Business Context and Reporting Period
This Form 8-K filing by First Internet Bancorp covers events occurring on March 6, 2013. The report details the acquisition of a corporate office building in Fishers, Indiana, intended for the administrative operations of its subsidiary, First Internet Bank of Indiana.
Key Financial Metrics and Transaction Details
- Asset Acquisition: Purchased a 52,000 square foot office building for approximately $4.0 million.
- Financing: Funded via a $4.0 million term loan from the Bank subsidiary.
- Loan Terms: Maturity date of March 6, 2014; interest rate of Prime + 1.00% (variable).
- Collateral Requirements: Loan secured by a first priority mortgage; Company must maintain collateral value of at least $5.2 million.
- Lease Agreement: Company leased 15,250 square feet of the property back to the Bank at $18.50 per square foot per month for an initial five-year term.
Material Changes
The filing reports a material definitive agreement and the creation of a direct financial obligation. The Company's balance sheet will reflect a new fixed asset (the Property) and a corresponding short-term liability (the Loan). No revenue, profit, or cash flow metrics for the reporting period are provided in this specific filing.
Outlook, Risks, and Contingencies
- Operational Use: The property is designated for administrative use only, not for branch or loan/deposit production.
- Future Expansion: Management expects the Bank to increase its usage of the property over time, though the current lease does not expressly provide expansion rights.
- Default Risk: The loan agreement includes an automatic acceleration clause triggered by a bankruptcy filing or similar insolvency event by the Company.
Investor Verification Checklist
- Verify the impact of the $4.0 million loan on the Company's short-term liquidity and debt-to-equity ratios.
- Confirm the valuation of the Property to ensure it meets the $5.2 million collateral maintenance requirement.
- Review the full text of the Loan Agreement (Exhibit 10.1) and Lease (Exhibit 10.2) for additional covenants or restrictions.
- Monitor future filings for any changes in the Bank's occupancy of the property or lease modifications.