ALERUS FINANCIAL CORP 8-K

What Happened

• Alerus Financial Corporation filed an 8-K on March 31, 2026 to report a Modification Agreement with the Bank of North Dakota dated March 30, 2026. The agreement amends the Subordinated Note Purchase Agreement originally entered March 30, 2021.
• The $50.0 million subordinated note issued to the Bank of North Dakota is amended to extend the stated maturity from March 30, 2031 to March 30, 2036. The note remains subordinated and was originally issued to support regulatory capital and general corporate purposes.

Key Details

• Parties: Alerus Financial Corporation and the Bank of North Dakota (purchaser).
• Principal: $50.0 million subordinated note (originally issued March 30, 2021).
• New maturity: extended from March 30, 2031 to March 30, 2036.
• Interest: fixed 6.75% annually until March 30, 2031; from March 30, 2031 until the (new) maturity or early redemption date interest resets to a fixed rate equal to the 5-year advance rate set by the Federal Home Loan Bank of Des Moines on that date plus 3.00%.
• Redemption: the modified note is redeemable in whole or in part on or after March 30, 2031 and at any time upon certain events.

Why It Matters

• Extending the maturity reduces near-term refinancing pressure on Alerus by pushing the principal repayment five years further out, which can help liquidity planning and capital management.
• The interest terms change cash interest exposure over time: a known 6.75% rate until 2031, then a formula-based fixed rate through 2036 tied to FHLB advances plus 3.00%, which could be higher or lower depending on market rates in 2031.
• For investors, this is a change to the company’s debt profile and interest obligations but does not otherwise alter the material terms of the original purchase agreement.