Company: BCTF
Filing Date: 2025-03-06
Form Type: 10-K
Source: 0001552781-25-000058
Chunk: 444

Company: Bancorp 34, Inc.
Filing Date: 2025-03-06
Form: 10-K
Item: Item 1B
Chunk 444
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 measurement date. Fair value is based on quoted market prices, or if market prices are not available, is estimated using models
employing various techniques.

The significant assumptions
used in the models are independently verified against observable market data where possible. When observable market data is not available,
the estimate of fair value becomes more subjective and involves a high degree of judgment. In this circumstance, fair value is estimated
based on our judgment regarding the value that market participants would assign to the asset or liability. Therefore, the results cannot
be determined with precision and may not be realized in an actual sale or immediate settlement of the asset or liability. Also, there
are inherent limitations to any valuation technique, and changes in the underlying assumptions used, including discount rates and estimates
of future cash flows, could significantly affect the results of current or future values.

60

A portion of our assets
and liabilities are carried at fair value on our consolidated balance sheet. The majority of these assets and liabilities are measured
at fair value on a recurring basis, however, certain assets are measured at fair value on a nonrecurring basis based on the fair value
of the underlying collateral.

For 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