Exhibit 10.4

AMENDED AND RESTATED
EMPLOYEE STOCK PURCHASE PLAN
OF
COLUMBIA BANKING SYSTEM, INC.

The original Employee Stock Purchase Plan of Columbia Banking System, Inc. was adopted by the Board of Directors on January 25, 1995, and approved by the Shareholders on April 26, 1995. The Plan is now being amended and restated by the Board of Directors for the purpose of (1) adding and clarifying definitions and making implementing changes throughout the Plan; (2) expanding eligibility of employees by removing the six months of employment requirement; (3) decreasing the number of offering periods to two by expanding the length of each period from three months to six months; (4) adding a "look-back" provision such that the purchase price of stock purchased under the Plan will be the lesser of the fair market value of the stock at the beginning of the Offering Period or at the end of the Offering Period; and (5) expanding the Board's and Committee's authority to amend the Plan and the terms of the options granted under the Plan to allow for easier administration of the Plan.

ARTICLE I - PURPOSE

The Employee Stock Purchase Plan (the "Plan") of Columbia Banking System, Inc. (the "Company") is intended to provide a method whereby Employees of the Company will have an opportunity to acquire a proprietary interest in the Company through the purchase of shares of the common stock of the Company ("Common Stock or Stock"). It is the intention of the Company to have the Plan qualify as an "employee stock purchase plan" under Section 423 of the Internal Revenue Code of 1986, as amended (the "Code"). The provisions of the Plan shall be construed so as to extend and limit participation in a manner consistent with the requirements of that Section of the Code.

ARTICLE II - DEFINITIONS

"Bank" means Columbia Bank.

"Beneficiary" means the person(s) designated by the Participant under
Section 12.1 (or otherwise determined under that Section) to receive Stock or cash under this Plan to which the Participant would have been entitled.

"Board" means the Board of Directors of Columbia Banking System, Inc.

"Committee" means the Personnel and Compensation Committee of the Board.

"Company" means Columbia Banking System, Inc., a Washington corporation, its subsidiaries or other related corporations as may be designated by the Board.

"Compensation" means any and all cash compensation paid by the Company to the Employee, including base pay, bonus, overtime and shift premiums.

"Employee" means any person who is employed by the Company on either a full-time or part-time basis.

"Enrollment Date" means the first day of each Offering Period.

"Exercise Date" means the last day of each Offering Period.

"Fair Market Value" means, as of any date, the value of Common Stock determined as follows:

(1) If the Common Stock is listed on any established stock exchange or a national market system, including without limitation The Nasdaq National Market or The Nasdaq Small Market of the Nasdaq Stock Market, its Fair Market Value shall be the closing sales price for such stock (or the closing bid, if no sales were reported) as quoted on such exchange or system for the last market trading day on the date of such determination, as reported in The Wall Street Journal or other source as the Committee deems reliable, or,

(2) If the Common Stock is regularly quoted by a recognized securities dealer but selling prices are not reported, its Fair Market Value shall be the mean of the closing bid and asked prices for such stock on the date of such determination, as reported in The Wall Street Journal or other source as the Committee deems reliable, or,

(3) In the absence of an established market for the Common Stock, the Fair Market Value shall be determined in good faith by the Committee.

"Offering Period" means a period of approximately six (6) months during which a Right granted pursuant to the Plan may be exercised, commencing on the first Trading Day on or after January 1 and terminating on the last Trading Day in the period ending the following June 30, or commencing on the first Trading Day on or after July 1 and terminating on the last Trading Day in the period ending the following December 31. The duration of Offering Periods may be changed pursuant to Section 4.1 of this Plan. The initial six-month Offering Period is a short period beginning on March 1, 2000, and terminating on June 30, 2000.

"Participant" means an Employee who has commenced participation in the Plan under Section 3.4.

"Purchase Price" means an amount equal to 90% of the Fair Market Value of a share of Common Stock on the Enrollment Date or on the Exercise Date, whichever is lower; provided that the Purchase Price may be adjusted by the Board pursuant to Section 12.5 of this Plan.

"Trading Day" means a day on which national stock exchanges and the Nasdaq System are open for trading.

"Right(s)" means a right, in the nature of an option, of a Participant to purchase Stock under this Plan.

ARTICLE III - ELIGIBILITY AND PARTICIPATION

Any Employee who is employed by the Company on a given Enrollment Date is eligible to participate in the Plan.

For purposes of the Plan, the employment relationship shall be treated as continuing intact while the individual is on sick leave or other leave of absence approved by the Company, except as provided by Treasury Regulation
Section 1.421-7(h).

Notwithstanding any provisions of the Plan to the contrary, no Employee shall be granted a Right under the Plan:

(a) if, immediately after the grant, such Employee would own stock, and/or hold outstanding options (of any type and regardless of whether then exercisable in whole or in part or not at all) to purchase stock, possessing 5% or more of the total combined voting power or value of all classes of stock of the Company (as determined under the rules of Section 424(d) of the Code); or

(b) which permits his Rights to purchase stock under all employee stock purchase (Section 423) plans of the Company to accrue at a rate which exceeds $25,000 in fair market value of the stock (determined at the time such Right under this or any other Section 423 Plan of the Company is granted) for each calendar year in which such Right is outstanding. For this purpose, the $25,000 annual limit is cumulative, such that unused amounts from a prior calendar year during which a Right was outstanding may be carried forward to future calendar years, in accordance with Treasury Regulations Section 1.423-2(i).

An Employee may become a Participant in the Plan by completing an authorization for payroll deduction on the form provided by the Company and filing it with the Company's Human Resources Department prior to the applicable Enrollment Date. Payroll deductions for a Participant will commence on the first payroll date following the Enrollment Date and will end on the last payroll date in the Offering Period to which such authorization is applicable, unless sooner terminated by the Participant as provided in Article VIII of this Plan.

ARTICLE IV - OFFERINGS

The Plan will be implemented by consecutive Offering Periods with a new Offering Period commencing on the first Trading Day on or after January 1 and July 1 each year, or on such other date as the Board or Committee shall determine, and continuing thereafter until terminated in accordance with Section 12.5 of this Plan. The Board or the Committee will have the power to change the duration of Offering Periods (including the commencement dates thereof) with respect to future offerings without stockholder approval if such change is announced at least five (5) days prior to the scheduled beginning of the first Offering Period to be affected thereafter. The initial six-month offering period is a short period beginning on March 1, 2000, and terminating on June 30, 2000.

ARTICLE V - PAYROLL DEDUCTIONS

At the time a Participant files an authorization for payroll deduction, the Participant shall elect to have deductions made from his Compensation on each payday during the time he is a Participant in an Offering. A Participant's payroll deductions may not be less than 1% of Compensation for the payroll date to which the deduction is applied, and must be in whole percentage increments.

All payroll deductions made for a Participant shall be credited to his account under the Plan. A Participant may not make any separate cash payment into such account.

A Participant may terminate or change the amount of his prospective payroll deductions during any Offering Period by completing and filing with the Company a new authorization for a change in payroll deduction. The Board or Committee may, in its discretion, limit the number of participation rate changes during any Offering Period. The change in payroll deduction rate will be effective with the first full payroll period following five (5) business days after the Company's receipt of the new authorization, unless processed sooner by the Company. A Participant's authorization will remain in effect for successive Offering Periods unless terminated as provided in Article VIII of this Plan.

If a Participant goes on a leave of absence and such leave of absence is not considered a termination of employment under Treasury Regulation Section 1.421-7(h), such Participant shall have the right to elect: (a) to withdraw the balance in his account pursuant to Section 8.1, (b) to discontinue further contributions to the Plan while on leave but remain a Participant in the Plan as to contributions made prior to the leave, or (c) if the leave is paid, to remain a Participant in

the Plan during such leave of absence, authorizing deductions to be made from payments by the Company to the Participant during such leave of absence.

To the extent necessary to comply with Section 423(b)(8) of the Code and
Section 3.3 of this Plan, a Participant's payroll deductions may be decreased to zero percent (0%) at any time during an Offering Period. Payroll deductions will recommence at the rate provided in such Participant's payroll deduction authorization at the beginning of the first Offering Period which is scheduled to end in the following calendar year, unless terminated by the Participant as provided in Article VII of this Plan.

At the time Participant's Right is exercised, in whole or in part, or at the time some or all of the Company's Common Stock issued under the Plan is disposed of, the Participant must report such disposition to the Company and make adequate provision for the Company's federal, state, or other tax withholding obligations, if any, which arise upon the exercise of the Right or the disposition of the Common Stock. At any time, the Company may, if required, withhold from the Participant's compensation the amount necessary for the Company to meet any applicable withholding obligations, including any withholding required to make available to the Company any tax deductions or benefits attributable to sale or early disposition of Common Stock by the Participant.

ARTICLE VI - GRANTING OF RIGHTS

On the Enrollment Date of each Offering Period, each Participant will be granted a Right to purchase on the Exercise Date of such Offering Period up to a number of shares of Common Stock determined by dividing such Participant's accumulated payroll deductions in his account as of the Exercise Date by the Purchase Price; provided that such purchase shall be subject to the limitations set forth in Section 3.3 of this Plan.

ARTICLE VII - EXERCISE OF RIGHTS

Unless a Participant gives notice to the Company as hereinafter provided, his Right for the purchase of Common Stock with payroll deductions made during any Offering Period will be deemed to have been exercised automatically on the Exercise Date applicable to such Offering Period, for the purchase of the maximum number of full shares of Common Stock which the accumulated payroll deductions in his account at the time will purchase at the Purchase Price. No fractional shares will be purchased; any accumulated payroll deductions in a Participant's account which are not sufficient to purchase a full share will be retained in the Participant's account for the subsequent Offering Period, subject to earlier withdrawal by the Participant as provided in Article VIII of this Plan. Any other monies left over in a Participant's account after the Exercise Date will be returned to the Participant.

Fractional shares will not be issued under the Plan and any accumulated payroll deductions which would have been used to purchase fractional shares will be applied to succeeding Offerings or ultimately returned to the Participant, as described above.

During a Participant's lifetime, Rights held by such Participant shall be exercisable only by the Participant.

As promptly as practicable after each Exercise Date on which a purchase of Common Stock occurs, the Company will arrange the delivery to each Participant, as appropriate, of the shares purchased upon exercise of any Right. The Company may, in its discretion, provide a procedure for Participant shares to be held in account by the Company or its agent. Such shares will be held in book entry form until such time as a Participant requests issuance of a stock certificate representing all or a portion of the accumulated shares held in such Participant's account.

ARTICLE VIII - WITHDRAWAL

A Participant may withdraw payroll deductions credited to his account under the Plan at any time by giving written notice to the Human Resources Department. All of the Participant's payroll deductions credited to his account will be paid to him promptly after receipt of his notice of withdrawal, and no further payroll deductions will be made from his pay during such Offering Period. The Company may, at its option, treat any attempt to borrow by a Participant on the security of his accumulated payroll deductions as an election, under Section 8.1, to withdraw such deductions.

A Participant's withdrawal from any Offering Period will not have any effect upon his eligibility to participate in any succeeding Offering Period or in any similar plan which may hereafter be adopted by the Company.

Upon termination of the Participant's employment with the Company for any reason, including retirement (but excluding death while in the employ of the Company or an approved leave of absence), the payroll deductions credited to the Participant's account will be returned to the Participant, or, in the case of the Participant's death subsequent to the termination of the Participant's employment, to the Participant's Beneficiary.

Upon termination of the Participant's employment because of the Participant's death, the Participant's Beneficiary shall have the right to elect, by written notice given to the Human Resources Department, prior to the earlier of the Exercise Date or the expiration of a period of sixty (60) days commencing with the date of the death of the Participant, either:

(a) to withdraw all of the payroll deductions credited to the Participant's account under the Plan, or

(b) to exercise, on the Exercise Date next following the date of the Participant's death, the Participant's Right for the purchase of the number of full shares of Stock which the accumulated payroll deductions in the Participant's account at the date of the Participant's death will purchase at the applicable Purchase Price, and any excess in such account will be returned to said Beneficiary.

In the event that no such written notice of election shall be duly received by the Human Resources Department, the Beneficiary shall automatically be deemed to have elected, pursuant to paragraph 8.4(b), to exercise the Participant's Right.

ARTICLE IX - NO INTEREST

No interest will be paid or allowed or any money paid into the Plan and credited to the account of any Participant, whether used to purchase Common Stock or returned to the participant or his Beneficiary.

ARTICLE X - STOCK

The maximum number of shares of Common Stock which shall be issued under the Plan, subject to adjustment upon changes in capitalization of the Company as provided in Section 12.4, shall not exceed 100,000 shares for all Offering Periods. If the total number of shares for which Rights are exercised during any Offering Period exceeds the number of shares of Common Stock remaining under the Plan, and if the Plan is not amended to increase the available shares, the Board or the Committee shall make a pro rata allocation of the shares available (based on the relative number of Rights exercised by each Participant during that Offering Period), and the Plan shall terminate after exercise of such remaining Rights.

The Participant will have no interest in Common Stock covered by his Right until such Right has been exercised.

Common Stock to be delivered to a Participant under the Plan will be registered in the name of the Participant, or, if the Participant so directs by written notice to the Human Resources Department prior to the Exercise Date applicable thereto, in the names of the Participant and one such other person as may be designated by the Participant, to the extent permitted by applicable law.

The Board or the Committee may, in its discretion, require as a condition to the exercise of any Right that the Participant shall have represented at the time of purchase, in form and substance satisfactory to the Company, that any disposition of the shares of Common Stock shall be effected in accordance with applicable securities laws, and that the Participant consents to having a legend placed on the share certificates to that effect which is acceptable to counsel for the Company.

ARTICLE XI - ADMINISTRATION

The Plan shall be administered by the Committee, or if the Board so elects, the full Board. If the Board desires to directly exercise its powers under this Plan, then the Board may take any action under the Plan that would otherwise be the responsibility of the Committee.

Subject to the express provisions of the Plan, the Committee shall have authority in its discretion to interpret and construe any and all provisions of the Plan, to adopt rules and regulations for administering the Plan, and to make all other determinations deemed necessary or advisable for administering the Plan. The Committee's determination on the foregoing matters shall be conclusive.

The quorum and action requirements for the Committee regarding the Plan shall be the same as for other activities conducted by the Committee. The Committee may correct any defect or omission or reconcile any inconsistency in the Plan, in the manner and to the extent it deems desirable.

Shares will not be issued with respect to a Right unless the exercise of such Right and the issuance and delivery of such shares pursuant thereto complies with all applicable provisions of law, domestic or foreign, including, without limitation, the Securities Act of 1933, the Securities Exchange Act of 1934, the rules and regulations promulgated thereunder, and the requirements of

any stock exchange upon which the shares may then be listed, and shall be further subject to the approval of counsel for the Company with respect to such compliance.

As a condition to the exercise of a Right, the Company may require the Participant exercising the Right to represent and warrant at the time of any such exercise that the shares are being purchased only for investment and without any present intention to sell or distribute such shares if, in the opinion of counsel for the Company, such a representation is required by any of the aforementioned applicable provisions of law.

ARTICLE XII - MISCELLANEOUS

A Participant may file a written designation of a Beneficiary who is to receive any Common Stock and/or cash to which the Participant may be entitled under this Plan in the event of the Participant's death subsequent to an Exercise Date on which the Right is exercised but prior to delivery to such Participant of any shares and cash. Such designation of Beneficiary must be in form satisfactory to the Company (including spousal consent to designation of any non-spouse primary Beneficiary by a married Participant) and may be changed by the Participant at any time by written notice to the Human Resources Department. Upon the death of a Participant and upon receipt by the Company of proof of identity and existence at the Participant's death of a Beneficiary validly designated by him under the Plan, the Company shall deliver such Common Stock and/or cash to such Beneficiary. In the event of the death of a Participant and in the absence of a Beneficiary validly designated under the Plan who is living at the time of such Participant's death, the Company shall deliver such Common Stock and/or cash to the executor or administrator of the estate of the Participant, or if no such executor or administrator has been appointed (to the knowledge of the Company), the Company, in its discretion, may deliver such Common Stock and/or cash to the spouse or to any one or more dependents of the Participant as the Company may designate. No Beneficiary shall, prior to the death of the Participant by whom he has been designated, acquire any interest in the Common Stock or cash credited to the Participant under the Plan.

Neither payroll deductions credited to a Participant's account nor any rights with regard to the exercise of a Right or to receive Common Stock under the Plan may be assigned, transferred, pledged, or otherwise disposed of in any way by the Participant other than by will or the laws of descent and distribution. Any such attempted assignment, transfer, pledge or other disposition shall be without effect, except that the Company may treat such act as an election to withdraw funds in accordance with Section 8.1.

All payroll deductions received or held by the Company under this Plan may be used by the Company for any corporate purpose and the Company shall not be obligated to segregate such payroll deductions.

(a) The Board of Directors of the Company or the Committee may at any time and for any reason terminate or amend the Plan. Except as provided in Section 12.4 hereof, no such termination can affect Rights previously granted, provided that an Offering Period may be terminated by the Board of Directors or the Committee on any Exercise Date if the Board or the Committee determines that the termination of the Offering Period or the Plan is in the best interests of the Company and its stockholders. Except as provided in Section 12.4 and Section 12.5 hereof, no amendment may make any change in any option theretofore granted which adversely affects the rights of any participant. To the extent necessary to comply with Section 423 of the Code (or any other applicable law, regulation or stock exchange rule), the Company shall obtain shareholder approval in such a manner and to such a degree as required.

(b) Without stockholder consent and without regard to whether any Participant Rights may be considered to have been "adversely affected," the Board (or its committee) shall be entitled to change the Offering Periods, limit the frequency and/or number of changes in the

amount withheld during an Offering Period, establish the exchange ratio applicable to amounts withheld in a currency other than U. S. dollars, permit payroll withholding in excess of the amount designated by a Participant in order to adjust for delays or mistakes in the Company's processing of properly completed withholding elections, establish reasonable waiting and adjustment periods and/or accounting and crediting procedures to ensure that amounts applied toward the purchase of Common Stock for each Participant properly correspond with amounts withheld from the Participant's Compensation, and establish such other limitations or procedures as the Board (or its committee) determines in its sole discretion advisable which are consistent with the Plan.

(c) In the event the Board or the Committee determines that the ongoing operation of the Plan may result in unfavorable financial accounting consequences, the Board or the Committee may, in its discretion and, to the extent necessary or desirable, modify or amend the Plan to reduce or eliminate such accounting consequences including, but not limited to:

(1) altering the Purchase Price for any Offering Period including an Offering Period underway at the time of the change in Purchase Price;

(2) shortening any Offering Period so that the Offering Period ends on a new Exercise Date, including an Offering Period underway at the time of the Board action; and

(3) allocating shares.

Such modifications or amendments shall not require stockholder approval or the consent of any Plan participants.

The Plan does not, directly or indirectly, create in any Employee or class of Employees, any right with respect to continuation of employment by the Company, and it shall not be deemed to interfere in any way with the Company's right to terminate, or otherwise modify, an Employee's employment at any time.

The provisions of the Plan shall, in accordance with its terms, be binding upon, and inure to the benefit of, each Participant and Beneficiary, and successors thereof, including, without limitation, estates and the executors, administrators or trustees, heirs and legatees, and any receiver, trustee in bankruptcy or creditor representative.

The laws of the State of Washington will govern all matters relating to this Plan, except to the extent superseded by the laws of the United States.

COLUMBIA BANKING SYSTEM, INC.

Lease Date:                                    December 15, 1999

Landlord:                                      Haub Brothers Enterprises Trust
Address of Landlord:                           c/o Mr. John D. Barline
                                               P.O. Box 1872
                                               Tacoma, WA 98401-1872

Tenant:                                        Columbia Banking Systems, Inc., a
                                               Washington corporation

Address of Premises:                           1301 South "A" Street

Contact:                                       W. W. Philip
                                               Telephone:  253-305-1900

Paragraph 1         Lease Term: One Hundred Eighty (180) Months, commencing 75
                    days after issuance of: (a) a certificate from Landlord's
                    Architect that the building has been substantially completed
                    in accordance with the approved plans and specifications
                    (the "Certificate of Construction Completion"); (b) a
                    Certificate of Construction Completion for the building from
                    the City of Tacoma; and (c) a Certificate from Landlord's
                    Architect that the Landlord's obligations as enumerated in
                    Exhibit "C" have been substantially competed except for
                    normal punch list items. In the event this Lease commences
                    on a date other than the first day of a calendar month, said
                    term shall extend for said number of Months in addition to
                    the remainder of the calendar month following the date of
                    Lease commencement.

Paragraph 2         Rent: $115,412.00 for floors 6, 7 and 8. This is based on
                    62,105 NRSF. The exact square footage will be verified in
                    writing and adjusted upon substantial completion of the
                    building. The rent will also be adjusted based on reduced
                    costs, as more particularly described on Exhibit H.

Paragraph 17        Tenant's Percentage Share of Operating Expenses is
                    estimated to be: (62,105 NRSF) 36.14% The exact percentage
                    will be verified in writing and adjusted upon substantial
                    completion of the building.

Paragraph 2         Security Deposit:          $0.00

                    The foregoing Basic Lease Information is hereby incorporated
                    into and made a part of this Lease. Each reference in this
                    Lease to any of the Basic Lease Information shall mean the
                    respective information hereinabove set forth and shall be
                    construed to incorporate all of the terms provided under the
                    particular Lease paragraph pertaining to such information.
                    In the event of any conflict between any Basic Lease
                    Information and the Lease, the latter shall control.

Lease Agreement

1. TERMS AND POSSESSION.

(a) The term of this Lease shall be One Hundred Eighty (180) Months, commencing 75 days after Landlord has delivered possession of the entire premises to Tenant and has delivered to Tenant: (a) a certificate from Landlord's Architect that the building has been substantially completed in accordance with the approved plans and specifications (the "Certificate of Construction Completion") and (b) a Certificate of Construction Completion for the building from the City of Tacoma ; and (c) a Certificate from Landlord's Architect that the Landlord's obligations as enumerated in Exhibit "C" have been substantially competed except for normal punch list items. The parties anticipate the Building to be completed and ready for commencement of occupancy on or about January 1, 2001 Landlord agrees to allow Tenant to commence construction of its tenant improvements concurrent with Landlord's construction of the building so long as the Tenant improvement work does not interfere with or adversely affect Landlord's ability to deliver the premises timely. Tenant shall be permitted to occupy the Premises before the commencement of the term for purposes of completing tenant improvements, installing equipment, moving furniture and other activities prior to conducting business from the Premises and such activities and occupancy by Tenant shall not be deemed Tenant's acceptance of possession; provided, however, that such period of occupancy before commencement of the term shall not exceed 75 days. Tenant shall be deemed to have accepted possession of the Premises and the Lease term shall begin upon commencing the operation of its business on the Premises or 75 days after issuance of the three (3) above required Certificates, , whichever first occurs (herein, the "Commencement Date"). If Landlord, for any reason whatsoever, cannot deliver possession of the building to Tenant on or before January 1,2001, this Lease shall not be void or voidable, nor shall Landlord or its agents be liable to Tenant for any loss or damage resulting therefrom. In that event, however, Tenant shall not be liable for any rent until the Lease commences as described above. In the event that Landlord fails to deliver possession of the building as defined above by December 15, 2001, unless otherwise modified by both parties, this Lease "may" be canceled by Tenant and, upon Tenant exercising this option, the Lease shall be of no further effect.

(c) Tenant shall accept the Premises upon notice from Landlord that all work which is the Landlord's responsibility is substantially complete, subject to minor punch list items. Tenant shall, within ninety (90) days of such notice, provide Landlord with a complete list of any alleged deficiencies in such work and Landlord shall promptly repair the same. Thereafter, Tenant shall be deemed to have waived such deficiencies not made known to Landlord, except for latent deficiencies, and to have accepted the building as fully in compliance with Landlord's obligations hereunder.

2. RENT. In consideration of this Lease, Tenant promises and agrees to pay Landlord rent for said Premises at the rate of:

                        ANNUAL BASE RENT
MONTHS              PER RENTABLE SQUARE FOOT        MONTHLY BASE RENT

1-24                         $22.30                       $115,412
25-48                        $23.30                       $120,587
49-72                        $25.80                       $133,526
73-120                       $26.30                       $136,113
121-180                      $27.06                       $140,047

One such monthly installment shall be payable by Tenant to Landlord in advance, without demand, upon Tenant's execution of this Lease, and a like monthly installment shall be due and payable on or before the first day of each succeeding calendar month during the term hereof. Rent for any fractional month at the beginning or end of the Lease term shall be prorated.

In the event Tenant fails to pay any installment of rent or other incurred expense hereunder as and when such installment is due, to help defray the additional cost to Landlord resulting from such late payments, Tenant shall pay to Landlord a late charge in an amount equal to three percent (3%) of such installment for any installment not paid by the 10th of the month for which it is due; and the failure to pay such amount within ten (10) days after written demand therefor shall be an event of default hereunder. The provision for such late charge shall be in addition to all of Landlord's other rights and remedies hereunder or at law and shall not be construed as liquidated damages or as limiting Landlord's remedies in any manner. In the event that any installment of rent or other incurred charge remains unpaid ten (10) days after assessment or invoice thereof, interest shall be assessed on all outstanding amounts at the lesser of (i) the rate of 12% per annum or (ii) the highest rate allowed by law.

3. USE. The demised Premises shall be used and occupied by Tenant as banking and other associated services, including but not limited to insurance and securities related activities.

(a) Tenant shall not use, or permit to be used, the demised Premises for any other purpose. Tenant shall not commit nor permit the commission of any waste in, on or about the Premises, and shall not occupy or use, nor permit to be occupied or used any portion of the demised Premises for any business or purpose which is unlawful in part or in whole, nor permit anything to be done which will in any way increase the rate of fire insurance on the Building or its contents, or cause the cancellation of such insurance or otherwise affect said insurance in any manner. In the event that, by reason of acts of Tenant, there shall be any increase in the rate of insurance on the Building or its contents created by Tenant's acts or conduct of business, then such acts shall be deemed to be an event of default hereunder and Tenant hereby agrees to pay the amount of such increase on demand and acceptance of such payment shall not constitute a waiver of any of Landlord's rights hereunder.

(b) Tenant agrees that it shall not generate, handle, store or dispose of any hazardous substance on or in the Premises or common areas or any other part of the Building. As used herein, the term "hazardous substance" means any hazardous, toxic or dangerous substance, waste or material, which is now or hereafter becomes designated a hazardous and/or regulated under any Federal, State or local statute, ordinance, rule, regulation or other law now or hereafter in effect pertaining to environmental protection, contamination or clean-up. Tenant agrees to hold harmless, indemnify and defend Landlord from and against any damage, loss, claim or liability resulting from any breach of this covenant, including

any attorneys' fees and costs incurred as a result of any such breach. This indemnity shall survive the termination of this Lease, whether by expiration of its term or otherwise.

(c) Landlord agrees that it shall not generate, handle, store or dispose of any hazardous substance on or in the Premises or common areas or any other part of the Building. As used herein, the term "hazardous substance" means any hazardous, toxic or dangerous substance, waste or material, which is now or hereafter becomes designated a hazardous and/or regulated under any Federal, State or local statute, ordinance, rule, regulation or other law now or hereafter in effect pertaining to environmental protection, contamination or clean-up. Landlord agrees to hold harmless, indemnify and defend Tenant from and against any damage, loss, claim or liability resulting from any breach of this covenant and any damage, loss, claim or liability with respect to any hazardous substance existing on or in the Building as of the Commencement Date of this Lease, including any attorneys' fees and costs incurred as a result of any such breach. This indemnity shall survive the termination of this Lease, whether by expiration of its term or otherwise.

4. LANDLORD'S OBLIGATIONS. Landlord shall maintain the Premises and the public and common areas of the Building in good order and condition consistent with the operation of a first-class office building in downtown Tacoma, Washington. Such maintenance includes, but is not limited to, changing burnt out florescent lights, maintaining the standard provided levelours and doors, washing in normal course exterior windows inside and out, furnishing Tenant while occupying the demised Premises water, hot and cold, at those points of supply provided for general use of tenants of the Building; providing heated and refrigerated air conditioning in season, at such times as Landlord normally furnishes these services to all tenants of the Building, and at such hours and temperatures and in such amounts as are considered by Landlord to be standard, such service on Sunday and holidays to be optional on the part of Landlord; janitor service on weekdays other than holidays; elevator service; and electric service for normal office use, all in the manner and to the extent deemed by Landlord to be standard for such a first class office building; but failure to any extent to furnish, or any stoppage of these defined services, resulting from causes beyond control of Landlord shall not render Landlord liable in any respect for damages to person, property or business, nor be construed as an eviction of Tenant for effect any abatement of rent, nor relieve Tenant from fulfillment of any covenant or agreement hereof. Landlord will provide all normal services to the building without any extra or special charges to tenant on holidays which are not bank holidays and during which the bank tenant is open to the public. Should any equipment or machinery furnished by Landlord break down, or for any cause cease to function properly, Landlord shall use reasonable diligence to repair same promptly, but Tenant shall have no claim for rebate of rent or damages on account of any interruptions in service occasioned thereby or resulting therefrom except for landlord gross negligence. Tenant shall pay to Landlord on demand such charges as Landlord may reasonably prescribe for any electric service required by Tenant for computers and other electrical equipment or other electric service deemed by Landlord not to be standard. Should tenant elect to operate, heating, ventilating, air conditioning services in the building at any time other than normal building operating hours, the cost of operating said systems shall be billed back to tenant based on an hourly rate of usage. No janitorial service shall be provided for Saturdays, Sundays or legal holidays. The costs of any janitorial or other service provided by Landlord to Tenant which are in addition to the services ordinarily provided Building tenants shall be repaid by Tenant as Additional Rent upon receipt of billings therefor.

5. TENANT'S REPAIRS AND ALTERATIONS. Tenant shall not in any manner deface, damage or injure the Building, and will pay the cost of repairing any damage or injury done to the Building or any part thereof by Tenant or Tenant's agents, employees. Tenant shall throughout the term of the Lease take good care of the demised Premises and keep them free from waste and nuisance of any kind. Tenant agrees to keep the demised Premises, including all fixtures installed by Tenant , in good condition and make all necessary repairs. At the end or other termination of this Lease, Tenant shall deliver up the demised Premises with all improvements located thereon, except as provided in this paragraph, in good repair and condition, reasonable wear and tear excepted. Tenant shall not make or allow to be made any alterations or physical additions in or to the demised area without the prior written consent of Landlord which consent shall not be unreasonably withheld or delayed. Not withstanding the above, tenant may make periodic improvements to the demised premises not costing more than twenty-five thousand and no/100 ($25,000.00), so long as said improvements are constructed in a professional manner consistent with the

level of quality of the building, and in compliance with all applicable building codes in affect at the time the improvements are to be constructed. tenant must complete the subject work in a manner that will not be disruptive to the other tenants in the building. At the termination of this Lease Tenant shall, if Landlord so elects, remove all alterations, physical additions or improvements erected by Tenant and shall restore the demised Premises to their original condition; otherwise such improvements shall be delivered up to Landlord with the demised Premises. All furniture and moveable trade fixtures installed by Tenant may be removed by Tenant at the termination of this Lease if Tenant so elects, and shall be removed if Landlord so elects. All such removals and restoration shall be accomplished in a good workmanlike manner so as not to damage the primary structure or structural qualities of the Building.

6. ASSIGNMENT AND SUBLETTING. Except in the event of a merger with another bank or similar entity with equal to or greater net worth at the time of transfer, Tenant shall not assign this Lease, or allow same to be assigned by operation of law or otherwise, or sub-let the demised Premises or any part thereof unless tenant agrees to remain primarily liable with respect to the terms and conditions of this lease. Said sublease or transfer shall require the prior written consent of landlord which shall not be unreasonably withheld. Landlord shall have the right to transfer and assign, in whole or in e part, any of its rights under this Lease, and in the Building and property referred to herein; and to the extent that such assignee assumes Landlord's obligations hereunder, Landlord shall by virtue of such assignment be released from such obligations.

If Tenant is a corporation, any dissolution or reorganization of Tenant, or the sale or other transfer of ownership (either in one or more transactions) of fifty percent (50%) or more of the total voting power of all classes of voting stock shall be deemed an assignment. If Tenant is a partnership, the withdrawal or change, voluntary, involuntary or by operation at law, of partners owning thirty percent (30%) or more of the partnership (either in one or more transactions), or the dissolution of the partnership shall be deemed an assignment.

In the event that Landlord agrees to the assignment of this Lease or to a sublease, Tenant agrees to pay the Landlord an amount of Five Hundred and No/100 Dollars ($500.00) to reimburse Landlord for its costs in processing such assignment or sublease.

7. MAINTENANCE. Tenant shall maintain the demised Premises in a neat, clean and healthful condition, and shall comply with all laws, ordinances, orders, rules, and regulations (state, federal, municipal, as well as those of other agencies or bodies having any jurisdiction thereof) with reference to use, condition, or occupancy of the demised Premises.

8. LIABILITY. Landlord shall not be liable for and Tenant shall indemnify and hold Landlord harmless from any loss, liability, costs and expenses, including attorneys' fees, arising out of any claim of injury or damage on or about the leased Premises caused by the negligence or misconduct or breach of this Lease by Tenant, its employees, subtenants, customers, invitees or by any other person entering the leased Premises or the Building or Property under express or implied invitation of Tenant or arising out of Tenant's use of the leased premises. Landlord shall not be liable to Tenant or Tenant's agents employees, invitees or any person entering upon the Property in whole or in part because of Tenant's use of the leased Premises for any damage to persons or property due to condition, design, or defect in the Building or its mechanical systems which may exist or occur Landlord shall not be liable or responsible for any loss or damage to any property or person occasioned by theft, fire, act of God, public enemy, injunction, riot, strike, insurrection, war, court order, requisition or order of government body or authority, or other matter beyond control on Landlord, or for any injury or damage or inconvenience, which may arise through repair or alteration of any part of the Building, or failure to make repairs, or from any cause whatever except Landlord's willful acts or gross negligence. Tenant agrees to purchase at its own expense and to keep in force during the term of this Lease a policy or policies of workmen's compensation and comprehensive liability insurance, including personal injury and property damage, in the minimum amounts of Two Million Dollars ($2,000,000.00) for property damage and Two Million Dollars ($2,000,000.00) per person and Two Million Dollars ($2,000,000.00) per occurrence for personal injuries or deaths of person occurring in or about the Premises. The amounts of insurance may be increased upon mutual written agreement of both parties. Said policies shall:
(I) name Landlord as an additional insured and insure Landlord's contingent liability

under this Lease; (ii) be issued by an insurance company which is acceptable to Landlord (acceptability shall not be unreasonably withheld) and licensed to do business in the State of Washington; and (iii) provide that such insurance shall not be canceled unless thirty (30) days' prior written notice shall have been given to Landlord. Said policy or policies or certificate thereof shall be delivered to Landlord by Tenant upon commencement of the term of the Lease and upon each renewal of said insurance. During the term of this lease, Landlord will maintain an amount of insurance on the building equal to at least 90% of its current replacement cost and Landlord will maintain comprehensive liability insurance, including personal injury and property damage, in the minimum amounts of Two Million Dollars ($2,000,000.00) for property damage and Two Million Dollars ($2,000,000.00) per person and Two Million Dollars ($2,000,000.00) per occurrence for personal injuries or deaths of person occurring in or about the Premises.

9. WAIVER OF SUBROGATION. Notwithstanding any provisions to the contrary elsewhere in this lease, Landlord and Tenant hereby waive any right that each may have against the other on account of any loss or damage arising in any manner which is covered by policies of insurance for fire and extended coverage, theft, public liability, workmen's compensation or other insurance now or hereafter existing during the term hereof.

11. INSPECTION. Landlord, or its officers, agents, and representatives shall have the right to enter into and upon any and all parts of the demised Premises, (except for bank "security areas") at reasonable hours to clean or make repairs or alterations or additions as Landlord may deem necessary. With 24 hour advance notice, Landlord, or its officers, agents, and representatives shall have the right to enter the Premises for general inspections of the same and/or to show the demised Premises to purchasers or lenders, and Tenant shall not be entitled to any abatement or reduction of rent by reason thereof. In addition to the above, Landlord may show the premises to prospective tenants only after the expiration of tenant's notice to renew its lease has expired as defined in paragraph 38 of this lease. The tenant bank may from time to time advise the Landlord in writing of bank "security areas" within its premise into which areas the Landlord will not have access without accompaniment of a bank officer.

12. CONDUCT OF BUSINESS. Tenant shall conduct its business, control its employees, and use its best efforts to control its agents, customers, and invitees - all in such a manner as not to create any nuisance, or interfere with, annoy or disturb other tenants or Landlord in the management of the Building.

13. CONDEMNATION. If the demised Premises shall be taken or condemned in whole or in substantial part for public purposes, then the term of this Lease shall, at the option of Landlord, forthwith cease and terminate. Tenant may make a claim against the condemning agency for Tenant's moving and relocation costs and for the value of its leasehold estate terminated because of the condemnation. Any such claim shall be made jointly with the Landlord and Landlord and Tenant will share pro-rata any condemnation award, but in any case, Tenant shall not be entitled to an amount in excess of its moving and relocation costs and the value of the terminated leasehold estate. In the event of a partial condemnation such that the balance of the Premises provides adequate space of Tenant's operations then and in the foreseeable future, as reasonably determined by Tenant, this Lease shall remain in full force and effect, rent shall be reduced proportionately by the amount of the Premises taken, and Landlord shall restore or make any reasonable improvement to the Premises or the Property which is required as a result of the condemnation so that the balance of the Premises and the property are restored to a useable condition as nearly as possible to the condition prior to the condemnation.

14. FIRE AND OTHER CASUALTY. In the event that the Building should be totally destroyed by fire, tornado or other casualty, or should be so damaged that rebuilding or repairs cannot be completed within two hundred forty (240) days after the date of such damage, Landlord, or Tenant, by giving written notice to the other within sixty (60) days after the date of such damage, may at its option terminate this Lease, in which event the rent shall be abated during the unexpired portion of this Lease effective with the date of such damage. In the event the Building should be damaged by fire, tornado or other casualty, but only to such extent that rebuilding or repairs can be completed within two hundred forty (240) days after the date of such damage, or if the damage should be more serious but neither party has elected to terminate this Lease, in either such event Landlord shall proceed with reasonable diligence to restore the Building to substantially the same condition in which it was immediately prior to the happening of the casualty, except that Landlord shall not be required to rebuild, repair or replace any part of the partitions, fixtures, and other improvements which may have been placed by Tenant or other tenants within the Building, except to the extent that insurance proceeds made available to Landlord include recovery for such improvements. Rent shall be abated prorata with respect to that portion of the Premises which is untenantable during the time the demised Premises are unfit for occupancy. In the event that any mortgagee under a deed of trust, security agreement or mortgage on the Building should require that the insurance proceeds be used to retire the mortgage debt, Landlord shall have no obligation to rebuild and this Lease may terminate upon notice to Tenant. Notwithstanding the foregoing, in no event shall the Landlord be responsible for loss or damage to any of Tenant's personal property. Any insurance which may be carried by Landlord or Tenant against loss or damage to the Building or to the demised Premises shall be for the sole benefit of the party carrying such insurance and under its sole control.

15. HOLDING OVER. Should Tenant, or any of its successors in interest, hold over the demised Premises, or any part thereof, after the expiration of the term of this Lease, unless otherwise agreed in writing, such holding over shall constitute and be construed as a tenancy from month to month only, at a rental equal to rent paid for the last month of the term of this Lease plus twenty-five percent (25%) of such amount. The inclusion of the preceding sentence shall not be construed as Landlord's consent for the Tenant to hold over.

16. TAXES ON TENANT'S PROPERTY. Tenant shall be liable for all taxes levied or assessed against personal property, furniture or fixtures placed by Tenant in the demised Premises. If any such taxes for which Tenant is liable are levied or assessed against Landlord or Landlord's property and if Landlord elects to pay the same or if the assessed value of Landlord's property is increased by inclusion of personal property, furniture or fixtures placed by Tenant in the demised Premises, and Landlord elects to pay the taxes based on such increase, Tenant shall pay to Landlord upon demand that part of such taxes for which Tenant is primarily liable hereunder.

17. RENT ADJUSTMENT - OPERATING EXPENSES. Landlord shall give Tenant a statement of the Operating Expenses (as defined below) for the Building for each calendar year, and shall use its best efforts to provide such statement within ninety (90) days after the close of the calendar year. Except as provided herein, if such Operating Expenses (allocated on a square foot basis to all rentable space in the Building) exceed a base of Six and 47/100 Dollars ($6.47) per square foot of area within the demised Premises (the "Base"), Tenant shall pay Landlord Tenant's proportionate share of such excess for the entire calendar year immediately preceding issuance of said statement. The statement shall also show the projected expenses for the upcoming year. If the projected expenses exceed the Base, then Tenant shall pay the difference between the new and the former estimates for the period from January 1 of the current calendar year through the month in which the statement is sent within twenty (20) days after Landlord sends the projections to Tenant. Thereafter, Tenant shall pay the new estimated amount until Landlord further revises such estimated amount. If the actual expenses show that Tenant's estimated payments exceeded Tenant's actual obligations, Landlord shall credit the difference against payment of the rent next due. If the Term shall have expired and no further Rent shall be due, Landlord shall provide a refund of such difference at the time Landlord sends its annual statement to tenants. Regardless of the foregoing, increases in Tenant's share of Operating Expenses shall be limited as they relate to "Capped Expenses." As used herein, "Capped Expenses" shall consist of all expenses except taxes, assessments, utilities, and insurance. The increase in Capped Expenses over those which existed in the third year of this Lease (the "Base Year"), shall be the lesser of (i) the actual amount of such increase, or (ii) the amount of the Capped Expense in the

If at Lease commencement or termination a partial calendar year is involved, operating expenses shall be computed as though a full calendar year were involved and prorated for such partial year. If the Lease terminates other than at the end of a calendar year, an estimate of current annual operating expenses shall be computed for the year of termination and any increased rental based on such estimate shall be billed to the Tenant prior to termination. Landlord shall furnish Tenant an itemized statement of the actual operating expenses at the end of the calendar year as outlined in the preceding paragraph.

For purposes of this Lease, operating expenses shall include those expenses paid or incurred by the Landlord for maintaining, operating and repairing the real property (including the building lobby and all building common areas), of which the demised Premises are a part, the Building and other improvements thereon and the personal property used in conjunction therewith (hereafter collectively referred to as "Project") including but not limited to the cost of ad valorem taxes, regular and special assessments, license fees and other charges of any kind whatsoever, payable by Landlord as a result of any public, quasi-public or private assessment or levy, electricity, lights, natural gas, ventilation, heating and air conditioning, water, window cleaning, window repair, levelor style or similar blinds, doors, janitorial service, exterior building maintenance, landscaping, insurance (including but not limited to fire, extended coverage, liability, worker's compensation, elevator or any other insurance carried in good faith by the Landlord and applicable to the Project) painting, uniforms, customary property management fees not to exceed 5% of rentals, supplies, sundries, sales or use taxes on supplies or services, cost of wages, salaries and so-called fringe benefits of all persons engaged in the operation, maintenance and repair of the Project, or any other costs or expenses which the Landlord pays or incurs to provide benefits for employees so engaged in the operation, maintenance and repair of the Project, the charges of any independent contractor who under contract with the Landlord or its representatives does any of the work of operating, maintaining or repairing the Project, legal and accounting expenses, including but not limited to such expenses as relate to seeking or obtaining reductions in and refunds of real estate taxes, or any other expense or charge, whether or not hereinabove mentioned, which in accordance with generally accepted accounting and management principles would be considered as an expense of maintaining, operating or repairing the Project. If any Project expense, though paid in one year, relates to more than one calendar year, the Landlord shall allocate the reimbursement of said expenses based on its normal life expectancy according to generally accepted accounting practices.

Landlord's managers may, from time to time, hire such individuals and companies to provide limited security for the Property as Landlord and its managers may decide and the cost thereof will be added to the total cost of operating the Building as defined in this lease. Notwithstanding the foregoing, Landlord will maintain a guard in, around, or near the building during such hours as may be mutually agreed upon by Landlord and tenant, or during such hours as the major building tenants (those leasing at least two (2) full floors) may request of the Landlord from time to time in writing.. In the event that Landlord maintains a guard or provides some other form of security, Landlord does not assume any liability whatsoever as a result of providing or contracting for such guard service/security.

Tenant at its expense shall have the right at all reasonable times to review Landlord's books and records relating to this Lease for any year or years for which additional rental payments become due hereunder. 0nce per calendar year, tenant at its expense shall have the right to audit landlord's books and records relating to this building. In the event the audit shows actual building expenses differ from landlords actual year end reconciled expenses by an amount greater than three percent of said expenses, tenant shall be reimbursed for its audit costs by Landlord.

The following shall be expressly excluded from Tenant's share of operating expenses:

. financing and refinancing charges, and costs associated with such financing and refinancing.;

. depreciation or amortization;
. leasing brokerage commissions and expenses;
. initial improvements to tenant spaces and other forms of tenant allowances and the costs of renovating or redecorating leased space;
. bad debt loss, rent loss or reserves for bad debt or rent loss;
. late payment interest or penalties;
. advertising and promotional expenditures for leasing space;
. costs of removing hazardous materials which were not placed on the property by tenant;
. costs associated with building code violations when the building was constructed;
. charitable or political contributions;
. costs of asbestos removal;
. capital expenses, except those (i) made primarily to reduce expenses or to comply with laws or insurance requirements imposed after the Building was constructed, or (ii) for replacements or upgrades of nonstructural items located in the common areas of the building required to keep such areas In a first class condition. To the extent that any such permitted capital expenditure exceed $5,000, such expenditure shall be amortized in accordance with generally accepted accounting principles. In each such case, Landlord may include interest on the unamortized amount at the prevailing loan rate available to Landlord when the cost was incurred;
. legal fees in connection with leasing, tenant disputes or enforcement of leases;

It is further agreed that rebates, refunds, and payments from other revenue sources specific to operating expenses will be applied towards operating expenses.

18. EVENTS OF DEFAULT. The following shall be deemed to be events of default by Tenant under the Lease:

(a) Tenant shall fail to pay any installment of rent hereby reserved on or by the first day of any month, and shall not cure such failure within ten
(10) days after written notice to Tenant. Tenant shall not have any grace period within which to cure any default in the payment of rental or adjustments thereto beyond said notice period.

(b) Tenant shall fail to comply with any term, provision, or covenant of this Lease, other than the payment of rent or other expenses, and shall not cure such failure within thirty (30) days after written notice to Tenant for any non-monetary default or within such reasonable period after such notice as may be required to effect compliance so long as Tenant initiates compliance within such thirty (30) day period and, thereafter, is diligently and reasonable pursuing such cure.

(c) Tenant shall make an assignment for the benefit of creditors.

(d) Tenant shall file a petition under any section of the United States Bankruptcy Code as amended, or any successor legislation or similar statute of the United States or any State thereof; or Tenant shall be adjudged bankrupt or insolvent in proceedings filled against Tenant thereunder and such adjudication shall not be vacated or set aside or stayed within the time permitted by law.

(e) A receiver or Trustee shall be appointed for all or substantially all of the assets of Tenant and such receivership shall not be terminated or stayed within the time permitted by law.

A notice under Paragraph 18 may be one and the same notice and may be given concurrently with a notice under the unlawful detainer statue in the State of Washington, if applicable.

19. REMEDIES. Upon the occurrence of any event of default specified in this Lease, Landlord shall have the option to pursue any one or more of the following remedies:

(a) Terminate this Lease by written notice to the Tenant, in which event Tenant shall immediately surrender the demised Premises to Landlord and if Tenant fails to do so, Landlord may, without

prejudice to any other remedy which it may have for possession or arrearages in rent, enter upon and take possession of the Premises and expel or remove Tenant or Tenant's property and any other person who may be occupying the demised Premises or any part thereof, without being liable for prosecution or of any claim of damages therefor; and Tenant agrees to pay to Landlord on demand the amount of all loss and damage which Landlord may suffer by reason of such termination, whether through inability to relet the demised Premises on satisfactory terms for the remainder of the Lease term or otherwise.

(b) Enter upon and take possession of the demised Premises and, if Landlord so elects, relet the demised Premises and receive the rent therefor without liability to Tenant for any amounts received in excess of the rent called for under this Lease. Tenant agrees to pay the Landlord on demand any costs of reletting and all other charges accruing hereunder, i.e., tenant improvements, leasing commissions, as well as any deficiency that may arise by reason of such reletting during the remaining term of this Lease.

(c) Enter upon the demised Premises without being liable for any claim for damages therefor, and do whatever Tenant is obligated to do under the terms of this Lease and has failed to do in a timely fashion; Tenant agrees to reimburse Landlord on demand for any expenses which Landlord may incur in thus effecting compliance with Tenant's obligations under this Lease, and Tenant further agrees that Landlord shall not be liable for any damages resulting to the Tenant from such action.

(d) Recover all unpaid rent, additional rent and other charges arising during the remaining term of the Lease as well as on any costs and commissions incurred in reletting and any losses or damages arising from Tenant's default including reasonable attorneys' fees and court costs, all such unpaid amounts to accrue interest at the lesser of (i) 12% per annum or (ii) the highest rate allowed by law, from date due or incurred until paid.

Pursuit of any of the foregoing remedies shall not preclude pursuit of any of the other remedies herein provided or any other remedies provided by law or equity, nor shall pursuit of any remedy herein provided constitute a forfeiture or waiver of any rent due to Landlord hereunder or of any damages occurring to Landlord by reason of the violation of any of the terms, provisions and covenants herein contained. Landlord's acceptance of rent following an event of default hereunder shall not be construed as Landlord's waiver of such event of default. No waiver by Landlord of any violation or breach of any of the terms, provisions and covenants herein contained shall be deemed or construed to constitute a waiver of any other violation or breach of any of the terms, provisions, and covenants herein contained. Forbearance by Landlord to enforce one or more of the remedies herein provided upon an event of default shall not be deemed or construed to constitute a waiver of such default or of any future default.

20. SURRENDER OF PREMISES. No act or thing done by the Landlord or its agents during the term hereby granted shall be deemed an acceptance of a surrender of the demised Premises and no agreement to accept a surrender of the demised Premises shall be valid unless the same be made in writing and signed by the Landlord.

21. ATTORNEYS' FEES. In case it should be necessary or proper for Landlord to bring any action under this lease or to consult or place said lease, or any amount payable by Tenant thereunder, with an attorney concerning or for the enforcement of any of Landlord's rights hereunder, then Tenant agrees in each and any such case to pay the Landlord a reasonable attorneys' fee if Landlord is the prevailing party. In case it should be necessary or proper for Tenant to bring any action under this Lease because of Landlord's default hereunder, then Landlord agrees in each and every case to pay to Tenant a reasonable attorneys' fee if Tenant is the prevailing party.

22. RECEIPTS FROM ASSIGNEE OR SUBTENANT. The receipt by the Landlord of rent from any assignee, subtenant or occupant of the demised Premises shall not be deemed a waiver of the covenant in this Lease contained against assignment and subletting or an acceptance of the assignee, subtenant or occupant as tenant or a release of the Tenant from the further observance or performance by the Tenant of the covenants in this Lease contained, on the part of the Tenant to be observed and performed. No provision of this Lease shall be deemed to have been waived by the Landlord unless such

waiver be in writing signed by the Landlord.

23. LANDLORD'S LIEN. Landlord retains its statutory landlord lien rights, but waives such with respect to any money or personal property of Tenant's customers or owned by the Tenant, but owed to the customer.

24. CORPORATE AUTHORITY. If Tenant signs as a corporation, each of the persons executing this Lease on behalf of Tenant does hereby covenant and warrant that Tenant is a duly authorized and existing corporation, that Tenant has and is qualified to do business in Washington, that the corporation has full right and authority to do so, and that said persons have the full rights and powers granted unto them by the corporation to bind it to this Lease. Upon Landlord's request, Tenant shall provide Landlord with evidence reasonably satisfactory to Landlord confirming the foregoing covenants and warranties.

25. CERTAIN RIGHTS RESERVED BY LANDLORD. Except as otherwise provided herein, Landlord shall have the following rights, exercisable without notice and without liability to Tenant for damage or injury to property, persons or business and without effecting an eviction, constructive or actual, or disturbance of Tenant's use or possession or giving rise to any claim for set off or abatement of rent:

(b) During this Lease term, Landlord and Tenant may mutually agree to change the name of the Building.

(c) To grant to anyone the exclusive right to conduct any business or render any service in or to the Building, provided such exclusive right shall not operate to exclude Tenant from the use expressly permitted herein, and provided that the Landlord shall obtain prior written approval of Tenant before Landlord allows any other Tenant the right to operate a bank, financial institution or ATM in the building. The term "financial institution" includes banks, credit unions, savings and loan associations, investment bankers and stock brokerage companies, but shall specifically exclude Morgan Stanley Dean Witter and the Frank Russell Company.

(d) To have access for Landlord and other tenants of the Building to any mail chutes located on the leased Premises according to the rules of the United States Postal Service.

(e) To take all such reasonable measures as Landlord may deem advisable for the security of the Building and its occupants, including without limitation, the search of all persons entering or leaving the Building, the evacuation of the Building for cause, suspected cause, or for drill purposes, the temporary denial of access to the Building, and the closing of the Building after normal business hours and on Saturdays, Sundays and holidays, subject, however, to Tenant's right to admittance when the Building is closed after normal business hours under such reasonable regulations as Landlord may prescribe from time to time which may include by way of example but not of limitation, that persons entering or leaving the Building, whether or not during normal business hours, identify themselves to a security officer by registration or otherwise and that such persons establish their right to enter or leave the Building.

26. PERSONAL LIABILITY. The liability of Landlord to Tenant for any default by Landlord under the terms of this Lease shall be limited to the interest of Landlord in the Building and the land, and

Landlord shall not be personally liable for any deficiency. This clause shall not be deemed to limit or deny any remedies which Tenant may have in the event of default by Landlord hereunder which do not involve the personal liability of Landlord.

27. NOTICES. Each provision of this Lease, or of any applicable governmental laws, ordinances, regulations, and other requirements with reference to the sending, mailing, or delivery of any notice, or with reference to the making of any payment by Tenant to Landlord, shall be deemed to be complied with when and if the following steps are taken:

(a) All rent and other payments required to be made by Tenant to Landlord hereunder shall be payable to Landlord at the address hereinbelow set forth, or at such address as Landlord may specify from time to time by written notice delivered in accordance with this Lease, and shall be deemed to be delivered upon actual receipt by Landlord;

(b) Any notice or document required to be delivered hereunder shall be deemed to be delivered, whether actually received or not, two (2) business days after being deposited in the United States mail, postage prepaid, certified or registered mail (with or without return receipt requested), addressed to the parties hereto at the respective addresses set out opposite their names below, or at such other address as they have theretofore specified by written notice delivered in accordance herewith:

         TENANT                                  LANDLORD

         Columbia Banking Systems, Inc.          Haub Brothers Enterprises Trust
         a Washington corporation                c/o Mr. John D. Barline
         Attn:  Chief Executive Officer          P.O. Box 1872
         P.O. Box 2156                           Tacoma, WA  98401-1872
         Tacoma, WA  98401-2156

and

         Columbia Banking Systems, Inc.
         c/o Mr. William E. Holt
         Gordon Thomas Honeywell, et al.
         P.O. Box 1157
         Tacoma, WA  98401-1157

28. FORCE MAJEURE. Whenever a period of time is herein prescribed for action to be taken by Landlord, Landlord shall not be liable or responsible for, and there shall be excluded from the computation for any such period of time, any delays due to strikes, riots, acts of God, shortages of labor or materials, war, governmental laws, regulations, or restrictions, or any other causes of any kind whatsoever which are beyond the control of Landlord.

29. ESTOPPEL CERTIFICATE. Within ten (10) days following any written request which Landlord may from time to time make, Tenant shall execute and deliver to Landlord a Certificate indicating that the Lease is in full force and effect and that the Landlord is not in default hereunder or, alternatively, specifying the nature of any claimed default, and the dates through which rent and other charges have been paid.

30. SEVERABLE. If any clause or provision of this Lease is illegal, invalid or unenforceable under present or future laws effective during the term of this Lease, then and in that event, it is the intention of the parties hereto that the remainder of this Lease shall not be affected thereby, and it is also the intention of the parties to the Lease that in lieu of each clause or provision of this Lease that is illegal, invalid or unenforceable, there be added as a part of this Lease a clause or provision as similar in terms to such illegal, invalid, or unenforceable clause or provision as may be possible and be legal, valid and enforceable.

31. AMENDMENTS; BINDING EFFECT. This Lease may not be altered, changed, or amended, except by instrument in writing signed by both parties hereto. The terms, provisions, covenants and conditions contained in this Lease shall apply to, inure to the benefit of, and be binding upon the parties hereto, and upon their respective successors in interest and legal representatives, except as otherwise herein expressly provided.

32. GENDER. Words of any gender used in this Lease shall be held and construed to include any other gender, and words in the singular number shall be held to include the plural, unless the context

otherwise requires.

33. CAPTIONS. The captions contained in this Lease are for convenience of reference only, and in no way limit or enlarge the terms and conditions of this Lease.

34. SUBORDINATION. This Lease is subject to and is hereby subordinated to all present and future mortgages, deeds of trust and other encumbrances affecting the leased Premises or the property of which said Premises are a part, provided that the holder of such encumbrance agrees to recognize the terms of this Lease and to not disturb Tenant's occupancy so long as Tenant is not in default. Tenant will upon demand by landlord, execute such instruments as may be required at any time, and from time to time, to subordinate the rights and interest of the Tenant under this Lease to the lien of any mortgage or Trust Deed at any time placed on the land of which the leased Premises are a part; provided, however, that such subordination shall not affect Tenant's right to possession, use and occupancy of the leased Premises so long as Tenant shall not be in default under any of the terms or conditions of this Lease. Tenant further agrees:

(a) That any such subordination agreement will contain a provision satisfactory to landlord's financing lender whereby Tenant will agree, in the event of foreclosure of any such mortgage or Trust Deed to attorn to and recognize as its landlord under the terms of this Lease said lender or any purchaser of the leased property at a foreclosure sale or their heirs, successors or assigns; and

(b) That it will execute and deliver to such lender an estoppel certificate in form satisfactory to such lender.

allowance would be 42 -22.40 = $19.60). If within thirty (30) days after Landlord delivers Tenant such written offer, Landlord does not receive notice in writing that Tenant elects to lease all (and not part) of such space and within twenty (20) days thereafter Tenant does not execute an amendment to this Lease adding such space as part of the Premises, increasing the rent and adjusting Tenant's prorata share of Operating Expenses, then Tenant shall have no further rights pursuant to this Paragraph 36.

37. OPTION TO EXPAND TO NEWLY DEVELOPED PROPERTY. Should Landlord elect to construct a building on the contiguous property to the north (commonly known as the southeast corner of 12th and A Street) or on the property at the southeast corner of 13th and Pacific Avenue (commonly known as the Greyhound Bus Property) and so long as Landlord owns all properties concerned, Tenant shall have a first right to negotiate a lease of space within such new development(s). All terms, rental amounts, and conditions associated with leasing of space in the development(s) shall be negotiated at the time the new property is to be developed and is subject to mutual agreement of the parties. This option to expand to newly developed property shall be for a period of sixty (60) days from the date Landlord gives written notice to Tenant of its intent to develop said properties.

38. OPTION TO RENEW. While this Lease is in full force and effect, provided that Tenant is not then in default beyond any applicable cure period of any of the terms, covenants and conditions hereof, Landlord grants to Tenant two
(2)consecutive options to extend the term of the Lease for periods of five (5) years each, the first option commencing upon the termination of the original Lease term as hereby extended, exercisable by giving Landlord notice in writing not more than one (1) year and not later than six (6) months prior to the commencement date of the option term, and the second option commencing upon the termination of the first option, but only if such option was in fact exercised, and exercisable by giving Landlord notice in writing not more than one (1) year and not later than six (6) months prior to the commencement date of said second option term. Such extension or renewal of the terms shall be on the same terms, covenants or conditions as provided for in the original or immediately preceding term except the monthly minimum rent shall be adjusted to an amount respectively, determined by the then current market rental rate for fully serviced similar Class A office space (including this building) in downtown Tacoma, Washington, there shall be a new floor for Operating Expenses equal to the Operating Expenses incurred during the last year of the lease term before commencement of the option term which shall replace and supersede the floor of $6.47 provided for in Section 17, and except that no additional options provided herein shall be created or implied by virtue of any extension or renewal of the lease term. Landlord and Tenant shall use their best efforts to negotiate and agree upon the Current Market Rental Rate within sixty (60) days after Tenant has given notice.

Landlord and Tenant shall use their best efforts to negotiate and agree upon the Current Market Rental Rate within sixty (60) days after Tenant has given notice to exercise of the option, and if they are unable to so agree, either party may request the following procedure. Landlord and Tenant shall each appoint one (1) arbitrator, both of whom shall be appointed within sixty (60) days after a party elects to pursue this arbitration process. The two arbitrators shall then agree to appoint a third arbitrator; failing such agreement, either Landlord or Tenant shall have the right to petition for the appointment of the third arbitrator by the Presiding Judge of the Superior Court of Pierce County. All arbitrators shall be persons having at least five (5) years experience in the real estate market in Pierce County and shall hold an MAI certification. Within thirty (30) days after the appointment of the three arbitrators (collectively, the "arbitrators"), Tenant and Landlord shall each submit to the arbitrators (and one another) their written opinion regarding Current Market Rental Rate. Within ten (10) days after the arbitrators' receipt of the last such opinion, the arbitrators shall decide by a majority vote the Current Market Rental Rate. Such selected opinion by the arbitrators shall be final and binding upon the parties. The arbitrators' agreed upon value must not be greater or lesser than the highest and lowest of the alternatives proposed. The cost of the arbitrators shall be split equally between Landlord and Tenant. Such determination shall be final and binding upon the parties.

39. SIGNAGE AND BUILDING NAME. The Building will be named "Columbia Bank Center" and tenant will be allowed appropriate signage on or about the building at Tenant's sole cost and expense. Tenant shall be allowed to change the Building name at any time with Landlord's prior written approval, which shall not be unreasonably withheld, however, in such event, Tenant shall be responsible for paying for the

costs of changing signage on the Building or on any signs maintained by Tenant. All Building signage must at all times be maintained in conformance with applicable rules, regulations and ordinances of the local governmental authorities and is subject to prior written approval of Landlord. At the termination of this lease, Tenant shall remove all signage at its sole cost and repair and restore the building to its original good condition. There shall be no other exterior signs on or about the building (except for traffic signs and storefront signage on the first floor) without Tenant's prior written consent, which consent will not be unreasonably withheld or delayed.

40. RIGHT OF FIRST REFUSAL TO PURCHASE.

term of this section.

ATM provisions?

          LANDLORD:                            TENANT:

          HAUB BROTHERS ENTERPRISES            COLUMBIA BANKING SYSTEMS, a

TRUST                           a Washington corporation

By:________________________     By:____________________________________
                                    W. W. Philip
Its:_______________________         Its: President and Chief Executive
                                    Officer

Acknowledgements

STATE OF WASHINGTON    )
                       )      ss.
COUNTY OF PIERCE       )

On this day personally appeared before me W.W. Philip, to me known to be the President and Chief Executive Officer of Columbia Banking Systems, a Washington Corporation, the corporation that executed the foregoing instrument, and acknowledged the said instrument to be the free and voluntary act and deed of said corporation, for the uses and purposes therein mentioned, and on oath stated that he was authorized to execute the same instrument.

GIVEN under my hand and official seal this _____ day of _______________, 1999.

STATE OF WASHINGTON                      )
                                         )      ss.
COUNTY OF PIERCE                         )

On this ___ day of __________, 1999, before me personally appeared John D. Barline, to me known to be the individual who executed the foregoing instrument as Attorney in Fact for Erivan Haub, as Trustee of the Haub Brothers Enterprises Trust and acknowledged that he signed the same as his free and voluntary act and deed as Attorney in Fact for said principal for the uses and purposes therein mentioned, and on oath stated that the Power of Attorney authorizing the execution of this instrument has not been revoked and that said principal is now living and is not insane.

GIVEN under my hand and official seal this _____ day of _______________, 1999.

Notary Public in and for the State of Washington, residing at ______________________________________ My commission expires: ___________________________

Exhibit 10.6

AMENDED EMPLOYMENT AGREEMENT

THIS EMPLOYMENT AGREEMENT (the "Agreement") is made and entered into by and between Columbia State Bank, a Washington banking corporation ("Columbia Bank") together with Columbia Banking System, Inc., a Washington corporation ("CBSI") (collectively, the "Employer"), and J. JAMES GALLAGHER (the "Executive"). This Agreement shall become effective as of December 20, 2000.

RECITALS

A. Executive has been serving Employer as Chief Executive Officer of CBSI, in addition to his position as Vice Chairman of CBSI and Columbia Bank and has substantial knowledge of Employer's affairs and of the business of financial institutions in general. Employer has incurred substantial growth and is looking to continue expansion of its operations, with the assistance of Executive.

B. Executive and Employer desire to amend and restate existing Employment Agreement to update terms addressing compensation and to conform certain provisions to those contained in recently granted contracts to other executives.

In consideration of the mutual promises made in this Agreement, the parties agree as follows:

AGREEMENT

1. Employment.

Employer employs Executive and Executive accepts employment with Employer on the terms and conditions set forth in this Agreement.

2. Term.

The term of this Agreement will commence as of December 20, 2000, and will continue until June 30, 2003, unless extended or sooner terminated as provided in this Agreement.

3. Duties.

(a) Executive will be Vice-Chairman and Chief Executive Officer of CBSI and Vice Chairman of Columbia Bank. In such capacities, and subject to the authority of the Board of Directors of CBSI and Columbia Bank, as appropriate, (i) Executive will have general management of the business of CBSI;
(ii) will be specifically responsible for strategic planning, merger and acquisition activity, and legal and regulatory compliance of Columbia Bank; and
(iii) will perform such other tasks in connection with the affairs of Columbia Bank that are normal and customary to the position he will hold.

(b) Executive will perform such other duties as may be appropriate to his position and as may be prescribed from time to time by the Board, or that are provided in the Bylaws of CBSI or Columbia Bank.

(c) Executive will devote his best efforts and all necessary time, attention, and effort to the business and affairs of Employer and its affiliates, as such business and affairs now exist or hereafter may be changed or supplemented, in order to properly discharge his responsibilities under this Agreement. He may delegate such of his duties as he sees fit to the other officers of CBSI or its subsidiaries.

4. Salary, Bonus, and Other Compensation.

4.1 Salary.

(a) During the term of this Agreement, Employer will pay Executive an annual (calendar year) base salary of not less than $235,000 per year (payable at the rate of $19,583.33 per month) beginning January 1, 2001.

(b) Columbia Bank will guarantee payment of any portion of Executive's compensation that may be allocated to a subsidiary of CBSI.

(c) If this Agreement terminates prior to June 30, 2003, then Employer will pay Executive such greater or lesser amount of the agreed compensation as provided in Section 5.

4.2 Bonus. Executive will be eligible to participate in the bonus pools, if any, that the Board of Columbia Bank or CBSI may establish for senior executives, either under an executive incentive plan or otherwise.

4.3 Benefits. In addition to the base salary and bonus payable or potentially payable to Executive pursuant to this Section 4, Executive will be entitled to receive benefits sim-ilar to those offered to other senior executives of Employer.

5. Termination of Agreement.

5.1 Early Termination.

(a) This Agreement may be terminated at any time by the Board of Employer or by Executive, and it shall terminate upon Executive's death or disability. Any termination by the Board of Employer other than termination for cause (as defined below) shall not prejudice Executive's right to compensation or other benefits under this Agreement. Except as provided in Section 7, if Executive voluntarily terminates his employment before June 30, 2003 he will be entitled only to such payments as he would have the right to receive upon termination for cause under subsection 5.1(b).

(b) Except as provided in Section 7, if Employer terminates this Agreement without cause, Employer shall pay Executive upon the effective date of such termination all salary earned, the pro-rata portion of any incentive payment expected to be

received for the year when termination occurs, benefits accrued and all reimbursable expenses hereunder incurred through such termination date and, in addition, liquidated damages in an amount equal to the greater of (i) two years' salary, or (ii) salary for the then-remaining term of the Agreement payable hereunder; in such event, all forfeiture provisions regarding any then outstanding restricted stock award or other compensation agreement shall lapse. If Employer terminates this Agreement for cause, Employer shall pay Executive upon the effective date of such termination only such salary earned, benefits accrued and expenses reimbursable hereunder incurred through such termination date. Executive shall have no right to receive compensation or other benefits for any period after termination for cause.

(c) For purposes of this Agreement, the term "cause" shall mean
(i) willful misfeasance or gross negligence in the performance of his duties;
(ii) conduct demonstrably and significantly harmful to Employer (including willful violation of any final cease and desist order applicable to Employer or a financial institution subsidiary); or (iii) conviction of a felony. For purposes of this Agreement, "disability" shall have the meaning contained in any long term disability insurance coverage maintained by Columbia Bank or its affiliate, or if no such coverage is in existence, shall mean a medically reimbursable physical or mental impairment that may be expected to result in death, or to be of long, continued duration, and that renders Executive incapable of performing the duties required under this Agreement. The Board or the Compensation Committee of the Board, acting in good faith, shall make the final determination of whether Executive is suffering under any disability as herein defined and, for purposes of making such determination, may require Executive to submit himself to a physical examination by a physician mutually agreed upon by Executive and the Board or the Committee at Employer's expense.

(d) In the event of termination of this Agreement by reason of Executive's death or disability, all forfeiture provisions regarding any then outstanding restricted stock award or other compensation agreement shall lapse.

5.2 Obligations. Except as otherwise provided in Section 7 or in a particular option grant, Executive's rights, if any, to vested but unexercised stock options will continue for a period of one year after early termination, other than termination for cause. In the case of termination for cause, Executive's unvested stock options, if any, shall terminate immediately.

6. Restrictive Covenant.

6.1 Noncompetition.

(a) Executive agrees that except as otherwise set forth in this Agreement, he will not, during the term of this Agreement and for a period of two years after the later of (i) expiration of the term of this Agreement, or
(ii) completion of service as an active executive officer and/or Board member of CBSI or Columbia Bank, directly or indirectly, become interested in, as principal shareholder, director, or officer, any financial institution (other than an institution controlled by, controlling, or under common control with Employer and its affiliates) that competes within the State of Washington with Employer or any of its affiliates,

with respect to activities of the type performed by such companies within such service area immediately prior to Executive's termination.

(b) The restrictions concerning competition after termination as contained in this Section 6.1 shall apply only in the event that Executive voluntarily terminates his employment with Employer without good reason. For purposes of this Agreement, termination for "good reason" shall mean termination by Executive as a result of any material breach of this Agreement by Employer, or any significant diminution of duties of Executive by the Board of either Columbia Bank or CBSI. The provisions restricting competition by Executive may be waived by the Employer.

6.2 Noninterference. During the noncompetition period described in
Section 6.1, Executive shall not solicit or attempt to solicit any other employee of Employer or its affiliates to leave the employ of those companies, or in any way interfere with the relationship between Employer and any other employee of Employer or its affiliates.

6.3 Interpretation. If a court or any other administrative body with jurisdiction over a dispute related to this Agreement should determine that the restrictive covenants set forth above is unreasonably broad, the parties authorize such court or administrative body to narrow the covenants so as to make it reasonable, given all relevant circumstances, and to enforce such revised covenants. The covenants in this paragraph shall survive termination of this Agreement.

7. Change of Control.

7.1 Benefits. The parties recognize that a "change of control" of Employer (as defined in Section 7.2) could be detrimental to Executive's continued employment. Accordingly, in order to give further assurances to the Executive to enter into this Agreement, if:

(a) There is a change of control of CBSI; and either

(b) Within 730 days of such change in control, Executive terminates his employment with Employer; or

(c) At any time from and after sixty days prior to the public announcement by Employer of a transaction that will result in the change of control, Employer (or its successor) terminates Executive's employment without cause, then Executive, as of the date of termination of his employment, subject to the remaining provisions of this Section 7.1, shall be paid or provided with:
(i) continued payment of his base salary, the pro-rata portion of any incentive payment expected to be received for the year when termination occurs and all benefits provided for in this Agreement until two years following termination or June 30, 2003, whichever is longer; and (ii) vesting of all stock options and lapse of all restrictions with respect to any then outstanding restricted stock award or other compensation agreement shall occur. The provisions of this
Section 7.1 shall survive expiration of the term of the Agreement.

7.2 Definitions. For purposes of this Agreement, the term "change of control" shall mean the occurrence of one or more of the following events:

(a) One person or entity acquiring or otherwise becoming the owner of twenty-five percent or more of CBSI's outstanding common stock;

(b) Replacement of a majority of the incumbent directors of CBSI or Columbia Bank by directors whose elections have not been supported by a majority of the Board of either company, as appropriate; or

(c) Dissolution, or sale of fifty percent or more in value of the assets, of either CBSI or Columbia Bank.

7.3 Reimbursement. In the event the provisions of this Section 7.3 result in imposition of a tax on Executive under the provisions of Internal Revenue Code (S) 4999, Employer agrees to reimburse Executive for the same, exclusive of any tax imposed by reason of receipt of reimbursement under this
Section 7.3.

8. Miscellaneous.

8.1 This Agreement contains the entire agreement between the parties with respect to Executive's employment with Employer and his covenant not to compete with Employer and its affiliates, and is subject to modification or amendment only upon amendment in writing signed by both parties.

8.2 This Agreement shall bind and inure to the benefit of the heirs, legal representatives, successors, and assigns of the parties, except that Employer's rights and obligations may not be assigned. The provisions of
Section 6.1 of this Agreement are intended to confer upon CBSI and its subsidiaries and affiliates the benefits of Executive's covenant not to compete.

8.3 If any provision of this Agreement is invalid or otherwise unenforceable, all other provisions shall remain unaffected and shall be enforceable to the fullest extent permitted by law.

8.4 This Agreement is made with reference to and is intended to be construed in accordance with the laws of the State of Washington. Venue for any action arising out of or concerning this Agreement shall lie in Pierce County, Washington. In the event of a dispute under this Agreement not involving injunctive relief, the dispute shall be arbitrated pursuant to the Superior Court Mandatory Arbitration Rules ("MAR") adopted by the Washington State Supreme Court, irrespective of the amount in controversy. This Agreement shall be deemed as stipulation to that effect pursuant to MAR 1.2 and 8.1. The arbitrator, in his or her discretion, may award attorney's fees to the prevailing party or parties.

8.5 Any notice required to be given under this Agreement to either party shall be given by personal service or by depositing a copy thereof in the United States registered or certified mail, postage prepaid, addressed to the following address, or such other address as addressee shall designate in writing:

Employer: 1102 Broadway Executive: 23 Lagoon Lane North Tacoma, WA 98402 Lakewood, WA 98498

COLUMBIA STATE BANK

By: /s/ Melanie J. Dressel
   -----------------------------
   Melanie J. Dressel
   Its President and Chief Executive Officer

COLUMBIA BANKING SYSTEM, INC.

By: /s/ Melanie J. Dressel
   -----------------------------
Melanie J. Dressel
Its President and Chief Operating Officer

EXECUTIVE

    /s/ J. James Gallagher
--------------------------------
J. JAMES GALLAGHER

Exhibit 10.7

AMENDED EMPLOYMENT AGREEMENT

THIS EMPLOYMENT AGREEMENT (the "Agreement") is made and entered by and between Columbia State Bank, a Washington banking corporation ("Columbia Bank") together with Columbia Banking System, Inc., a Washington corporation ("CBSI") (collectively, the "Employer"), and MELANIE J. DRESSEL (the "Executive"). This Agreement shall become effective as of December 20, 2000.

RECITALS

A. Executive is currently serving as President and Chief Operating Officer of CBSI and President and Chief Executive Officer of Columbia Bank.

B. Employer considers the continuance of sound and vital management essential to protecting and enhancing Employer's best interests.

C. Employer desires to assure itself of retaining the exclusive services of Executive and to continue the Employment of Executive under the terms of this Agreement, and to reward Executive for her valuable, dedicated service to Employer should her employment be terminated under the circumstances described in this Agreement.

D. Executive and Employer desire to amend and restate existing Employment Agreement to update terms addressing compensation and to conform certain provisions to those contained in recently granted contracts to other executives.

In consideration of the mutual promises made in this Agreement, the parties agree as follows:

AGREEMENT

1. Employment.

Employer employs Executive and Executive accepts employment with Employer on the terms and conditions set forth in this Agreement.

2. Term.

The term of this Agreement will commence as of December 20, 2000, and will continue until June 30, 2004, unless extended or sooner terminated as provided in this Agreement.

3. Duties.

(a) Executive will be President and Chief Executive Officer of Columbia Bank and President and Chief Operating Officer of CBSI. In such capacities, and subject to the authority of the Vice Chairman and Chief Executive Officer of CBSI and the Boards of Directors of Columbia Bank and CBSI (separately or collectively, the "Board" as applicable), as appropriate, Executive will render the executive management services and perform such tasks in connection with the affairs of Columbia Bank and CBSI that are normal and customary to the positions that she holds.

(b) Executive will perform such other duties as may be appropriate to her position and as may be prescribed from time to time by the Vice Chairman and Chief Executive Officer of CBSI or the Board of Columbia Bank, as appropriate, or that are provided in the Bylaws of Columbia Bank or CBSI.

(c) Executive will devote her best efforts and all necessary time, attention, and effort to the business and affairs of Employer and its affiliates, as such business and affairs now exist or hereafter may be changed or supplemented, in order to properly discharge her responsibilities under this Agreement. She may delegate such of her duties as she sees fit to the other officers of CBSI or its subsidiaries.

4. Salary, Bonus, and Other Compensation.

4.1 Salary.

(a) During the term of this Agreement, Employer will pay Executive an annual (calendar year) base salary of not less than $225,000 per year beginning January 1, 2001 (payable at the rate of $18,750 per month).

(b) Columbia Bank will guarantee payment of any portion of Executive's compensation that may be allocated to a subsidiary of CBSI.

(c) If this Agreement terminates prior to June 30, 2004, then Employer will pay Executive such greater or lesser amount of the agreed compensation as provided in Section 5.

4.2 Bonus. Executive will be eligible to participate in the bonus pools, if any, that the Board of Columbia Bank or CBSI may establish for senior executives, either under an executive incentive plan or otherwise.

4.3 Benefits. In addition to the base salary and bonus payable or potentially payable to Executive pursuant to this Section 4, Executive will be entitled to receive benefits similar to those offered to other senior executives of Employer.

5. Termination of Agreement.

5.1 Early Termination.

(a) This Agreement may be terminated at any time by the Board of Employer or by Executive, and it shall terminate upon Executive's death or disability. Any termination by the Board of Employer other than termination for cause (as defined below) shall not prejudice Executive's right to compensation or other benefits under this Agreement. Except as provided in Section 7, if Executive voluntarily terminates her employment before June 30, 2004 she will be entitled only to such payments as she would have the right to receive upon termination for cause under subsection 5.l(b).

(b) Except as provided in Section 7, if Employer terminates this Agreement without cause, Employer shall pay Executive upon the effective date of such termination all salary earned, the pro-rata portion of any incentive payment expected to be received for the year when termination occurs, benefits accrued and all reimbursable expenses hereunder incurred through such termination date and, in addition, liquidated damages in an amount equal to the greater of (i) two years' salary, or (ii) salary for the then-remaining term of the Agreement payable hereunder; in such event, all forfeiture provisions regarding any then outstanding restricted stock award or other compensation agreement shall lapse. If Employer terminates this Agreement for cause, Employer shall pay Executive upon the effective date of such termination only such salary earned, benefits accrued and expenses reimbursable hereunder incurred through such termination date. Executive shall have no right to receive compensation or other benefits for any period after termination for cause.

(c) For purposes of this Agreement, the term "cause" shall mean
(i) willful misfeasance or gross negligence in the performance of her duties;
(ii) conduct demonstrably and significantly harmful to Employer (including willful violation of any final cease and desist order applicable to Employer or a financial institution subsidiary); or (iii) conviction of a felony. For purposes of this Agreement, "disability" shall have the meaning contained in any long term disability insurance coverage maintained by Columbia Bank or its affiliate, or if no such coverage is in existence, shall mean a medically reimbursable physical or mental impairment that may be expected to result in death, or to be of long, continued duration, and that renders Executive incapable of performing the duties required under this Agreement. The Board or the Compensation Committee of the Board, acting in good faith, shall make the final determination of whether Executive is suffering under any disability as herein defined and, for purposes of making such determination, may require Executive to submit himself to a physical examination by a physician mutually agreed upon by Executive and the Board or the Committee at Employer's expense.

(d) In the event of termination of this Agreement by reason of Executive's death or disability, all forfeiture provisions regarding any then outstanding restricted stock award or other compensation agreement shall lapse.

5.2 Obligations. Except as otherwise provided in Section 7 or in a particular option grant, Executive's rights, if any, to vested but unexercised stock options will continue for a period of one year after early termination, other than termination for cause. In the case of termination for cause, Executive's unvested stock options, if any, shall terminate immediately.

6. Restrictive Covenant.

6.1 Noncompetition.

(a) Executive agrees that except as otherwise set forth in this Agreement, she will not, during the term of this Agreement and for a period of two years after the later of (i) expiration of the term of this Agreement, or
(ii) completion of service as an active executive officer and/or Board member of CBSI or Columbia Bank, directly or indirectly, become interested in, as principal shareholder, director, or officer, any financial institution (other than an institution controlled by, controlling, or under common control with Employer and its affiliates) that competes within the State of Washington with Employer or any of its affiliates, with respect to activities of the type performed by such companies within such service area immediately prior to Executive's termination.

(b) The restrictions concerning competition after termination as contained in this Section 6.1 shall apply only in the event that Executive voluntarily terminates her employment with Employer without good reason. For purposes of this Agreement, termination for "good reason" shall mean termination by Executive as a result of any material breach of this Agreement by Employer, or any significant diminution of duties of Executive by the Board of either Columbia Bank or CBSI. The provisions restricting competition by Executive may be waived by the Employer.

6.2 Noninterference. During the noncompetition period described in
Section 6.1, Executive shall not solicit or attempt to solicit any other employee of Employer or its affiliates to leave the employ of those companies, or in any way interfere with the relationship between Employer and any other employee of Employer or its affiliates.

6.3 Interpretation. If a court or any other administrative body with jurisdiction over a dispute related to this Agreement should determine that the restrictive covenants set forth above is unreasonably broad, the parties authorize such court or administrative body to narrow the covenants so as to make it reasonable, given all relevant circumstances, and to enforce such revised covenants. The covenants in this paragraph shall survive termination of this Agreement.

7. Change of Control.

7.1 Benefits. The parties recognize that a "change of control" of Employer (as defined in Section 7.2) could be detrimental to Executive's continued employment. Accordingly, in order to give further assurances to the Executive to enter into this Agreement, if:

(a) There is a change of control; and either;

(b) Within 730 days of such change in control, Executive terminates her employment with Employer; or

(c) At any time from and after sixty days prior to the public announcement by Employer of a transaction that will result in the change of control, Employer (or its successor) terminates Executive's employment without cause, then Executive, as of the date of termination of her employment, subject to the remaining provisions of this Section 7.1, shall be paid or provided with:
(i) continued payment of her base salary, the pro-rata portion of any incentive payment expected to be received for the year when termination occurs and all benefits provided for in this Agreement until two years following termination or June 30, 2004, whichever is longer; and (ii) vesting of all stock options and lapse of all restrictions with respect to any outstanding restricted stock awards or other compensation agreement shall occur. The provisions of this
Section 7.1 shall survive expiration of the term of the Agreement.

7.2 Definitions. For purposes of this Agreement, the term "change of control" shall mean the occurrence of one or more of the following events:

(a) One person or entity acquiring or otherwise becoming the owner of twenty-five percent or more of CBSI's outstanding common stock;

(b) Replacement of a majority of the incumbent directors of CBSI or Columbia Bank by directors whose elections have not been supported by a majority of the Board of either company, as appropriate; or

(c) Dissolution or sale of fifty percent or more in value of the assets, of either CBSI or Columbia Bank.

7.3 Reimbursement. In the event the provisions of this Section 7.3 result in imposition of a tax on Executive under the provisions of Internal Revenue Code (S) 4999, Employer agrees to reimburse Executive for the same, exclusive of any tax imposed by reason of receipt of reimbursement under this
Section 7.3.

8. Miscellaneous.

8.1 This Agreement contains the entire agreement between the parties with respect to Executive's employment with Employer and her covenant not to compete with Employer and its affiliates, and is subject to modification or amendment only upon amendment in writing signed by both parties.

8.2 This Agreement shall bind and inure to the benefit of the heirs, legal representatives, successors, and assigns of the parties, except that Employer's rights and obligations may not be assigned. The provisions of
Section 6.1 of this Agreement are intended to confer upon CBSI and its subsidiaries and affiliates the benefits of Executive's covenant not to compete.

8.3 If any provision of this Agreement is invalid or otherwise unenforceable, all other provisions shall remain unaffected and shall be enforceable to the fullest extent permitted by law.

8.4 This Agreement is made with reference to and is intended to be construed in accordance with the laws of the State of Washington. Venue for any action arising out of or concerning this Agreement shall lie in Pierce County, Washington. In the event of a dispute under this Agreement not involving injunctive relief, the dispute shall be arbitrated pursuant to the Superior Court Mandatory Arbitration Rules ("MAR") adopted by the Washington State Supreme Court, irrespective of the amount in controversy. This Agreement shall be deemed as stipulation to that effect pursuant to MAR 1.2 and 8.1. The arbitrator, in his or her discretion, may award attorney's fees to the prevailing party or parties.

8.5 Any notice required to be given under this Agreement to either party shall be given by personal service or by depositing a copy thereof in the United States registered or certified mail, postage prepaid, addressed to the following address, or such other address as addressee shall designate in writing:

Employer:           Columbia Banking System, Inc.
                    1102 Broadway
                    Tacoma, WA 98402

Executive:          Melanie J. Dressel
                    10924 Bliss-Cochrane KPN
                    Gig harbor, WA 98329

IN WITNESS WHEREOF, the parties have executed this Agreement effective on December 20, 2000.

COLUMBIA STATE BANK

By: /s/ J. James Gallagher
   -------------------------
J. James Gallagher
Its Vice Chairman

COLUMBIA BANKING SYSTEM, INC.

By: /s/ J. James Gallagher
   -------------------------
J. James Gallagher
Its Vice Chairman and Chief Executive Officer

EXECUTIVE

    /s/ Melanie J. Dressel
----------------------------
Melanie J. Dressel

Exhibit 10.8

EMPLOYMENT AGREEMENT

THIS EMPLOYMENT AGREEMENT (the "Agreement") is made and entered by and between Columbia State Bank, a Washington banking corporation ("Columbia Bank") together with Columbia Banking System, Inc., a Washington corporation ("CBSI") (collectively, the "Employer"), and HARALD R. RUSSELL (the "Executive"). This Agreement shall become effective as of December 20, 2000.

RECITALS

A. Executive is currently serving as Executive Vice President of Columbia Bank and Columbia Banking System, Inc.

B. Employer considers the continuance of sound and vital management essential to protecting and enhancing Employer's best interests.

C. Employer desires to assure itself of retaining the exclusive services of Executive and to continue the Employment of Executive under the terms of this Agreement. Executive and Employer have entered into an Employment Agreement effective December 20, 2000.

In consideration of the mutual promises made in this Agreement, the parties agree as follows:

AGREEMENT

1. Employment.

Employer employs Executive and Executive accepts employment with Employer on the terms and conditions set forth in this Agreement.

2. Term.

The term of this Agreement will commence as of December 20, 2000, and will continue until June 30, 2004, unless extended or sooner terminated as provided in this Agreement.

3. Duties.

(a) Executive will be Executive Vice President of CBSI and of Columbia Bank. In such capacities, and subject to the authority of the Chief Executive Officer of CBSI and/or the Bank, as appropriate, or such other officer to whom the authority has been granted (separately or collectively as applicable), Executive will render the executive management services and perform such tasks in connection with the affairs of CBSI and of Columbia Bank that are normal and customary to the position that Executive holds.

(b) Executive will perform such other duties as may be appropriate to Executive's position and as may be prescribed from time to time by the Chief Executive Officer of CBSI or Columbia Bank, as appropriate, or that are provided in the Bylaws of CBSI or Columbia Bank.

(c) Executive will devote their best efforts and all necessary time, attention, and effort to the business and affairs of Employer and its affiliates, as such business and affairs now exist or hereafter may be changed or supplemented, in order to properly discharge her responsibilities under this Agreement.

4. Salary, Bonus, and Other Compensation.

4.1 Salary.

(a) During the term of this Agreement, Employer will pay Executive an annual (calendar year) base salary of not less than $165,000.00 per year (payable at the rate of $13,750.00 per month January 1, 2001.

(b) Columbia Bank will guarantee payment of any portion of Executive's compensation that may be allocated to a subsidiary of CBSI.

4.2 Bonus. Executive will be eligible to participate in the bonus pools, if any, that the Board of CBSI or Columbia Bank may establish for senior executives, either under an executive incentive plan or otherwise.

5. Termination of Agreement.

5.1 Early Termination.

(c) For purposes of this Agreement, the term "cause" shall mean (i) willful misfeasance or gross negligence in the performance of Executive's duties; (ii) conduct demonstrably and significantly harmful to Employer (including willful violation of any final cease and desist order applicable to Employer or a financial institution subsidiary); or (iii) conviction of a felony. For purposes of this Agreement, "disability" shall have the meaning contained in any long term disability insurance coverage maintained by CBSI or its affiliates, and if no such coverage is in existence, shall mean a medically reimbursable physical or mental impairment that may be expected to result in death, or to be of long, continued duration, and that renders Executive incapable of performing the duties required under this Agreement. The Board or the Compensation Committee of the Board, acting in good faith, shall make the final determination of whether Executive is suffering under any disability as herein defined and, for purposes of making such determination, may require Executive to submit to a physical examination by a physician mutually agreed upon by Executive and the Board or the Committee at Employer's expense.

6. Restrictive Covenant.

6.1 Noncompetition.

(a) Executive agrees that except as otherwise set forth in this Agreement, Executive will not, during the term of this Agreement and for a period of two years after the later of (i) expiration of the term of this Agreement, or (ii) completion of service as an active executive officer of CBSI or Columbia Bank, directly or indirectly, become interested in, as principal shareholder, director, or officer, any financial institution (other than an institution controlled by, controlling, or under common control with Employer and its affiliates) that competes within the State of Washington with Employer or any of its affiliates, with respect to activities of the type performed by such companies within such service area immediately prior to Executive's termination.

6.3 Interpretation. If a court or any other administrative body with jurisdiction over a dispute related to this Agreement should determine that the restrictive covenants set forth above is unreasonably broad, the parties authorize such court or administrative body to narrow the covenants so as to make it reasonable, given all relevant circumstances, and to enforce such revised covenants. The covenants in this paragraph shall survive termination of this Agreement.

7. Change of Control.

(a) There is a change of control; and either;

(b) Within 730 days of such change in control, Executive terminates her employment with Employer; or

7.2 Definitions. For purposes of this Agreement, the term "change of control" shall mean the occurrence of one or more of the following events:

(a) One person or entity acquiring or otherwise becoming the owner of twenty-five percent or more of CBSI's outstanding common stock;

(b) Replacement of a majority of the incumbent directors of CBSI or Columbia Bank by directors whose elections have not been supported by a majority of the Board of either company, as appropriate; or

(c) Dissolution or sale of fifty percent or more in value of the assets, of either CBSI or Columbia Bank.

8. Miscellaneous.

8.1 This Agreement contains the entire agreement between the parties with respect to Executive's employment with Employer and her covenant not to compete with Employer and its affiliates, and is subject to modification or amendment only upon amendment in writing signed by both parties. The Severance Agreement between Employer and Executive dated June 23, 1999 is terminated effective December 20, 2000.

8.3 If any provision of this Agreement is invalid or otherwise unenforceable, all other provisions shall remain unaffected and shall be enforceable to the fullest extent permitted by law.

8.4 This Agreement is made with reference to and is intended to be construed in accordance with the laws of the State of Washington. Venue for any action arising out of or concerning this Agreement shall lie in Pierce County, Washington. In the event of a dispute under this Agreement not involving injunctive relief, the dispute shall be arbitrated pursuant to the Superior Court Mandatory Arbitration Rules ("MAR") adopted by the Washington State Supreme Court, irrespective of the amount in controversy. This Agreement shall be deemed as stipulation to that effect pursuant to MAR 1.2 and 8.1. The arbitrator, in his or her discretion, may award attorney's fees to the prevailing party or parties.

8.5 Any notice required to be given under this Agreement to either party shall be given by personal service or by depositing a copy thereof in the United States registered or certified mail, postage prepaid, addressed to the following address, or such other address as addressee shall designate in writing:

Employer:           Columbia State Bank
                    1102 Broadway
                    Tacoma, WA 98402

Executive:          Harald R. Russell
                    33411 33/rd/ Place South
                    Auburn, WA 98001

IN WITNESS WHEREOF, the parties have executed this Agreement effective on December 20, 2000.

COLUMBIA BANKING SYSTEM, INC.

By: /s/ J. James Gallagher
   ---------------------------
   J. James Gallagher
   Its Chief Executive Officer

COLUMBIA STATE BANK

By: /s/ Melanie Dressel
   ---------------------------
Melanie Dressel
Its Chief Executive Officer

EXECUTIVE

    /s/ Harald R. Russell
-----------------------------
Harald R. Russell

Exhibit 10.9

EMPLOYMENT AGREEMENT

THIS EMPLOYMENT AGREEMENT (the "Agreement") is made and entered by and between Columbia State Bank, a Washington banking corporation ("Columbia Bank") together with Columbia Banking System, Inc., a Washington corporation ("CBSI") (collectively, the "Employer"), and EVANS Q. WHITNEY (the "Executive"). This Agreement shall become effective as of December 20, 2000.

RECITALS

A. Executive is currently serving as Executive Vice President of Columbia Bank and Columbia Banking System, Inc..

B. Employer considers the continuance of sound and vital management essential to protecting and enhancing Employer's best interests.

C. Employer desires to assure itself of retaining the exclusive services of Executive and to continue the Employment of Executive under the terms of this Agreement. Executive and Employer have entered into an Employment Agreement effective December 20, 2000.

In consideration of the mutual promises made in this Agreement, the parties agree as follows:

AGREEMENT

1. Employment.

Employer employs Executive and Executive accepts employment with Employer on the terms and conditions set forth in this Agreement.

2. Term.

The term of this Agreement will commence as of December 20, 2000, and will continue until June 30, 2004, unless extended or sooner terminated as provided in this Agreement.

3. Duties.

(a) Executive will be Executive Vice President of CBSI and of Columbia Bank. In such capacities, and subject to the authority of the Chief Executive Officer of CBSI and/or the Bank, as appropriate, or such other officer to whom the authority has been granted (separately or collectively as applicable), Executive will render the executive management services and perform such tasks in connection with the affairs of CBSI and of Columbia Bank that are normal and customary to the position that Executive holds.

(b) Executive will perform such other duties as may be appropriate to Executive's position and as may be prescribed from time to time by the Chief Executive Officer of CBSI or Columbia Bank, as appropriate, or that are provided in the Bylaws of CBSI or Columbia Bank.

(c) Executive will devote their best efforts and all necessary time, attention, and effort to the business and affairs of Employer and its affiliates, as such business and affairs now exist or hereafter may be changed or supplemented, in order to properly discharge Executive's responsibilities under this Agreement.

4. Salary, Bonus, and Other Compensation.

4.1 Salary.

(a) During the term of this Agreement, Employer will pay Executive an annual (calendar year) base salary of not less than $165,000.00 per year (payable at the rate of $13,750.00 per month) beginning January 1, 2001.

(b) Columbia Bank will guarantee payment of any portion of Executive's compensation that may be allocated to a subsidiary of CBSI.

4.2 Bonus. Executive will be eligible to participate in the bonus pools, if any, that the Board of CBSI or Columbia Bank may establish for senior executives, either under an executive incentive plan or otherwise.

5. Termination of Agreement.

5.1 Early Termination.

(c) For purposes of this Agreement, the term "cause" shall mean
(i) willful misfeasance or gross negligence in the performance of Executive's duties; (ii) conduct demonstrably and significantly harmful to Employer (including willful violation of any final cease and desist order applicable to Employer or a financial institution subsidiary); or (iii) conviction of a felony. For purposes of this Agreement, "disability" shall have the meaning contained in any long term disability insurance coverage maintained by CBSI or its affiliates, and if no such coverage is in existence, shall mean a medically reimbursable physical or mental impairment that may be expected to result in death, or to be of long, continued duration, and that renders Executive incapable of performing the duties required under this Agreement. The Board or the Compensation Committee of the Board, acting in good faith, shall make the final determination of whether Executive is suffering under any disability as herein defined and, for purposes of making such determination, may require Executive to submit to a physical examination by a physician mutually agreed upon by Executive and the Board or the Committee at Employer's expense.

6. Restrictive Covenant.

6.1 Noncompetition.

(a) Executive agrees that except as otherwise set forth in this Agreement, Executive will not, during the term of this Agreement and for a period of two years after the later of (i) expiration of the term of this Agreement, or (ii) completion of service as an active executive officer of CBSI or Columbia Bank, directly or indirectly, become interested in, as principal shareholder, director, or officer, any financial institution (other than an institution controlled by, controlling, or under common control with Employer and its affiliates) that competes within the State of Washington with Employer or any of its affiliates, with respect to activities of the type performed by such companies within such service area immediately prior to Executive's termination.

6.3 Interpretation. If a court or any other administrative body with jurisdiction over a dispute related to this Agreement should determine that the restrictive covenants set forth above is unreasonably broad, the parties authorize such court or administrative body to narrow the covenants so as to make it reasonable, given all relevant circumstances, and to enforce such revised covenants. The covenants in this paragraph shall survive termination of this Agreement.

7. Change of Control.

(a) There is a change of control; and either;

(b) Within 730 days of such change in control, Executive terminates employment with Employer; or

7.2 Definitions. For purposes of this Agreement, the term "change of control" shall mean the occurrence of one or more of the following events:

(a) One person or entity acquiring or otherwise becoming the owner of twenty-five percent or more of CBSI's outstanding common stock;

(b) Replacement of a majority of the incumbent directors of CBSI or Columbia Bank by directors whose elections have not been supported by a majority of the Board of either company, as appropriate; or

(c) Dissolution or sale of fifty percent or more in value of the assets, of either CBSI or Columbia Bank.

8. Miscellaneous.

8.1 This Agreement contains the entire agreement between the parties with respect to Executive's employment with Employer and Executive's covenant not to compete with Employer and its affiliates, and is subject to modification or amendment only upon amendment in writing signed by both parties. The Severance Agreement between Employer and Executive dated June 23, 1999 is terminated effective December 20, 2000.

8.3 If any provision of this Agreement is invalid or otherwise unenforceable, all other provisions shall remain unaffected and shall be enforceable to the fullest extent permitted by law.

8.4 This Agreement is made with reference to and is intended to be construed in accordance with the laws of the State of Washington. Venue for any action arising out of or concerning this Agreement shall lie in Pierce County, Washington. In the event of a dispute under this Agreement not involving injunctive relief, the dispute shall be arbitrated pursuant to the Superior Court Mandatory Arbitration Rules ("MAR") adopted by the Washington State Supreme Court, irrespective of the amount in controversy. This Agreement shall be deemed as stipulation to that effect pursuant to MAR 1.2 and 8.1. The arbitrator, in his or her discretion, may award attorney's fees to the prevailing party or parties.

8.5 Any notice required to be given under this Agreement to either party shall be given by personal service or by depositing a copy thereof in the United States registered or certified mail, postage prepaid, addressed to the following address, or such other address as addressee shall designate in writing:

Employer:           Columbia State Bank
                    1102 Broadway
                    Tacoma, WA 98402


Executive:          Evans Q. Whitney
                    16 35/th/ Avenue NW
                    Gig Harbor, WA 98335

IN WITNESS WHEREOF, the parties have executed this Agreement effective on December 20, 2000.

COLUMBIA BANKING SYSTEM, INC.

By: /s/ J. James Gallagher
   --------------------------
J. James Gallagher
Its Chief Executive Officer

COLUMBIA STATE BANK

By: /s/ Melanie Dressel
   --------------------------
Melanie Dressel
Its Chief Executive Officer

EXECUTIVE

    /s/ Evans Q. Whitney
-----------------------------
Evans Q. Whitney

Exhibit 10.10

SEVERANCE AGREEMENT

THIS SEVERANCE AGREEMENT ("Agreement") is made and entered into effective this ___ day of _________, 2000, by and between COLUMBIA STATE BANK, a Washington banking corporation (the "Bank") and _______________."Executive").

RECITALS

1. The Bank (collectively referred to as the "Company") currently receives the exclusive services of Executive as its employee, and Executive desires that this employment relationship continue.

2. The Bank desires to provide a severance benefit to Executive (i) to encourage Executive to continue his/her employment relationship with the Bank;
(ii) to continue obtaining his/her services in the event of a potential Change in Control (as defined below) of Columbia Banking System, Inc. ("CBSI") that may be detrimental to the Executive; and (iii) to allow CBSI to maximize the benefits obtainable by its shareholders from any Change in Control.

In consideration of the mutual promises, covenants, agreements and undertakings contained in this Agreement, the parties hereby contract and agree as follows:

AGREEMENT

compensation payable by the Bank to the Executive, or upon any of the other terms of Executive's employment with the Bank.

4.1 Termination of Executive's employment by the Bank without Cause (as defined below) or by Executive for Good Reason (as defined below) within 730 days following the effective date of a Change of Control; or

4.2 Termination of Executive's employment by the Bank without Cause prior to a Change of Control if such termination occurs at any time from and after sixty days prior to the public announcement by the CBSI or any other party of a transaction which will result in a Change in Control; provided that the effective date of the Change of Control occurs within eighteen (18) months of Executive's termination.

6.2.1. One person or entity acquiring or otherwise becoming the owner of twenty-five percent (25%) or more of CBSI's outstanding common stock;

6.2.2. Replacement of incumbent directors or election of newly- elected directors constituting a majority of the Board of CBSI where such replacement or election has not been supported by the Board; or

6.2.3. Dissolution, or sale of fifty percent (50%) or more in value of the assets, or either CBSI or the Bank.

7.1 This Agreement contains the entire agreement between the parties with respect to the subject matter, and is subject to modification or amendment only upon amendment in writing signed by both parties.

7.2 This agreement shall bind and inure to the benefit of the heirs, legal representatives, successors, and assign of the parties.

7.3 If any provision of this Agreement is invalid or otherwise unenforceable, all other provisions shall remain unaffected and shall be enforceable to the fullest extent permitted by law.

7.4 This Agreement is made with reference to and is intended to be construed in accordance with the laws of the State of Washington. Venue for any action arising out of or concerning this Agreement shall lie in Pierce County, Washington. In the event of a dispute under this agreement, the disputes shall be arbitrated pursuant to the Superior Court Mandatory Arbitration Rules ("MAR") adopted by the Washington State Supreme Court, irrespective of the amount in controversy. This Agreement shall be deemed as stipulation to that effect pursuant to

MAR 1.2 and 8.1. The arbitrator, in his or her discretion, may award attorney's fees to the prevailing party or parties.

7.5 Any notice required to be given under this Agreement to either party shall be given by personal service or by depositing a copy thereof in the United States registered or certified mail, postage prepaid, addressed to the following address or such other address as addressee shall designate in writing:

Company:       Columbia Bank
               1102 Broadway Plaza
               Tacoma, WA 98401
               Attn: (Corporate Secretary)
                      -------------------

Executive:     ______________________________
               ______________________________
               ______________________________

IN WITNESS WHEREOF, the parties have executed this Agreement effective on the date first above written.

COLUMBIA STATE BANK

By: _________________________

Its: _________________________

EXECUTIVE

Exhibit 10.11

PROMISSORY NOTE

$__________ Tacoma, Washington

___________, 2000

FOR VALUE RECEIVED, ___________ (the "Maker") hereby promises to pay to Columbia Banking System, Inc. ("CBSI") at Tacoma, Washington, or such other place as the Payee may in writing designate, the principal sum of ___________________________($_________), and to pay interest on the outstanding principal sum commencing on the date hereof at the rate of 5.87% per annum (the applicable federal rate) commencing on December 21, 2000 until this note is paid in full. Interest only shall be due on each anniversary of this note and the full amount of principal and accrued interest shall be due on or before December 21, 2007.

This Note may be prepaid, in whole or in part, any time or from time to time. All such prepayments shall be applied first to accrued and unpaid interest. The balance, if any, shall be applied to principal.

Notwithstanding any other provision of this Note, upon Maker's default under this Promissory Note, Payee may declare the outstanding principal amount hereof, and all accrued and unpaid interest thereon, immediately due and payable, and commence suit to recover the same or exercise any other remedy that Payee may have in law or equity. Default under this Promissory Note shall occur if any payment due is unpaid ten (10) days after its due date. Default under this Promissory Note shall also occur if the Maker does not, at all times during the term of this Promissory Note, own, in his own name and not pledged or otherwise hypothecated to any other party, a minimum of ____________ (________) shares of CBSI common stock.

The failure or delay of CBSI to enforce any provision of this Note shall not be deemed a waiver of any such provision, and CBSI shall not be prevented from enforcing any such provision at a later time. Any waiver of any provision hereof must be in writing and signed by CBSI. Any such waiver, consent or approval shall be effective only in the specific instance and for the specific purpose for which it is given.

This Note shall be governed by and construed in accordance with the laws of the State of Washington.

In the event of any failure by the Maker to make payments of principal and interest when due hereunder, the Maker agrees to pay all costs and expenses of collection of the holder of this Note including, but not limited to, reasonable attorneys' fees and costs.

Exhibit 10.12

AMENDED RESTRICTED STOCK AWARD AGREEMENT

AMENDED RESTRICTED STOCK AWARD AGREEMENT is made and entered into by and between COLUMBIA BANKING SYSTEM, INC., a Washington corporation ("CBSI"), J. James Gallagher (the "Executive"), and COLUMBIA STATE BANK, as escrow agent (the "Escrow Agent"). This Amended Agreement, which amends, supercedes and replaces the Agreement which became effective on April 22, 1998, is effective as of July 1, 1998.

1. On April 22, 1998, Board of Directors of CBSI approved the grant of a nonqualified stock option to purchase 25,000 shares of CBSI common stock (the"Option") and a Restricted Stock Award for 10,000 shares of CBSI common stock to the Executive. In December 1998, the Compensation Committee of the Board of Directors of CBSI amended the Option to change the date of the grant from April 22, 1998 to July 1, 1998, the actual date of Mr. Gallagher's employment with CBSI.

2. In order to make the dates of the grant of Mr. Gallagher's Option and Restricted Stock Award consistent, on June 23, 1999, the Compensation Committee amended the Restricted Stock Award to provide for the grant and issuance of 15,000 shares (which reflects an adjustment to take into account the three-for- two stock split payable in May 1998) of CBSI common stock, effective as of July 1, 1998, to the Executive (the "Award").

2. In consideration for the Executive's agreement to serve as a senior executive officer of CBSI and its subsidiary bank, Columbia State Bank ("Columbia Bank"), and as an incentive for Executive to continue to serve in this capacity in the future, CBSI grants the Award to Executive on the terms and conditions stated herein.

1. Grant of Restricted Stock Award. In consideration of Executive's agreement to serve as a senior executive officer of CBSI and the Bank and to incent Executive to continue as a senior executive officer, CBSI hereby grants and issues to and in the name of the Executive as a Restricted Stock Award a total of Fifteen Thousand (15,000) shares of the no par value common stock of CBSI. (the "Shares"). The date of grant is July 1, 1998.

2. Consideration of Issuance of Shares. In consideration for the issuance of the Shares, the Executive agrees to become Vice Chairman of CBSI and Columbia Bank effective July 1, 1998 and to remain as an executive officer of CBSI and/or Columbia Bank form July 1, 1998 through the period the Shares are subject to the escrow, as provided herein. Should the Executive fail, without the express approval of the Board of Directors or the Personnel and Compensation Committee (the "Committee"), to occupy and remain

in such capacity, the Shares will be redelivered by the Escrow Agent to CBSI and will be cancelled. CBSI will have no other remedy for such a breach.

3. Escrow. The certificate(s) evidencing the Shares shall be deposited in escrow immediately upon issuance by CBSI. Columbia Bank shall act as Escrow Agent and, as such, shall hold the Shares subject to delivery to the Executive or redelivery to CBSI in its corporate capacity, all in accordance with the terms of this Agreement. The Executive hereby grants an irrevocable power of attorney to the Escrow Agent to transfer and deliver the Shares and the stock certificate(s) evidencing the same in accordance with the terms and provisions of this Agreement and the Board of Directors or the Committee.

4. Escrow Stock Not Transferable. No transfer, pledge or other disposition of the shares may be made by the Executive so long as they are held under and remain subject to the escrow.

5. Term of Escrow. The Shares shall be subject to escrow until July 1, 2003 unless sooner terminated in accordance with the terms of this Agreement.

6. Dividends and Voting Rights. During the period while the Shares are held in escrow, all dividends payable with respect to such Shares shall be paid by the Escrow Agent directly to the Executive and the Executive shall be entitled to exercise all voting rights with respect to such Shares, all in the same manner and to the full extent as though the Shares were held by the Executive free of the escrow.

7. Release of Stock From Escrow. Shares held in escrow pursuant to this Agreement shall be released from such escrow by the delivery of the stock certificate(s) evidencing such Shares to the Executive (or, in the case of death or disability of the Executive, to the Executive's estate or legal guardian) at the earlier of:

(a) July 1, 2003;

(b) The death or disability (as defined in Section 9 of this Agreement) of the Executive;

(c) The determination by the Board of Directors or the Committee to authorize the re-lease of such Shares to the Executive upon the occurrence of any event the Board determines to warrant such release; or

(d) The occurrence of a change in control, as defined in Section 10 of this Agreement.

8. Termination of Service/Forfeiture of Shares. In the event of the termination of service as an active officer of CBSI and/or Columbia Bank during the period that the Shares are held in escrow (and the Shares are not then released pursuant to the provisions of this Section 7), such Shares shall be forfeited to CBSI and all rights of the Executive with respect thereto terminated, unless, in the case of termination by act of the Employer,

the Board of Directors or the Committee, within thirty (30) days following such termination, authorizes release of such Shares to the Executive. Upon the expiration of such thirty (30) day period without action by the Board or Committee to release such Shares to the Executive, the Shares shall be deemed forfeited and the stock certificate(s) evidencing the same shall be redelivered to CBSI, whereupon they shall be cancelled and retired.

9. Reliance by Escrow Agent. The Escrow Agent shall have no liability for action in reliance upon any instructions delivered to it and believed in good faith by it to be from the Board or the Committee.

10. Disability. For purposes of this Agreement, the term "disability" shall mean a medically reimbursable physical or mental impairment that may be expected to result in death, or to be of long, continued duration, and that renders Executive incapable of performing the duties required for his/her position. The Board or Committee, acting in good faith, shall make the final determination of whether Executive is suffering under any disability as herein defined and, for purposes of making such determination, may require Executive to submit to a physical examination by a physician mutually agreed upon by the Executive and the Board or the Committee at CBSI's expense.

11. Change in Control. For the purposes of this Agreement, the term "change in control" shall mean the occurrence of one or more of the following events:

(a) One person or entity acquiring or otherwise becoming the owner of twenty-five percent or more of CBSI's outstanding common stock;

(b) Replacement of a majority of the incumbent directors of CBSI or Columbia Bank by directors whose elections have not been supported by a majority of the Board of either company, as appropriate; or

(c) Dissolution, or sale of fifty percent or more in value of the assets, of either CBSI or Columbia Bank.

12. Binding Effect. This Agreement shall be binding upon and inure to the benefit of CBSI, in its corporate capacity, Columbia Bank, as Escrow Agent, the Executive, and their respective heirs, representatives, successors and assigns.

COLUMBIA BANKING SYSTEM, INC.           COLUMBIA STATE BANK

By: /s/ W. W. Philip                    By: /s/ W. W. Philip
   --------------------------              --------------------------
W. W. Philip, Chairman, President       W. W. Philip, Chairman,
and Chief Executive Officer             and Chief Executive Officer

/s/ J. James Gallagher
-----------------------------
J. James Gallagher
Executive

Exhibit 10.13

RESTRICTED STOCK AWARD AGREEMENT

THIS AGREEMENT is affective the 28th day of January, 1998, by and between COLUMBIA BANKING SYSTEM, INC., a Washington corporation ("CBSI"), Melanie J. Dressel (the "Executive"), and COLUMBIA STATE BANK, as escrow agent (the "Escrow Agent").

1. On January 28, 1998, the Personnel and Compensation Committee of the Board of Directors of CBSI (the "Committee") approved and recommended to the full Board of Directors the grant and issuance of a Restricted Stock Award for 5,000 shares of CBSI common stock (the "Award") to the Executive. On January 28, 1998, the Board of Directors of CBSI accepted the Committee's recommendation and approved the grant and issuance of the Award to the Executive.

2. In consideration for the Executive's prior service to and as an incentive for Executive to continue to serve as a senior officer of CBSI and its subsidiary bank, Columbia State Bank ("Columbia Bank") in the future, CBSI grants the Award to Executive on the terms and conditions stated herein.

1. Grant of Restricted Stock Award. In order to reward Executive for prior accomplishments and to incent Executive to continue as a senior executive officer, CBSI hereby grants and issues to and in the name of the Executive as a Restricted Stock Award a total of Five Thousand (5,000) shares of the no par value common stock of CBSI (the "Shares"). The date of grant is January 28, 1998.

2. Consideration of Issuance of Shares. In consideration for the issuance of the Shares, the Executive agrees to remain as an active senior officer of CBSI and/or Columbia Bank from January 28, 1998 through the period the Shares are subject to the escrow, as provided herein. Should the Executive fail, without the express approval of the Board of Directors or the Committee, to remain in such capacity, the Shares will be redelivered by the Escrow Agent to CBSI and will be cancelled. CBSI will have no other remedy for such a breach.

3. Escrow. The certificate(s) evidencing the Shares shall be deposited in escrow immediately upon issuance by CBSI. Columbia Bank shall act as Escrow Agent and, as such, shall hold the Shares subject to delivery to the Executive or redelivery to CBSI in its corporate capacity, all in accordance with the terms of this Agreement. The Executive hereby grants an irrevocable power of attorney to the Escrow Agent to transfer and deliver the Shares and the stock certificate(s) evidencing the same in accordance with the terms and provisions of this Agreement and the Board of Directors or the Committee.

4. Escrow Stock Not Transferable. No transfer, pledge or other disposition of the 5,000 shares may be made by the Executive so long as they are held under and remain subject to the escrow.

5. Term of Escrow. The Shares shall be subject to escrow until January 28, 2003 unless sooner terminated in accordance with the terms of this Agreement.

6. Dividends and Voting Rights. During the period while the Shares are held in escrow, all dividends payable with respect to such Shares shall be paid by the Escrow Agent directly to the Executive and the Executive shall be entitled to exercise all voting rights with respect to such Shares, all in the same manner and to the full extent as though the Shares were held by the Executive free of the escrow.

7. Release of Stock From Escrow. Shares held in escrow pursuant to this Agreement shall be released from such escrow by the delivery of the stock certificate(s) evidencing such Shares to the Executive (or, in the case of death or disability of the Executive, to the Executive's estate or legal guardian) at the earlier of:

(a) January 28, 2003;

(b) The death or disability (as defined in Section 9 of this Agreement) of the Executive;

(c) The determination by the Board of Directors to authorize the re- lease of such Shares to the Executive upon the occurrence of any event the Board determines to warrant such release; or

(d) The occurrence of a change in control, as defined in Section 10 of this Agreement.

(e) Termination of Service/Forfeiture of Shares. In the event of the termination of service as an active officer of CBSI and/or Columbia Bank during the period that the Shares are held in escrow (and the Shares are not then released pursuant to the provisions of this Section 7), such Shares shall be forfeited to CBSI and all rights of the Executive with respect thereto terminated, unless, in the case of termination by act of the Employer, the Board of Directors or the Committee, within thirty (30) days following such termination, authorizes release of such Shares to the Executive. Upon the expiration of such thirty (30) day period without action by the Board or Committee to release such Shares to the Executive, the Shares shall be deemed forfeited and the stock certificate(s) evidencing the same shall be redelivered to CBSI, whereupon they shall be cancelled and retired.

8. Reliance of Escrow Agent. The Escrow Agent shall have no liability for action in reliance upon any instructions delivered to it and believed in good faith by it to be from the Board or the Committee.

9. Disability. For purposes of this Agreement, the term "disability" shall mean a medically reimbursable physical or mental impairment that may be expected to result in death, or to be of long, continued duration, and that renders Executive incapable of performing the duties required for his/her position. The Board or the Committee, acting in good faith, shall make the final determination of whether Executive is suffering under any disability as herein defined and, for purposes of making such determination, may require Executive to submit to a physical examination by a physician mutually agreed upon by Executive and the Board or the Committee at CBSI's expense.

10. Change in Control. For the purposes of this Agreement, the term "change in control" shall mean the occurrence of one or more of the following events:

(a) One person or entity acquiring or otherwise becoming the owner of twenty-five percent or more of CBSI's outstanding common stock;

(b) Replacement of a majority of the incumbent directors of CBSI or Columbia Bank by directors whose elections have not been supported by a majority of the Board of either company, as appropriate; or

(c) Dissolution, or sale of fifty percent or more in value of the assets, of either CBSI or Columbia Bank.

11. Binding Effect. This Agreement shall be binding upon and inure to the benefit of CBSI, in its corporate capacity, Columbia Bank, as Escrow Agent, the Executive, and their respective heirs, representatives, successors and assigns.

COLUMBIA BANKING SYSTEM, INC.                COLUMBIA STATE BANK

By: /s/ W. W. Philip                         By: /s/ W. W. Philip
   -----------------------------                -------------------------------
W. W. Philip, Chairman,                      W. W. Philip, Chairman, President
and Chief Executive Officer                  and Chief Executive Officer


/s/ Melanie J. Dressel
--------------------------------
Melanie J. Dressel
Executive

Exhibit 10.14

RESTRICTED STOCK AWARD AGREEMENT

THIS AGREEMENT is affective the 28th day of January, 1998, by and between COLUMBIA BANKING SYSTEM, INC., a Washington corporation ("CBSI"), Harald R. Russell (the "Executive"), and COLUMBIA STATE BANK, as escrow agent (the "Escrow Agent").

1. On January 28, 1998, the Personnel and Compensation Committee of the Board of Directors of CBSI (the "Committee") approved and recommended to the full Board of Directors the grant and issuance of a Restricted Stock Award for 5,000 shares of CBSI common stock (the "Award") to the Executive. On January 28, 1998, the Board of Directors of CBSI accepted the Committee's recommendation and approved the grant and issuance of the Award to the Executive.

2. In consideration for the Executive's prior service to and as an incentive for Executive to continue to serve as a senior officer of CBSI and its subsidiary bank, Columbia State Bank ("Columbia Bank") in the future, CBSI grants the award to Executive on the terms and conditions stated herein.

1. Grant of Restricted Stock Award. In order to reward Executive for prior accomplishments and to incent Executive to continue as a senior executive officer, CBSI hereby grants and issues to and in the name of the Executive as a Restricted Stock Award a total of Five Thousand (5,000) shares of the no par value common stock of CBSI (the "Shares"). The date of grant is January 28, 1998.

2. Consideration of Issuance of Shares. In consideration for the issuance of the Shares, the Executive agrees to remain as an active senior officer of CBSI and/or Columbia Bank from January 28, 1998 through the period the Shares are subject to the escrow, as provided herein. Should the Executive fail, without the express approval of the Board of Directors or the Committee, to remain in such capacity, the Shares will be redelivered by the Escrow Agent to CBSI and will be cancelled. CBSI will have no other remedy for such a breach.

3. Escrow. The certificate(s) evidencing the Shares shall be deposited in escrow immediately upon issuance by CBSI. Columbia Bank shall act as Escrow Agent and, as such, shall hold the Shares subject to delivery to the Executive or redelivery to CBSI in its corporate capacity, all in accordance with the terms of this Agreement. The Executive hereby grants an irrevocable power of attorney to the Escrow Agent to transfer and deliver the Shares and the stock certificate(s) evidencing the same in accordance with the terms and provisions of this Agreement and the Board of Directors or the Committee.

4. Escrow Stock Not Transferable. No transfer, pledge or other disposition of the 5,000 shares may be made by the Executive so long as they are held under and remain subject to the escrow.

5. Term of Escrow. The Shares shall be subject to escrow until January 28, 2003 unless sooner terminated in accordance with the terms of this Agreement.

6. Dividends and Voting Rights. During the period while the Shares are held in escrow, all cash dividends payable with respect to such Shares shall be paid by the Escrow Agent directly to the Executive and the Executive shall be entitled to exercise all voting rights with respect to such Shares, all in the same manner and to the full extent as though the Shares were held by the Executive free of the escrow.

7. Release of Stock From Escrow. Shares held in escrow pursuant to this Agreement shall be released from such escrow by the delivery of the stock certificate(s) evidencing such Shares to the Executive (or, in the case of death or disability of the Executive, to the Executive's estate or legal guardian) at the earlier of:

(a) January 28, 2003;

(b) The death or disability (as defined in Section 9 of this Agreement) of the Executive;

(c) The determination by the Board of Directors to authorize the re- lease of such Shares to the Executive upon the occurrence of any event the Board determines to warrant such release; or

(d) The occurrence of a change in control, as defined in Section 10 of this Agreement.

(e) Termination of Service/Forfeiture of Shares. In the event of the termination of service as an active officer of CBSI and/or Columbia Bank during the period that the Shares are held in escrow (and the Shares are not then released pursuant to the provisions of this Section 7), such Shares shall be forfeited to CBSI and all rights of the Executive with respect thereto terminated, unless, in the case of termination by act of the Employer, the Board of Directors or the Committee, within thirty (30) days following such termination, authorizes release of such Shares to the Executive. Upon the expiration of such thirty (30) day period without action by the Board or Committee to release such Shares to the Executive, the Shares shall be deemed forfeited and the stock certificate(s) evidencing the same shall be redelivered to CBSI, whereupon they shall be cancelled and retired.

8. Reliance of Escrow Agent. The Escrow Agent shall have no liability for action in reliance upon any instructions delivered to it and believed in good faith by it to be from the Board or the Committee.

9. Disability. For purposes of this Agreement, the term "disability" shall mean a medically reimbursable physical or mental impairment that may be expected to result in death, or to be of long, continued duration, and that renders Executive incapable of performing the duties required for his/her position. The Board or the Committee, acting in good faith, shall make the final determination of whether Executive is suffering under any disability as herein defined and, for purposes of making such determination, may require Executive to submit to a physical examination by a physician mutually agreed upon by Executive and the Board or the Committee at CBSI's expense.

10. Change in Control. For the purposes of this Agreement, the term "change in control" shall mean the occurrence of one or more of the following events:

(a) One person or entity acquiring or otherwise becoming the owner of twenty-five percent or more of CBSI's outstanding common stock;

(b) Replacement of a majority of the incumbent directors of CBSI or Columbia Bank by directors whose elections have not been supported by a majority of the Board of either company, as appropriate; or

(c) Dissolution, or sale of fifty percent or more in value of the assets, of either CBSI or Columbia Bank.

11. Binding Effect. This Agreement shall be binding upon and inure to the benefit of CBSI, in its corporate capacity, Columbia Bank, as Escrow Agent, the Executive, and their respective heirs, representatives, successors and assigns.

COLUMBIA BANKING SYSTEM, INC.                 COLUMBIA STATE BANK

By: /s/ W. W. Philip                          By: /s/ W. W. Philip
   --------------------------------              ---------------------------
W. W. Philip, Chairman, President             W. W. Philip, Chairman, President
and Chief Executive Officer                   and Chief Executive Officer


/s/ Harald R. Russell
-----------------------------------
Harald R. Russell
Executive

Exhibit 10.15

RESTRICTED STOCK AWARD AGREEMENT

THIS AGREEMENT is affective the 28th day of January, 1998, by and between COLUMBIA BANKING SYSTEM, INC., a Washington corporation ("CBSI"), Evans Q. Whitney (the "Executive"), and COLUMBIA STATE BANK, as escrow agent (the "Escrow Agent").

1. On January 28, 1998, the Personnel and Compensation Committee of the Board of Directors of CBSI (the "Committee") approved and recommended to the full Board of Directors the grant and issuance of a Restricted Stock Award for 5,000 shares of CBSI common stock (the "Award") to the Executive. On January 28, 1998, the Board of Directors of CBSI accepted the Committee's recommendation and approved the grant and issuance of the Award to the Executive.

2. In consideration for the Executive's prior service to and as an incentive for Executive to continue to serve as a senior officer of CBSI and its subsidiary bank, Columbia State Bank ("Columbia Bank") in the future, CBSI grants the Award to Executive on the terms and conditions stated herein.

1. Grant of Restricted Stock Award. In order to reward Executive for prior accomplishments and to incent Executive to continue as a senior executive officer, CBSI hereby grants and issues to and in the name of the Executive as a Restricted Stock Award a total of Five Thousand (5,000) shares of the no par value common stock of CBSI (the "shares"). The date of grant is January 28, 1998.

2. Consideration of Issuance of Shares. In consideration for the issuance of the Shares, the Executive agrees to remain as an active senior officer of CBSI and/or Columbia Bank from January 28, 1998 through the period the Shares are subject to the escrow, as provided herein. Should the Executive fail, without the express approval of the Board of Directors or the Committee, to remain in such capacity, the Shares will be redelivered by the Escrow Agent to CBSI and will be cancelled. CBSI will have no other remedy for such a breach.

3. Escrow. The certificate(s) evidencing the Shares shall be deposited in escrow immediately upon issuance by CBSI. Columbia Bank shall act as Escrow Agent and, as such, shall hold the Shares subject to delivery to the Executive or redelivery to CBSI in its corporate capacity, all in accordance with the terms of this Agreement. The Executive hereby grants an irrevocable power of attorney to the Escrow Agent to transfer and deliver the Shares and the stock certificate(s) evidencing the same in accordance with the terms and provisions of this Agreement and the Board of Directors or the Committee.

4. Escrow Stock Not Transferable. No transfer, pledge or other disposition of the 5,000 shares may be made by the Executive so long as they are held under and remain subject to the escrow.

5. Term of Escrow. The Shares shall be subject to escrow until January 28, 2003 unless sooner terminated in accordance with the terms of this Agreement.

6. Dividends and Voting Rights. During the period while the Shares are held in escrow, all dividends payable with respect to such Shares shall be paid by the Escrow Agent directly to the Executive and the Executive shall be entitled to exercise all voting rights with respect to such Shares, all in the same manner and to the full extent as though the Shares were held by the Executive free of the escrow.

7. Release of Stock From Escrow. Shares held in escrow pursuant to this Agreement shall be released from such escrow by the delivery of the stock certificate(s) evidencing such Shares to the Executive (or, in the case of death or disability of the Executive, to the Executive's estate or legal guardian) at the earlier of:

(a) January 28, 2003;

(b) The death or disability (as defined in Section 9 of this Agreement) of the Executive;

(c) The determination by the Board of Directors to authorize the re- lease of such Shares to the Executive upon the occurrence of any event the Board determines to warrant such release; or

(d) The occurrence of a change in control, as defined in Section 10 of this Agreement.

(e) Termination of Service/Forfeiture of Shares. In the event of the termination of service as an active officer of CBSI and/or Columbia Bank during the period that the Shares are held in escrow (and the Shares are not then released pursuant to the provisions of this Section 7), such Shares shall be forfeited to CBSI and all rights of the Executive with respect thereto terminated, unless, in the case of termination by act of the Employer, the Board of Directors or the Committee, within thirty (30) days following such termination, authorizes release of such Shares to the Executive. Upon the expiration of such thirty (30) day period without action by the Board or Committee to release such Shares to the Executive, the Shares shall be deemed forfeited and the stock certificate(s) evidencing the same shall be redelivered to CBSI, whereupon they shall be cancelled and retired.

8. Reliance of Escrow Agent. The Escrow Agent shall have no liability for action in reliance upon any instructions delivered to it and believed in good faith by it to be from the Board or the Committee.

9. Disability. For purposes of this Agreement, the term "disability" shall mean a medically reimbursable physical or mental impairment that may be expected to result in death, or to be of long, continued duration, and that renders the Executive incapable of performing the duties required for his/her position. The Board or the Committee, acting in good faith, shall make the final determination of whether the Executive is suffering under any disability as herein defined and, for purposes of making such determination, may require Executive to submit to a physical examination by a physician mutually agreed upon by the Executive and the Board or the Committee at CBSI's expense.

10. Change in Control. For the purposes of this Agreement, the term "change in control" shall mean the occurrence of one or more of the following events:

(a) One person or entity acquiring or otherwise becoming the owner of twenty-five percent or more of CBSI's outstanding common stock;

(b) Replacement of a majority of the incumbent directors of CBSI or Columbia Bank by directors whose elections have not been supported by a majority of the Board of either company, as appropriate; or

(c) Dissolution, or sale of fifty percent or more in value of the assets, of either CBSI or Columbia Bank.

11. Binding Effect. This Agreement shall be binding upon and inure to the benefit of CBSI, in its corporate capacity, Columbia Bank, as Escrow Agent, the Executive, and their respective heirs, representatives, successors and assigns.

COLUMBIA BANKING SYSTEM, INC.       COLUMBIA STATE BANK

By: /s/ W. W. Philip                         By: /s/ W. W. Philip
   -------------------------------              ----------------------------
W. W. Philip, Chairman, President            W. W. Philip, Chairman, President
and Chief Executive Officer                  and Chief Executive Officer

/s/ Evans Q. Whitney
----------------------------------
Evans Q. Whitney
Executive