Document:

EX-10.2

 Exhibit 10.2 

CONFIDENTIAL MUTUAL RELEASE AND SETTLEMENT AGREEMENT 

This CONFIDENTIAL MUTUAL RELEASE AND SETTLEMENT AGREEMENT (this “Agreement”) is entered into by and between Varilease Finance, Inc.
(“Varilease”) and CCA Financial, LLC (“CCA”), on the one hand, and Unilife Medical Solutions, Inc. and Unilife Corporation (collectively “Unilife”), on the other hand. This Agreement is effective upon the date of
signatures by Varilease, CCA and Unilife (the “Parties”). 
 RECITALS 

A. A dispute has arisen between the Parties pursuant to a Master Lease Agreement, Lease Schedule No. 1, Lease Schedule Nos. 2(a) and (b),
a Guaranty and other related documents (collectively the “Lease”). On September 30, 2013, Varilease and CCA filed a complaint against Unilife in the Circuit Court for the County of Oakland, Michigan, case No. 13-136458-ck., Later
that same day, Unilife filed a complaint against Varilease and CCA in the United State District Court for the Eastern District of Michigan, case no. 2:13-cv-14174. The Varilease state court complaint was subsequently removed to the United States
District Court for the Eastern District of Michigan and assigned case no. 2:13-cv-14239. The two lawsuits 2:13-cv-14174 and 2:13-cv-14239 (the “Lawsuits”) are pending before the Honorable Sean F. Cox; 

B. The Parties desire to resolve, compromise, settle and dispose of all disputes between them, known or unknown, that were or could have been
asserted in the Lawsuits; and 
 C. The Parties state and agree that this Agreement is not an admission of any fault, liability, or
wrongdoing of any kind by any of the Parties. 
 AGREEMENT 

NOW, THEREFORE, in consideration of the mutual promises, covenants, and agreements set forth herein, the Parties mutually agree as follows:

 1. Terms of Settlement. As consideration for the complete and full settlement of all disputes, obligations, claims and demands
between the Parties that were or could have been asserted in the Lawsuits, and in full accord and satisfaction of same, Unilife shall pay to Varilease as follows: 

(a) Varilease will retain the October 2013 and November 2013 rental payments under Lease Schedule No. 1 to the Lease, in the amount of
$167,800.00 each ($335,600.00 total), that Unilife previously made pursuant to a reservation of rights. 
 (b) Varilease will retain
Unilife’s payment of $83,900.00 for the December 2013 rental payment on Lease Schedule No. 1 to the Lease. 
 (c) Varilease will
apply the previously-paid deposit being held by Varilease to satisfy Unilife’s November and December 2013 rental payment for Lease Schedule Nos. 2(a) and 2(b) to the Lease. 

(d) Unilife shall make twelve (12) consecutive monthly payments, each in the amount of $391,666.67 to Varilease and CCA as set forth in
Exhibit 1 attached hereto. Unilife’s monthly payments will begin on January 2, 2014 and will be due on the first day of each month thereafter. If the first day of each month falls on a weekend or legal holiday, the payment will be due on
the following business day. The monthly payments will be paid to Varilease and CCA by ACH withdrawal. The total amount of the twelve (12) monthly payments is $4,699,992.00, with the final payment occurring on December 1, 2014. The parties
agree that Unilife will be provided with a credit of $83,900.00 for the January 2014 payment. Unilife, in its sole discretion, has the option of pre-paying any portion (without discount), or all (without discount), of its payment obligations under
this Agreement without penalty. 
 (e) Unilife shall pay all taxes and shall perform all other obligations as set forth in the Lease, in
accordance with the terms of the Lease (except as modified herein). 

 2. Material Adverse Change. Varilease’s and CCA’s previous forbearance of their
assertion of a claim of breach of the Lease based upon Section 16 of the Lease shall not be raised as a defense by Unilife in any further proceeding between the Parties. The Parties further agree that Unilife’s September 30, 2013
financial statements shall be used as a baseline for determining if a material adverse change has occurred under Section 16(a)(vii) of the Lease. 

3. Continued Operation of the Lease. Except as modified by the terms of this Agreement, all the terms of the Lease shall remain in full
force and effect. 
 4. Title of Equipment. Clear and unencumbered title to the equipment identified in Lease Schedule Nos. 1, 2(a)
and 2(b) to the Lease will immediately transfer to Unilife upon Unilife’s full and complete satisfaction of its payment obligations under this Agreement and the Lease. 

5. Release of Claims by Varilease. Varilease, on behalf of itself, and its predecessors, successors, direct and indirect parent
companies, direct and indirect subsidiary companies, companies under common control with any of the foregoing, affiliates and assigns, and its and their past, present, and future officers, directors, shareholders, interest holders, members,
partners, attorneys, agents, employees, managers, representatives, assigns, and successors in interest, and all persons acting by, through, under, or in concert with them, and each of them, hereby release and discharge Unilife and its predecessors,
successors, direct and indirect parent companies, direct and indirect subsidiary companies, companies under common control with any of the foregoing, affiliates and assigns, and its and their past, present, and future officers, directors,
shareholders, interest holders, members, partners, attorneys, agents, employees, managers, representatives, assigns, and successors in interest, and all persons acting by, through, under, or in concert with them, and each of them (collectively, the
“Unilife Releasees’”) from any and all claims, demands, damages, costs, expenses, fees (including attorneys’ and consultants’ fees and costs), actions and causes of action, known or unknown, that have been or could have been
asserted in the Lawsuits, with the exception that Varilease does not release any of the Unilife Releasees from any obligations under the terms of this Agreement and the Lease (as modified by this Agreement). 

6. Release of Claims by CCA. CCA, on behalf of itself, and its predecessors, successors, direct and indirect parent companies, direct
and indirect subsidiary companies, companies under common control with any of the foregoing, affiliates and assigns, and its and their past, present, and future officers, directors, shareholders, interest holders, members, partners, attorneys,
agents, employees, managers, representatives, assigns, and successors in interest, and all persons acting by, through, under, or in concert with them, and each of them, hereby release and discharge the Unilife Releasees from any and all claims,
demands, damages, costs, expenses, fees (including attorneys’ and consultants’ fees and costs), actions and causes of action, known or unknown, that have been or could have been asserted in the Lawsuits, with the exception that CCA does
not release any of the Unilife Releasees from any obligations under the terms of this Agreement and the Lease (as modified by this Agreement). 

7. Release of Claims by Unilife. Unilife, on behalf of itself and its predecessors, successors, direct and indirect parent companies,
direct and indirect subsidiary companies, companies under common control with any of the foregoing, affiliates and assigns, and its and their past, present, and future officers, directors, shareholders, interest holders, members, partners,
attorneys, agents, employees, managers, representatives, assigns, and successors in interest, and all persons acting by, through, under, or in concert with them, and each of them, hereby release and discharge Varilease and CCA and their
predecessors, successors, direct and indirect parent companies, direct and indirect subsidiary companies, companies under common control with any of the foregoing, affiliates and assigns, and its and their past, present, and future officers,
directors, shareholders, interest holders, members, partners, attorneys, agents, employees, managers, representatives, assigns, and successors in interest, and all persons acting by, through, under, or in concert with them, and each of them,
(collectively, the “Varilease and CCA Releasees”) from any and all claims, demands, damages, costs, expenses, fees (including attorneys’ and consultants’ fees and costs), actions and causes of action, known or unknown, that have
been or could have been asserted in the Lawsuits, with the exception that Unilife does not release the Varilease and CCA Releasees from any obligations under the terms of this Agreement and the Lease (as modified by this Agreement). 

 8. Representations and Warranties. Unilife represents and warrants (a) that it has
not sold, assigned, factored or otherwise transferred any interest in the claims released hereby and (b) that the signatory on behalf of Unilife has the authority to bind Unilife to this Agreement. Varilease represents and warrants that
(a) the signatory on behalf of Varilease has the authority to bind Varilease to this Agreement and (b) Varilease has not sold, assigned, factored or otherwise transferred any interest in the claims released hereby. CCA represents and
warrants that (a) the signatory on behalf of CCA has the authority to bind CCA to this Agreement and (b) CCA has not sold, assigned, factored or otherwise transferred any interest in the claims released hereby. 

9. Incorporation of Recitals. Each of the recitals set forth above are hereby incorporated into this Agreement by this reference and
are made a part hereof. 
 10. No Future Actions. Each of the Parties agrees that it has not, and will not commence, maintain,
initiate or prosecute any action, suit, proceeding or claim before any court or administrative agency (whether state, federal or otherwise) against any other Party hereto in regard to the claims released under this Agreement. This section shall not
apply to any efforts to enforce the terms of this Agreement (or the rights and obligations contained therein) or to enforce the terms of the Lease, which remain in full force and effect, except as modified hereunder. 

11. No Admission of Liability. This Agreement is not an admission of any fault, liability, or wrongdoing by any of the Parties. 

12. Entire Agreement. Except as provided for herein, this Agreement supersedes and voids any and all prior or contemporaneous
communications, agreements and understandings between the Parties relating to the subject matter of this Confidential Mutual Release and Settlement Agreement, whether oral or written, and this Confidential Mutual Release and Settlement Agreement
contains the entire agreement between the Parties with respect to this Agreement. The parties express agree and recognize, as set forth in paragraph 3 above, that all of the terms of the Lease shall remain in full force and effect except as modified
by the terms of this Agreement. Each of the Parties agrees and acknowledges that neither they nor any agent or attorney of them have made any representation, warranty, promise or covenant whatsoever, express or implied, not contained in this
Agreement to induce the other to execute this Agreement. 
 13. Amendment. This Agreement may not be supplemented, amended, or
modified except through a new written agreement signed by all Parties. 
 14. Governing Law; Venue. This Agreement shall be governed
by and construed in accordance with the laws of the State of Michigan, without regard to conflict of law principles. Each Party hereto hereby irrevocably submits and consents to the exclusive jurisdiction of the United States District Court for the
Eastern District of Michigan, Southern Division (“the District Court”) with respect to any matter arising out of this Agreement. The parties agree that the District Court shall retain exclusive jurisdiction over the Lawsuits and this
Agreement, and any dispute between the parties shall be exclusively adjudicated by the District Court. 
 15. Severability. Should
any provision of this Agreement be declared or determined by any court of competent jurisdiction to be illegal, invalid, or unenforceable as a result of any action or proceeding, the validity of the remaining parts, terms, and provisions shall not
be affected thereby and said illegal or invalid part, term or provision shall be deemed not to be a part of this Agreement. 
 16.
Successors. This Agreement shall be binding upon and inure to the benefit of the respective heirs, personal representatives, successors and assigns of the parties. No Party shall delegate its or their duties, obligations, benefits or rights
hereunder without the written consent of the other Parties. 
 17. Further Assurances. Each of the Parties shall execute and deliver
such further instruments, documents and agreements and do such further acts and things as may be useful or required to carry out the purpose and intent of this Agreement and which are not inconsistent with the provisions hereof. 

 18. Fees and Expenses. Each of the Parties shall pay its own expenses, including mediation
costs, legal and other costs incurred, including those related to the negotiation, preparation and execution of the Agreement. 
 19.
Execution in Counterparts. This Agreement may be signed by faxed or PDF signature, which shall be deemed to be an original signature. This Agreement may be executed in counterparts, each of which shall be deemed to be an original, and all of
which shall be deemed to constitute one and the same instrument. 
 20. Waiver. The failure of any Party to insist upon strict
performance of any of the terms or conditions of this Agreement will not constitute a waiver of any of its rights hereunder. 
 21.
Agreement Voluntarily Executed. Each of the Parties acknowledges and represents that it has voluntarily executed this Agreement after consulting with, or having the opportunity to consult with, independent legal counsel chosen by it and
representing such Party’s interests. Each Party acknowledges and represents that it (a) has fully and carefully read this Agreement prior to execution, (b) has been fully apprised by attorneys of its own choosing of the legal effect
and meaning of this document and its terms, (c) has been afforded the opportunity to negotiate as to any and all terms of this Agreement, (d) is executing this Agreement voluntarily and free of any undue influence, duress or coercion, and
(e) has had the opportunity to make such investigation or inquiry as it deemed necessary and appropriate in connection with the subject matter of this Agreement. 

22. Confidentiality. The Parties acknowledge and agree that they will each maintain confidentiality relative to this Agreement and will
not communicate in regard to, or discuss, the terms of this settlement with any person or entity except to the extent required by law. If disclosure is required by law (other than disclosure required under the U.S. securities laws), the Party
required to disclose shall provide written notice to the other Parties within ten (10) business days of receipt of a subpoena, discovery request, or court order requiring disclosure and, in all events, shall provide five (5) business days
prior to any disclosure. 
 23. Default. Provided that Varilease (and/or CCA) otherwise deems there to be a non-payment default,
Varilease (and/or CCA) shall provide Unilife with forty-five (45) days written notice of such default before any attempt to sell, repossess, dispose of, or otherwise seek the return of the equipment contained in Lease Schedules Nos. 1, 2(a) and
2(b) to the Lease. 
 24. Dismissal. The Parties shall execute a stipulation of dismissal of the Lawsuits with prejudice within five
calendar days of the full execution of this Agreement. 

 The undersigned have entered into and executed this Agreement as of the date below. 

 

									
	Unilife Medical Solutions, Inc.	 		 	Varilease Finance, Inc.
					
	By:	 	 /s/ J. Christopher Naftzger
	 		 	By:	 	 /s/ Greg Adondakis

					
	Title:	 	 VP, General Counsel, Corporate Secretary and CCO
	 		 	Title:	 	 CEO

					
	Date:	 	 December 30, 2013
	 		 	Date:	 	 December 26, 2013

  

									
	Unilife Corporation	 		 	CCA Financial, LLC
					
	By:	 	 /s/ J. Christopher Naftzger
	 		 	By:	 	 /s/ R. Gregory Williams

					
	Title:	 	 VP, General Counsel, Corporate Secretary and CCO
	 		 	Title:	 	 President

					
	Date:	 	 December 30, 2013
	 		 	Date:	 	 December 27, 2013

 EXHIBIT 1 

																			
	 Settlement Payment No.*
	  	Payment Due
Date	  	Schedule 01	 	  	Schedule 02A	 	 	Schedule 02B	 	 	Total	 
	 1
	  	1/2/2014	  	$	51,791.67	  	  	$	68,742.13	  	 	$	187,232.87	  	 	$	307,766.67	  
		  		  				  				 				 	  
	  
	 
	 2
	  	2/1/2014	  	$	135,691.67	  	  	$	68,742.13	  	 	$	187,232.87	  	 	$	391,666.67	  
		  		  				  				 				 	  
	  
	 
	 3
	  	3/1/2014	  	$	135,691.67	  	  	$	68,742.13	  	 	$	187,232.87	  	 	$	391,666.67	  
		  		  				  				 				 	  
	  
	 
	 4
	  	4/1/2014	  	$	135,691.67	  	  	$	68,742.13	  	 	$	187,232.87	  	 	$	391,666.67	  
		  		  				  				 				 	  
	  
	 
	 5
	  	5/1/2014	  	$	135,691.67	  	  	$	68,742.13	  	 	$	187,232.87	  	 	$	391,666.67	  
		  		  				  				 				 	  
	  
	 
	 6
	  	6/1/2014	  	$	135,691.67	  	  	$	68,742.13	  	 	$	187,232.87	  	 	$	391,666.67	  
		  		  				  				 				 	  
	  
	 
	 7
	  	7/1/2014	  	$	135,691.67	  	  	$	68,742.13	  	 	$	187,232.87	  	 	$	391,666.67	  
		  		  				  				 				 	  
	  
	 
	 8
	  	8/1/2014	  	$	135,691.67	  	  	$	68,742.13	  	 	$	187,232.87	  	 	$	391,666.67	  
		  		  				  				 				 	  
	  
	 
	 9
	  	9/1/2014	  	$	135,691.67	  	  	$	68,742.13	  	 	$	187,232.87	  	 	$	391,666.67	  
		  		  				  				 				 	  
	  
	 
	 10
	  	10/1/2014	  	$	135,691.67	  	  	$	68,742.13	  	 	$	187,232.87	  	 	$	391,666.67	  
		  		  				  				 				 	  
	  
	 
	 11
	  	11/1/2014	  	$	135,691.67	  	  	$	68,742.13	  	 	$	187,232.87	  	 	$	391,666.67	  
		  		  				  				 				 	  
	  
	 
	 12
	  	12/1/2014	  	$	135,691.67	  	  	$	68,742.13	  	 	$	187,232.87	  	 	$	391,666.67	  
						
		  	Total	  	$	1,544,400.04	  	  	$	824,905.56	  	 	$	2,246,794.44	  	 	$	4,616,100.04	  
		  		  	  
	  
	 	  	  
	  
	 	 	  
	  
	 	 	  
	  
	 
						
		  	Remit
Payment To	  	 
 
 
 	CCA FINANCIAL,
INC. PO BOX 758760
BALTIMORE MD
21275-8760	  
  
  
  	  	 
 
   
  

 
  
 
	VFI SPV VIII
CORP DEPT
#1088  

PO BOX 29338
  

PHOENIX AZ
85038-9338
	  
  
    

  
  

  
  
	 	 
 
   
  

 
  
 
	VFI SPV VIII
CORP DEPT
#1088  

PO BOX 29338
  

PHOENIX AZ
85038-9338
	  
  
    

  
  

  
  
	 			

  

	*	Settlement Payment Amounts above do not include applicable sales or property tax amounts.EX-10.1

 Exhibit 10.1 

HERITAGE FINANCIAL CORPORATION 

EMPLOYMENT AGREEMENT 

This EMPLOYMENT AGREEMENT is made and entered into as of January 2, 2014 by and between
HERITAGE FINANCIAL CORPORATION and DAVID A. SPURLING. As used in this Agreement, capitalized terms have the meanings set forth in
Section 21. 
 RECITALS 

A. Executive is currently employed by the Company. 

B. Heritage Bank is a wholly-owned subsidiary of the Company. 

C. The Company desires to continue to employ Executive pursuant to the terms of this Agreement and Executive desires to continue to be
employed by the Company pursuant to such terms. 
 D. The Parties have made commitments to each other on a variety of important
issues concerning Executive’s employment with the Company, including the performance that will be expected of Executive, the compensation Executive will be paid, how long and under what circumstances Executive will remain employed, and the
financial details relating to any decision that either the Company or Executive may make to terminate this Agreement and Executive’s employment with the Company. 

E. The Parties desire to enter into this Agreement as of the Effective Date and, to the extent provided herein, to have this Agreement
supersede all Prior Agreements, and to have any such Prior Agreements become null and void as of the Effective Date. 

AGREEMENT 

In consideration of the foregoing and the mutual promises and covenants of the Parties set forth in this Agreement, and for other good and
valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties, intending to be legally bound, hereby expressly covenant and agree as follows: 

1. Employment Period. The Company shall continue to employ Executive during the Employment Period and Executive shall continue
to remain in the employ of the Company and provide services to the Company during the Employment Period in accordance with the terms of this Agreement. The “Employment Period” shall be the period beginning on the Effective Date and
ending on June 30, 2016, unless sooner terminated as provided herein. The Employment Period shall be extended automatically for one additional year beginning on July 1, 2015 and on each July 1 thereafter unless either Party
notifies the other Party, by written notice delivered no later than 90 days prior to such July 1, that the Employment Period shall not be extended for an additional year. Notwithstanding any provision of this Agreement to the contrary, if a
Change in Control occurs during the Employment Period, this Agreement shall remain in effect for the two-year period immediately following the Change in Control and shall then terminate. 

 2. Duties. During the Employment Period, Executive shall devote Executive’s
full business time, energy and talent to serving as Executive Vice President and Chief Credit Officer of the Company and Executive Vice President and Chief Credit Officer of Heritage Bank, subject to the direction of the Chief Executive Officer of
the Company and Heritage Bank, respectively. Executive shall have the duties that are commensurate with Executive’s position(s) and any other duties that may be assigned to Executive by the CEO of the Company or Heritage Bank, and Executive
shall perform all such duties faithfully and efficiently. Executive shall have such powers as are inherent to the undertakings applicable to Executive’s position and necessary to carry out the duties required of Executive hereunder. Executive
shall perform the duties required by this Agreement at the Company’s principal headquarters, unless the nature of such duties requires otherwise. Notwithstanding the foregoing provisions of this Section 2, during the Employment
Period, Executive may devote reasonable time to activities other than those required under this Agreement, including activities of a charitable, educational, religious, or similar nature to the extent such activities do not, in the judgment of the
CEO of the Company or Heritage Bank or the Board, inhibit, prohibit, interfere with, or conflict with Executive’s duties under this Agreement or conflict in any material way with the business of the Company or an Affiliate; provided,
however, that Executive shall not serve on the board of directors of any business (other than the Company or an Affiliate) or hold any other position with any business without receiving the prior written consent of the Board. 

3. Compensation and Benefits. During the Employment Period, while Executive is employed by the Company, the Company shall
compensate Executive for Executive’s services as follows: 
 (a) Executive shall be paid a base salary at an annual rate of Two
Hundred and Fifteen Thousand Two Hundred and Fifty Dollars ($215,250) (the “Annual Base Salary”), which shall be payable in accordance with the normal payroll practices of the Company then in effect. Each year during the Employment Period,
Executive’s Annual Base Salary shall be reviewed by the Board to determine if any increase (but not decrease) is appropriate, with any such increase to be effective as of July 1 of the year of such adjustment. 

(b) Executive shall be eligible to receive performance-based annual incentive bonuses (each, the “Incentive Bonus”)
from the Company for each fiscal year ending during the Employment Period. Incentive Bonuses shall be established and determined in accordance with the Company’s annual cash incentive plan, as may be in effect from time to time, or otherwise as
determined by the Board. Any Incentive Bonus shall be paid to Executive no later than two and one-half months after the close of the year in which it is earned, provided that any Incentive Bonus shall not be considered earned until the Board
has made all determinations and taken all actions necessary to establish such Incentive Bonus. 
 (c) Executive shall be eligible to
participate, subject to the terms thereof, in all incentive plans of the Company as may be in effect from time to time with respect to senior executives employed by the Company, on as favorable a basis as other similarly situated and

  
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performing executives (excluding participation in any non-qualified retirement or deferred compensation programs, unless specifically selected for participation by the Company). During the
Employment Period, Executive and Executive’s dependents, as the case may be, shall be eligible to participate, subject to the terms thereof, in all tax qualified retirement and similar benefit plans and all medical, dental, disability, group
and executive life, accidental death and travel accident insurance, and other similar welfare benefit plans of the Company as may be in effect from time to time with respect to senior executives employed by the Company, on as favorable a basis as
other similarly situated and performing executives. 
 (d) Executive shall be entitled to accrue paid vacation in accordance with and
subject to the Company’s vacation programs and policies as may be in effect from time to time. 
 (e) Executive shall be
eligible to be reimbursed by the Company, on terms that are substantially similar to those that apply to other similarly situated and performing executives employed by the Company, for reasonable out-of-pocket expenses for entertainment, travel,
meals, lodging, and similar items that are consistent with the Company’s expense reimbursement policy and that are actually incurred by Executive in the promotion of the Company’s business. 

4. Rights upon Termination. This Agreement and Executive’s employment under this Agreement may be terminated for any of the
reasons described in this Section 4. Executive’s right to benefits, if any, for periods after the Termination Date shall be determined in accordance with this Section 4: 

(a) Minimum Benefits. If the Termination Date occurs during the Employment Period for any reason, Executive shall be entitled to
the Minimum Benefits, in addition to any other benefits to which Executive may be entitled under the following provisions of this Section 4 or the express terms of any employee benefit plan or as required by law. Any benefits to be
provided to Executive pursuant to this Section 4(a) shall be provided within 30 days after the Termination Date; provided, however, that any benefits, incentives or awards payable as described in Section 4(g)
shall be provided in accordance with the terms of the applicable plan, program or arrangement. Except as may expressly be provided to the contrary in this Agreement, nothing in this Agreement shall be construed as requiring Executive to be treated
as employed by the Company or any Affiliate following the Termination Date for purposes of any plan, program, or arrangement. 
 (b)
Termination for Cause, Death, Disability, Voluntary Resignation, or Non-Renewal. If the Termination Date occurs during the Employment Period and is a result of a Termination for Cause, Executive’s death or Disability, or a
termination by Executive other than for Good Reason, or if this Agreement expires due to notice of non-renewal by either Party as provided under Section 1 or at the end of a Covered Period, then, other than the Minimum Benefits,
Executive shall have no right to benefits under this Agreement (and the Company and its Affiliates shall have no obligation to provide any such benefits) for periods after the Termination Date. 

  
 3 

 (c) Termination other than for Cause or Termination for Good Reason. If
Executive’s employment is subject to a Termination other than during a Covered Period, then, in addition to the Minimum Benefits, the Company shall provide Executive the following benefits: 

(i) On the first regularly-scheduled payroll date following the 45th day following the Termination Date, Executive shall
commence receiving the Severance Amount (less any amount described in Section 4(c)(ii)), with such amount to be paid in 24 substantially equal monthly installments, with each successive payment being due on the monthly anniversary
of the Termination Date. 
 (ii) To the extent any portion of the Severance Amount exceeds the “safe harbor” amount
described in Treasury Regulation Section 1.409A-1(b)(9)(iii)(A), Executive shall receive such portion of the Severance Amount that exceeds the “safe harbor” amount in a single lump sum payment payable on the first regularly-scheduled
payroll date following the 45th day following the Termination Date. 
 (iii) Executive (and Executive’s dependents, as
may be applicable) shall be entitled to the benefits described in Section 4(e). 
 (iv) Any equity awards granted to
Executive by the Company that are subject to vesting, performance, or target requirements shall be treated as having satisfied such vesting, performance, and target requirements. 

(d) Termination upon a Change in Control. If Executive’s employment is subject to a Termination within a Covered Period,
then, in addition to Minimum Benefits, the Company shall provide Executive the following benefits: 
 (i) On the 45th day
following the Termination Date, the Company shall pay Executive a lump sum payment in an amount equal to the Severance Amount. 

(ii) Executive (and Executive’s dependents, as may be applicable) shall be entitled to the benefits provided in Section
4(e). 
 (iii) Any equity awards granted to Executive by the Company that are subject to vesting, performance, or target
requirements shall be treated as having satisfied such vesting, performance, and target requirements. 
 (e) Medical and Dental
Benefits. If Executive’s employment is subject to a Termination, then to the extent that Executive or any of Executive’s dependents may be covered under the terms of any medical or dental plans of the Company (or an Affiliate) for
active employees immediately prior to the Termination Date, then, provided Executive is eligible for and elects coverage under the health care continuation rules of COBRA, the Company shall provide Executive and those dependents with coverage
equivalent to the coverage in effect immediately prior to the Termination. For a period of 12 months (18 months for a Termination during a Covered Period), Executive shall be required to pay the same amount as Executive would pay if Executive
continued in employment with the Company during such period and 

  
 4 

 
thereafter Executive shall be responsible for the full cost of such continued coverage; provided, however, that such coverage shall be provided only to the extent that it does not result in any
additional tax or other penalty being imposed on the Company (or an Affiliate) or violate any nondiscrimination requirements then applicable with respect to the applicable plans. The coverages under this Section 4(e) may be procured
directly by the Company (or an Affiliate, if appropriate) apart from, and outside of the terms of the respective plans, provided that Executive and Executive’s dependents comply with all of the terms of the substitute medical or dental
plans, and provided, further, that the cost to the Company and its Affiliates shall not exceed the cost for continued COBRA coverage under the Company’s (or an Affiliate’s) plans, as set forth in the immediately preceding
sentence. In the event Executive or any of Executive’s dependents is or becomes eligible for coverage under the terms of any other medical and/or dental plan of a subsequent employer with plan benefits that are comparable to Company (or
Affiliate) plan benefits, the Company’s and its Affiliates’ obligations under this Section 4(e) shall cease with respect to the eligible Executive and/or dependent. Executive and Executive’s dependents must notify the
Company of any subsequent employment and provide information regarding medical and/or dental coverage available. 
 (f) Golden
Parachute Payment Adjustment. 
 (i) If the value of any payment or other benefit Executive would receive (the
“Benefit”) would (A) constitute a “parachute payment” within the meaning of Code Section 280G, and (B) but for this sentence, be subject to the Excise Tax, then the Benefit shall be reduced to the Reduced
Amount. The “Reduced Amount” shall be either (1) the largest portion of the Benefit that would result in no portion of the Benefit being subject to the Excise Tax or (2) the largest portion, up to and including the total,
of the Benefit, whichever amount, after taking into account all applicable federal, state, and local employment taxes, income taxes, and the Excise Tax (all computed at the highest applicable marginal rate), results in Executive’s receipt, on
an after-tax basis, of the greater amount of the Benefit notwithstanding that all or some portion of the Benefit may be subject to the Excise Tax. If a reduction in payments or benefits constituting “parachute payments” is necessary so
that the Benefit equals the Reduced Amount, reduction shall occur in the following order unless Executive elects in writing a different order (provided, however, that such election shall be subject to the Company’s approval if
made on or after the date on which the event that triggers the Benefit occurs and to the extent that such election does not violate Code Section 409A): reduction of cash payments; cancellation of accelerated vesting of stock awards; reduction
of employee benefits. In the event that accelerated vesting of stock awards is to be reduced, such accelerated vesting shall be cancelled in the reverse order of the grant date of Executive’s stock awards unless Executive elects in writing a
different order for cancellation. 
 (ii) The accounting firm engaged by the Company for general audit purposes shall perform
any calculations necessary in connection with this Section 4(f). The Company shall bear all expenses with respect to the determinations by such accounting firm required to be made hereunder. 

  
 5 

 (iii) The accounting firm engaged to make the determinations under this
Section 4(f) shall provide its calculations, together with detailed supporting documentation, to Executive and the Company within 15 calendar days after the date on which Executive’s right to a Benefit is triggered (if requested at
that time by Executive or the Company) or such other time as requested by Executive or the Company. If the accounting firm determines that no Excise Tax is payable with respect to a Benefit, it shall furnish Executive and the Company with an opinion
reasonably acceptable to Executive that no Excise Tax will be imposed with respect to such Benefit. Any good faith determinations of the accounting firm made hereunder shall be final, binding, and conclusive upon Executive and the Company, except as
set forth below. 
 (iv) If, notwithstanding any reduction described in this Section 4(f), the IRS
determines that Executive is liable for the Excise Tax as a result of the receipt of the payment of benefits as described above, then Executive shall be obligated to pay back to the Company, within 30 days after a final IRS determination, or, in the
event Executive challenges the final IRS determination, within 30 days after a final judicial determination, a portion of the payment equal to the Repayment Amount. The “Repayment Amount” with respect to the payment of benefits
shall be the smallest amount, if any, required to be paid to the Company so that Executive’s net after-tax proceeds with respect to any payment of benefits (after taking into account the payment of the Excise Tax and all other applicable taxes
imposed on such payment) are maximized. The Repayment Amount with respect to the payment of benefits shall be $0 if a Repayment Amount of more than $0 would not result in Executive’s net after-tax proceeds with respect to the payment of such
benefits being maximized. If the Excise Tax is not eliminated pursuant to this Section 4(f), Executive shall pay the Excise Tax. 

(v) Notwithstanding any other provision of this Section 4(f), if (A) there is a reduction in the
payment of benefits as described in this Section 4(f), (B) the IRS later determines that Executive is liable for the Excise Tax, the payment of which would result in the maximization of Executive’s net after-tax
proceeds (calculated as if Executive’s benefits had not previously been reduced), and (C) Executive pays the Excise Tax, then the Company shall pay to Executive those benefits that were reduced pursuant to Section 4(f)
contemporaneously or as soon as administratively possible after Executive pays the Excise Tax so that Executive’s net after-tax proceeds with respect to the payment of benefits is maximized. 

(g) Other Benefits.  

(i) Executive’s rights following a termination of employment with the Company and its Affiliates for any reason with
respect to any benefits, incentives, or awards provided to Executive pursuant to the terms of any plan, program, or arrangement sponsored or maintained by the Company or its Affiliates, whether tax-qualified or not, which are not specifically
addressed herein, shall be subject to the terms of such plan, program, or arrangement and this Agreement shall have no effect upon such terms except as specifically provided herein. 

  
 6 

 (ii) Except as specifically provided herein, the Company and its Affiliates shall
have no further obligations to Executive under this Agreement following Executive’s termination of employment for any reason. 
 (h)
Removal from any Boards and Positions. Upon Executive’s termination of employment for any reason under this Agreement, Executive shall be deemed to resign (i) if a member, from the Board and the board of directors of any
Affiliate and any other board to which Executive has been appointed or nominated by or on behalf of the Company or an Affiliate, (ii) from each position with the Company and any Affiliate, including as an officer of the Company or an Affiliate
and (iii) as a fiduciary of any employee benefit plan of the Company and any Affiliate. 
 (i) Regulatory Suspension and
Termination. 
 (i) If Executive is suspended or temporarily prohibited from participating in the conduct of the
affairs of the Company or an Affiliate by a notice served under Section 8(e) or 8(g) of the FDIA, or pursuant to Section 30.12.040 of the Revised Code of Washington, all obligations of the Company and its Affiliates under this Agreement
shall be suspended as of the date of service, unless stayed by appropriate proceedings; if the charges in such notice are dismissed, the Company may in its discretion (A) pay Executive all or part of the compensation withheld while its and its
Affiliates’ obligations under this Agreement were suspended and (B) reinstate in whole or in part any of its and its Affiliates’ obligations that were suspended, all in accordance with Code Section 409A. 

(ii) If Executive is removed or permanently prohibited from participating in the conduct of the affairs of the Company or an
Affiliate by an order issued under Section 8(e) or 8(g) of the FDIA, or pursuant to Section 30.12.040 of the Revised Code of Washington, all obligations of the Company and its Affiliates under this Agreement shall terminate as of the
effective date of the order, provided that this Section 4(i) shall not affect any vested rights of the Parties. 

(iii) If the Company is in default as defined in Section 3(x) of the FDIA, all obligations of the Company under this
Agreement shall terminate as of the date of default, provided that this Section 4(i) shall not affect any vested rights of the Parties. 

(iv) All obligations of the Company under this Agreement shall be terminated, except to the extent determined by the FDIC that
continuation of this Agreement is necessary for the continued operation of the institution, at the time the FDIC enters into an agreement to provide assistance to or on behalf of the Company under the authority contained in Section 13(c) of the
FDIA, or when the Company is determined by the FDIC to be in an unsafe or unsound condition, provided that this Section 4(i) shall not affect any vested rights of the Parties. 

(v) Any payments made to Executive pursuant to this Agreement, or otherwise, are subject to and conditioned upon their
compliance with Section 18(k) of the FDIA. 

  
 7 

 (j) Clawback. Notwithstanding any provision of this Agreement to the contrary, if
any Severance Restrictions require the recapture or “clawback” of any Severance Amount paid to Executive under this Agreement, Executive shall repay to the Company the aggregate amount of any such payments, with such repayment to occur no
later than 30 days following Executive’s receipt of a written notice from the Company indicating that payments received by Executive under this Agreement are subject to recapture or clawback pursuant to the Severance Restrictions. 

5. Release. Notwithstanding any provision of this Agreement to the contrary, no benefits owed to Executive under
Section 4(c), 4(d) or 4(e) (other than the Minimum Benefits) shall be provided to Executive unless Executive executes (without subsequent revocation) and delivers to the Company a Release within 21 days (or such longer period to the
extent required by applicable law) following the Termination Date. 
 6. Restrictive Covenants. Executive acknowledges that
Executive has been and will continue to be provided intimate knowledge of the business practices, trade secrets, and other confidential and proprietary information of the Company and its Affiliates (including the Confidential Information), which, if
exploited by Executive, would seriously, adversely, and irreparably affect the interests of the Company and its Affiliates and the ability of each to continue its business. 

(a) Confidential Information. Executive acknowledges that, during the course of Executive’s employment with the Company and
its Affiliates, Executive may produce and have access to Confidential Information. Executive shall not directly or indirectly use, disclose, copy, or make lists of Confidential Information for the benefit of anyone other than the Company, either
during or after Executive’s employment with the Company and its Affiliates, except to the extent that such information is or thereafter becomes lawfully available from public sources, or such disclosure is authorized in writing by the Company,
required by law, or otherwise as reasonably necessary or appropriate in connection with the performance by Executive of Executive’s duties hereunder. If Executive receives a subpoena or other court order or is otherwise required by law to
provide information to a governmental authority or other person concerning the activities of the Company or its Affiliates, or Executive’s activities in connection with the business of the Company or its Affiliates, Executive shall immediately
notify the Company of such subpoena, court order, or other requirement and deliver forthwith to the Company a copy thereof and any attachments and non-privileged correspondence related thereto. Executive shall take reasonable precautions to protect
against the inadvertent disclosure of Confidential Information. Executive shall abide by the Company’s and its Affiliates’ policies, as in effect from time to time, respecting avoidance of interests conflicting with those of the Company
and its Affiliates. In this regard, Executive shall not directly or indirectly render services to any person or entity where Executive’s service would involve the use or disclosure of Confidential Information. Executive shall not use any
Confidential Information to guide Executive in searching publications or other publicly available information, selecting a series of items of knowledge from unconnected sources, and fitting them together to claim that Executive did not violate any
terms set forth in this Agreement. 

  
 8 

 (b) Documents and Property. 

(i) All records, files, documents, and other materials or copies thereof relating to the business of the Company or its
Affiliates that Executive prepares, receives, or uses, shall be and remain the sole property of the Company and, other than in connection with the performance by Executive of Executive’s duties hereunder, shall not be removed from the premises
of the Company or its Affiliates without the Company’s prior written consent, and shall be immediately returned to the Company upon Executive’s termination of employment for any reason, together with all copies (including copies or
recordings in electronic form), abstracts, notes, or reproductions of any kind made from or about the records, files, documents, or other materials. Executive shall disclose to the Company all computer and internet user identifications and passwords
used by Executive in the course of Executive’s performance of Executive’s duties hereunder or necessary for accessing information on the Company’s or its Affiliates’ computer systems upon Executive’s termination of
employment for any reason. 
 (ii) Executive acknowledges that Executive’s access to and permission to use the
Company’s and its Affiliates’ computer systems, networks, and equipment, and all Company and Affiliate information contained therein, is restricted to legitimate business purposes on behalf of the Company. Any other access to or use of
such systems, network, equipment, and information is without authorization and is prohibited. The restrictions contained in this Section 6(b) extend to any personal computers or other electronic devices of Executive that are used for
business purposes relating to the Company or its Affiliates (including smart phones, PDAs, digital tablets, or other portable electronic devices). Executive shall not transfer any Company or Affiliate information to any personal computer or other
electronic device that is not otherwise used for any business purpose relating to the Company or an Affiliate. Upon the termination of Executive’s employment with the Company for any reason, Executive’s authorization to access and
permission to use the Company’s and its Affiliates’ computer systems, networks, and equipment, and any Company and Affiliate information contained therein, shall cease. 

(c) Non-Competition and Non-Solicitation. The primary service area of the Company’s and its Affiliates’ businesses in
which Executive will actively participate extends separately to the Restricted Area. Therefore, as an essential ingredient of and in consideration of this Agreement and Executive’s employment with the Company and its Affiliates, Executive shall
not, during Executive’s employment or during the Restricted Period, whether the termination of Executive’s employment occurs during the Employment Period or thereafter, directly or indirectly do any of the following (all of which are
collectively referred to in this Agreement as the “Restrictive Covenant”): 
 (i) Engage or invest in, own,
manage, operate, finance, control, participate in the ownership, management, operation, or control of, be employed by, associated with, or in any manner connected with, serve as a director, officer, or consultant to, lend Executive’s name or
any similar name to, lend Executive’s credit to, 

  
 9 

 
or render services or advice to, any person, firm, partnership, corporation, or trust that owns, operates, or is in the process of forming a Competitor with an office located, or to be located at
an address identified in a filing with any regulatory authority, within the Restricted Area; provided, however, that the ownership by Executive of shares of the capital stock of any institution, which shares are listed on a securities
exchange and that do not represent more than 1% of the institution’s outstanding capital stock, shall not violate any terms of this Agreement. For purposes of clarification and not limitation or expansion, it is the intent of the Parties that
the foregoing shall not limit Executive from performing services outside of the Restricted Area for a person or entity solely because the person or entity has a location within the Restricted Area, unless Executive’s services are directed
toward activities on behalf of such person or entity within the Restricted Area. 
 (ii) (A) Induce or attempt to induce
an employee of the Company or its Affiliates (limited to all officer-level employees, Executive’s direct reports, and members of Executive’s department or area of responsibility) to leave the employ of the Company or its Affiliates;
(B) in any way interfere with the relationship between the Company or its Affiliates and any management-level employee of the Company or its Affiliates; or (C) induce or attempt to induce any customer, supplier, licensee, or other business
relation of the Company or its Affiliates to cease doing business with the Company or its Affiliates or in any way interfere with the relationship between the Company or its Affiliates and their respective customers, suppliers, licensees, or other
business relations. 
 (iii) Solicit the business of any person or entity known to Executive to be a customer of the Company
or its Affiliates, where Executive, or any person reporting to Executive, had accessed Confidential Information of, had an ongoing business relationship with, or had made Substantial Business Efforts with respect to, such person or entity, with
respect to products, activities, or services that compete in whole or in part with the products, activities, or services of the Company or its Affiliates. 

(iv) Serve as the agent, broker, or representative of, or otherwise assist, any person or entity in obtaining services or
products from any Competitor within the Restricted Area, with respect to products, activities, or services that compete in whole or in part with the products, activities, or services of the Company or its Affiliates. 

(v) Accept employment, provide services to, or act in any other such capacity for or with any Competitor, if in such employment
or capacity Executive would, because of Executive’s knowledge of the Company’s Confidential Information or trade secrets, inevitably use and/or disclose Company’s Confidential Information or trade secrets in Executive’s work or
service for such Competitor. For purposes of clarification and not limitation or expansion, it is the intent of the Parties that the foregoing shall not limit Executive from performing services outside of the Restricted Area for a person or entity
solely because the person or entity has a location within the Restricted Area, unless Executive’s services are directed towards activities on behalf of such person or entity within the Restricted Area. 

  
 10 

 (d) Works Made for Hire Provisions. The Parties acknowledge that all work performed
by Executive for the Company or its Affiliates shall be deemed a work made for hire. The Company shall at all times own and have exclusive right, title, and interest in and to all Confidential Information and Inventions, and the Company shall retain
the exclusive right to license, sell, transfer, and otherwise use and dispose of the same. All enhancements of the technology of the Company or its Affiliates that are developed by Executive shall be the exclusive property of the Company. Executive
hereby assigns to the Company any right, title, and interest in and to all Inventions that Executive may have, by law or equity, without additional consideration of any kind whatsoever from the Company or its Affiliates. Executive shall execute and
deliver any instruments or documents and do all other things (including the giving of testimony) requested by the Company (both during and after the termination of Executive’s employment with the Company) in order to vest more fully in the
Company or its Affiliates all ownership rights in the Inventions (including obtaining patent, copyright, or trademark protection therefore in the United States and/or foreign countries). To the extent required by applicable state statute, this
Section 6(d) shall not apply to an Invention for which no equipment, supplies, facility, or trade secret information of the Company or its Affiliates was used and that was developed entirely on Executive’s own time, unless the
Invention (i) relates to the business of the Company or an Affiliate or to the Company’s or an Affiliate’s actual or demonstrably anticipated research or development or (ii) results from any work performed by Executive for the
Company or an Affiliate. 
 (e) Remedies for Breach of Restrictive Covenants. Executive has reviewed the provisions of this
Agreement with legal counsel, or has been given adequate opportunity to seek such counsel, and Executive acknowledges that the covenants contained in this Section 6 are reasonable with respect to their duration, geographical area, and
scope. Executive further acknowledges that the restrictions contained in this Section 6 are reasonable and necessary for the protection of the legitimate business interests of the Company and its Affiliates, that they create no undue
hardships, that any violation of these restrictions would cause substantial injury to the Company and its Affiliates and such interests, and that such restrictions were a material inducement to the Company to enter into this Agreement. In the event
of any violation or threatened violation of the restrictions contained in this Section 6, the Company and the Affiliates, in addition to and not in limitation of, any other rights, remedies, or damages available under this Agreement or
otherwise at law or in equity, (i) shall be entitled to preliminary and permanent injunctive relief to prevent or restrain any such violation by Executive and all persons directly or indirectly acting for or with Executive, as the case may be,
without any requirement that the Company or an Affiliate post bond and (ii) shall be relieved of any obligation to pay or provide any amounts or benefits pursuant to this Agreement. If Executive violates the Restrictive Covenant and the Company
brings legal action for injunctive or other relief, the Company shall not, as a result of the time involved in obtaining such relief, be deprived of the benefit of the full period of the Restrictive Covenant; accordingly, the Restrictive Covenant
shall be deemed to have the duration specified herein computed from the date the relief is granted but reduced by the time between the period when the Restricted Period began to run and the date of the first violation of the Restrictive Covenant by
Executive. 
 (f) Other Agreements. In the event of the existence of another agreement between the Parties that (i) is in
effect during the Restricted Period, and (ii) contains restrictive 

  
 11 

 
covenants that conflict with any of the provisions of Section 6, then the more restrictive of such provisions from the two agreements shall control for the period during which both
agreements would otherwise be in effect. 
 7. No Set-Off; No Mitigation. Except as provided herein, the Company’s
obligation to provide benefits under this Agreement and otherwise to perform its obligations hereunder shall not be affected by any circumstances, including any set-off, counterclaim, recoupment, defense, or other right the Company may have against
Executive or others. In no event shall Executive be obligated to seek other employment or take any other action by way of mitigation of the amounts payable to Executive under any of the provisions of this Agreement, and such amounts shall not be
reduced whether or not Executive obtains other employment. 
 8. Notices. Notices and all other communications under this
Agreement shall be in writing and shall be deemed given when mailed by United States registered or certified mail, return receipt requested, postage prepaid, addressed as follows: if to the Company, Heritage Financial Corporation; Attention:
Director of Human Resources; 201 Fifth Avenue S.W.; Olympia, Washington 98501; and if to Executive, to Executive’s most recent address in the Company’s records; or, in each respective case, to such other address as either Party may furnish
to the other in writing, except that notices of changes of address shall be effective only upon receipt. 
 9. Applicable Law.
All questions concerning the construction, validity, and interpretation of this Agreement and the performance of the obligations imposed by this Agreement shall be governed by the internal laws of the State of Washington applicable to agreements
made and wholly to be performed in such state without regard to conflicts of law provisions of any jurisdiction. 
 10. Mandatory
Arbitration. Except as provided in Section 6(e), if any dispute or controversy arises under or in connection with this Agreement, and such dispute or controversy cannot be settled through negotiation, the Parties
shall first try in good faith to settle the dispute or controversy by mediation administered by the American Arbitration Association under its Commercial Mediation Procedures. If such mediation is not successful, the dispute or controversy shall be
settled exclusively by arbitration in accordance with the rules of the American Arbitration Association then in effect. Judgment may be entered on the arbitrator’s award in any court having jurisdiction. Notwithstanding the foregoing, the
Company may resort to the Superior Court of Thurston County, Washington for injunctive and such other relief as may be available in the event that the Employee engages in conduct, after termination of this Agreement, that amounts to a violation of
the Washington Trade Secrets Act or amounts to unlawful interference with the business expectations of the Company or its Affiliates. The FDIC may appear at any arbitration hearing but any decision made thereunder shall not be binding on the FDIC.

 11. Entire Agreement. This Agreement constitutes the entire agreement between the Parties concerning the subject matter
hereof, and supersedes all prior negotiations, undertakings, agreements, and arrangements with respect thereto, whether written or oral, including the Prior Agreements. If a court of competent jurisdiction determines that any provision of this

  
 12 

 
Agreement is invalid or unenforceable, then the invalidity or unenforceability of that provision shall not affect the validity or enforceability of any other provision of this Agreement and all
other provisions shall remain in full force and effect. The various covenants and provisions of this Agreement are intended to be severable and to constitute independent and distinct binding obligations. Without limiting the generality of the
foregoing, if the scope of any covenant contained in this Agreement is too broad to permit enforcement to its full extent, such covenant shall be enforced to the maximum extent permitted by law, and such scope may be judicially modified accordingly.

 12. Withholding of Taxes. The Company may withhold from any benefits payable under this Agreement all federal, state, city
and other taxes as may be required pursuant to any law, governmental regulation, or ruling. 
 13. No Assignment.
Executive’s rights to receive benefits under this Agreement shall not be assignable or transferable whether by pledge, creation of a security interest, or otherwise, other than a transfer by will or by the laws of descent or distribution. In
the event of any attempted assignment or transfer contrary to this Section 13, the Company and its Affiliates shall have no liability to pay any amount so attempted to be assigned or transferred. This Agreement shall inure to the benefit
of and be enforceable by Executive’s personal and legal representatives, executors, administrators, successors, heirs, distributees, devisees, and legatees. 

14. Successors. This Agreement shall be binding upon and inure to the benefit of the Company, its successors, and assigns. 

15. Legal Fees. In the event that either Party commences mediation, arbitration, or litigation to enforce or protect such
Party’s rights in accordance with and under this Agreement, the prevailing Party in any such action shall be entitled to recover reasonable attorneys’ fees and costs (including the costs of experts, evidence, and counsel) and other costs
relating to such action, in addition to all other entitled relief, including damages and injunctive relief. 
 16. Amendment.
This Agreement may not be amended or modified except by written agreement signed by the Parties. 
 17. Code
Section 409A. 
 (a) To the extent any provision of this Agreement or action by the Company would subject Executive to
liability for interest or additional taxes under Code Section 409A, it shall be deemed null and void, to the extent permitted by law and deemed advisable by the Company. It is intended that this Agreement will comply with Code
Section 409A, and this Agreement shall be administered accordingly and interpreted and construed on a basis consistent with such intent. Notwithstanding any provision of this Agreement to the contrary, no termination or similar payments or
benefits shall be payable hereunder on account of Executive’s termination of employment unless such termination constitutes a “separation from service” within the meaning of Code Section 409A. For purposes of Code
Section 409A, all installment payments of deferred compensation made hereunder, or pursuant to another plan or arrangement, shall be deemed to be separate payments. To the extent any reimbursements or in-kind benefit payments under this
Agreement are subject to Code Section 409A, such reimbursements and 

  
 13 

 
in-kind benefit payments shall be made in accordance with Treasury Regulation Section 1.409A-3(i)(1)(iv). This Agreement may be amended to the extent necessary (including retroactively) by
the Company to avoid the application of taxes or interest under Code Section 409A, while maintaining to the maximum extent practicable the original intent of this Agreement. This Section 17 shall not be construed as a guarantee of
any particular tax effect for Executive’s benefits under this Agreement and the Company does not guarantee that any such benefits will satisfy the provisions of Code Section 409A. 

(b) Notwithstanding any provision of this Agreement to the contrary, if Executive is determined to be a Specified Employee as of the
Termination Date, then, to the extent required pursuant to Code Section 409A, payments due under this Agreement that are deemed to be deferred compensation shall be subject to a six-month delay following the Termination Date; and all delayed
payments shall be accumulated and paid in a lump-sum payment as of the first day of the seventh month following the Termination Date (or, if earlier, as of Executive’s death), with all such delayed payments being credited with interest
(compounded monthly) for this period of delay equal to the prime rate in effect on the first day of such six-month period (based on the prime rate as reflected in the Wall Street Journal). Any portion of the benefits hereunder that were not
otherwise due to be paid during the six-month period following the Termination Date shall be paid to Executive in accordance with the payment schedule established herein. 

18. Deferral of Nondeductible Compensation. If Executive’s aggregate compensation (including benefits that are deemed
remuneration for purposes of Code Section 162(m)) from the Company and the Affiliates for any calendar year exceeds the maximum amount of compensation deductible by the Company or any Affiliate in any calendar year under Code
Section 162(m) (for purposes of this paragraph, the “maximum allowable amount”), then any such amount in excess of the maximum allowable amount shall be mandatorily deferred with interest thereon at 4% per annum to a calendar
year such that the amount to be paid to Executive in such calendar year, including deferred amounts and interest thereon, does not exceed the maximum allowable amount. Subject to the foregoing, deferred amounts, including interest thereon, shall be
payable at the earliest time permissible, in accordance with Code Section 409A. 
 19. Scope of Company and Affiliate
Obligations. Although the Company and its Affiliates may have jointly obligated themselves to Executive under certain provisions of this Agreement, in no event shall Executive be entitled to more than what is explicitly provided for
hereunder, such that no duplicative payments shall be provided under this Agreement. 
 20. Construction. In this Agreement,
unless otherwise stated, the following uses apply: (a) references to a statute shall refer to the statute and any amendments and any successor statutes, and to all regulations promulgated under or implementing the statute, as amended, or its
successors, as in effect at the relevant time; (b) in computing periods from a specified date to a later specified date, the words “from” and “commencing on” (and the like) mean “from and including, “ and the words
“to,” “until,” and “ending on” (and the like) mean “to, but excluding”; (c) references to a governmental or quasi-governmental agency, authority or instrumentality shall also refer to a regulatory body
that succeeds to the functions of the agency, authority, or instrumentality; (d) indications of time of day shall be based upon the time applicable to the 

  
 14 

 
location of the principal headquarters of the Company; (e) the words “include,” “includes,” and “including” (and the like) mean “include, without
limitation,” “includes, without limitation,” and “including, without limitation,” (and the like) respectively; (f) all references to preambles, recitals, sections, and exhibits are to preambles, recitals, sections, and
exhibits in or to this Agreement; (g) the words “hereof,” “herein,” “hereto,” “hereby,” “hereunder,” (and the like) refer to this Agreement as a whole (including exhibits); (h) any
reference to a document or set of documents, and the rights and obligations of the parties under any such documents, means such document or documents as amended from time to time, and all modifications, extensions, renewals, substitutions, or
replacements thereof; (i) all words used shall be construed to be of such gender or number as the circumstances and context require; (j) the captions and headings of preambles, recitals, sections, and exhibits appearing in or attached to
this Agreement have been inserted solely for convenience of reference and shall not be considered a part of this Agreement, nor shall any of them affect the meaning or interpretation of this Agreement or any of its provisions and (k) all
accounting terms not specifically defined herein shall be construed in accordance with GAAP. This Agreement may be executed in any number of counterparts, each of which shall be deemed an original, and all of which together shall constitute one and
the same Agreement. 
 21. Definitions. As used in this Agreement, the terms defined in this Section 21 have the
meanings set forth below. 
 (a) “1934 Act” means the Securities Exchange Act of 1934. 

(b) “Affiliate” means each Business Entity that, directly or indirectly, is controlled by, controls, or is under
common control with, the Company, where “control” means (i) the ownership of 51% or more of the Voting Securities or other voting or equity interests of any Business Entity, or (ii) the possession, directly or indirectly, of the
power to direct or cause the direction of the management and policies of such Business Entity. 
 (c) “Agreement”
means this employment agreement, made and entered into as of the Effective Date, by and between the Parties. 
 (d) “Annual
Base Salary” has the meaning set forth in Section 3(a). 
 (e) “Average Incentive Bonus”
means the average of Incentive Bonuses determined for the immediately preceding three completed fiscal year performance periods of the Company; provided, however, that if an Incentive Bonus has not yet been determined for a previously
completed fiscal year performance period as of the Termination Date, then Target Bonus shall be used with respect to such fiscal year for purposes of calculating the Average Incentive Bonus. For purposes of calculating the Average Incentive Bonus,
fiscal years for which no bonus was determined to have been earned shall be included in the calculation of the three-year average. 

(f) “Base Compensation” means the amount equal to the sum of (i) the greater of Executive’s then-current
Annual Base Salary or Executive’s Annual Base Salary as of the date one day prior to the Change in Control, and (ii) the Average Incentive Bonus. 

  
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 (g) “Benefit” has the meaning set forth in
Section 4(f)(i). 
 (h) “Board” means the Board of Directors of the Company. 

(i) “Business Entity” means any corporation, partnership, limited liability company, joint venture, association,
partnership, business trust or other business entity. 
 (j) “Change in Control” means the first to occur of the
following: 
 (i) The acquisition in one or more transactions by any “person” (for purposes of this definition, as
such term is used for purposes of Section 13(d) or 14(d) of the 1934 Act) of “beneficial ownership” (for purposes of this definition, within the meaning of Rule 13d-3 promulgated under the 1934 Act) of 50% or more of the combined
voting power of the Company’s then outstanding Voting Securities; provided, however, that for purposes of this definition, the Voting Securities acquired directly from the Company by any person shall be excluded from the
determination of such person’s beneficial ownership of Voting Securities (but such Voting Securities shall be included in the calculation of the total number of Voting Securities then outstanding); or 

(ii) During any 12-month period, the individuals who are members of the Incumbent Board cease for any reason to constitute more
than 50% of the Board; provided, however, that if the election, or nomination for election by the Company’s shareholders, of any new director was approved by a vote of at least two-thirds of the Incumbent Board, such new director
shall, for purposes of this Agreement, be considered as a member of the Incumbent Board, but excluding for this purpose, any such individual whose initial assumption of office occurs as a result of an actual or threatened election contest with
respect to the election or removal of directors or other actual or threatened solicitation of proxies or consents by or on behalf of a person other than the Board; or 

(iii) The consummation of a merger or consolidation involving the Company if the Company’s shareholders immediately before
such merger or consolidation do not own, directly or indirectly immediately following such merger or consolidation, more than 50% of the combined voting power of the outstanding voting securities of the corporation resulting from such merger or
consolidation in substantially the same proportion as their ownership of the Voting Securities immediately before such merger or consolidation; or 

(iv) The consummation of a complete liquidation or dissolution of the Company or an agreement for the sale or other disposition
of all or substantially all of the assets of the Company; or 
 (v) Acceptance by the Company’s shareholders of shares
in a share exchange if the Company’s shareholders immediately before such share exchange do not own, directly or indirectly immediately following such share exchange, more than 50% of the combined voting power of the outstanding voting
securities of the corporation resulting from such share exchange in substantially the same proportion as their ownership of the Voting Securities outstanding immediately before such share exchange. 

  
 16 

 Notwithstanding the foregoing, a Change in Control shall not be deemed to occur
solely because 50% or more of the then outstanding Voting Securities is acquired by (A) a trustee or other fiduciary holding securities under one or more employee benefit plans maintained by the Company or any of its Affiliates, or (B) any
corporation that, immediately prior to such acquisition, is owned directly or indirectly by the Company’s shareholders in the same proportion as their ownership of stock in the Company immediately prior to such acquisition. 

Moreover, notwithstanding the foregoing, a Change in Control shall not be deemed to occur solely because any person (the
“Subject Person”) acquires beneficial ownership of more than the permitted amount of the outstanding Voting Securities as a result of the acquisition of Voting Securities by the Company that, by reducing the number of Voting
Securities outstanding, increases the proportional number of shares beneficially owned by the Subject Person, provided that if a Change in Control would occur (but for the operation of this sentence) as a result of the acquisition of Voting
Securities by the Company, and after such share acquisition by the Company, the Subject Person becomes the beneficial owner of any additional Voting Securities that increases the percentage of the then outstanding Voting Securities beneficially
owned by the Subject Person, then a Change in Control shall be deemed to have occurred. 
 Notwithstanding anything in this
Change in Control definition to the contrary, in the event that any amount or benefit under this Agreement constitutes deferred compensation and the settlement of or distribution of such amount or benefit is to be triggered by a Change in Control,
then such settlement or distribution shall be subject to the event constituting the Change in Control also constituting a “change in control event” under Code Section 409A. 

(k) “COBRA” means the Consolidated Omnibus Budget Reconciliation Act of 1985. 

(l) “Code” means the Internal Revenue Code of 1986. 

(m) “Company” means Heritage Financial Corporation. 

(n) “Competitor” means a bank, savings bank, savings and loan association, credit union, or similar financial
institution. 
 (o) “Confidential Information” means confidential or proprietary, non-public information concerning
the Company or its Affiliates, including research, development, designs, formulae, processes, specifications, technologies, marketing materials, financial and other information concerning customers and prospective customers, customer lists, records,
data, computer programs, source codes, object codes, database structures, trade secrets, proprietary business information, pricing and profitability information and policies, strategic planning, commitments, plans, procedures, litigation, pending
litigation, and other information not generally available to the public. 

  
 17 

 (p) “Covered Period” means the period beginning six months prior to a
Change in Control and ending on the date that is 24 months after the Change in Control. 
 (q) “Disability” means
that (i) Executive is unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of not
less than 12 months, or (ii) Executive is, by reason of any medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of not less than 12 months, receiving
income replacement benefits for a period of not less than three months under an accident or health plan covering employees of the Company. 

(r) “Effective Date” means January 1, 2014. 

(s) “Employment Period” has the meaning set forth in Section 1. 

(t) “Excise Tax” means the excise tax imposed under Code Section 4999. 

(u) “Executive” means David A. Spurling. 

(v) “FDIA” means the Federal Deposit Insurance Act. 

(w) “FDIC” means the Federal Deposit Insurance Corporation. 

(x) “Good Reason” means the occurrence of any one of the following events, unless Executive agrees in writing that
such event shall not constitute Good Reason: 
 (i) A material and adverse change in the nature, scope, or status of
Executive’s position, authorities, or duties from those in effect in accordance with Section 2 immediately following the Effective Date, or if applicable and greater, immediately prior to the Covered Period; 

(ii) A material reduction in Executive’s Annual Base Salary or target Incentive Bonus opportunity, or a material reduction
in Executive’s aggregate benefits or other compensation plans in effect immediately following the Effective Date, or if applicable and greater, immediately prior to the Covered Period; 

(iii) A relocation of Executive’s primary place of employment of more than 35 miles from Executive’s primary place of
employment immediately following the Effective Date, or if applicable, prior to the Covered Period, or a requirement that Executive engage in travel that is materially greater than prior to the Covered Period; 

(iv) The failure by an acquirer to assume this Agreement at the time of a Change in Control; or 

(v) A material breach by the Company of this Agreement. 

  
 18 

 Notwithstanding any provision of this Good Reason definition to the contrary,
(A) prior to Executive’s Termination for Good Reason, Executive must give the Company written notice of the existence of any condition set forth in a clause immediately above within 90 days of its initial existence and the Company shall
have 30 days from the date of such notice in which to cure the condition giving rise to Good Reason, if curable, and if, during such 30-day period, the Company cures the condition giving rise to Good Reason, such condition shall not constitute Good
Reason and (B) any Termination for Good Reason must occur within six months of the initial existence of the condition constituting Good Reason. 

(y) “Heritage Board” means the Board of Directors of Heritage Bank. 

(z) “Incentive Bonus” has the meaning set forth in Section 3(b), and for purposes of determining a
Severance Amount, the term shall include any amounts required to be deferred pursuant to Section 18 or subject to Executive’s elective deferrals under a deferred compensation plan of the Company, and shall exclude any Company contributions
under a deferred compensation plan. 
 (aa) “Incumbent Board” means the members of the Board as of the Effective
Date. 
 (bb) “Inventions” means all systems, procedures, techniques, manuals, databases, plans, lists, inventions,
trade secrets, copyrights, patents, trademarks, discoveries, innovations, concepts, ideas, and software conceived, compiled, or developed by Executive in the course of Executive’s employment with the Company or its Affiliates and/or comprised,
in whole or part, of Confidential Information. Notwithstanding the foregoing sentence, Inventions shall not include: (i) any inventions independently developed by Executive and not derived, in whole or part, from any Confidential Information or
(ii) any invention made by Executive prior to Executive’s exposure to any Confidential Information. 
 (cc)
“IRS” means the United States Internal Revenue Service. 
 (dd) “Minimum Benefits” means, as
applicable, the following: 
 (i) Executive’s earned but unpaid Annual Base Salary for the period ending on the
Termination Date; 
 (ii) Executive’s earned but unpaid Incentive Bonus, if any, for any completed fiscal year preceding
the Termination Date; provided, however, that Executive shall not be entitled to any Incentive Bonus in the event of a Termination for Cause; 

(iii) Executive’s accrued but unpaid vacation pay for the period ending on the Termination Date; 

(iv) Executive’s unreimbursed business expenses and all other items earned and owed to Executive by the Company through
and including the Termination Date, provided that all required submissions for expense reimbursement are made in accordance with the Company’s expense reimbursement policy and within 15 days following the Termination Date; and 

  
 19 

 (v) The benefits, incentives, and awards described in
Section 4(g)(i). 
 (ee) “Parties” means the Company and Executive. 

(ff) “Prior Agreements” means all employment, change in control or similar agreements in effect prior to the Effective
Date, whether or not in writing, between the Parties or between Executive and Heritage Bank. 
 (gg) “Reduced
Amount” has the meaning set forth in Section 4(f)(i). 
 (hh) “Release” means a general
release and waiver substantially in the form attached hereto as Exhibit A. 
 (ii) “Repayment Amount” has the
meaning set forth in Section 4(f)(iv). 
 (jj) “Restricted Area” means the area that encompasses
a 25-mile radius from each banking or other office location of the Company and its Affiliates; provided, however, that in the event of a Change in Control, the Restricted Area shall be determined as of the date immediately preceding
the Change in Control. 
 (kk) “Restricted Period” means a period of 12 months with respect to Sections
6(c)(i) and 6(c)(v), and a period of 24 months with respect to Sections 6(c)(ii), 6(c)(iii), and 6(c)(iv), in each case immediately following the termination of Executive’s employment for any reason, whether such
termination occurs during the Employment Period or thereafter; provided, however, that, with respect to any termination that occurs during a Covered Period, the Restricted Period, in all cases, shall be a period of 12 months. 

(ll) “Restrictive Covenant” has the meaning set forth in Section 6(c). 

(mm) “Severance Amount” means 

(i) For any Termination that occurs during the Employment Period and not during a Covered Period, an amount equal to 100% of
Executive’s Base Compensation as of the respective Termination; or 
 (ii) For any Termination that occurs during a
Covered Period, an amount equal to 200% of Executive’s Base Compensation as of the respective Termination. 
 (nn)
“Severance Restrictions” means any applicable statute, law, regulation, or regulatory interpretation or other guidance, including FIL-66-2010 and any related or successor FDIC guidance, that would require the Company or any
Affiliate to seek or demand repayment or return of any payments made to Executive for any reason, including the Company, an Affiliate or their successors later obtaining information indicating that Executive has committed, is substantially
responsible for, or has violated, the respective acts or omissions, conditions, or offenses outlined under 12 C.F.R. 359.4(a)(4). 

  
 20 

 (oo) “Specified Employee” means any person who is a “key
employee” (as defined in Code Section 416(i) without regard to paragraph (5) thereof), as determined by the Company based upon the 12-month period ending on each December 31st (such 12-month period is referred to below as the
“identification period”). If Executive is determined to be a key employee, Executive shall be treated as a Specified Employee for purposes of this Agreement during the 12-month period that begins on the April 1 following the close of
the identification period. For purposes of determining whether Executive is a key employee, “compensation” means Executive’s W-2 compensation as reported by the Company for a particular calendar year. 

(pp) “Subject Person” has the meaning set forth in Section 21(j). 

(qq) “Substantial Business Efforts” means marketing, promotional, purchasing, sales, or solicitation activities
undertaken on behalf of the Company or an Affiliate, which include (i) in person and voice communications and (ii) either or both of (A) delivery of a quote, bid, proposal, or request for any of the foregoing or (B) visits to the
site of the actual or potential business development and other similar meetings or visits (conducted alone or with other employees of the Company or an Affiliate), where such activities would enjoy a reasonable prospect of success in the absence of
any breach of this Agreement. 
 (rr) “Target Bonus” means the target Incentive Bonus for the applicable fiscal year
performance period, if one is used, and if not, the Target Bonus shall be determined based upon the mid-point between the maximum Incentive Bonus and the threshold Incentive Bonus for the applicable fiscal year performance period, with the threshold
bonus based upon the first level of performance for which some amount of Incentive Bonus would be payable. 
 (ss)
“Termination” means a termination of Executive’s employment with the Company and all Affiliates during the Employment Period either: 

(i) By the Company, other than (A) a Termination for Cause or (B) a termination as a result of Executive’s death
or Disability; or 
 (ii) By Executive for Good Reason. 

(tt) “Termination Date” means the date of termination (whether or not such termination constitutes a
“Termination”) of Executive’s employment with the Company and all Affiliates. 
 (uu) “Termination for
Cause” means a termination of Executive’s employment by the Company as a result of any of the following (in each case as determined by the Board): 

(i) Executive’s willful and continuing failure to perform Executive’s obligations hereunder, which failure is not
remedied within five business days after receipt of written notice of such failure from the Company; 

  
 21 

 (ii) Executive’s conviction of, or plea of nolo contendere to, a
crime of embezzlement or fraud or any felony under the laws of the United States or any state thereof; 
 (iii)
Executive’s breach of fiduciary responsibility; 
 (iv) An act of dishonesty by Executive that is materially injurious
to the Company or an Affiliate; 
 (v) Executive’s engagement in one or more unsafe or unsound banking practices that
have a material adverse effect on the Company or an Affiliate; 
 (vi) Executive’s removal or permanent suspension from
banking pursuant to Section 8(e) of the FDIA or any other applicable state or federal law; 
 (vii) A material breach by
Executive of this Agreement; 
 (viii) An act or omission by Executive that leads to a material harm (financial or
reputational) to the Company or an Affiliate in the community; or 
 (ix) A material breach of Company policies as may be in
effect from time to time. 
 Further, a Termination for Cause shall be deemed to have occurred if, after the termination of
Executive’s employment with the Company and any Affiliate, facts and circumstances arising during the course of such employment are discovered that would have warranted a Termination for Cause. 

Further, with respect to clauses (i), (vii), (viii), and (ix) of this definition, Executive shall be entitled to at least
30 days’ prior written notice of the Company’s intention to terminate Executive’s employment in a Termination for Cause, which notice shall specify the grounds for the Termination for Cause; and Executive shall be provided a
reasonable opportunity to cure any conduct or act, if curable, alleged as grounds for the Termination for Cause, and a reasonable opportunity to present to the Board Executive’s position regarding any dispute relating to the existence of any
grounds for Termination for Cause. 
 Further, all rights Executive has or may have under this Agreement shall be suspended
automatically during (A) the pendency of any investigation by the Board or its designee (provided that any such suspension shall not exceed 60 days, except as set forth in clause (B)), or (B) any negotiations between the Board or
its designee and Executive regarding any actual or alleged act or omission by Executive of the type that would warrant a Termination for Cause (provided that any passage of time during such negotiations shall not be counted for purposes of
the 60-day limit set forth in clause (A)), and any such suspension shall not give rise to a claim of Good Reason by Executive. 

  
 22 

 (vv) “Voting Securities” means any securities that ordinarily possess the
power to vote in the election of directors without the happening of any precondition or contingency. 
 22. Survival. The
provisions of Section 6 shall survive the termination of this Agreement. 
 [Signature page follows] 

  
 23 

 IN WITNESS WHEREOF, the Company has caused this Agreement to be executed in its name and
on its behalf, and Executive acknowledges understanding and acceptance of, and agrees to, the terms of this Agreement, all as of the Effective Date. 
  

			
	HERITAGE FINANCIAL CORPORATION
		
	By:	 	 /s/ Brian L. Vance

		 	Brian L. Vance
		 	Chief Executive Officer
	
	EXECUTIVE
		
	By:	 	 /s/ David A. Spurling

		 	David A. Spurling

  
 24 

 EXHIBIT A 

AGREEMENT AND RELEASE AND WAIVER 

This AGREEMENT AND RELEASE (“Agreement”) is made and
entered into by and between HERITAGE FINANCIAL CORPORATION (the “Company”) and
[                    ] (“Executive”). 

WHEREAS, Executive and the Company desire to settle fully and amicably all issues between them, including
any issues arising out of Executive’s employment with the Company and the termination of that employment; and 

WHEREAS, Executive and the Company are parties to that certain Employment Agreement, made and entered
into as of [                    ], as amended (the “Employment Agreement”). 

NOW, THEREFORE, for and in consideration of the mutual promises contained herein, and for
other good and sufficient consideration, receipt of which is hereby acknowledged, Executive and the Company (collectively, the “Parties” and, individually, each a “Party”), intending to be legally bound, hereby
agree as follows: 
 1. Termination of Employment. Executive’s employment with the Company shall terminate effective as of the
close of business on [                    ] (the “Termination Date”). 

2. Compensation and Benefits. Subject to the terms of this Agreement, the Company shall compensate Executive under this Agreement as
follows (collectively, the “Severance Payments”): 
 (a) Severance Amount.
[                    ]. 
 (b)
Accrued Salary and Vacation. Executive shall be entitled to a lump sum payment in an amount equal to Executive’s earned but unpaid annual base salary and vacation pay for the period ending on the Termination Date, with such payment to be
made on the first payroll date following the Termination Date. 
 (c) COBRA Benefits.
[                    ]. 
 (d)
Executive Acknowledgement. Executive acknowledges that, subject to fulfillment of all obligations provided for herein, Executive has been fully compensated by the Company, including under all applicable laws, and that nothing further is owed
to Executive with respect to wages, bonuses, severance, other compensation, or benefits. Executive further acknowledges that the Severance Payments (other than (b) above) are consideration for Executive’s promises contained in this
Agreement, and that the Severance Payments are above and beyond any wages, bonuses, severance, other compensation, or benefits to which Executive is entitled from the Company under the terms of Executive’s employment or under any other contract
or law that Executive would be entitled to absent execution of this Agreement. 

  
 A-1 

 (e) Withholding. The Severance Payments shall be treated as wages and subject to all taxes
and other payroll deductions required by law. 
 3. Termination of Benefits. Except as provided in Section 2 above or as
may be required by law, Executive’s participation in all employee benefit (pension and welfare) and compensation plans of the Company shall cease as of the Termination Date. Nothing contained herein shall limit or otherwise impair
Executive’s right to receive pension or similar benefit payments that are vested as of the Termination Date under any applicable tax-qualified pension or other plans, pursuant to the terms of the applicable plan. 

4. Release of Claims and Waiver of Rights. Executive, on Executive’s own behalf and that of Executive’s heirs, executors,
attorneys, administrators, successors, and assigns, fully releases and discharges the Company, its predecessors, successors, parents, subsidiaries, affiliates, and assigns, and its and their directors, officers, trustees, employees, and agents, both
in their individual and official capacities, and the current and former trustees and administrators of each retirement and other benefit plan applicable to the employees and former employees of the Company, both in their official and individual
capacities (the “Releasees”) from all liability, claims, demands, and actions Executive now has, may have had, or may ever have, whether currently known or unknown, as of or prior to Executive’s execution of this Agreement (the
“Release”), including liability claims, demands, and actions: 
 (a) Arising from or relating to Executive’s
employment or other association with the Company, or the termination of such employment, 
 (b) Relating to wages, bonuses, other
compensation, or benefits, 
 (c) Relating to any employment or change in control contract, 

(d) Relating to any employment law, including 
  

	 	(i)	The United States and State of Washington Constitutions, 

  

	 	(ii)	The Civil Rights Act of 1964, 

  

	 	(iii)	The Civil Rights Act of 1991, 

  

	 	(iv)	The Equal Pay Act, 

  

	 	(v)	The Employee Retirement Income Security Act of 1974, 

  

	 	(vi)	The Age Discrimination in Employment Act (the “ADEA”), 

  

	 	(vii)	The Americans with Disabilities Act, 

  

	 	(viii)	Executive Order 11246, and 

  

	 	(ix)	Any other federal, state, or local statute, ordinance, or regulation relating to employment, 

  
 A-2 

 (e) Relating to any right of payment for disability, 

(f) Relating to any statutory or contractual right of payment, and 

(g) For relief on the basis of any alleged tort or breach of contract under the common law of the State of Washington or any other state,
including defamation, intentional or negligent infliction of emotional distress, breach of the covenant of good faith and fair dealing, promissory estoppel, and negligence. 

Executive acknowledges that Executive is aware that statutes exist that render null and void releases and discharges of any claims, rights,
demands, liabilities, actions, and causes of action that are unknown to the releasing or discharging party at the time of execution of the release and discharge. Executive waives, surrenders, and shall forego any protection to which Executive would
otherwise be entitled by virtue of the existence of any such statutes in any jurisdiction, including the State of Washington. 
 5.
Exclusions from General Release. Excluded from the Release are any claims or rights that cannot be waived by law, as well as Executive’s right to file a charge with an administrative agency or participate in any agency investigation.
Executive is, however, waiving the right to recover any money in connection with a charge or investigation. Executive is also waiving the right to recover any money in connection with a charge filed by any other individual or by the Equal Employment
Opportunity Commission or any other federal or state agency. 
 6. Covenant Not to Sue. 

(a) A “covenant not to sue” is a legal term that means Executive promises not to file a lawsuit in court. It is different from the
release of claims and waiver of rights contained in Section 4 above. Besides waiving and releasing the claims covered by Section 4 above, Executive shall never sue the Releasees in any forum for any reason covered by the
Release. Notwithstanding this covenant not to sue, Executive may bring a claim against the Company to enforce this Agreement, to challenge the validity of this Agreement under the ADEA or for any claim that arises after execution of this Agreement.
If Executive sues any of the Releasees in violation of this Agreement, Executive shall be liable to them for their reasonable attorneys’ fees and costs (including the costs of experts, evidence, and counsel) and other litigation costs incurred
in defending against Executive’s suit. In addition, if Executive sues any of the Releasees in violation of this Agreement, the Company can require Executive to return all but a sum of $100 of the Severance Payments, which sum is, by itself,
adequate consideration for the promises and covenants in this Agreement. In that event, the Company shall have no obligation to make any further Severance Payments. 

(b) If Executive has previously filed any lawsuit against any of the Releasees, Executive shall immediately take all necessary steps and
execute all necessary documents to withdraw or dismiss such lawsuit to the extent Executive’s agreement to withdraw, dismiss, or not file a lawsuit would not be a violation of any applicable law or regulation. 

7. Representations by Executive. Executive warrants that Executive is legally competent to execute this Agreement and that Executive
has not relied on any statements or explanations made by the Company or its attorneys. Executive acknowledges that Executive has been afforded the opportunity to be advised by legal counsel regarding the terms of this

  
 A-3 

 
Agreement, including the Release. Executive acknowledges that Executive has been offered at least 21 days to consider this Agreement. After being so advised, and without coercion of any kind,
Executive freely, knowingly, and voluntarily enters into this Agreement. Executive acknowledges that Executive may revoke this Agreement within seven days after Executive has signed this Agreement and acknowledges understanding that this Agreement
shall not become effective or enforceable until seven days after Executive has signed this Agreement (the “Effective Date”), as evidenced by the date set forth below Executive’s signature on the signature page hereto. Any
revocation must be in writing and directed to [                    ]. If sent by mail, any revocation must be postmarked within the seven-day
period described above and sent by certified mail, return receipt requested. 
 8. Restrictive Covenants. Section 6 of the
Employment Agreement (entitled “Restrictive Covenants”), shall continue in full force and effect as if fully restated herein. 

9. Non-Disparagement. Executive shall not engage in any disparagement or vilification of the Releasees, and shall refrain from making
any false, negative, critical, or disparaging statements, implied or expressed, concerning the Releasees, including regarding management style, methods of doing business, the quality of products and services, role in the community, or treatment of
employees. Executive shall do nothing that would damage the Company’s business reputation or goodwill. 
 10. Company Property.

 (a) Executive shall return to the Company all information, property, and supplies belonging to the Company or any of its affiliates,
including any confidential or proprietary information, Company autos, keys (for equipment or facilities), laptop computers and related equipment, cellular phones, smart phones or PDAs (including SIM cards), security cards, corporate credit cards,
and the originals and all copies of all files, materials, and documents (whether in tangible or electronic form) containing confidential or proprietary information or relating to the business of the Company or any of its affiliates. 

(b) Executive shall not, at any time on or after the Termination Date, directly or indirectly use, access, or in any way alter or modify any
of the databases, e-mail systems, software, computer systems, or hardware or other electronic, computerized, or technological systems of the Company or any of its affiliates. Executive acknowledges that any such conduct by Executive would be illegal
and would subject Executive to legal action by the Company, including claims for damages and/or appropriate injunctive relief. 
 11. No
Admissions. The Company denies that the Company or any of its affiliates, or any of their employees or agents, has taken any improper action against Executive, and this Agreement shall not be admissible in any proceeding as evidence of improper
action by the Company or any of its affiliates or any of their employees or agents. 
 12. Confidentiality of Agreement. Executive
shall keep the existence and the terms of this Agreement confidential, except for Executive’s immediate family members and Executive’s legal and tax advisors in connection with services related hereto and except as may be required by law
or in connection with the preparation of tax returns. 

  
 A-4 

 13. Non-Waiver. The Company’s waiver of a breach of this Agreement by Executive shall
not be construed or operate as a waiver of any subsequent breach by Executive of the same or of any other provision of this Agreement. 

14. Applicable Law; Mandatory Arbitration and Equitable Relief. All questions concerning the construction, validity, and interpretation
of this Agreement and the performance of the obligations imposed by this Agreement shall be governed by Sections 9 and 10 of the Employment Agreement as if restated herein in their entirety. 

15. Legal Fees. In the event that either Party commences mediation, arbitration, or litigation to enforce or protect such Party’s
rights under this Agreement, the prevailing Party in any such action shall be entitled to recover reasonable attorneys’ fees and costs (including the costs of experts, evidence, and counsel) and other costs relating to such action, in addition
to all other entitled relief, including damages and injunctive relief. 
 16. Entire Agreement. This Agreement sets forth the entire
agreement of the Parties regarding the subject matter hereof, and shall be final and binding as to all claims that have been or could have been advanced on behalf of Executive pursuant to any claim arising out of or related in any way to
Executive’s employment with the Company and the termination of that employment. 
 17. Counterparts. This Agreement may be
executed in any number of counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same Agreement. 

18. Successors. This Agreement shall be binding upon and inure to the benefit of the Company, its successors and assigns. 

19. Enforcement. The provisions of this Agreement shall be regarded as divisible and separable and if any provision should be declared
invalid or unenforceable by a court of competent jurisdiction, the validity and enforceability of the remaining provisions shall not be affected thereby. If the scope of any restriction or requirement contained in this Agreement is too broad to
permit enforcement of such restriction or requirement to its full extent, then such restriction or requirement shall be enforced to the maximum extent permitted by law, and Executive hereby consents that any court of competent jurisdiction may so
modify such scope in any proceeding brought to enforce such restriction or requirement. In addition, Executive stipulates that breach by Executive of restrictions and requirements under this Agreement will cause irreparable damage to the Releasees
in the case of Executive’s breach and that the Company would not have entered into this Agreement without Executive binding Executive to these restrictions and requirements. In the event of Executive’s breach of this Agreement, in addition
to any other remedies the Company may have, and without bond and without prejudice to any other rights and remedies that the Company may have for Executive’s breach of this Agreement, the Company shall be relieved of any obligation to provide
Severance Payments and shall be entitled to an injunction to prevent or restrain any such violation by Executive and all persons directly or indirectly acting for or with Executive. Executive stipulates that the restrictive period for which the
Company is entitled to an injunction shall be extended in for a period that equals the time period during which Executive is or has been in violation of the restrictions contained herein. 

  
 A-5 

 20. Construction. In this Agreement, unless otherwise stated, the following uses apply:
(a) references to a statute shall refer to the statute and any amendments and any successor statutes, and to all regulations promulgated under or implementing the statute, as amended, or its successors, as in effect at the relevant time;
(b) in computing periods from a specified date to a later specified date, the words “from” and “commencing on” (and the like) mean “from and including, “ and the words “to,” “until,” and
“ending on” (and the like) mean “to, but excluding”; (c) references to a governmental or quasi-governmental agency, authority, or instrumentality shall also refer to a regulatory body that succeeds to the functions of the
agency, authority, or instrumentality; (d) indications of time of day shall be based upon the time applicable to the location of the principal headquarters of the Company; (e) the words “include,” “includes,” and
“including” (and the like) mean “include, without limitation,” “includes, without limitation,” and “including, without limitation,” (and the like) respectively; (f) all references to preambles, recitals,
sections, and exhibits are to preambles, recitals, sections, and exhibits in or to this Agreement; (g) the words “hereof,” “herein,” “hereto,” “hereby,” “hereunder,” (and the like) refer to this
Agreement as a whole (including exhibits); (h) any reference to a document or set of documents, and the rights and obligations of the parties under any such documents, means such document or documents as amended from time to time, and all
modifications, extensions, renewals, substitutions, or replacements thereof; (i) all words used shall be construed to be of such gender or number as the circumstances and context require; (j) the captions and headings of preambles,
recitals, sections, and exhibits appearing in or attached to this Agreement have been inserted solely for convenience of reference and shall not be considered a part of this Agreement, nor shall any of them affect the meaning or interpretation of
this Agreement or any of its provisions; and (k) all accounting terms not specifically defined herein shall be construed in accordance with GAAP. 

21. Future Cooperation. In connection with any and all claims, disputes, negotiations, governmental, internal or other investigations,
lawsuits, or administrative proceedings (the “Legal Matters”) involving the Company or any affiliate, or any of their current or former officers, employees or board members (collectively, the “Disputing Parties”
and, individually, each a “Disputing Party”), Executive shall make himself reasonably available, upon reasonable notice from the Company and without the necessity of subpoena, to provide information and documents, provide
declarations and statements regarding a Disputing Party, meet with attorneys and other representatives of a Disputing Party, prepare for and give depositions and testimony, and otherwise cooperate in the investigation, defense, and prosecution of
any and all such Legal Matters, as may, in the good faith and judgment of the Company, be reasonably requested. The Company shall consult with Executive and make reasonable efforts to schedule such assistance so as not to materially disrupt
Executive’s business and personal affairs. The Company shall reimburse all reasonable expenses incurred by Executive in connection with such assistance, including travel, meals, rental car, and hotel expenses, if any; provided such
expenses are approved in advance by the Company and are documented in a manner consistent with expense reporting policies of the Company as may be in effect from time to time. 

IN WITNESS WHEREOF, the Parties have duly executed this Agreement as of the dates set
forth below their respective signatures below. 

  
 A-6 

									
	HERITAGE FINANCIAL CORPORATION	 		 	EXECUTIVE
				
	By:	 	  
	 		 	  

		 	[Name]	 		 		 	[Name]
		 	[Title]	 		 	
					
	Date:	 	  
	 		 	Date:	 	  

  
 A-7

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