Company: BCTF
Filing Date: 2025-03-06
Form Type: 10-K
Source: 0001552781-25-000058
Chunk: 87

Company: Bancorp 34, Inc.
Filing Date: 2025-03-06
Form: 10-K
Item: Item 1
Chunk 87
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 further information
regarding the valuation of our financial instruments, see Note 1 – Summary of Significant Accounting Policies and Note 16 –
Fair Value Information in our consolidated financial statements included in this Annual Report on Form 10-K.

CBOA
Financial, Inc. Merger

On March 19, 2024,
Bancorp 34 completed its previously announced merger with CBOA pursuant to the Agreement and Plan of Merger, dated as of April 27, 2023,
as amended (the “Merger Agreement”). Under the Merger Agreement, CBOA was merged with and into Bancorp 34, with Bancorp 34
continuing as the surviving entity (“the CBOA Merger”). Immediately following the completion of the CBOA Merger, CBOA’s
wholly-owned subsidiary, Commerce Bank of Arizona, an Arizona state-chartered bank, was merged with and into the Bank, with the Bank
continuing as the surviving bank.

Pursuant to the terms
of the Merger Agreement, at the effective time of the CBOA Merger, each CBOA shareholder had the right to receive 0.2628 shares of Bancorp
34 common stock, for each share of CBOA common stock owned by the CBOA shareholder, with cash to be paid in lieu of fractional shares.
Additionally, each outstanding CBOA restricted stock unit vested and was cancelled and converted automatically into the right to receive
0.2628 shares of Bancorp 34 common stock with respect to each share of CBOA common stock underlying such restricted stock unit. In connection
with the CBOA Merger, Bancorp 34 issued approximately 2.7 million shares of Bancorp 34 common stock, which had a fair value of approximately
$23.3 million based on a common share valuation completed by an independent third party as of the CBOA Merger date. Each outstanding
share of Bancorp 34 common stock remained outstanding and was unaffected by the CBOA Merger.

Commerce Bank of Arizona
operated five full-service offices serving customers in Gilbert, Green Valley, Oro Valley, Scottsdale and Tucson, Arizona. The combined
banks operate as Southwest Heritage Bank and serve customers from seven full-service offices in Arizona and southern New Mexico. The
core system conversion was executed in March 2024.

We accounted for the
CBOA Merger using the acquisition method of accounting in accordance the Financial Accounting Standards Board’s