Banner Corporation Merger Agreement with Pacific Financial Corporation

On April 30, 2026, Banner Corporation entered into an Agreement and Plan of Merger with Pacific Financial Corporation. The merger will result in Pacific Financial merging with and into Banner, with Banner as the surviving corporation. Each share of Pacific Financial's common stock will be converted into 0.2633 shares of Banner's common stock. Fractional shares will be paid in cash. Stock options and RSUs of Pacific Financial will be vested and converted into cash payments. Following the merger, Pacific Financial's bank subsidiary will merge with Banner's bank subsidiary, with Banner Bank surviving. The merger is subject to shareholder and regulatory approvals, including from the Federal Reserve, FDIC, and Washington State Department of Financial Institutions. The transaction is expected to close in the third quarter of 2026. A termination fee of $6,300,000 is payable by Pacific Financial under certain circumstances. Both parties have entered into a Voting and Support Agreement, with Pacific Financial's directors and officers agreeing to vote their shares in favor of the merger. The filing also includes a joint press release, an investor presentation, and an employee email regarding the merger. Cautionary statements regarding forward-looking statements and risks associated with the merger are also provided.