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coverage under COBRA, WBC shall pay Mr. Cann’s insurance premiums for the group medical, dental andvision insurance continuation coverage for up to eighteen (18) months beginning October 1, 2008,and ending March 31, 2010, provided, however, if Mr. Cann becomes eligible for another employer’shealth insurance plan or otherwise becomes ineligible to continue his health insurance under COBRA,such health insurance premium payments shall cease. Mr. Cann shall notify WBC immediately uponeligibility for another such health plan.     6. Other Benefits. After the Retirement Date, Mr. Cann’s participation and conversionrights in any other benefits programs shall be governed by the terms of the applicable plan and anylegal requirements.     7. Automobile. Upon the Retirement Date, WBC agrees to transfer title to Mr. Cann tothe automobile (2005 Chevrolet Tahoe) that Mr. Cann has been using for WBC-related business.     8. Confidentiality. Mr. Cann acknowledges that under the provisions of previouslyexecuted agreements, and under applicable laws including the Washington Trade Secrets Act, he isobligated to maintain confidential all trade secret, proprietary, confidential and otherinformation not publicly known of or about WBC or any of its customers, employees or businesspartners. Mr. Cann affirms his agreement to maintain the confidentiality of all such information,including his obligations under Section 8 of his Employment Agreement. In addition, Mr. Cann agreesto maintain the confidentiality of the terms of this Agreement, except that he may share the termswith his wife, attorney or tax advisor. Similarly, WBC agrees to maintain the confidentiality ofthis Agreement, except that WBC may share the terms with its senior management (such as itsPresident), Board members, attorneys, accountants, regulatory authorities and as may be required bylaw.     9. References. All inquiries about Mr. Cann including any requests for referenceinformation shall be directed to WBC’s Vice President of Human Resources, who shall confirm Mr.Cann’s title, dates of employment and that he departed WBC as a voluntary retirement.     10. Return of Property. As of the Retirement Date, Mr. Cann will return to WBC allcompany-owned property in his possession, if any, specifically including all keys and card keybadges to company buildings or property, all company-owned equipment, and all company documents andpapers, including but not limited to trade secrets or confidential company information.     11. Non-Solicitation of Employees and Customers. Mr. Cann reaffirms hisnonsolicitation obligations stated in Section 9 of his Employment Agreement, except that theparties agree that the period of the non-solicitation restriction shall be reduced from two yearsto one year from the Retirement Date.     12. Non-Competition Agreement. Mr. Cann reaffirms his non-competition obligationsunder Section 7 of the Employment Agreement, except that the parties agree that the period of thenon-competition restriction shall be reduced from two years to one year from the Retirement Date.
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     13. Release. In exchange for the enhanced severance and other benefits describedabove, Mr. Cann, on behalf of himself and his marital community, irrevocably and unconditionallywaives, releases, and forever discharges, WBC and all of its parent, affiliated or subsidiaryorganizations, any employer-sponsored employee benefit plans and each of their respectivedirectors, officers, agents, trustees, employees, employee-spouses, successors and assigns(collectively “the Releases”), from any and all claims or damages (including attorney’s fees andcosts actually incurred), whether known or unknown, which have arisen through the date of thisAgreement related in any way to his employment by WBC or his separation. This release includes butis not limited to, claims under federal, state or local laws prohibiting discrimination inemployment, including the Age Discrimination in Employment Act, and the Employee Retirement Incomeand Security Act of 1974, as well as any tort or contract claims or any other claims arising fromany alleged legal restrictions of the right of WBC to compensate, manage or terminate itsemployees. This release shall not prohibit Mr. Cann from filing a charge with the Equal EmploymentOpportunity Commission but shall be a waiver of any damages or monetary recovery therefrom. Thisrelease does not affect or include claims Mr. Cann may have in a capacity other than as anemployee, such as rights as a shareholder or customer of WBC.     14. Voluntary Agreement. Mr. Cann understands and acknowledges the significance andconsequences of this Agreement. Mr. Cann acknowledges that it is voluntary and he has not signedit as a result of any coercion. Mr. Cann acknowledges that he was given at least twenty-one (21)days after receipt of this document during which to consider this Agreement and that he has beenencouraged to consult with an attorney prior to signing it, and that he signs it only aftercareful consideration and analysis. In the event that Mr. Cann signs this Agreement beforeexpiration of this consideration period, the remaining time shall be waived.     15. Revocation Period. Mr. Cann understands and acknowledges that he has seven (7)days after signing this Agreement to revoke it. This Agreement will not be effective until theeighth day after it is signed or the Retirement Date, whichever occurs later (“Effective Date”).     16. No Admission of Liability. This Agreement shall not be considered as evidenceof any violation of any statute or law, or any wrongdoing or liability on the part of Mr. Cann orWBC or its agents or employees.     17. Non-Disparagement. Mr. Cann reaffirms his obligations not to disparage WBC or itspast or present officers, directors, agents, employees, products or services in any form or forumto any person or entity as stated in Section 10 of his Employment Agreement. WBC, through itsPresident and Board of Directors, shall not disparage Mr. Cann. Both WBC and Mr. Cann shallcharacterize Mr. Cann’s departure as a voluntary retirement.     18. Entire Agreement. The Agreement contains the entire understanding between Mr. Cannand WBC regarding the subject matter of this Agreement. It supersedes the Employment Agreement andall other agreements that relate to the termination of Mr. Cann’s employment (or the benefitsavailable as a result thereof) between the parties except that Sections 7, 8, 9, and 10 of theEmployment Agreement shall remain in effect except as expressly modified herein. This Agreement maynot be modified except in writing signed by Mr. Cann and by WBC.
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     19. Miscellaneous. This Agreement is entered into without reliance on any promiseor representation, written or oral, other than those expressly contained herein. It supersedes anyother such promises or representations unless specifically identified in this Agreement. ThisAgreement shall bind the heirs, personal representatives, successors and assigns of both Mr. Cannand WBC. If any provision of this Agreement is determined to be invalid or unenforceable, in wholeor in part, this determination will not affect any other provision of this Agreement and theprovision in question shall be modified by the court so as to be rendered enforceable. ThisAgreement shall be deemed to have been entered into and shall be construed and enforced inaccordance with the laws of the State of Washington and an action for breach of this Agreement mayonly be filed in federal or state courts residing in King County, Washington.MR. CANN ACKNOWLEDGES AND UNDERSTANDS THAT THE ABOVE AGREEMENTINCLUDES A RELEASE OF ALL CLAIMS, KNOWN AND UNKNOWN, TO THE EXTENTSPECIFIED IN SECTION 13 ABOVE AND EXECUTES THIS AGREEMENT WITH FULLKNOWLEDGE OF ITS CONTENTS AND OPPORTUNITY FOR CONSULTATION WITHLEGAL COUNSEL.        Dated: 9/23/08  Employee:   /s/ Michal Cann    Michal Cann           Dated: 9/23/08 Washington Banking Company, Inc.