Note 15 Acquisitions Utah Banner Bank Branch Acquisition On October 6, 2017, the Company acquired the loans and deposits of seven Utah branch locations from Banner Bank (Banner branches). The Company acquired $257 million in loans and assumed $160 million in deposits and paid a deposit premium of $13.8 million based on average deposits at closing. Two of the seven branches were consolidated into existing Bank branches. The Company has successfully completed the conversion of these branches into its core-banking platform and integrated personnel into the Companys operations. The acquired assets and assumed liabilities were recorded at fair value at the date of the acquisition. In accordance with GAAP guidance for business combinations, the Company recorded $14.9 million of goodwill and $2.6 million of other intangibles as of the acquisition date. The other intangible asset is related to core deposits and is being amortized using a straight-line method over a period of ten years with no significant residual value. For tax purposes, the purchase accounting adjustments, including goodwill and other intangibles related to the Banner branch acquisition are taxable or deductible. Note 15 Acquisitions (continued) The following table summarizes the consideration paid and the fair value of the assets acquired and liabilities assumed and recognized at the acquisition date. (Dollars in thousands) Purchase Price Cash $ 100,283 Premium paid on average deposits 13,762 Total consideration $ 114,045 Recorded amounts of assets acquired and liabilities assumed Assets Loans, net of discounts $ 251,782 Premises &amp; equipment 3,467 Core deposit intangible 2,604 Other assets 1,761 Total assets 259,614 Liabilities Deposits, net of premiums 160,292 Other liabilities 175 Total liabilities assumed 160,467 Total net assets from merger $ 99,147 Goodwill $ 14,898 Direct costs related to the branch acquisition were expensed as incurred in the year ended December 31, 2017. Such expenses primarily related to professional and legal services, human resource costs and information system charges. For the year ended December 31, 2017, the Company incurred $1.7 million of expenses related to the acquisition of the Utah branches of Banner Bank. Pro forma income statements are not being presented as the information is not practicable to produce. Town &amp; Country Bank Acquisition The Company also completed the merger of Town &amp; Country Bank (TC Bank) located in St. George, Utah on November 13, 2017, including the acquisition of $117 million in loans and assumption of $124 million in deposits. The Company successfully completed the conversion of this branch into its core-banking platform, consolidated its existing branch and the TC Bank Branch in St. George into one branch, and integrated personnel into the Companys operations. The Company exchanged Town &amp; Country Bank shares for 466,546 PUB common shares and paid cash of $11.6 million of which $2.0 million is being held in escrow to cover potential loss indemnifications. Note 15 Acquisitions (continued) The acquired assets and assumed liabilities were recorded at fair value at the date of the respective acquisitions. In accordance with GAAP guidance for business combinations, the Company recorded $11.1 million of goodwill and $845,000 of core deposit intangibles and $702,000 in deposit premium on certificates of deposit related to Town &amp; Country Bank on the acquisition date. The core deposit intangible is being amortized using a straight-line method over a period of ten years with no significant residual value. The deposit premium is being accreted into net interest income over the life of the certificates of deposit. In accordance with the applicable accounting guidance for business combinations, there was no carry-over of TC Banks previously established allowance for loan losses. The acquisition was a tax-free exchange; therefore, for tax purposes, purchase accounting adjustments, including goodwill, for the TC Bank acquisition are all non-taxable and/or non-deductible. The following table summarizes the consideration paid and the fair value of the assets acquired and liabilities assumed and recognized at the acquisition date. (Dollars in thousands, except share data) Purchase Price PUB common shares issued for Town &amp; Country shares 466,546 PUB share price at closing $ 29.96 Consideration from common stock conversion (0.2916 ratio) $ 13,977 Cash 11,603 Total consideration $ 25,580 Recorded amounts of assets acquired and liabilities assumed Assets Cash and cash equivalents $ 13,401 Investment securities 9,585 Loans, net of discounts 110,334 Premises &amp; equipment 145 Core deposit intangible 845 Bank owned life insurance 3,332 Deferred income tax asset 2,571 Other assets 4,161 Total assets 144,374 Liabilities Deposits, net of premiums 123,777 Other liabilities 6,127 Total liabilities assumed 129,904 Total net assets from merger $ 14,470 Goodwill $ 11,110 The following table provides the unaudited pro forma information for the results of operations for the twelve months ended December 31, 2017 and 2016, as if the acquisition had occurred on January 1, 2016. These adjustments reflect the impact of certain purchase accounting fair value measurements, primarily comprised of TC Banks loan and deposit portfolios. In addition, the acquisition-related expenses are included in the twelve months ended December 31, 2017. These unaudited pro forma results are presented for illustrative purposes only and are not intended to represent or be indicative of the actual results of operations of the combined banking organization that would have been achieved had the acquisition occurred at the beginning of each period presented, nor are they intended to represent or be indicative of future results of operations. No assumptions have been applied to the pro forma results of operations regarding possible revenue enhancements, expense efficiencies or asset dispositions. Note 15 Acquisitions (continued) The following table is Unaudited Pro Forma Statements of Income Years Ended December 31, (Dollars in thousands) 2017 2016 Net interest income $ 87,294 $ 75,075 Provision for loan losses 2,895 1,009 Non-interest income 18,623 18,426 Non-interest expense 64,950 54,116 Income before income tax expense 38,072 38,376 Income tax expense 17,152 13,533 Net income $ 20,920 $ 24,843 Earnings per share: Basic $ 1.13 $ 1.37 Diluted $ 1.11 $ 1.33 Direct costs related to the branch acquisition were expensed as incurred in the year ended December 31, 2017. Such expenses primarily related to professional and legal services, human resource costs and information system charges. For the year ended December 31, 2017, the Company incurred $3.1 million of expenses related to the TC Bank acquisition, the majority of which is tax deductible. The two acquisitions were consistent with the Companys strategy to expand our presence in Utah. The acquisitions offer the Company the opportunity to increase profitability by introducing existing products and services to the acquired customer base as well as add new customers in Utah. Goodwill arising from the acquisition consisted largely of synergies and the cost savings resulting from the combined operations. During 2018, the Company made acquisition related measurement period adjustments of $335,000 to goodwill. Changes to initially estimated fair values from a business combination are recognized as an adjustment to goodwill over the measurement period, which cannot exceed one year from the acquisition date. The adjustments to goodwill related to changes in the preliminary goodwill recorded for the TC Bank acquisition and were related to loan valuations.