AGREEMENT OF MERGER
THIS AGREEMENT OF MERGER dated as of September 15, 2003 between and among Mid Valley Bank, a
California chartered commercial bank ("MVB"), PremierWest Bancorp, an Oregon corporation and a registered
financial services holding company (the "Company"), and PremierWest Bank, an Oregon chartered stock bank
and a wholly owned subsidiary of the Company (the "Bank"). Capitalized terms not otherwise defined in this
Agreement shall have the meanings ascribed in Section 8.3.
A. The respective boards of directors of MVB, the Bank and the Company have determined that a business
combination among MVB, the Bank and the Company, on the terms described herein, is in the best interests of
their respective companies and shareholders. Accordingly, the respective boards of directors of MVB, the Bank
and the Company have approved this Agreement and deem it advisable and in the best interests of their
respective shareholders to approve the merger of MVB with and into the Bank upon the terms and subject to the
conditions set forth in this Agreement.
B. MVB, the Bank and the Company desire to make certain representations, warranties, covenants and
agreements in connection with the Merger (as defined below), and to prescribe various conditions to the Merger.
C. The directors, officers, and certain other affiliates of MVB are entering into certain agreements as
contemplated hereby, and without such agreements the Company and the Bank would not have entered into this
D. For federal income tax purposes, it is intended that the Merger qualify as a reorganization within the meaning
of Section 368(a) of the Code and the rules and regulations promulgated thereunder, and that this Agreement
constitute a plan of reorganization.
NOW, THEREFORE, the parties agree as follows:
Section 1.1 The Merger. Upon the terms and subject to the conditions set forth in this Agreement, and in
accordance with the Oregon Bank Act, ORS Chapters 707 throug