Sterling Financial files $348.45 million TARP preferreds, warrants for trading

By Susanna Moon

Chicago, Jan. 6 - Sterling Financial Corp. registered the $303 million of fixed-rate cumulative perpetual preferred stock it sold to the U.S. Treasury under the Troubled Asset Relief Program for public trading in an S-3 shelf registration with the Securities and Exchange Commission.

Also covered under the registration is up to $45.45 million of warrants to purchase 6,437,677 common shares.

The preferreds pay cumulative dividends at 5% per year to Feb. 15, 2014 after which they step up to 9%.

The preferreds may not be redeemed prior to Feb. 15, 2012 unless the company has obtained proceeds from one or more equity offerings of $75.75 million.

Spokane, Wash.-based Sterling said it will not receive proceeds from the reselling holders.

Issuer:	Sterling Financial Corp.
Issue:	Series A preferred stock
Amount:	$303 million (plus $45,449,999 warrants)
Maturity:	Perpetual
Dividend:	5%, steps up to 9% after Feb. 15, 2014
Call option:	Before Feb. 15, 2012 only with proceeds from equity offerings of $75.75 million; after Feb. 15, 2012 at par
Warrants:	For 6,437,677 shares
Warrant exercise price:	$7.06
Warrant expiration:	Dec. 5, 2018

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