Note 2   Business Combinations On August 30, 2012, we announced signing of a definitive agreement to acquire Circle Bancorp and its subsidiary, Circle Bank (the  merger Agreement ). The aggregate deal value is approximately $ 24.9 million in cash, which includes a planned cash redemption of $ 3.5 million in preferred stock and the value of outstanding options and warrants. The board of directors of each company has approved this transaction. Completion of the transaction is subject to customary closing conditions, including bank regulatory approval and approval of Circle Bancorp s common and preferred shareholders. The transaction is expected to close in the fourth quarter of 2012. The structure of the transaction is as follows: " Umpqua will complete the organization of a wholly owned subsidiary UB Acquisition Subsidiary, Inc., which is a California corporation created solely to structure the transactions contemplated by the Merger Agreement to meet certain tax requirements and will not conduct any business, own any assets or incur any liabilities; " UB Acquisition Subsidiary, Inc. will merge with and into Circle Bancorp (the   First Step Merger  ), with Circle the surviving corporation; " Immediately following and on the same day as the First Step Merger, Circle Bancorp will merge with and into Umpqua (the   Second Step Merger  ), with Umpqua the surviving corporation; and " Immediately following and on the same day as the Second Step Merger, Circle Bank will merge with and into Umpqua Bank (the   Bank Merger  ), with Umpqua Bank being the resultant bank. Upon completion of the acquisition, all Circle Bank branches will operate under the Umpqua Bank name. The acquisition will add Circle Bank s Bay Area network of six branches in Corte Madera, Novato, Petaluma, San Francisco, San Rafael and Santa Rosa to Umpqua Bank s network of 193 locations in California, Oregon, Washington and Northern Nevada and will result in a combined institution with assets of approximately $ 11.8 billion.