applicable law related to Executive’s employment relationship with the Bank or Bancorp,
which has a material adverse effect on the Bank or Bancorp;


 


(c)          conviction
of, or entry of a plea of nolo contendere or guilty to, a felony or a crime of moral turpitude; or







 


(d)          engaging
in fraud, misappropriation, embezzlement, conduct involving moral turpitude, or act or acts of dishonesty resulting or intended
to result directly or indirectly in a gain or personal enrichment to the Executive at the expense of the Bank or Bancorp or a subsidiary
of Bank or Bancorp or that otherwise has a material adverse effect on the Bank or Bancorp or the operations of either.


 


1.16       “Year
of Service” means the twelve (12) consecutive month period beginning on the Executive’s date of hire and any twelve
(12) month anniversary thereof during the entirety of which time the Executive is an employee of the Bank.


 


Article 2


Distributions During Lifetime






2.1          Normal
Retirement Benefit. Upon Separation from Service after Normal Retirement Age, the Bank shall distribute the benefit described
in this Section 2.1 in lieu of any other benefit under this Article.


 





2.1.1       Amount
of Benefit. The annual benefit under this Section 2.1 is Two Hundred Twenty-Six Thousand Seven Hundred Dollars ($226,700).








 



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Bank of the Cascades


Supplemental Employee Retirement
Plan


  


2.1.2       Distribution
of Benefit. The Bank shall distribute the annual benefit to the Executive in twelve (12) equal monthly installments commencing
on the first day of the month following Separation from Service. The annual benefit shall be distributed to the Executive for the
Executive’s life, but not less than twenty (20) years.


 


2.1.3       Benefit
Inflator. Commencing on the first anniversary of the first benefit payment under this Section 2.1 and continuing on each subsequent
anniversary, the benefit shall increase by two and one-half percent (2.5%) from the previous anniversary date.


 


2.2          Early
Retirement Benefit. Upon Early Retirement, the Bank shall distribute the benefit described in this Section 2.2 in lieu of any
other benefit under this Article.


 


		2.2.1	Amount of Benefit. The benefit under this Section 2.2 is the amount shown on Schedule A.
 



 


2.2.2       Distribution
of Benefit. The Bank shall distribute the benefit to the Executive in two hundred forty (240) equal monthly installments commencing
on the first day of the month following Separation from Service.


 


2.3          Change
in Control Benefit. If a Change in Control occurs followed by Separation from Service prior to Normal Retirement Age (provided
the Separation from Service occurs within eighteen (18) months following a Change in Control), the Bank shall distribute the benefit
described in this Section 2.3 in lieu of any other benefit under this Article.


 


2.3.1      Amount
of Benefit. The benefit under this Section 2.3 is the amount shown on Schedule A.


 


2.3.2      Distribution
of Benefit.  The Bank shall distribute the benefit to the Executive in a lump sum within thirty (30) days following
Separation from Service.


 


2.4          Restriction
on Commencement of Distributions.  Notwithstanding any provision of this Agreement to the contrary, if the Executive is
considered a Specified Employee, the provisions of this Section 2.4 shall govern all distributions hereunder. If benefit distributions
which would otherwise be made to the Executive due to Separation from Service are limited because the Executive is a Specified
Employee, then such distributions shall not be made during the first six (6) months following Separation from Service. Any distribution
which would otherwise be paid to the Executive during such period shall be accumulated and paid to the Executive in a lump sum
on the first day of the seventh month following Separation from Service. All subsequent distributions shall be paid in the manner
specified.


 





2.5         Distributions
Upon Taxation of Amounts Deferred. If, pursuant to Code Section 409A, the Federal Insurance Contributions Act or other state,
local or foreign tax, the Executive becomes subject to tax on the amounts deferred hereunder, then the Bank may make a limited
distribution to the Executive in a manner that conforms to the requirements of Code Section 409A. Any such distribution will decrease
the Executive’s benefits distributable under this Agreement.




 



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Bank of the Cascades


Supplemental Employee Retirement
Plan


  


2.6         Change
in Form or Timing of Distributions.  For distribution of benefits under this Article 2, the Executive and the Bank may,
subject to the terms of Section 8.1, amend this Agreement to delay the timing or change the form of distributions.  Any such
amendment:


 


(a)          may
not accelerate the time or schedule of any distribution, except as provided in Code Section 409A;


(b)          must,
for benefits distributable under Sections 2.1, 2.2 and 2.3, delay the commencement of distributions for a minimum of five (5) years
from the date the first distribution was originally scheduled to be made; and


(c)          must
take effect not less than twelve (12) months after the amendment is made.


 


Article 3


Distribution at Death


 


3.1         Death
During Active Service. If the Executive dies prior to Separation from Service and Disability, the Bank shall distribute to
the Beneficiary the benefit described in this Section 3.1. This benefit shall be distributed in lieu of any benefit under Article
2.


 


3.1.1        Amount
of Benefit. The benefit under this Section 3.1 is the Normal Retirement Benefit amount described in Section 2.1.1.


 


3.1.2       Distribution
of Benefit. The Bank shall distribute the annual benefit to the Beneficiary in twelve (12) equal monthly installments for twenty
(20) years commencing on the first day of the fourth month following the Executive’s death. The Beneficiary shall be required
to provide the Executive’s death certificate to the Bank.


 


3.1.3       Benefit
Inflator. Commencing on the first anniversary of the first benefit payment under this Section 3.1 and continuing on each subsequent
anniversary, the benefit shall increase by two and one-half percent (2.5%) from the previous anniversary date.


 


3.2          Death
During Distribution of a Benefit. If the Executive dies after any benefit distributions have commenced under this Agreement
but before receiving all such distributions, the Bank shall distribute to the Beneficiary the remaining benefits at the same time
and in the same amounts as the benefits would have been distributed to the Executive had the Executive survived; provided, however,
for benefits payable under Section 2.1, if the Executive has received less than two hundred forty (240) monthly installments, the
Beneficiary shall continue to receive the same amounts at the same times until the sum of the installments to the Beneficiary and
Executive total two hundred forty (240).


 



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Bank of the Cascades


Supplemental Employee Retirement
Plan


 


3.3          Death
after Separation from Service and prior to Commencement of Benefit Distributions. If the Executive is entitled
to benefit distributions under this Agreement but dies prior to the date that commencement of any benefit distributions is scheduled
to be made under this Agreement, the Bank shall distribute to the Beneficiary the same benefits to which the Executive would have
been entitled prior to death, except that the benefit distributions shall be paid in the manner specified in Section 3.1.2 and
shall commence on the first day of the fourth month following the Executive’s death for a total of two hundred forty (240)
equal consecutive monthly installments.


 


Article 4


Beneficiaries


 


4.1          In
General. The Executive shall have the right, at any time, to designate a Beneficiary to receive any benefit distributions under
this Agreement upon the death of the Executive. The Beneficiary designated under this Agreement may be the same as or different
from the beneficiary designated under any other plan of the Bank in which the Executive participates.


 


4.2          Designation.
The Executive shall designate a Beneficiary by completing and signing the Beneficiary Designation Form and delivering it to the
Plan Administrator or its designated agent. If the Executive names someone other than the Executive’s spouse as a Beneficiary,
the Plan Administrator may, in its sole discretion, determine that spousal consent is required to be provided in a form designated
by the Plan Administrator, executed by the Executive’s spouse and returned to the Plan Administrator. The Executive's beneficiary
designation shall be deemed automatically revoked with respect to a Beneficiary if the Beneficiary predeceases the Executive or
if the Executive names a spouse as Beneficiary and the marriage is subsequently dissolved. The Executive shall have the right to
change a Beneficiary by completing, signing and otherwise complying with the terms of the Beneficiary Designation Form and the
Plan Administrator’s rules and procedures. Upon the acceptance by the Plan Administrator of a new Beneficiary Designation
Form, all Beneficiary designations previously filed shall be cancelled. The Plan Administrator shall be entitled to rely on the
last Beneficiary Designation Form filed by the Executive and accepted by the Plan Administrator prior to the Executive’s
death.


 


4.3          Acknowledgment.
No designation or change in designation of a Beneficiary shall be effective until received, accepted and acknowledged in writing
by the Plan Administrator or its designated agent.


 


4.4          No
Beneficiary Designation. If the Executive dies without an acknowledged beneficiary designation, or if all designated Beneficiaries
predecease the Executive, then the Executive’s spouse shall be the designated Beneficiary. If the Executive has no surviving
spouse, any benefit shall be paid to the Executive's estate.


 



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Bank of the Cascades


Supplemental Employee Retirement
Plan


  


4.5          Facility
of Distribution. If the Plan Administrator determines in its discretion that a benefit is to be distributed to a Beneficiary
who is a minor, incapacitated, under legal disability or considered by the Plan Administrator to be incapable of handling receipt
of the benefits hereunder if paid to the Beneficiary directly, the Plan Administrator may direct distribution of such benefit to
the guardian, legal representative or person having the care or custody of such individual. The Plan Administrator may require
proof of incompetence, minority or guardianship as it may deem appropriate prior to distribution of the benefit. Any distribution
of a benefit shall be a distribution for the account of the Executive and the Beneficiary, as the case may be, and shall completely
discharge any liability under this Agreement for such distribution amount.


 


Article 5


General Limitations


 


5.1          Termination
for Cause. Notwithstanding any provision of this Agreement to the contrary, the Bank shall not distribute any benefit under
this Agreement if the Executive’s employment with the Bank is terminated by the Bank or an applicable regulator due to a
Termination for Cause.


 


5.2          Misstatement.
No benefit shall be distributed if an insurance company which issued a life insurance policy covering the Executive and owned by
the Bank denies coverage (i) for material misstatements of fact made by the Executive on an application for such life insurance,
or (ii) for any other reason.


 


5.3          Removal.
Notwithstanding any provision of this Agreement to the contrary, the Bank shall not distribute any benefit under this Agreement
if the Executive is subject to a final removal or prohibition order issued by an appropriate federal banking agency pursuant to
Section 8(e) of the Federal Deposit Insurance Act.


 


5.4          Golden
Parachute Indemnification Payments. Notwithstanding anything herein to the contrary, any payments made to the Executive pursuant
to this Agreement, or otherwise, shall be subject to and conditioned upon compliance with 12 U.S.C. 1828 and FDIC Regulation 12
CFR Part 359, Golden Parachute Indemnification Payments and any other regulations or guidance promulgated thereunder.


 


5.5          Forfeiture
Provisions.


 





(a)          Prior
to Separation from Service and during the eighteen (18) month period thereafter, if the Executive directly or indirectly advises,
invests in, owns, manages, operates, controls, is employed by, provides services to, lends money to, guarantees any obligation
of, lends Executive’s name to, or otherwise assists any person engaged in or planning to be engaged in any business whose
products, services, or activities compete or will compete in whole or in part with the Bank’s products, services, or activities
in Oregon or Idaho, the Executive shall forfeit any benefits hereunder and shall be obligated to repay any benefits already paid.
Notwithstanding the forgoing, the Executive may own up to 1% of any class of securities of any issuer if the securities are listed
on a national or regional securities exchange or have been registered under Section 12(g) of the Exchange Act without losing the
right to any payments hereunder.







 



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Bank of the Cascades


Supplemental Employee Retirement
Plan


 


			(b)          Prior to Separation from Service
and during the eighteen (18) month period thereafter, if the Executive breaches the Confidentiality and Nonsolicitation Agreement
between the Executive and Bank, the Executive shall forfeit any benefits hereunder and shall be obligated to repay any benefits
already paid.



 


			(c)          Prior to Separation from Service
and during the eighteen (18) month period thereafter, if the Executive transacts business of a nature similar to the Bank’s
or Bancorp’s business with customers of the Bank or Bancorp, the Executive shall forfeit any benefits hereunder and shall
be obligated to repay any benefits already paid.



 


Article 6


Administration of Agreement


 


6.1          Plan
Administrator Duties. The Plan Administrator shall administer this Agreement according to its express terms and shall also
have the discretion and authority to (i) make, amend, interpret and enforce rules and regulations for the administration of this
Agreement and (ii) decide or resolve any and all questions, including interpretations of this Agreement, as may arise in connection
with this Agreement to the extent the exercise of such discretion and authority does not conflict with Code Section 409A.


 


6.2          Agents.
In the administration of this Agreement, the Plan Administrator may employ agents and delegate to them such administrative duties
as the Plan Administrator sees fit, including acting through a duly appointed representative, and may from time to time consult
with counsel who may be counsel to the Bank.


 


6.3          Binding
Effect of Decisions. Any decision or action of the Plan Administrator with respect to any question arising out of or in connection
with the administration, interpretation or application of this Agreement and the rules and regulations promulgated hereunder shall
be final and conclusive and binding upon all persons having any interest in this Agreement. 


 


6.4          Indemnity
of Plan Administrator. The Bank shall indemnify and hold harmless the Plan Administrator and its agents against any and all
claims, losses, damages, expenses or liabilities arising from any action or failure to act with respect to this Agreement, except
in the case of willful misconduct by the Plan Administrator.


 


6.5          Bank
Information. The Bank shall supply full and timely information to the Plan Administrator on all matters relating to the date
and circumstances of the Executive’s death, Disability or Separation from Service, and such other pertinent information as
the Plan Administrator or its agents may reasonably require.


 


6.6          Annual
Statement. The Plan Administrator shall provide to the Executive, within one hundred twenty (120) days after the end of each
Plan Year, a statement setting forth the benefits to be distributed under this Agreement. 


 



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Bank of the Cascades


Supplemental Employee Retirement
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Article 7


Claims And Review Procedures


 


7.1          Claims
Procedure. An Executive or Beneficiary (“claimant”) who has not received benefits under this Agreement that he
or she believes should be distributed shall make a claim for such benefits as follows:


 


7.1.1       Initiation
– Written Claim. The claimant initiates a claim by submitting to the Plan Administrator a written claim for the benefits.
If such a claim relates to the contents of a notice received by the claimant, the claim must be made within sixty (60) days
after such notice was received by the claimant. All other claims must be made within one hundred eighty (180) days of the
date on which the event that caused the claim to arise occurred. The claim must state with particularity the determination desired
by the claimant.


 


7.1.2       Timing
of Plan Administrator Response. The Plan Administrator shall respond to such claimant within ninety (90) days after
receiving the claim. If the Plan Administrator determines that special circumstances require additional time for processing the
claim, the Plan Administrator can extend the response period by an additional ninety (90) days by notifying the claimant in writing,
prior to the end of the initial ninety (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 Plan Administrator expects to render its decision.


 


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


 


(a)          The
specific reasons for the denial;


(b)          A
reference to the specific provisions of this Agreement on which the denial is based;


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


(d)          An
explanation of this Agreement’s review procedures and the time limits applicable to such procedures; and


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


 


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


 





7.2.1       Initiation
– Written Request. To initiate the review, the claimant, within sixty (60) days after receiving the Plan Administrator’s
notice of denial, must file with the Plan Administrator a written request for review. 


 



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Bank of the Cascades


Supplemental Employee Retirement
Plan


  


7.2.2       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 Plan Administrator shall also provide the claimant, upon request and
free of charge, reasonable access to, and copies of, all documents, records and other information relevant (as defined in applicable
ERISA regulations) to the claimant’s claim for benefits.


 


7.2.3       Considerations
on Review. In considering the review, the Plan Administrator 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.


 


7.2.4       Timing
of Plan Administrator Response. The Plan Administrator shall respond in writing to such claimant within sixty (60) days after
receiving the request for review. If the Plan Administrator determines that special circumstances require additional time for processing
the claim, the Plan Administrator can extend the response period by an additional sixty (60) days by notifying the claimant in
writing, prior to the end of the initial sixty (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 Plan Administrator expects to render its decision.


 


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


 


(a)          The
specific reasons for a denial;


(b)          A
reference to the specific provisions of this Agreement on which the a denial is based;


(c)          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


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


 





Article 8


Amendments and Termination


 


8.1          Amendments.
This Agreement may be amended only by a written agreement signed by the Bank and the Executive. However, the Bank may unilaterally
amend this Agreement to conform with written directives to the Bank from its auditors or banking regulators or to comply with legislative
changes or tax law.





 



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Bank of the Cascades


Supplemental Employee Retirement
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8.2          Plan
Termination Generally. This Agreement may be terminated only by a written agreement signed by the Bank and the Executive. The
benefit shall be the Account Value as of the date this Agreement is terminated. Except as provided in Section 8.3, the termination
of this Agreement shall not cause a distribution of benefits under this Agreement. Rather, upon such termination benefit distributions
will be made at the earliest distribution event permitted under Article 2 or Article 3.


 


8.3          Plan
Terminations Under Code Section 409A. Notwithstanding anything to the contrary in Section 8.2, if this Agreement in the following
circumstances:


 


(a)          Within thirty (30) days before or
twelve (12) months after a Change in Control, provided that all distributions are made no later than twelve (12) months following
such termination of this Agreement and further provided that all the Bank's arrangements which are substantially similar
to this Agreement are terminated so the Executive and all participants in the similar arrangements are required
to receive all amounts of compensation deferred under the terminated arrangements within twelve (12) months of such termination; 



(b)          Upon
the Bank’s dissolution or with the approval of a bankruptcy court provided that the amounts deferred under this Agreement
are included in the Executive's gross income in the latest of (i) the calendar year in which this Agreement terminates; (ii) the
calendar year in which the amount is no longer subject to a substantial risk of forfeiture; or (iii) the first calendar year in
which the distribution is administratively practical; or


(c)          Upon
the Bank’s termination of this and all other arrangements that would be aggregated with this Agreement pursuant to Treasury
Regulations Section 1.409A-1(c) if the Executive participated in such arrangements (“Similar Arrangements”), provided
that (i) the termination and liquidation does not occur proximate to a downturn in the financial health of the Bank, (ii) all termination
distributions are made no earlier than twelve (12) months and no later than twenty-four (24) months following such termination,
and (iii) the Bank does not adopt any new arrangement that would be a Similar Arrangement for a minimum of three (3) years following
the date the Bank takes all necessary action to irrevocably terminate and liquidate the Agreement;


 


the Bank may distribute the Account
Value, determined as of the date of the termination of this Agreement, to the Executive in a lump sum subject to the above terms.


 





Article 9


Miscellaneous


 


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


 


9.2          No
Guarantee of Employment. This Agreement is not a contract for employment. It does not give the Executive the right to remain
as an employee of the Bank nor interfere with the Bank's right to discharge the Executive. It does not require the Executive to
remain an employee nor interfere with the Executive's right to terminate employment at any time.


  



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Bank of the Cascades


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


 


9.4          Tax
Withholding and Reporting. The Bank shall withhold any taxes that are required to be withheld from the benefits provided under
this Agreement. The Executive acknowledges that the Bank’s sole liability regarding taxes is to forward any amounts withheld
to the appropriate taxing authorities. The Bank shall satisfy all applicable reporting requirements.


 


9.5          Applicable
Law. This Agreement and all rights hereunder shall be governed by the laws of the State of Oregon without giving effect to
any conflict-of-law principle that would result in the laws of any other jurisdiction governing this Agreement, except to the extent
preempted by the laws of the United States of America.


 


9.6          Unfunded
Arrangement. The Executive and the Beneficiary are general unsecured creditors of the Bank for the distribution of benefits
under this Agreement. The benefits represent the mere promise by the Bank to distribute 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 or other informal funding asset is a general asset of the Bank to which the
Executive and Beneficiary have no preferred or secured claim.


 


9.7          Reorganization.
The Bank shall not merge or consolidate into or with another bank, or reorganize, or sell substantially all of its assets to
another bank, firm or person unless such succeeding or continuing bank, firm or person agrees to assume and discharge the obligations
of the Bank under this Agreement. Upon the occurrence of such an event, the term “Bank” as used in this Agreement shall
be deemed to refer to the successor or survivor entity.


 


9.8          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.


 





9.9          Interpretation.
Wherever the fulfillment of the intent and purpose of this Agreement requires and the context will permit, the use of the masculine
gender includes the feminine and use of the singular includes the plural.


 


9.10        Alternative
Action. In the event it shall become impossible for the Bank or the Plan Administrator to perform any act required by this
Agreement due to regulatory or other constraints, the Bank or Plan Administrator may perform such alternative act as most nearly
carries out the intent and purpose of this Agreement and is in the best interests of the Bank, provided that such alternative act
does not violate Code Section 409A.


 


9.11        Headings.
Article and section headings are for convenient reference only and shall not control or affect the meaning or construction of any
provision herein.





 



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Bank of the Cascades


Supplemental Employee Retirement
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9.12        Validity.
If any provision of this Agreement shall be illegal or invalid for any reason, said illegality or invalidity shall not affect the
remaining parts hereof, but this Agreement shall be construed and enforced as if such illegal or invalid provision had never been
included herein.


 


9.13        Notice.
Any notice or filing required or permitted to be given to the Bank or Plan Administrator under this Agreement shall be sufficient
if in writing and hand-delivered or sent by registered or certified mail to the address below:


 


	 	 	 
	 	 	 
	 	 	 


 


Such notice shall be deemed given
as of the date of delivery or, if delivery is made by mail, as of the date shown on the postmark on the receipt for registration
or certification.


 


Any notice or filing required
or permitted to be given to the Executive under this Agreement shall be sufficient if in writing and hand-delivered or sent by
mail to the last known address of the Executive.


 


9.14        Deduction
Limitation on Benefit Payments. If the Bank reasonably anticipates that the Bank’s deduction with respect to any distribution
under this Agreement would be limited or eliminated by application of Code Section 162(m), then to the extent deemed necessary
by the Bank to ensure that the entire amount of any distribution from this Agreement is deductible, the Bank may delay payment
of any amount that would otherwise be distributed under this Agreement. The delayed amounts shall be distributed to the Executive
(or the Beneficiary in the event of the Executive's death) at the earliest date the Bank reasonably anticipates that the deduction
of the payment of the amount will not be limited or eliminated by application of Code Section 162(m).


 


IN WITNESS WHEREOF,
the Executive and a duly authorized representative of the Bank have signed this Agreement.


 


	EXECUTIVE	 	BANK
	 	 	 
	/s/ Patricia L. Moss	 	By:	/s/ Peggy L. Biss
	Patricia L. Moss	 	Title:	EVP


 






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