Document:

SECURITY AGREEMENT

Exhibit 10.2

SECURITY AGREEMENT

This Security Agreement (the “Agreement”) is entered into as of this 5th day of October, 2016 by and between Ecosphere Technologies, Inc., a Delaware corporation (“Ecosphere”), and Brisben Water Solutions LLC (the “Lender” and together with Ecosphere, the “Parties”). The Parties hereby agree as follows:

1.

Creation of Security Interest.  In connection with the issuance by Ecosphere of that certain Secured Promissory Note, dated as of the date hereof, in the amount of $500,000 (the “Note”) and as consideration for the Lender’s advance of funds thereunder, Ecosphere hereby grants to the Lender a security interest in the Collateral described in Section 2 to secure the performance or payment of all of the Obligations (as defined below) of Ecosphere under Section 3. The Parties agree that notwithstanding any provision to the contrary contained in any prior agreement between the Parties, the entry into each of this Agreement and the Note do not constitute a default or violation of any covenant under any prior agreement of the Parties, and it is the intent of the Parties that this Agreement shall replace and supersede all prior security agreements made between the Parties without affecting the validity or priority of any security interests in the collateral granted in favor of the Lender to secure the obligations under any such prior security agreements.  

2.

Collateral.  The collateral of this Agreement (the “Collateral”) consists of the items described on attached Exhibit A, including the Physical Collateral, the Patent Collateral, and the Securities Collateral, each as defined in Exhibit A. Included in, and not limiting, the foregoing, in furtherance of the grant of a security interest and as collateral security for the payment of the Note and the Prior Note (as hereinafter defined), Ecosphere grants the Lender a security interest in Ecosphere’s ownership of 57,232,278 shares common stock of Sea of Greens System, Inc., a Florida corporation (“SOGS”).

3.

Ecosphere’s Obligations.

(a)

Obligation to Pay.  Ecosphere shall pay to the Lender $500,000 and accrued interest thereon in accordance with the terms of the Note, and shall pay to the Lender $3,654,000 and accrued interest thereon in accordance with the terms of the Amended, Restated, and Consolidated Convertible Note dated as of September 12, 2016 (the “Prior Note”).

(b)

Additional Obligations.

(i)

Protection of Collateral.  The Physical Collateral:

(A)

will not be misused or abused, but will be maintained in good and operable condition, reasonable wear and tear excepted (except for any loss, damage or destruction which is fully covered by insurance proceeds) and will be repaired, renewed and replaced by Ecosphere as its management, in the exercise of reasonable discretion, shall deem necessary;

(B)

until this Agreement is terminated and not replaced, will be insured by Ecosphere in the amount of $750,000 for the Ecos PowerCube® unit and $500,000 for the Ecos GrowCubeTM unit against all expected risks to which it is exposed, including fire, theft, wind and flood, and those which the Lender may designate, with the policies acceptable to the Lender, payable to the Lender and providing for 30 days’ minimum cancellation notice to the Lender, and 

with certificates evidencing such insurance delivered to the Lender as a condition to advances under the Note; and

(ii)

Protection of Security Interest.

(A)

The Collateral will not be sold, licensed, transferred, encumbered, pledged, or disposed of or be subjected to any unpaid charge, including taxes, or to any subsequent interest of a third person created or suffered by Ecosphere voluntarily or involuntarily, unless the Lender consents in advance in writing to such charge, transfer, disposition or subsequent interest, and

(B)

The Lender has filed Financing Statements and may file additional Financing Statements it deems necessary in places it deems appropriate to protect the security interest under this Agreement against the rights or interests of third persons.

(C)

Any proceeds received by Ecosphere upon the sale, lease, license, assignment, transfer, encumbrance, pledge or other disposition of any of the Collateral or any part thereof shall be paid to Lender when received and applied to the Note and Prior Note until all principal, accrued interest and attorneys’ fees outstanding under the Note and Prior Note are paid in full.  All additional proceeds, if any, from such sale or other disposition shall be retained by Ecosphere.

(iii)

Sale of FNES Interest.  In addition to the Lender’s rights and remedies with respect to the Collateral, to secure the performance or payment of the Obligations, Ecosphere agrees as follows:

(A)

Ecosphere shall not sell, assign, transfer or encumber in any manner Ecosphere’s 30.6% limited liability company ownership interest in Fidelity National Environmental Solutions, LLC (“FNES”, and such 30.6% interest, the “FNES Interest”); and

(B)

In the event Ecosphere is in default of the Note and/or Prior Note and Lender declares the Note and/or Prior Note to be immediately due and payable, Ecosphere shall sell the FNES Interest or any part thereof for cash at public or private sale, subject to full compliance with the provisions, including tag-along rights and rights of first refusal, of the Amended and Restated Limited Liability Company Agreement of FNES, as in effect on the date hereof.  To facilitate the sale process, Lender may solicit offers to purchase the FNES Interest.  Such public or private sale shall take place no later than 90 days after the date of default by non-payment.  Ecosphere shall give Lender at least 30 days’ notice of the time and place of any public sale or the time at which any private sale is to be made.  At any sale of the FNES Interest the Lender may be the purchaser of the FNES Interest or any part thereof and shall be entitled to use and apply any sums due it under the Note and/or Prior Note as a credit on account of the purchase price of the FNES Interest or any part thereof payable at such sale.  All proceeds received by Ecosphere upon sale of the FNES Interest or any part thereof shall be paid to Lender and applied to the Note and/or Prior Note until all principal, accrued interest and attorneys’ fees outstanding under the Note and/or Prior Note are paid in full.  All additional proceeds, if any, from the sale shall be retained by Ecosphere.

2

(iv)

Sale of EM Interest.  In addition to the Lender’s rights and remedies with respect to the Collateral, to secure the performance or payment of the Obligations, Ecosphere agrees as follows:

(A)

Ecosphere shall not sell, assign, transfer or encumber in any manner the 25% limited liability company ownership interest in Ecosphere Mining, LLC (“EM”) which Ecosphere owns and has pledged to the Lender under this Agreement (the “EM Interest”); and

(B)

In the event Ecosphere is in default of the Note and/or Prior Note and Lender declares the Note and/or Prior Note to be immediately due and payable, Ecosphere shall sell the EM Interest or any part thereof for cash at public or private sale.  To facilitate the sale process, Lender may solicit offers to purchase the EM Interest.  Such public or private sale shall take place no later than 90 days after the date of default by non-payment.  Ecosphere shall give Lender at least 30 days’ notice of the time and place of any public sale or the time at which any private sale is to be made.  At any sale of the EM Interest, the Lender may be the purchaser of the EM Interest or any part thereof and shall be entitled to use and apply any sums due it under the Note and/or Prior Note as a credit on account of the purchase price of the EM Interest or any part thereof payable at such sale.  All proceeds received by Ecosphere upon sale of the EM Interest or any part thereof shall be paid to Lender and applied to the Note and/or Prior Note until all principal, accrued interest and attorneys’ fees outstanding under the Note and/or Prior Note are paid in full.  All additional proceeds, if any, from the sale shall be retained by Ecosphere.

(v)

Pledge  of SOGS Interest.  In addition to the Lender’s rights and remedies with respect to the Collateral, to secure the performance or payment of the Obligations, Ecosphere agrees as follows:

(A)

Ecosphere pledges and is delivering a certificate for 57,232,278 shares of SOGS presently held by Ecosphere (the “SOGS Interest”), together with a stock power endorsed in blank to the Lender, simultaneously with execution of this Agreement;  

(B)

Ecosphere shall not sell, assign, transfer or encumber in any manner the SOGS Interest; and

(C)

In the event Ecosphere is in default of the Note and/or Prior Note and Lender declares the Note and/or Prior Note to be immediately due and payable, the Lender may  sell the SOGS Interest or any part thereof for cash or other property at a public or private sale as provided in the Uniform Commercial Code.  To facilitate the sale process, Ecosphere may solicit offers to purchase the SOGS Interest.  Such public or private sale shall take place no later than 90 days after the date of default by non-payment. The Lender shall give Ecopshere  at least 30 days’ notice of the time and place of any public sale or the time at which any private sale is to be made.  At any sale of the SOGS Interest, the Lender may be the purchaser of the SOGS Interest or any part thereof and shall be entitled to use and apply any sums due it under the Note and/or Prior Note as a credit on account of the purchase price of the SOGS Interest or any part thereof payable at such sale  until all principal, accrued interest and attorneys’ fees outstanding under the Note and/or Prior Note are paid in full.  All additional proceeds, if any, from the sale shall be paid to Ecosphere.

(vi)

Allocation of Ecosphere Revenues.  In addition to the Lender’s rights and remedies with respect to the Collateral, to secure the performance or payment of the Obligations, 

3

Ecosphere and its subsidiaries agree that so long as any amounts payable under the Note and/or Prior Note remain outstanding, Ecosphere and its subsidiaries shall allocate and pay to Lender 5% of all revenues actually received by Ecosphere and its subsidiaries from equipment sales, licensing fees, services and other sources to payment of the Obligations, as prepayments of principal and accrued interest; provided, however, that for the purposes of such calculations, management fees payable to Ecosphere from SOGS, which have been accruing at the rate of $25,000 monthly since January 1, 2015 and remain unpaid as of the date hereof (the “Management Fees”), shall not be considered revenues under this Section 3(b)(vi).  Provided, further, that SOGS shall not be deemed to be a subsidiary within the meaning of the first sentence of this Section 3(b)(vi).  Equipment sales from Ecosphere to SOGS shall be deemed to be revenues of Ecosphere.  To the extent Ecosphere pays the Lender $200,000 under the Note or Prior Note from its receipt of at least $450,000 as a result of a financing transaction related to SOGS engaging in a reverse merger, sums received by SOGS as a result of such reverse merger shall not be deemed to be revenues within the meaning of the first sentence of this Section 3(b)(vi).

(vii)

Allocation of Initial Public Offering Proceeds.  In addition to the Lender’s rights and remedies with respect to the Collateral, to secure the performance or payment of the Obligations, Ecosphere and its subsidiaries agree that so long as any amounts payable under the Note and/or Prior Note remain outstanding, Ecosphere and its subsidiaries shall allocate and pay to Lender 10% of all net proceeds actually received by Ecosphere or its subsidiaries in connection with the closing of an initial public offering of any of its present subsidiaries to payment of the Obligations; provided, however, that for the purposes of such calculations, the Management Fees shall not be considered net proceeds under this Section 3(b)(vii).  For avoidance of doubt, financing proceeds received in connection with a reverse merger shall not be deemed to be an initial public offering.  For purposes of this Section 3(b)(vii), “reverse merger” means a merger, consolidation or share exchange between an Ecosphere subsidiary and another entity which is treated as a reverse merger for accounting purposes.

(viii) 

Additional Provisions Concerning the SOGS Interest.

(A)

In the event, prior to the payment of the Note and/or Prior Note, that SOGS shall issue any of its shares of common stock as a stock dividend or shall subdivide or combine the number of outstanding shares of common stock into a greater or lesser number of shares, then the number of shares of SOGS representing the SOGS Interest shall be increased or decreased, respectively, in portion to such subdivision or combination.  Any dividend paid or distributed upon the common stock in shares of any other class of capital stock of SOGS or securities convertible into shares of common stock shall be treated as a dividend paid in common stock.  In the event that SOGS shall pay a dividend consisting of the securities of any other entity or in cash or other property, upon any acquisition of shares of SOGS representing the SOGS Interest upon an Event of Default (as defined in the Note and Prior Note), the Lender shall receive the securities, cash, or property which the Lender would have been entitled to if the SOGS Interest were acquired immediately prior to the record date of such dividend.

(B)

In the event, prior to the payment of the Note and/or Prior Note, that SOGS shall be recapitalized by reclassifying its outstanding common stock (other than into shares of common stock with a different par value, or by changing its outstanding shares of common stock to shares without par value), or in the event SOGS or a successor corporation, partnership, limited liability company or other entity (any of which is defined as a “Corporation”) shall consolidate or 

4

merge with or convey all or substantially all of its, or of any successor Corporation’s, property and assets to any other Corporation or Corporations (any such other Corporation being included within the meaning of the term “successor Corporation” used in the context of any consolidation or merger of any other Corporation with, or the sale of all or substantially all of the property of any such other Corporation to, another Corporation or Corporations), or in the event of any other material change in the capital structure of SOGS or of any successor Corporation by reason of any reclassification, reorganization, recapitalization, consolidation, merger, conveyance or otherwise, then, as a condition of any such reclassification, reorganization, recapitalization, consolidation, merger or conveyance, a prompt, proportionate, equitable, lawful and adequate provision shall be made whereby  in lieu of the securities of SOGS theretofore representing the SOGS Interest, the SOGS Interest shall represent the right to receive the securities or assets as may be issued or paid as a result of the foregoing; and in any such event, the rights of the Lender to any adjustment in the number of shares representing the SOGS Interest shall continue and be preserved in respect of any shares, securities or assets which the Lender becomes entitled to obtain.  The foregoing provisions of this Section 3(b) shall apply to successive reclassifications, capital reorganizations and changes of securities and to successive consolidations, mergers, sales or conveyances.

(C) 

Ecosphere possesses full voting rights with respect to the shares constituting the SOGS Interest, and will possess full voting rights, if any, with respect to securities issued as a result of any of the events described in this Section 3(b)(viiii) in accordance with applicable state securities laws, in each case unless and until Ecosphere disposes of such securities following an Event of Default pursuant to this Agreement. 

4.

Representations, Warranties and Covenants.

(a) 

Ecosphere represents, warrants and covenants to Lender that:

(i)

Ecosphere has good and sufficient title to the Collateral, the FNES Interest, the EM Interest and the SOGS Interest, free and clear of all security interests, liens, encumbrances and claims whatsoever, other than those created in favor of the Lender.

(ii)

No financing statement, notice of lien, security agreement or any other agreement or instrument creating or giving notice of an encumbrance or charge against any of the Collateral, the FNES Interest, the EM Interest and the SOGS Interest is in existence or on file in any public office, except those in favor of Lender.

(iii)

Ecosphere will at all times hereafter keep the Collateral, the FNES Interest, the EM Interest and the SOGS Interest free of all security interests, liens and claims whatsoever, except the security interests, liens and claims in favor of Lender.

(iv)

Ecosphere (i) will, from time to time, on request of Lender, execute such financing statements, statements of assignment, notices and other documents and pay the costs of filing or recording the same in all public offices deemed necessary by Lender and do such other acts as Lender may request to establish and maintain a valid security interest in the Collateral, the FNES Interest, the EM Interest and the SOGS Interest and (ii) authorizes Lender at Ecosphere’s expense to file any financing statements, or any notices or assignments with the Patent and Trademark Office, relating to the Collateral (without Ecosphere’s signature thereon) which Lender deems appropriate.

5

(v)

Ecosphere irrevocably appoints Lender as Ecosphere’s attorney-in-fact, with full power of substitution, in its own name or in Ecosphere’s name, place and stead: 

(A)

To file any financing statements, and any documents in the Patent and Trademark Office that Lender deems appropriate in connection with the perfection, protection, priority or enforcement of Lender’s security interest in the Collateral; 

(B)  

To take any actions required of Ecosphere under this Agreement that Ecosphere fails or is unable to take in a timely manner; and 

(C) 

While Ecosphere is in default under this Agreement, to take any actions that Lender deems appropriate (i) to protect, preserve or realize upon the Collateral and its security interest in the Collateral or to accomplish the purposes of this Agreement, including any actions described in Section 6 and (ii)   in connection with the disposition of any Collateral (1) to assign or transfer title to such Collateral to itself or to any third party purchaser in connection with the Lender’s exercise of its rights under the Uniform Commercial Code, and (2) to file with the Patent and Trademark Office or other governmental office or authority any documents necessary or advisable to implement, effectuate or reflect the disposition.

(D)

Lender will not disturb the rights of any third-party licensee of Patent Collateral under a license granted by Ecosphere in the ordinary course of business so long as the licensee is not in breach of its obligations to Ecosphere under the license.

(vi)

Ecosphere will account fully and faithfully for and promptly pay or turn over to Lender proceeds in whatever form received in disposition in any manner of any of the Collateral, the FNES Interest, the EM Interest and the SOGS Interest as provided herein.

(vii)

All information now or hereafter furnished by Ecosphere to Lender relating in any way to the Company, any of its subsidiaries, the Collateral, the FNES Interest, the EM Interest and the SOGS Interest is and will be true and correct in all material respects as of the date furnished.

(viii)

The FNES Interest and the EM Interest are not represented by a certificate and are “uncertificated securities” under the Uniform Commercial Code as in effect in Delaware. Ecosphere will, if the FNES Interest or the EM Interest are represented by a certificate, promptly deliver possession of such certificate to Lender. The SOGS Interest is represented by a certificate which has been delivered to the Lender in connection with this Agreement.

(i)

The Lender is acquiring the Note, and, if it acts as the purchaser of the Securites Collateral in the Event of Default, will acquire the Securities Collateral, for its own account, for investment and not with a view to, or for resale in connection with, the distribution thereof.  The Lender has no present intention of reselling or distributing the Securities Collateral after any period of time.  The acquisition of the securities for investment is consistent with Lender’s financial needs. 

(ix)

THE LENDER ACKNOWLEDGES THAT ALL SECURITIES PLEDGED AS COLLATERAL FOR THE NOTE AND PRIOR NOTE HAVE NOT BEEN 

6

AND WILL NOT BE REGISTERED UNDER THE FEDERAL OR ANY STATE SECURITIES LAWS AND MAY NOT BE SOLD, TRANSFERRED OR HYPOTHECATED IN ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT UNDER SUCH LAWS AS MAY BE APPLICABLE OR, AN OPINION OF COUNSEL TO THE COMPANY, THAT AN EXEMPTION FROM SUCH APPLICABLE LAWS EXIST.

5.

Default.  Any material misrepresentation, misstatement or omission in connection with, or non-compliance with or non-performance of the Note, the Prior Note, this Agreement, the Company or any of its subsidiaries, or the occurrence of an Event of Default under the Note or Prior Note, shall constitute default under this Agreement.  In addition, Ecosphere shall be in default if (i) bankruptcy or insolvency proceedings are instituted by or against Ecosphere, which proceedings are not dismissed within 30 days; (ii) if Ecosphere makes any assignment for the benefit of creditors, or (iii) if Ecosphere shall default in performance of any agreement with the Lender.  

6.

The Lender’s Rights and Remedies.

(a)

The Lender may assign this Agreement, with notice to Ecosphere, and, if the Lender does assign this Agreement, the assignee shall be entitled, upon notifying Ecosphere, to performance of all of Ecosphere’s obligations under this Agreement.

(b)

Upon Ecosphere’s default, the Lender may exercise its rights of enforcement under the Uniform Commercial Code in force in Delaware and any notice of lien filed with the United States Patent Office and, in conjunction with, addition to or substitution for those rights, at the Lender’s discretion, it may:

(i)

To the extent permitted by law, enter upon Ecosphere’s premises to take possession of, assemble and collect the Collateral or to render it unuseable.

(ii)

Require Ecosphere to assemble the Collateral and make it available at a place the Lender designates which is mutually convenient, to allow the Lender to take possession or sell, lease, license or otherwise dispose of the Collateral.

(iii)

Waive any default or remedy any default in any reasonable manner without waiving the default remedied and without waiving any other prior or subsequent default.

(iv)

Ecosphere understands that to the extent permitted by law, if Ecosphere fails to meet any of Ecosphere’s obligations under this Agreement, the Lender has a right to take possession of the Collateral by all lawful means and to sell, lease, license or otherwise dispose of the Collateral.

(c) 

Upon default of the Note and/or Prior Note, the Lender shall have rights to a sale of the EM Interest, the FNES Interest and the SOGS Interest as provided in this Agreement, including a right to solicit purchasers, in accordance with Sections 3(b)(iii), 3(b)(iv) and 3(b)(v).

(d)

With regards to only non-monetary defaults, the Lender will give notice to Ecosphere that Ecosphere is in default hereunder, and Ecosphere shall have 30 days from the date of such notice to cure the non-monetary defaults.

7

(e)

The Lender’s remedies are limited to recovering its outstanding principal and accrued interest under the Note and Prior Note, attorneys’ fees and costs incurred in the sale of the Collateral.

7. 

Other Lienholders.  Any person or entity taking a junior encumbrance, or other lien upon the Collateral or any part thereof or any interest therein, shall take said lien subject to the rights of the Lender to amend, modify, extend, renew, enlarge or release the Note and/or Prior Note, this  Agreement or any other document or instrument evidencing, securing or guaranteeing the Note and/or Prior Note, including, but not limited to, any amendments, modifications, extensions or renewals that increase the amount outstanding under the Note and/or Prior Note, in each and every case without obtaining the consent of the holder of such junior lien and without the lien of this Agreement losing its priority over the rights of any such junior lien.  Accordingly, any person or entity taking a junior encumbrance, or other lien upon the Collateral or any part therein or any interest therein, shall take said lien subject to the provisions of the Note, the Prior Note and this Agreement, including, but not limited to, the above provision.  Nothing in this Section shall be deemed to authorize any such junior encumbrance or other liens on the Collateral, the FNES Interest, the EM Interest and the SOGS Interest.

8.

Severability.  In the event any parts of this Agreement are found to be void, the remaining provisions of this Agreement shall nevertheless be binding with the same effect as though the void parts were deleted.

9.

Counterparts.  This Agreement may be executed in one or more counterparts, each of which shall be deemed an original but all of which together shall constitute one and the same instrument.  The execution of this Agreement may be by actual or facsimile signature.

10.

Benefit.  This Agreement shall be binding upon and inure to the benefit of the parties hereto and their legal representatives, successors and assigns.

11.

Notices and Addresses.  All notices, offers, acceptance and any other acts under this Agreement (except payment) shall be in writing, and shall be sufficiently given if delivered to the addressees in person, by FedEx or similar receipted next business day delivery, or by email followed by overnight next business day delivery as follows:

Lender:

Brisben Water Solutions LLC

23 N. Beach Road

Jupiter Island, FL 33455

Attn:  William Brisben

with a copy to:

Dinsmore & Shohl LLP

Fifth Third Center

One South Main Street, Suite 1300

Dayton, OH 45402

Attn: Steven R. Watts, Esq.

8

Ecosphere:

3515 SE Lionel Terrace

Stuart, Florida 34997

Attention: Dennis McGuire

with a copy to:

Nason, Yeager, Gerson, White

& Lioce, P.A.

3001 PGA Boulevard, Suite 305

Palm Beach Gardens, Florida 33410

Attention:  Michael D. Harris

or to such other address as any of them, by notice to the other may designate from time to time.  Time shall be counted to, or from, as the case may be, the date of delivery.

12.

Attorneys’ Fees.  In the event that there is any controversy or claim arising out of or relating to this Agreement, or to the interpretation, breach or enforcement thereof, and any action or proceeding is commenced to enforce the provisions of this Agreement, the prevailing party shall be entitled to reasonable attorneys’ fees, costs and expenses (including such fees and costs on appeal).

13.

Oral Evidence.  This Agreement constitutes the entire Agreement between the parties and supersedes all prior oral and written agreements between the parties hereto with respect to the subject matter hereof.  Neither this Agreement nor any provision hereof may be changed, waived, discharged or terminated orally, except by a statement in writing signed by the party or parties against which enforcement or the change, waiver, discharge or termination is sought.

14.

Additional Documents.  The parties hereto shall execute such additional instruments as may be reasonably required by their counsel in order to carry out the purpose and intent of this Agreement and to fulfill the obligations of the parties hereunder.

15.

Governing Law.  All claims relating to or arising out of this Agreement, or the breach thereof, whether sounding in contract, tort, or otherwise, shall also be governed by the laws of the State of Delaware without regard to choice of law considerations.

16.

Section or Paragraph Headings.  Section headings herein have been inserted for reference only and shall not be deemed to limit or otherwise affect, in any matter, or be deemed to interpret in whole or in part any of the terms or provisions of this Agreement.

(Signature Page Follows)

9

IN WITNESS WHEREOF the parties hereto have set their hand as of the date first above written.

			
	 
	ECOSPHERE:  

	 
	ECOSPHERE TECHNOLOGIES, INC.

	 
	 
	 

	 
	 
	 

	 
	 
	 

	 
	By:  

	/s/ Dennis McGuire

	        

	 
	Dennis McGuire, Chief Executive Officer

	 
	 
	 

	 
	 
	 

	 
	BRISBEN WATER SOLUTIONS LLC

	 
	 
	 

	 
	 
	 

	 
	 
	 

	 
	By:  

	/s/ William Brisben

	        

	 
	William Brisben, Manager

THE UNDERSIGNED subsidiaries of Ecosphere Technologies, Inc. have executed this Agreement solely to acknowledge their obligations under Section 3(b)(vi) and (vii).

			
	 
	ECOSPHERE MINING, LLC

	 
	 
	 

	 
	 
	 

	 
	 
	 

	 
	By:  

	/s/ Dennis McGuire

	        

	 
	Dennis McGuire, Chief Executive Officer

	 
	 
	 

	 
	 
	 

	 
	SEA OF GREEN SYSTEMS, INC.

	 
	 
	 

	 
	 
	 

	 
	By:  

	/s/ Corey McGuire

	        

	 
	Corey McGuire, Chief Executive Officer

 

10

EXHIBIT A

COLLATERAL

This Security Agreement covers all of the following property of Ecosphere Technologies, Inc. (“Ecosphere”), whether now or hereafter owned, existing, acquired or arising and wherever now or hereafter located (capitalized terms used herein shall have the meaning ascribed to such term under the Uniform Commercial Code as in effect in the State of Delaware and/or as otherwise set forth herein):

(a)

The Ecos PowerCube® unit (with the Ecos GrowCubeTM unit, the “Physical Collateral”) located in Stuart, Florida.

(b)

One completed Ecos GrowCubeTM unit (with the Ecos PowerCube® unit, the “Physical Collateral”) located at 236709 E. Lechelt Road, Kennewick WA 99337-7545.

(c)

Each United States Patent and Patent Application listed on Schedule A-1 hereto (the “Patent Collateral”).

(d)

All warranties, increases, parts, renewals, additions and accessions to, substitutions for, and replacements, products and Proceeds of the foregoing property, and all of Ecosphere’s books and records relating to any of the foregoing. Provided, however, that if Ecosphere manufactures any additional Ecos PowerCube® units or Ecos GrowCube® units, they shall not be deemed to be Physical Collateral or subject to this Agreement.

(e)

30.6% of the limited liability company interests in Fidelity National Environmental Solutions, LLC, a Delaware limited liability company and Ecosphere’s subsidiary (the “FNES Interest”, and together with the EM Interest and the SOGS Interest, the “Securities Collateral”). 

(f)

25% of the limited liability company interests in Ecosphere Mining, LLC, a Delaware limited liability company and Ecosphere’s subsidiary (the “EM Interest”, and together with the FNES Interest and the SOGS Interest, the “Securities Collateral”). 

(g)

All Proceeds received, directly or indirectly, by Ecosphere from the Patent Collateral in any global field of use. 

(h)

57,232,278 shares of Sea of Green Systems, Inc., a Florida corporation (“SOGS”), and Ecosphere’s subsidiary (the “SOGS Interest”, and together with the EM Interest and the FNES Interest, the “Securities Collateral”).

Proceeds shall mean and include all proceeds of, and all other profits, products, rents or receipts, in whatever form, arising from the collection, sale, lease, exchange, assignment, licensing or other disposition of, or other realization upon collateral, including, without limitation, all licenses, permits, authorizations and applications, all claims of Ecosphere against third parties for loss of, damage to or destruction of, or for proceeds payable under, or unearned premiums with respect to, policies of insurance in respect of, any collateral, and any condemnation or requisition payments with respect to any collateral, in each case whether now existing or hereafter arising.

Schedule A-1

Patent Collateral

1.

Approved U.S. Patent No’s.:

7,699,994

7,699,988

7,785,470

7,943,087

8,318,027

8,593,102

8,721,898

8,858,064

8,936,392

8,906,242

8,968,577

8,999,154

9,034,180

9,169,146

9,266,752

9,403,697

U.S. Patent, when issued, pertaining to Patent Application No. 14/627,874 filed February 20, 2015, relating to pressure rod anode

U.S. Patent, when issued, pertaining to Patent Application No. 14/950,811 filed November 24, 2015, relating to the Ecos GrowCubeTM

2.

 All U.S. Patents, when and if issued, (i) for which Ecosphere, Dennis McGuire, any employees of Ecosphere or any subsidiaries have applied as of November 3, 2016 and (ii) for which Ecosphere, Dennis McGuire, any employees of Ecosphere or any subsidiaries apply in the future.

3.

All reissues, continuations, divisions, continuations in part, renewals, improvements or extensions of the foregoing.Exhibit

EMPLOYMENT AGREEMENT
THIS AGREEMENT (the “Agreement”) is made and entered into effective the 25th day of August, 2016 (the “Effective Date”), by and between NORTHRIM BANCORP, INC. and its wholly owned subsidiary, NORTHRIM BANK, a state‐chartered commercial bank, with its principal office in Anchorage, Alaska (collectively, the “Employer”), and Latosha M. Frye (the “Executive”).
In consideration of the mutual promises made in this Agreement, the parties agree as follows:
1.    Employment.
Employer employs Executive and Executive accepts employment with Employer as its Executive Vice President, Chief Financial Officer.
2.    Term.
The term of this Agreement (the “Term”) shall commence on the Effective Date and, unless terminated earlier pursuant to Section 5, shall continue through December 31, 2016; provided, however, that on January 1, 2017 and each succeeding January 1, the Term shall automatically be extended for one (1) additional year unless, not later than ninety (90) days prior to any such January 1, either party shall have given written notice to the other that it does not wish to extend the Term.  In the event the Term is not extended, Executive shall have no rights to any of the severance payments or benefits continuation described in Section 5 except as specifically provided for in Section 5.a.  
3.    Duties.
The Executive will serve as Executive Vice President, Chief Financial Officer of the Employer.  Executive shall render such executive, management and administrative services and perform such tasks in connection with the affairs and overall operation of the Employer as is customary for her position, subject to the direction of Employer’s President and Board of Directors.  Executive shall devote necessary time, attention and effort to Employer’s business in order to properly discharge her responsibilities under this Agreement.
4.    Compensation, Benefits, Reimbursement and Profit Sharing.
a.    Base Salary.  In consideration for all services rendered by Executive during the term of this Agreement, Employer shall pay Executive an annual base salary (before all customary and proper payroll deductions) of $237,000 as adjusted from time to time (“Base Salary”).  The Board of Directors of the Employer shall review Executive’s salary each year, in a manner consistent with that used for all management employees of the Employer, and in its sole discretion may adjust such salary commensurate with the Executive’s performance under this Agreement.
b.    Profit Sharing Plan.  Under the Northrim BanCorp, Inc. Profit Sharing Plan, Executive shall be eligible to receive an annual profit share (“Profit Share”) based on performance as defined by the Board of Directors.  Executive will be classified in the Executive Vice President tier under the Plan’s Responsibility Factors.  If Employer is required to prepare an accounting restatement due to “material noncompliance of the Employer”, the Employer will recover from the Executive any incentive compensation during the three (3) years prior to the date of the restatement, in excess of what would have been paid under the restatement.  Executive’s signature on this Agreement authorizes Employer to offset or deduct from any 

compensation Employer may owe Executive, any excess payments (in whole or in part) that Executive may owe Employer due to such restatement(s).  
c.    Stock Incentive Plan.  Executive shall be eligible for awards under the Employer’s Stock Incentive Plan.  The type, timing and size of awards will be at the discretion of the Board of Directors.
d.    Supplemental Executive Retirement Plan (“SERP”) and Deferred Compensation Plan.  Executive shall also be entitled to receive an annual contribution equal to ten percent (10%) of annual Base Salary in accordance with the Employer’s Supplemental Executive Retirement Plan, as may be adjusted at the discretion of the Board of Directors from time to time.  The Executive may also participate in the Employer’s Deferred Compensation Plan.
e.    Other Benefits.  Throughout the term of this Agreement, Employer shall provide Executive with reasonable health insurance, disability and other employee benefits.  Executive shall participate in all employee benefit plans and programs of Employer on a basis at least as favorable as that accorded to any other officer of Employer.
f.    Expenses.  Employer shall reimburse Executive for her reasonable expenses (including, without limitation, travel, entertainment, and similar expenses) incurred in performing and promoting the business of Employer.  Executive shall present from time to time itemized accounts and receipts of any such expenses as required by Employer, subject to any limits of company policy and the rules and regulations of the Internal Revenue Service, including the Internal Revenue Code, (referred to throughout this Agreement as “IRC” or the “Code”).
5.    Termination of Agreement.
a.    Termination Due to a Change of Control.  If (A) Employer (either Northrim BanCorp, Inc. or Northrim Bank) is subjected to a Change of Control (as defined in Section 5.f.(i)), and (B) either Employer or its assigns terminates Executive’s employment without Cause (either during the annual term of this Agreement or by refusing to extend this Agreement when the annual termination occurs every December 31) or Executive terminates her employment for Good Reason within 730 days of such Change of Control, then Employer shall pay Executive (i) all Base Salary earned and all reimbursable expenses incurred under this Agreement through such termination date; (ii) an amount equal to two (2) times Executive’s highest Base Salary over the prior three (3) years; and (iii) an amount equal to two (2) times Executive’s average Profit Share over the prior three (3) year period.  The amounts described in Section 5.a.(i), (ii) and (iii) herein shall be paid no later than forty-five (45) days after the day on which employment is terminated.  No payment will be made pursuant to Sections 5.a.(ii) and (iii) unless the Executive has signed an agreement, in a form acceptable to Employer, that releases and holds Employer harmless from all known and unknown claims and liabilities arising out of Executive’s employment with Employer or the performance of this Agreement (“Release Agreement”) and the Release Agreement has become irrevocable prior to the payment date.
(I)    Benefits Continuation.  In addition, Executive shall be entitled to health and dental insurance benefits for a period of two (2) years following the termination of this Agreement.  These benefits will be provided at Employer’s expense, but such period shall count towards the Employer’s continuation of coverage obligation under Section 4980B of the Internal Revenue Code (commonly referred to as “COBRA”).
(II)    Age and Service Credit.  Executive shall also be entitled to receive age credit and credit for period of service towards all SERP plans for the remaining period of time covered by this Agreement.  If Executive is hired by Employer, its assigns, any company in control of Employer, or any 

company controlled by Employer during the period covered by this Agreement, then Executive will be entitled to be treated for all purposes relating to future compensation, and benefits, as if this Agreement had never been terminated and as if Executive had performed her responsibilities as an Executive throughout the period originally covered by this Agreement.
b.    Termination by Employer Without Cause or by Executive for Good Reason.  If Employer terminates Executive’s employment without Cause, or if Executive terminates her employment for Good Reason, Employer shall pay Executive in a lump sum: (i) all Base Salary earned and all reimbursable expenses incurred under this Agreement through such termination date; and (ii) an amount equal to one (1) times Executive’s highest Base Salary over the prior three (3) years.  The amount described in 5.b.(i) herein shall be paid no later than forty-five (45) days after the day on which employment is terminated.  The amount described in 5.b.(ii) herein shall be paid on the first day of the month following a period of six (6) months after the termination of employment, provided that the payment may be made sooner if either (i) the amount does not exceed the IRC Safe Harbor or (ii) at the Executive’s election, the amount described in Section 5.a.(ii) is reduced to fit within the IRC Safe Harbor.  No payment will be made pursuant to Section 5.a.(ii) unless the Executive has signed a Release Agreement which has become irrevocable prior to the payment date.  
(I)    Benefits Continuation.  In addition, Executive shall be entitled to health and dental insurance benefits for a period of twelve (12) months following the termination of this Agreement.  These benefits will be provided at Employer’s expense, but such period shall count towards the Employer’s continuation of coverage obligation under Section 4980B of the Internal Revenue Code (commonly referred to as “COBRA”).
(II)    Age and Service Credit.  If Executive is hired by Employer, its assigns, any company in control of Employer, or any company controlled by Employer during the period covered by this Agreement, then Executive will be entitled to be treated for all purposes relating to future compensation, and benefits, as if this Agreement had never been terminated and as if Executive had performed her responsibilities as an Executive throughout the period originally covered by this Agreement.
c.    Termination by Employer for Cause or by Executive Without Good Reason.  If Employer terminates Executive’s employment for Cause or if Executive terminates her employment without Good Reason, Employer shall pay Executive upon the effective date of such termination only such Base Salary earned and expenses reimbursable under this Agreement incurred through such termination date.  In such case, Executive shall have no right to receive compensation or other benefits for any period after termination under this Agreement.  
d.    Termination Due to Disability.  If Employer terminates Executive’s employment on account of any mental or physical Disability that prevents Executive from performing her essential job functions, even with reasonable accommodation, Executive shall be entitled to: (i) all Base Salary earned and reimbursement for expenses incurred under this Agreement through the termination date, (ii) full Base Salary for the year following the termination date (less the amount of any payments received by Executive during such one (1) year period under any Employer sponsored disability plan), and (iii) health and dental insurance benefits for a period of one (1) year following the termination date, which benefits will be provided at Employer’s expense, but such period shall count towards the Employer’s continuation of coverage obligation under Section 4980B of Code (commonly referred to as “COBRA”).  All such compensation shall be paid Executive in one (1) lump sum the first day of the month following a period of six (6) months after Executive’s employment was terminated, provided that Executive has signed a Release Agreement which has become irrevocable prior to the payment date.

If any disputed termination under Section 5.c. is subsequently determined to have been without Cause, Executive's recovery shall be limited to those payments and benefits set out under Section 5.b. 
e.    Termination Upon Death of Executive.  Executive’s employment under this Agreement shall be terminated upon the death of Executive.  In such case, the Employer shall be obligated to pay to the surviving spouse of Executive, or if there is none, to the Executive’s estate: (i) that portion of Executive’s Base Salary that would otherwise have been paid to him for the month in which her death occurred, and (ii) any amounts due her pursuant to the Northrim Bank Savings Incentive Plan (401-K) and the Northrim BanCorp, Inc. Profit Sharing Plan, any supplemental deferred compensation plan, and any other death, insurance, employee benefit plan or stock benefit plan provided to Executive by the Employer, according to the terms of the respective plans.
f.    Termination Definitions.
(i)    “Change of Control.”  For purposes of this Agreement, the term “Change of Control” shall mean the occurrence of one or more of the following events: (A) one (1) person or entity acquiring or otherwise becoming the owner of twenty-five percent (25%) or more of Employer’s outstanding common stock; (B) replacement of a majority of the incumbent directors of Northrim BanCorp, Inc. or Northrim Bank by directors whose elections have not been supported by a majority of the Board of either company, as appropriate; (C) dissolution or sale of fifty percent (50%) or more in value of the assets, of either Northrim BanCorp, Inc. or Northrim Bank; or (D) a change “in the ownership or effective control” or “in the ownership of a substantial portion of the assets” of Employer, within the meaning of Section 280G of the Internal Revenue Code.
(ii)    “Cause.”  For purposes of this Agreement, termination for “Cause” shall include termination because Executive: (A) continually fails to substantially perform her duties with the Employer; (B) is adjudged guilty of a felony, any crime involving dishonesty or breach of trust or any crime involving a breach of her fiduciary duties to the Employer; (C) is willfully and continually failing to comply with any law, rule, or regulation (other than traffic violations or similar offenses) or final cease and desist order of a regulatory agency having jurisdiction over Employer; (D) commits a material act of dishonesty or disloyalty related to the business of the Employer; or (E) is unable to substantially perform her duties with the Employer due to drug addiction or chronic alcoholism.  Notwithstanding the foregoing, Executive shall not be deemed to have been terminated for Cause unless and until there shall have been delivered to her a copy of a resolution duly adopted by the affirmative vote of not less than three‐quarters (3/4) of the entire membership of the Employer’s Board of Directors at a meeting of the Board called for such purpose (after reasonable notice to Executive and an opportunity for her, together with her counsel, to be heard before the Board), finding that in the good faith opinion of the Board, she was guilty of conduct that constitutes Cause (as defined above) and specifying the conduct in detail.
(iii)    “Disability.”  For purposes of this Agreement, “Disability” shall mean a medically diagnosed physical or mental impairment that may be expected to result in death, or to be of long, continued duration, and that renders Executive incapable of performing her essential job functions under this Agreement, even after she has been accorded reasonable accommodation.  Employer’s Board of Directors, acting in good faith, in accordance with applicable law, shall make the final determination of whether Executive is suffering under any Disability (as herein defined) and, for purposes of making such determination, may require Executive to submit herself to a physical examination by a physician mutually agreed upon by the Executive and Employer’s Board of Directors at Employer’s expense.
(iv)    “Good Reason.”  For purposes of this Agreement, termination for “Good Reason” shall mean termination by Executive as a result of any material breach of this Agreement by 

Employer.  Good Reason shall include, but not be limited to: (A) a material reduction in Executive’s compensation defined as a reduction equal to or greater than five percent (5%) of Executive’s then annual base salary; (B) a material reduction in Executive’s duties and responsibilities, but not merely a change in title; or (C) relocation of Executive’s primary workplace by more than fifty (50) miles.  “Good Reason” will only be deemed to occur if, within ninety (90) days after a material reduction or change described above first occurs, the Executive provides notice to the Employer of the existence of Good Reason and of the Executive’s intended termination of employment due to Good Reason, and the Employer does not remove the Good Reason condition within ninety (90) days after receiving such notice from the Executive.  The Executive’s written notice must explain the basis on which the Executive believes Good Reason exists, the cure period, and the date on which the Executive intends to terminate employment, which must be no later than six (6) months after the existence of the Good Reason.  The provisions of Section 5.f.(iv) are intended to comply with the Good Reason safe harbor provisions of Code Section 409A and applicable regulations.
(v)    Termination from Employment.  A termination from employment under this Agreement shall mean a “Separation from Service” as interpreted in accordance with Code Section 409A and generally meaning the date on which the Executive is no longer performing services for the Employer.  The Executive shall not have a Separation from Service while on military leave, sick leave, or other bona fide leave of absence if the period of such leave does not exceed six (6) months, or if longer, so long as the Executive retains a right to reemployment under an applicable statute or contract.  A leave of absence constitutes a bona fide leave of absence only if there is a reasonable expectation that the Executive will return to perform services. 
6.    Limit on Severance Payment for Change of Control.
Notwithstanding anything above in Section 5.a., if the severance payment provided for in that Section, together with any other payments which the Executive has the right to receive from the Employer, would constitute a “parachute payment” (as defined in Section 280G(b)(2) of the Code), the severance payment shall be reduced.  The reduction shall be in an amount so that the present value of the total amount received by the Executive from the Employer or its affiliates and subsidiaries will be 2.99 times the Executive’s base amount (as defined in Section 280G of the Code) and so that no portion of the amounts received by the Executive shall be subject to the excise tax imposed by Section 4999 of the Code (excise tax).  Insofar as permitted by the Code, Employer shall reduce those elements of the severance pay package specified by the Executive.  The determination as to whether any reduction in the severance payment is necessary shall be made by the Employer in good faith, and the determination shall be conclusive and binding on Executive.  If through error or otherwise Executive should receive payments under this Plan, together with other payments the Executive has the right to receive from the Employer, in excess of 2.99 times her base amount, Executive shall immediately repay the excess to Employer upon notification that an overpayment has been made.
7.    Covenant Not To Compete.
a.    Executive agrees that for the term of this Agreement and for a period of one (1) year after this Agreement is terminated pursuant to Section 5.a. or 5.b., Executive will not directly or indirectly be employed by, own, manage, operate, support, join, or benefit in any way from any business activity within the states where Employer operates that is competitive with Employer’s business or reasonably anticipated business of which Executive has knowledge.  For purposes of the foregoing, Executive will be deemed to be connected with such business if the business is carried on by: (i) a partnership in which Executive is a general or limited partner; or (ii) a corporation of which Executive is a shareholder (other than a shareholder owning less than five percent (5%) of the total outstanding shares of the corporation), officer, director, employee or consultant, whether paid or unpaid.  In the event of an alleged breach by Executive of this Section 7, the one-year non-compete period shall be extended until such breach or violation has been duly 

cured, and shall restart so that Employer has received the intended benefit of one (1) uninterrupted year of non-competition by Executive.
b.    The parties agree that if a trial judge with jurisdiction over a dispute related to this Agreement should determine that the restrictive covenant set forth above is unreasonably broad, the parties authorize such trial judge to narrow the covenant so as to make it reasonable, given all relevant circumstances, and to enforce such covenant.  The provisions of this Section 7 shall survive termination of this Agreement.
8.    Nondisclosure of Confidential Information.
a.    During the term of Executive’s employment and thereafter, Executive agrees to hold Employer’s Confidential Information in strict confidence, and not disclose or use it at any time except as authorized by Employer and for Employer’s benefit.  If anyone tries to compel Executive to disclose any Confidential Information, by subpoena or otherwise, Executive agrees immediately to notify Employer so that Employer may take any actions it deems necessary to protect its interests.  Executive’s agreement to protect Employer’s Confidential Information applies both during the term of this Agreement and after employment ends, regardless of the reason it ends.
b.    “Confidential Information” includes, without limitation, any information in whatever form that Employer considers to be confidential, proprietary, information and that is not publicly or generally available relating to Employer’s: trade secrets (as defined by the Uniform Trade Secrets Act), know-how, concepts, methods, research and development, product, content and technology development plans, marketing plans, databases, inventions, research data and mechanisms, software (including functional specifications, source code and object code), procedures, engineering, purchasing, accounting, marketing, sales, customers, advertisers, joint venture partners, suppliers, financial status, contracts or employees.  Confidential Information includes information developed by Executive, alone or with others, or entrusted to Employer by its customers or others.
9.    Non-Solicitation.
During the course of Executive’s employment and for a period of one (1) year from the date of termination of employment for any reason, Executive shall not directly or indirectly solicit or entice any of the following to cease, terminate or reduce any relationship with Employer or to divert any business from Employer: (a) any person who was an employee of Employer during the one (1) year period immediately preceding the termination of Executive’s employment; (b) any customer or client of Employer; or (c) any prospective customer or client of Employer from whom Executive actively solicited business within the last one (1) year of Executive’s employment.  In the event of an alleged breach by Executive of this Section 9, the one (1) year non-solicitation period shall be extended until such breach or violation has been duly cured, and shall restart so that Employer has received the intended benefit of one (1) uninterrupted year of non-solicitation by Executive.
10.    Non-Disparagement.  
Executive will not, during the Term or after the termination or expiration of this Agreement or Executive’s employment, make disparaging statements, in any form, about Employer’s officers, directors, agents, employees, products or services which Executive knows, or has reason to believe, are false or misleading.

11.    Mutual Agreement to Arbitrate.
a.    Except as provided in Section 11.b., in the event of a dispute or claim between Executive and Employer related to Employee’s employment or termination of employment, all such disputes or claims will be resolved exclusively by confidential arbitration in accordance with the National Rules for the Resolution of Employment Disputes of the American Arbitration Association (“AAA”).  This means that the parties agree to waive their rights to have such disputes or claims decided in court by a jury.  Instead, such disputes or claims will be resolved by an impartial AAA arbitrator whose decision will be final.  
b.    The only disputes or claims that are not subject to arbitration are any claims by Executive for workers’ compensation or unemployment benefits, and any claim by Executive for benefits under an employee benefit plan that provides its own arbitration procedure.  Also, Executive and Employer may seek equitable relief (such as an injunction or declaratory relief) in court in appropriate circumstances.  Specifically, Executive recognizes that Employer does not have an adequate remedy at law to protect its business from Executive’s breach of Sections 7, 8, or 9 of this Agreement, and therefore Employer shall be entitled to bring an action for a temporary restraining order and preliminary injunctive relief pre-arbitration, in the event of any actual or threatened breach by Executive of Sections 7, 8, or 9.  In such court proceeding, Employer shall not be required to post a bond or other security, and Employer may also be awarded actual damages caused by Executive’s breach of Sections 7, 8, or 9 of this Agreement as well as repayment of all or a portion of any severance that Employer previously paid to Executive.   
c.    Except as provided by section 11.b., the arbitration procedure will afford Executive and Employer the full range of legal, equitable, and/or statutory remedies.  Employer will pay all costs that are unique to arbitration, except that the party who initiates arbitration will pay the filing fee charged by AAA.  Executive and Employer shall be entitled to discovery sufficient to adequately arbitrate their claims, including access to essential documents and witnesses, as determined by the arbitrator and subject to limited judicial review.  In order for any judicial review of the arbitrator’s decision to be successfully accomplished, the arbitrator will issue a written decision that will decide all issues submitted and will reveal the essential findings and conclusions on which the award is based.  
12.    Miscellaneous.
a.    This Agreement contains the entire agreement between the parties with respect to Executive’s employment with Employer, and is subject to modification or amendment only upon agreement in writing signed by both parties.
b.    This Agreement shall bind and inure to the benefit of the heirs, legal representatives, successors and assigns of the parties, except that Employer’s rights and obligations may not be assigned.
c.    If any provision of this Agreement is invalid or otherwise unenforceable, in whole or in part, then such provision shall be modified so as to be enforceable to the maximum extent permitted by law.  If such provision cannot be modified to be enforceable, the provision shall be severed from the Agreement to the extent it is unenforceable.  All other provisions and any partially enforceable provisions shall remain unaffected and shall remain in full force and effect.
d.    In the event of any claim or dispute arising out of this Agreement, the party that substantially prevails shall be entitled to reimbursement of all expenses incurred in connection with such claim or dispute, including, without limitation, attorneys’ fees and other professional fees.  This paragraph shall apply to expenses incurred with or without suit, and in any judicial, arbitration or administrative proceedings, including all appeals therefrom.

e.    Any notice required to be given under this Agreement to either party shall be given by personal service (i.e., via hand delivery) or by depositing a copy of such notice in the United States registered or certified mail, postage prepaid, addressed to the following address, or such other address as addressee shall designate in writing:

Employer:      

3111 “C” Street
Anchorage, AK  99503

Executive:    

Address on file with Northrim BanCorp, Inc. Human Resources Department.

f.    This Agreement shall in all respects, including all matters of construction, validity and performance, be governed by and construed and enforced according to the laws of the State of Alaska.
g.    This Agreement is intended to comply and shall be interpreted and construed in a manner consistent with the provisions of Internal Revenue Code Section 409A, including any rule or regulation promulgated thereunder.  In the event that any provision of the Agreement would cause a benefit or amount provided hereunder to be subject to tax under the Internal Revenue Code prior to the time such amount is paid, such provision shall, without the necessity of further action by the signatories to this Agreement, be null and void as of the Effective Date.
h.    Notwithstanding any provision to the contrary in this Agreement, no payment of any type or amount of compensation or benefits shall be made or owed by Employer to Executive pursuant to this Agreement or otherwise to the extent that payment of such type or amount is restricted or prohibited by, is not permitted under, or has not received any required approval under, any applicable federal or state statute, regulation, rule, policy, order, opinion, interpretation or similar issuance, whether now in existence or hereafter adopted or imposed, including without limitation any provisions of the Dodd-Frank Wall Street Reform and Consumer Protection Act or regulations promulgated thereunder, 12 USC 1828(k) or 12 CFR Part 359.  In the event that any payment made to Executive hereunder, under any prior employment agreement or arrangement or otherwise is required under any applicable federal or state statute, regulation, rule, policy, order, opinion, interpretation or similar issuance or under any agreement with or policy or plan of Employer to be paid back to Employer, Executive shall upon written demand from Employer promptly pay such amount back to Employer.

EMPLOYER:    

NORTHRIM BANCORP, INC.

    
By: /s/ David J. McCambridge
David J. McCambridge
Its: Chairman of the Compensation Committee of the Board of Directors

NORTHRIM BANK

By: /s/ David J. McCambridge
David J. McCambridge
Its: Chairman of the Compensation Committee of the Board of Directors

EXECUTIVE:

/s/ Latosha M. Frye    
Latosha M. Frye

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00264-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00264-of-00352.parquet"}]]