InPoint Commercial Real Estate Income : Completion of Acquisition or Disposition of Assets

Beth McCandry

ck1690012-8k_20211115.DOCX.htm

UNITED STATES

SECURITIES AND BILLS COMMISSION

Washington, DC 20549

FORM 8-K

CURRENT REPORT
Pursuant to Section 13 or 15 (d) of the Securities Exchange Act of 1934

Date of the report (date of the earliest reported event):November 15, 2021

INPOINT COMMERCIAL REAL ESTATE INCOME, INC.
(Exact name of the registrant as stated in its articles of association)

Maryland

(State or other jurisdiction
the foundation)

001-40833

(Commission file
Number)

32-0506267

(IRS employer
Identification Number.)

2901 Butterfield Road, Oak Brook, Illinois

60523

(Address of the main offices)

(Postal code)

(800) 826-8228

(Participant’s phone number, including area code)

N / A

(former name or address, if it has changed since the last report)

Check the appropriate box below if the submission of Form 8 ‑ K is also intended to meet the filing requirement of the registrant under one of the following provisions:

☐

Written communications under Rule 425 of the Securities Act

☐

Requesting material in accordance with Rule 14a-12 of the Stock Exchange Act

☐

Notifications before the start in accordance with Rule 14d-2 (b) of the Stock Exchange Act

☐

Notifications before the start in accordance with Rule 13e-4 (c) of the Stock Exchange Act

Securities registered under Section 12 (b) of the Act:

Title of each class

Trading symbol (s)

Name of each exchange on which it registers

6.75% Cumulative Redeemable Series A Preferred Stock, par value $ 0.001 per share

ICR PR A

New York Stock Exchange

Check the box to indicate whether the registrant is an emerging growth company within the meaning of Rule 405 of the Securities Act of 1933 (17 CFR.)

§230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2).

Aspiring growth company ☑

If the company is an emerging growth company, check the box to indicate whether the registrant has chosen not to use the extended transition period to meet new or revised accounting standards under Section 13 (a) of the Stock Exchange Act. ☑

Point 2.01. Completion of the acquisition or sale of assets.

On November 15, 2021, InPoint REIT Operating Partnership, LP, a Delaware limited partnership (“InPoint OP” or “Subscriber B”), a subsidiary of InPoint Commercial Real Estate Income, Inc. (the “Company”), entered into a master participation agreement (the “Participation Agreement”) with the American Family Life Assurance Company of Columbus, a Nebraska company (“Participant A”), pursuant to which Participant A has acquired a senior interest in each of the mortgage loans held by InPoint OP, approximately the total unpaid principal balance thereof Is $ 136.9 million (collectively the “Equity Loans”).

Participant A purchased from InPoint OP, as a bondholder, an 80% undivided senior interest (“Interest A”) in each of the equity loans for 109.5 million. InPoint OP has an undivided subordinate interest of 20% (“Interest B”) in each of the equity loans whose initial equity balances of Participation B total $ 27.4 million. Participant B’s rights to payment of interest, principal and other amounts in relation to participation B are subordinate, subject to and subordinate to the rights of participant A to payment of interest, principal and other amounts in relation to participation A, with the exception that Participant B’s right to exit fees, deferred origination fees and drawdown fees payable in connection with additional advances and any other fees payable to the Lender under applicable loan documents are generally not the rights of Participant A. subordinate.

Participant A is entitled to, amA senior interest payment on the principal balance of Participation A, among other payments, in determining the interest rate payable to Participant A, SPCRE InPoint Advisors, LLC, the Company’s sub-advisor, advised the Company on the prevailing market rates applicable to senior tranches of collateralized loan Obligations (CLOs) are paid, which are loan components comparable to participation A, and a well-known national consulting, auditing, auditing and advisory company has presented the board of directors of the company and participant A with an opinion in which it was determined, that the interest rate payable to Participant A is within a range of market rates based on a review (1) of the loan-to-value ratios for each underlying property “as stabilized” and independent research on similar types of loans recently available for mixed-use, multi-family and multi-family properties Office real estate and (2) credit spreads from published third party market participants.

The Participation Agreement provides that Participant B generally exercises the bondholder’s rights under any Participatory Loan as an instructed participant, but allows Participant A to prohibit certain acts in relation to a Participatory Loan, such as: B. the modification of a payment or other term of a loan without the consent of participant A and makes participant A the lead participant when the appraisal of the mortgage property is reduced, principal payments have been made or in each case there have been realized losses amounts and under certain conditions .

The participation agreement generally ends with: (a) the written agreement of the parties; (b) 90 days after full payment of each of the Participations; or (c) 90 days after payment (or making available for payment) to Participants of all amounts held by or on behalf of the Servicer and required under the then-applicable Service Agreement due on the last remittance date after final payment Paying is the payment or other liquidation (or any related advance payment) of the mortgage loan or mortgage-backed property.

Sound Point Capital Management, LP (“SPCM”), the parent company of Company Sub-Advisor, has a separate ongoing business relationship with an affiliate of Participant A under which SPCM or its affiliates make and manage loan investments for Affiliate A and receives fees for the additional assets under management represented by Participation A’s interests in the equity loans. Several of the Company’s officers, including two officers, one of whom is also a Director of the Company, hold positions with the Company’s Sub-Advisor and are employed by SPCM or its affiliates.

SIGNATURE

In accordance with the requirements of the Securities Exchange Act of 1934 as amended from time to time, the registrant has duly signed this report on his behalf by the duly authorized signatory.

INPOINT COMMERCIAL REAL ESTATE INCOME, INC.

Date:

November 19, 2021

From:

/ s / Catherine L. Lynch

Catherine L. Lynch

CFO

Disclaimer of liability

InPoint Commercial Real Estate Income Inc. published this content on November 19, 2021 and is solely responsible for the information contained therein. Distributed by public, unedited and unchanged, on November 19, 2021 21:53:07 UTC.