X0303 4 2010-10-22 0000891106 STERLING FINANCIAL CORP /WA/ STSA 0001218637 DEPILLO DAVID S 111 NORTH WALL STREET SPOKANE WA 99201 1 Chief Credit Officer Common Stock 2010-10-22 4 C 0 13800000 A 15000000 I The DePillo Family Trust Convertible Participating Voting Preferred Stock, Series D 2010-10-22 4 C 0 30000 D Common Stock 13800000 0 I The DePillo Family Trust Prior to the transaction reported herein, The DePillo Family Trust was the holder of 1,200,000 shares of Common Stock and 30,000 shares of Convertible Participating Voting Preferred Stock, Series D, no par value with a liquidation preference of $4.60 per share (the "Series D Stock"). On October 21, 2010, "Stockholder Approval" (as defined below) was obtained and, as a result, on October 22, 2010, each share of Series D Preferred Stock automatically converted into 460 shares of Common Stock. The DePillo Family Trust's 30,000 shares of Preferred Stock, Series D, converted into 13,800,000 shares of Common Stock. "Stockholder Approval" refers to the approval by the stockholders of STSA on October 21, 2010 to increase the number of authorized shares of Common Stock to at least 10,000,000,000 shares or a larger number that the Board of Directors determines in its reasonable judgment is necessary to permit STSA to comply with its obligations under agreements entered into in connection with certain recapitalization transactions that occurred on August 26, 2010. Since Stockholder Approval was obtained on October 21, 2010, each share of the Series D Preferred Stock automatically converted into 460 shares of Common Stock on October 22, 2010, in accordance with the terms of the Series D Preferred Stock. No consideration for this conversion was required. /s/ Robert G. Butterfield, attorney-in-fact 2010-10-26