Business Context and Reporting Period
Company: Bank of the James Financial Group, Inc.
Filing Type: Form 8-K (Current Report)
Date of Report: March 30, 2009
Event: Entry into a Material Definitive Agreement involving the sale of debt securities.
Key Financial Metrics
This filing reports a specific financing transaction rather than periodic operating results. Key metrics related to the transaction include:
- Principal Amount Sold: $6,180,000
- Interest Rate: 6% per annum
- Interest Payment Frequency: Quarterly in arrears (first payment due July 1, 2009)
- Maturity Date: April 1, 2012
- Principal Repayment: Due in full on the Maturity Date
- Related Party Sales: $1,700,000 sold to directors and their affiliates (James F. Daly, wife of Donald M. Giles, Donna S. Clark, and Richard R. Zechini)
- Remaining Offering Capacity: Up to an additional $820,000 available for sale by April 30, 2009
Note: The filing text does not provide clear values for revenue, profit, cash flow, margins, or existing debt levels outside of this specific transaction.
Material Changes
The primary material change is the creation of a new direct financial obligation of $6,180,000. This represents a significant increase in the company's debt load and future interest expense obligations effective March 30, 2009.
Guidance, Outlook, and Risks
- Regulatory Status: The offering was conducted under Rule 506 of Regulation D and Section 4(2) of the Securities Act of 1933. The Notes are unregistered and cannot be offered or sold in the United States absent registration or an applicable exemption.
- Future Obligations: The company is obligated to pay quarterly interest starting July 1, 2009, and repay the full principal plus accrued interest on April 1, 2012.
- Contingencies: The company retains the option to sell up to $820,000 in additional notes under the same terms before April 30, 2009.
Investor Verification Checklist
- Verify the total outstanding debt of the company post-transaction to assess leverage ratios.
- Confirm the company's ability to service the new quarterly interest payments given the 6% rate.
- Review the full text of the Note Purchase Agreement (Exhibit 10.7) for covenants or default provisions.
- Monitor whether the company exercises the option to sell the additional $820,000 in notes.
- Assess the impact of the $1.7 million related-party transaction on corporate governance and potential conflicts of interest.