Merchants Bancorp (NASDAQ: MBIN) Files An 8-K Termination of a Material Definitive AgreementItem 1.02 Termination of a Material Definitive Agreement.
As of December6, 2018, Merchants Bancorp (the “Company”) has repaid all principal and interest owed to Home Point Financial Corporation (“Home Point”) under that Revolving Subordinated Loan Agreement (the “Loan Agreement”) by and between the Company and Home Point dated May31, 2017, and the Subordinated Promissory Note (the “Note”) associated therewith. Also on such date, the Company notified Home Point that the maturity date of the Note should not be extended and that both the Loan Agreement and Note are terminated. There were no penalties incurred by the Company or Home Point in connection with the termination.
By the Loan Agreement Home Point invested $30million in the Company’s subordinated debt. The Company was required to invest the funds into its subsidiary, Merchants Bank of Indiana (the “Bank”), which was required to then invest the funds into its subsidiary, NattyMac Funding,Inc. (“NMF”). Through NMF, the Company engaged in loan participations and warehouse financing with Home Point and its subsidiaries and correspondent customers. On a monthly basis the Company paid Home Point an interest payment on the principal outstanding at a rate of one-month LIBOR plus 350 basis points, plus additional interest equal to 49% of NMF’s earnings. With the termination of the Loan Agreement and Note, the Company will no longer be required to pay such interest to Home Point.
The Loan Agreement and Note are being terminated in connection with the Bank’s acquisition of the assets of Home Point’s subsidiary, NattyMac, LLC, described in Item 8.01 below. After closing on the acquisition, the Company anticipates that NMF will cease engaging in loan participations and warehouse financing with Home Point and its subsidiaries and correspondent customers, and instead any such loan participations and warehouse financing will be provided by the Bank.
Item 8.01 Other Events
On December6, 2018 the Company issued a press release announcing the Bank has entered into an agreement with Home Point to acquire the assets of Home Point’s wholly owned subsidiary, NattyMac, LLC, a warehouse lender operating out of Clearwater, Florida. The Company expects the acquisition to close by the end of 2018.
Item 9.01. Financial Statements and Exhibits.
(d)Exhibits.
Forward Looking Statements
This Current Report on Form8-K and the press release attached hereto contain forward-looking statements which reflect the Company’s current views with respect to, among other things, future events and our financial performance. These statements are often, but not always, made through the use of words or phrases such as “may,” “might,” “should,” “could,” “predict,” “potential,” “believe,” “expect,” “continue,” “will,” “anticipate,” “seek,” “estimate,” “intend,” “plan,” “projection,” “goal,” “target,” “outlook,” “aim,” “would,” “annualized” and “outlook,” or the negative version of those words or other comparable words or phrases of a future or forward-looking nature. These forward-looking statements