[8-K] Glen Burnie Bancorp Reports Material Event

Rhea-AI Filing Summary

Glen Burnie Bancorp (GLBZ) filed an 8-K announcing that its wholly-owned subsidiary, The Bank of Glen Burnie, executed a Stock Purchase Agreement on 5 Mar 2025 to acquire 100 % of VA Wholesale Mortgage Inc. (VAWM), a Virginia-based residential mortgage banker.

Transaction terms:

• Up-front cash consideration: $750,000.
• Earn-out: 33 % of VAWM’s net earnings plus 4 bps (0.04 %) on closed loan volume for three years post-closing.
• Expected closing: early Aug 2025, subject to customary regulatory approvals and closing conditions.
• Retention: Seller Eric Tan will become President of VAWM under an employment agreement, ensuring operational continuity.

The Agreement contains standard representations, warranties and covenants. A copy is filed as Exhibit 10.1 and incorporated by reference.

Strategic context: Although the purchase price is modest, the deal broadens GLBZ’s fee-based income stream into mortgage banking and could enhance non-interest revenue. However, earn-out obligations may temper profitability and closing risk remains until regulatory approval is secured.

Positive

• Diversification: Entry into mortgage banking can boost non-interest income and reduce reliance on spread revenue.
• Low upfront cost: $750k purchase price limits capital risk for shareholders.
• Management continuity: Employment agreement with seller helps preserve VAWM’s customer relationships and operational know-how.

Negative

• Earn-out dilution: 33 % of net earnings plus 4 bps on volume reduces VAWM’s contribution to GLBZ’s bottom line for three years.
• Regulatory closing risk: Deal remains subject to approvals; failure or delay could affect strategic timeline.
• Integration burden: Mortgage compliance and systems integration could strain GLBZ’s resources given its community-bank scale.

Insights

Banking Analyst

TL;DR: Small, strategic mortgage acquisition; modest price, earn-out limits risk but impact likely incremental, not transformative.

GLBZ’s $750k cash outlay for VAWM is minor relative to its balance-sheet size, making the deal financially low-risk. By adding mortgage banking, the bank gains fee income diversification at a time when net interest margins are pressured. Retaining the founder as President mitigates execution risk. The three-year earn-out aligns incentives, but also siphons 33 % of future earnings, capping upside. Overall, the acquisition looks strategically sound yet unlikely to materially change near-term earnings.

M&A Specialist

TL;DR: Deal structure balanced; low entry cost, standard covenants, regulatory approval still a gating item.

The agreement follows conventional community-bank playbooks: modest upfront cash, seller earn-out, and employment rollover. Closing conditions are typical, but any delay in OCC/FDIC consent could push closing beyond August. Given the price, potential impairment risk is minimal, though integration of mortgage compliance systems can strain small institutions. Investors should watch initial post-close loan volumes to gauge ROI.

07/08/2025 - 09:25 AM

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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): March 5, 2025

GLEN BURNIE BANCORP

(Exact name of registrant as specified in its charter)

Maryland	0-24047	52-1782444
(State or Other Jurisdiction	(Commission File Number)	(IRS Employer
of Incorporation)		Identification No.)

101 Crain Highway, S.E., Glen Burnie, Maryland 21061

(Address of Principal Executive Offices)

Registrant’s telephone number, including area code: (410) 766-3300

Inapplicable

(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))

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. ¨

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading symbol	Name of each exchange on which registered
Common Stock	GLBZ	Nasdaq Capital Market

INFORMATION TO BE INCLUDED IN THE REPORT

Item 1.01. Entry into a Material Definitive Agreement.

On March 5, 2025, The Bank of Glen Burnie, and Maryland chartered bank (the “Bank”) and wholly-owned subsidiary of Glen Burnie Bancorp (the “Company”) entered into a Stock Purchase Agreement (collectively, including its exhibits and ancillary agreements, the “Agreement”) with Eric Tan (the “Seller”), with respect to the sale by the Seller of 100% of the issued and outstanding stock of VA Wholesale Mortgage Incorporated (“VAWM”), a Virginia corporation which provides residential mortgage banking services to the general public, for $750,000 cash consideration to the Seller. In addition, the Seller will receive 33% of the net earnings of VAWM plus an additional 4 basis points (.04%) on closed loan volume of VAWM for a period of three years following the Closing Date. The sale is expected to close in early August 2025. As a condition of closing, VAWM and the Seller will enter into an employment agreement pursuant to which the Seller will be employed as president of VAWM and will be responsible for the overall daily management of VAWM.

The Agreement contains customary representations, warranties and covenants. The closing is subject to the satisfaction or waiver of certain customary closing conditions, including but not limited to, the receipt of all necessary regulatory approvals.

The foregoing description of the Agreement and the transactions contemplated thereby does not purport to be complete and is qualified in its entirety by reference to the Agreement, a copy of which is filed as Exhibit 10.1 hereto and is hereby incorporated into this report by reference. The Agreement has been included to provide stockholders and investors with information regarding its terms. It is not intended to provide any other factual information about the Company or VAWM. Moreover, certain representations and warranties in the Agreement were used for the purpose of allocating risk between the parties thereto rather than establishing matters as facts. Accordingly, stockholders and investors should not rely on the representations and warranties in the Agreement as characterizations of the actual state of facts about VAWM.

Item 9.01 Financial Statements and Exhibits.

(d)     Exhibits

Exhibit No.	Description
10.1	Stock Purchase Agreement by and between The Bank of Glen Burnie and Eric Tan. dated March 5, 2025.
104	Cover Page Interactive Data File (embedded within the Inline XBRL document).

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SIGNATURES

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 thereunto duly authorized.

		GLEN BURNIE BANCORP
		(Registrant)
Date: July 8, 2025	By:	/s/ Mark C. Hanna
		Mark C. Hanna
		Chief Executive Officer

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FAQ

What did Glen Burnie Bancorp (GLBZ) announce in its 8-K?

The company signed a Stock Purchase Agreement to buy 100 % of VA Wholesale Mortgage Inc. for $750,000 plus an earn-out.

How much will GLBZ pay upfront for VAWM?

$750,000 in cash will be paid at closing, expected in early August 2025.

What is the earn-out structure for the VAWM acquisition?

The seller receives 33 % of net earnings and 0.04 % of closed loan volume for three years after closing.

When is the VAWM acquisition expected to close?

The parties anticipate closing in early August 2025, pending regulatory approvals.

Will Eric Tan remain involved after selling VAWM?

Yes. Eric Tan will become President of VAWM under an employment agreement executed at closing.

What approvals are required before the deal closes?

Customary regulatory approvals for bank acquisitions must be obtained or waived.