Document:

Exhibit 10.42

 

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 10th day of July, 2008, by and
between BANK OF THE CASCADES, an Oregon corporation located in Bend, Oregon (the “Bank”), and SANDRA GIANOTTI (the
“Executive”).

 

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:

 

		(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 l3d(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	“Disability”
means the Executive: (i) is unable to engage in any substantial gainful activity by reason of any medically determinable physical
or mental impairment which can be expected to result in death or can be expected to last for a continuous period of not less than
twelve (12) months; or (ii) is, by reason of any medically determinable physical or mental impairment which can be expected to
result in death or can be expected to last for a continuous period of not less than twelve (12) months, receiving income replacement
benefits for a period of not less than three (3) months under a long-term disability plan covering employees of the Bank. Medical
determination of Disability may be made by either the Social Security Administration or by the provider of disability insurance
covering employees of the Bank provided that the definition of “disability” applied under such insurance program complies
with the requirements of the preceding sentence. Upon the request of the Plan Administrator, the Executive must submit proof to
the Plan Administrator of the Social Security Administration’s or the provider’s determination.

 

		1.9	“Early
                                         Retirement Age” means the Executive attaining age fifty-five (55) and
                                         completing fifteen (15) Years of Service.

 

		1.10	“Early Termination”
means Separation from Service before Early Retirement Age except when such Separation from Service occurs within twelve (12) months
following a Change in Control or due to death or Termination for Cause.

 

		1.11	“Normal Retirement Age”
means the Executive attaining age sixty-two (62).

 

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

 

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

 

    	 

    	 

    

 

		1.14	“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.

 

		1.15	“Separation from Service”
means termination of the Executive’s employment with the Bank for reasons other than death or Disability. 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 (whether as an employee or as an independent
contractor) would permanently decrease to no more than twenty percent (20%) of the average level of bona fide services performed
(whether as an employee or 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).

 

		1.16	“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)(l)(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.

 

		1.17	“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)	continuous and repeated problems occur in connection with the performance of Executive’s
duties that materially impact Executive’s performance of his/her duties;

 

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

 

	 	(e)	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.

 

    	 

    	 

    

 

		1.18	“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 Fifty-Five Thousand Dollars ($55,000).

 

		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 fifteen (15) years.

 

		2.2	Early Retirement Benefit. Upon
Separation from Service after Early Retirement Age and before Normal Retirement Age, 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 2.3 is the amount shown on Schedule A.

 

		2.2.2	Distribution of Benefit. The Bank
shall distribute the benefit to the Executive in one hundred eighty (180) equal monthly installments commencing on the first day
of the month following Separation from Service.

 

		2.3	Early Termination Benefit. Upon
Early Termination, 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	Disability Benefit. Upon Disability
prior to Early Retirement Age, the Bank shall distribute the benefit described in this Section 2.4 in lieu of any other benefit
under this Article.

 

    	 

    	 

    

 

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

 

		2.4.2	Distribution of Benefit. The Bank
shall distribute the benefit to the Executive in a lump sum within thirty (30) days following Disability.

 

		2.5	Change in Control Benefit. If a
Change in Control occurs followed by Separation from Service prior to Early Retirement Age (provided the Separation from Service
occurs within twelve (12) months following a Change in Control), the Bank shall distribute the benefit described in this Section
2.5 in lieu of any other benefit under this Article.

 

		2.5.1	Amount of Benefit. The benefit under
this Section 2.5 is the amount shown on Schedule A.

 

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

 

		2.6	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 2.6 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.

 

		2.7	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.

 

		2.8	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, 2.3 and 2.5, 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 fifteen (15) 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.

 

		3.2	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.

 

		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.

 

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.

 

		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.

 

(b)       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.

 

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 timelimits 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.

 

		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.

 

		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-l(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.

 

		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.

 

		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:

 

	 	  Bank of the Cascades	 
	 	  1125 NW Bond Street	 
	 	  Bend, OR 97701	 

 

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/ Sandra Gianotti	 	By	 /s/ Peggy Biss
	Sandra Gianotti	 	Title:	EVP10.47 Langland Employement Agreement 012014

EMPLOYMENT AGREEMENT
THIS AGREEMENT (the “Agreement”) is made and entered into effective the 1st day of January, 2014 (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 R. Marc Langland  (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 Northrim Bancorp Inc.  as its Chairman, President and Chief Executive Officer and with Northrim Bank as its Chairman.
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, 2014; provided, however, that on January 1, 2015 and each succeeding January 1, the Term shall automatically be extended for one 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.  
3.    Duties.
The Executive will serve as Chairman, President and Chief Executive Officer of Northrim Bancorp Inc. and Chairman of Northrim Bank.  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 his position, subject to the direction of Employer’s Board of Directors.  Executive shall devote necessary time, attention and effort to Employer’s business in order to properly discharge his responsibilities under this Agreement. As the Employer’s succession plan is implemented, it is anticipated that certain duties and responsibilities may be reduced during the time of this contract.  If such changes occur, it is understood that Executive’s Base Salary will be adjusted accordingly. Executive agrees to prepare a transition plan containing his work schedule and commitments and to ensure that the duties of Chairman, President and CEO are carried out during the term of this Agreement.
4.    Compensation, Benefits, Reimbursement.
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 $156,100 as adjusted from time to time (“Base Salary”) and as adjusted to the extent that Executive works less than full-time.  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.    Supplemental Executive Retirement Plan (“SERP”), Supplemental Executive Retirement Deferred Compensation Plan and Deferred Compensation Plan.  Executive shall participate 

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in the SERP Plan however no additional principal contribution shall be made to his accounts except for earnings contributions in conformance with the Plan. 
 The Executive will participate in the Employer’s Supplemental Executive Retirement Deferred Compensation Plan. The Employer will make its customary principal contribution in 2012, but will not make additional contributions in future years.  Executive will remain a participant in the Plan in conformance with the Plan document until he notifies Employer to the contrary.
c.    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, except Executive will not participate in the Northrim Bancorp Inc. Profit Sharing Plan.
d.    Expenses.  Employer shall reimburse Executive for his 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”).
e.    Automobile Allowance.  Executive shall receive a NINE HUNDRED FIFTY DOLLAR ($950.00) monthly automobile allowance for his automobile, fuel and maintenance expenses for Bank business.  No other expense reimbursement will be provided for use of his vehicle.
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 his employment for Good Reason within 730 days of such Change of Control, then Employer shall pay Executive  all Base Salary earned and all reimbursable expenses incurred under this Agreement through such termination date; The amounts described shall be paid no later than forty five (45) days after the day on which employment is terminated.   
 b.    Termination by Employer Without Cause or by Executive for Good Reason.  If Employer terminates Executive’s employment without Cause, or if Executive terminates his employment for Good Reason, Employer shall pay Executive in a lump sum:  all Base Salary earned and all reimbursable expenses incurred under this Agreement through such termination date.
(I)    Benefits Continuation.  In addition, Executive shall be entitled to health and dental insurance benefits for a period of eighteen (18) 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”).

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(II)    Age and Service Credit.  Executive shall also be entitled to receive age credit and credit for period of service towards all plans, in which he participates, 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 his 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 his 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 his 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 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 his death occurred, and (ii) any amounts due him pursuant to the Employer’s SERP, Executive Retirement 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 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 

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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 his 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 his 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 his 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 him 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 him, together with his counsel, to be heard before the Board), finding that in the good faith opinion of the Board, he 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 his essential job functions under this Agreement even after he 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 himself 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.

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(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.  By way of clarification, even if Executive reduces his work-time status to a level under twenty percent (20%) that is considered a “Separation from Service” under Section 409A and triggers payment of deferred compensation under the plans in Section 4.b., it will not be treated as a Separation from Service for purposes of severance under this Section 5.  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, provided, however, that Employer will not reduce the SERP credits provided for in Section 5.b.(II).   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 his 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 noncompete 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 uninterrupted year of noncompetition by Executive.

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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.    Nonsolicitation.
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-year nonsolicitation 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 nonsolicitation 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, 

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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 

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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:    
10101 Schuss Drive
Anchorage, AK 99507     

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.

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EMPLOYER:    
NORTHRIM BANCORP, INC.

By:   /s/Ronald A. Davis    
Ronald A. Davis
Its: Chairman of the Compensation Committee of The Board of Directors
NORTHRIM BANK

By:   /s/Ronald A. Davis    
Ronald A. Davis
Its: Chairman of the Compensation Committee of The Board of Directors

EXECUTIVE:
  /s/R. Marc Langland    
R. Marc Langland

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