Legal Proceedings.
−Removed: 1st Source and our subsidiaries are involved in various other legal proceedings incidental to the conduct of our businesses.
−Removed: Our management does not expect that the outcome of any such proceedings will have a material adverse effect on our consolidated financial position or results of operations.
+Added: 1st Source and our subsidiaries are involved in various legal proceedings that are inherent risks of, or incidental to, the conduct of our businesses.
+Added: Management does not expect the outcome of any such proceedings will have a material adverse effect on our consolidated financial position or results of operations.
+Added: One such proceeding involves the consolidated bankruptcy cases of IOI Integrated Systems, Inc., its affiliates (collectively, “IOI”) and the owner of IOI, Najeeb Khan.
+Added: The consolidated cases commenced in August 2019 and are pending in the United States Bankruptcy Court, Western District of Michigan, Southern Division.
+Added: Khan were customers of 1st Source Bank.
+Added: Khan was also a director of 1st Source and 1st Source Bank until his resignation on July 9, 2019.
+Added: The liquidating trustee of the consolidated bankruptcy estates has alleged Mr.
+Added: Khan misappropriated funds of IOI over many years for his own benefit and to the detriment of IOI creditors.
+Added: The trustee is investigating whether various banks and other third parties, including 1st Source Bank, may have liability because of prior business relationships with IOI and/or Mr.
+Added: The trustee’s focus regarding the Bank is on transaction activity in respective deposit accounts of Mr.
+Added: Khan and entities controlled by Mr.
+Added: Khan at the Bank.
+Added: The Bank has fully cooperated with the trustee’s information requests.
+Added: The trustee has variously asserted that the Bank received avoidable transfers under applicable federal bankruptcy and state law by virtue of transactions involving deposit accounts of Mr.
+Added: Khan and IOI, and that the Bank had actual knowledge of and aided and abetted Mr.
+Added: Khan’s fraudulent activity.
+Added: No claims have previously been formally served on the Bank.
+Added: The trustee had filed a complaint but withheld service of process and agreed to stay prosecution through February 28, 2022.
+Added: Management expects the trustee may formally commence litigation against various parties including the Bank during the first or second quarters of 2022.
+Added: The Bank will vigorously defend any claim that it was involved with and/or benefited from the alleged misconduct of Mr.
+Added: Khan and/or IOI.
Mine Safety Disclosures.
Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.