Company: MCHB
Filing Date: 2025-07-16
Form Type: 424B3
Source: 0001140361-25-026051
Chunk: 350

Company: Mechanics Bancorp
Filing Date: 2025-07-16
Form: 424B3
Chunk 350
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 provides for probable losses inherent with funding the unused portion of legal lending commitments. The reserve for unfunded commitments calculation includes factors that are consistent with Allowance for Credit Losses methodology for funded loans using expected loss factors and a draw down factor. Changes in the reserve for unfunded commitments are reflected within Interest Payable and Other Liabilities on the Consolidated Balance Sheets and Provision for (Reversal of) Losses on Unfunded Lending Commitments on the Consolidated Income Statements.

#### Impairment of Long-Lived Assets
: The Bank reviews its long-lived assets for impairment whenever events or changes indicate that the carrying amount of an asset may not be recoverable. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets. Assets to be disposed of are reported at the lower of the carrying amount or fair value less costs to sell.

#### Loss Contingencies
: Loss contingencies, including claims and legal actions arising in the ordinary course of business, are recorded as liabilities when the likelihood of a loss is probable and an amount or range of loss can be reasonably estimated. For additional information, refer to Note 15, “Contingencies.”

#### Stock-Based Compensation
: Compensation cost is recognized for stock options and restricted stock awards based on the fair value of these awards at the date of grant. The estimated market price of the Bank’s common stock at the date of grant is used for restricted stock awards.

<div align='center'>F-17</div>

#### TABLE OF CONTENTS
Compensation cost is recognized over the required service period, generally defined as the vesting period. For awards with graded vesting, compensation cost is recognized on a straight-line basis over the requisite service period for the entire award. The Bank’s accounting policy is to recognize forfeitures as they occur.

The Mechanics Bank 2022 Omnibus Incentive Plan (RSU) provides for and the Mechanics 2017 Incentive Unit Plan provided for, the issuance of restricted shares (RSU shares) to select officers (under the Mechanics 2017 Incentive Unit Plan, such RSUs are referred to as “Units”). Compensation expense is recognized over the vesting period of the awards based on the fair value of the stock at the issue date. Fair value for future expense is recalculated at each vesting period. The fair value of the stock is determined using an internal valuation. RSU shares vest over a four