NRIM

Business Context and Reporting Period

Company: Northrim BanCorp, Inc. (Northrim)
Filing Type: Form 8-K (Current Report)
Date of Report: July 23, 2026 (Reporting event date: July 22, 2026)
Event: Entry into a Material Definitive Agreement to acquire PBCO Financial Corporation (PBCO).

Key Financial Metrics and Transaction Terms

This filing details a merger agreement rather than periodic financial performance. Key transaction metrics include:

• Exchange Ratio: 1.160 shares of Northrim Common Stock for each share of PBCO Common Stock.
• Equity Adjustment: The Exchange Ratio may be adjusted downward if PBCO's Adjusted Tangible Common Equity is less than $102,542,499 as calculated 10 business days prior to closing.
• Fractional Shares: Paid in cash based on the average closing price of Northrim stock over the 20 trading days preceding the second trading day prior to closing.
• Termination Fee: $6,692,331 payable by PBCO to Northrim under specific termination scenarios (e.g., change in recommendation, superior proposal).
• Employee Compensation: Outstanding PBCO Restricted Stock Units (RSUs) will fully vest. Phantom Stock Units will be converted to cash based on the Exchange Ratio and Northrim's closing stock price.

Note: The filing does not provide current revenue, profit, cash flow, or debt figures for Northrim or PBCO.

Material Changes and Transaction Structure

On July 22, 2026, Northrim entered into an Agreement and Plan of Merger with PBCO and a wholly-owned subsidiary, Whitewater Sub, Inc. The transaction structure involves:

1. PBCO merging into Whitewater Sub, Inc. (Surviving Corporation).
2. The Surviving Corporation merging into Northrim.
3. People's Bank of Commerce (PBCO's subsidiary) merging into Northrim Bank.

Northrim Bank will remain the surviving bank entity. The Boards of Directors of both Northrim and PBCO have unanimously approved the agreement.

Guidance, Outlook, and Risks

Timeline: The parties anticipate completing the Merger in the fourth quarter of 2026 or early in the first quarter of 2027.

Conditions to Closing: The transaction is subject to:

• Shareholder approval from both Northrim and PBCO (majority vote required).
• Regulatory approvals from the Federal Reserve, FDIC, Alaska Department of Commerce, and Oregon Department of Consumer and Business Services.
• Effectiveness of a Form S-4 registration statement.
• Confirmation that less than 10% of PBCO shareholders exercise dissenters' rights.
• A tax opinion confirming the Merger qualifies as a "reorganization."

Management Changes: One PBCO director will join the Northrim Board. Julia Beattie, CEO of People's Bank of Commerce, is expected to become Oregon market president of Northrim Bank. Employment agreements will be executed for key PBCO executives.

Risks: Risks include integration difficulties, failure to realize anticipated benefits, disruption of customer/employee relationships, regulatory delays, and potential dilution to Northrim shareholders.

Investor Verification Checklist

• Verify the final Exchange Ratio and any adjustments based on PBCO's Adjusted Tangible Common Equity prior to closing.
• Monitor the status of regulatory approvals from the Federal Reserve and FDIC.
• Review the upcoming Form S-4 registration statement for detailed pro forma financial information and risk factors.
• Confirm shareholder voting results for both Northrim and PBCO.
• Assess the potential impact of the $6.7 million termination fee on PBCO's liquidity if the deal fails.