UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
____________________________________________
Form 8-K
____________________________________________
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event Reported): December 13, 2024
Stellar Bancorp, Inc.
(Exact Name of Registrant as Specified in Charter)
| | | | | | | | |
| Texas | 001-38280 | 20-8339782 |
| (State or Other Jurisdiction of Incorporation) | (Commission File Number) | (I.R.S. Employer Identification Number) |
9 Greenway Plaza, Suite 110
Houston, Texas 77046
(Address of Principal Executive Offices) (Zip Code)
(713) 210-7600
(Registrant's telephone number, including area code)
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| | | | | |
| ☐ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| |
| ☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| |
| ☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| |
| ☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act:
| | | | | | | | | | | | | | |
| Title of each class | | Trading Symbol(s) | | Name of each exchange on which registered |
| Common stock, par value $0.01 per share | | STEL | | New York Stock Exchange |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 1.01. Entry into a Material Definitive Agreement.
On December 13, 2024, Stellar Bancorp, Inc. (the “Company”) entered into a First Amendment to Third Amended and Restated Loan Agreement (the “Amended Agreement”) with Frost Bank, as lender, and the Company, as borrower. The Amended Agreement amends and restates in its entirety the Company's Second Amended and Restated Loan Agreement, dated as of December 13, 2022, as amended and modified.
The Amended Agreement provides for a $75 million revolving line of credit (the “Line of Credit”). Interest will accrue on outstanding borrowings under the Line of Credit at a per annum rate equal to the 3-Month Term SOFR plus 2.75% with said interest rate to be adjusted quarterly in accordance with the terms of the Renewal Promissory Note, dated December 13, 2024 (the “Note”), and is payable quarterly. Interest only shall be due and payable quarterly as it accrues on the 13th day of each March, June, September and December beginning March 13, 2025 and continuing quarterly thereafter until December 13, 2026 (the “Interest Only Period Expiration Date”) Following the Interest Only Period Expiration Date, principal and interest shall be due and payable in quarterly payments in equal amounts sufficient to fully amortize the principal balance of this Note as of the Interest Only Period Expiration Date over an amortization period of 84 months, payable on the 13th day of each March, June, September and December, beginning March 13, 2027, and continuing quarterly thereafter until December 13, 2033 (the “Maturity Date”), when the entire outstanding amount of this Note including all principal and accrued interest then remaining unpaid, shall be then due and payable.
The Company may prepay the principal amount of any loan under the Amended Agreement without premium or penalty. The Company has pledged its right, title and interest in and to all of the shares of capital stock of Community Bank of Texas N.A. (now called Stellar Bank) the Company’s wholly owned subsidiary, as collateral security for the payment and performance of the Company’s obligations arising under the Line of Credit pursuant to that certain Amended and Restated Pledge and Security Agreement with Frost Bank (the “Pledge Agreement”), dated November 17, 2022.
The Amended Agreement includes customary covenants including, among other things, that while there are any outstanding obligations under the Line of Credit, the Company shall comply with customary financial covenants and restrictions on the ability of the Company and its subsidiaries to incur additional debt.
As of December 13, 2024, the Company had no balance drawn under the Line of Credit. The foregoing descriptions of the Amended Agreement, the Note and the Pledge Agreement do not purport to be complete and are qualified in their entirety by reference to the full text of the Amended Agreement, the Note and the Pledge Agreement, which are filed as Exhibits 10.1, 10.2 and 10.3 to this Current Report on Form 8-K and are incorporated herein by reference.
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.
The information set forth in Item 1.01 of this Current Report on Form 8-K is incorporated herein by reference.
Item 8.01. Other Events.
On December 15, 2024, Stellar Bank, the Company’s wholly owned subsidiary, redeemed all of the $40.0 million aggregate principal amount of Fixed-to-Floating Rate Subordinated Notes due December 15, 2027 (the “Notes”). The redemption price for the Notes was equal to 100% of principal amount of the Notes redeemed, plus any accrued and unpaid interest to, but excluding, the redemption date. The Company did not draw on the Line of Credit in connection with the redemption of the Notes.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits. The following are furnished as exhibits to this Current Report on Form 8-K:
| | | | | |
| Exhibit Number | Description of Exhibit |
| 10.1 | |
| 10.2 | |
| 10.3 | |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| | | | | | | | |
| STELLAR BANCORP, INC. |
| | |
| Date: December 18, 2024 | By: | /s/ Paul P. Egge |
| | Paul P. Egge |
| | Chief Financial Officer |
