Colony Starwood Homes (NYSE:SFR) Files An 8-K Entry into a Material Definitive Agreement
Entry into a Material Definitive Agreement.
On April 27, 2017, Colony Starwood Homes Partnership, L.P. (the
Borrower), a wholly-owned subsidiary of Colony Starwood Homes
(the Company), entered into a new credit agreement (the Credit
Agreement) with the lenders party thereto (the Lenders), JPMorgan
Chase Bank, N.A. (JPMorgan), as administrative agent and the
other parties thereto. The Credit Agreement provides for a $675.0
million senior secured revolving credit facility (the Facility),
which will mature on April 27, 2020, with a one-year extension
option subject to certain conditions.The Facility was undrawn as
of the effective date.Loans and letters of credit are available
under the Facility, subject to customary conditions, for working
capital and other general corporate purposes, including
acquisitions and debt refinancing.
The Credit Agreement includes an accordion feature to increase
the size of the Facility to up to $1.2 billion, subject to
satisfying certain requirements and obtaining lender commitments.
The Company concurrently terminated its two existing secured
revolving credit facilities:(i) the Amended and Restated Master
Loan and Security Agreement dated June 13, 2014, among Starwood
Waypoint Borrower, LLC and other subsidiaries, Citibank, N.A., as
administrative agent the lenders party thereto, and (ii) the
Second Amended and Restated Revolving Credit Agreement, dated as
of July 14, 2015, among ColFin AH Finance Masterco, LLC and other
subsidiaries, JPMorgan, as administrative agent, and the lenders
Interest Rate and Fees
Loans under the Facility will bear interest at a floating rate
equal to either the Adjusted LIBO Rate or the Alternate Base Rate
plus the Applicable Margin (each as defined in the Credit
Agreement).The Applicable Margin varies based on the Total
Leverage Ratio, ranging from 75 basis points to 130 basis points
for Alternative Base Rate loans and from 175 basis points to 230
basis points for Adjusted LIBO Rate loans.
The Borrower is also required to pay customary fees on any
outstanding letters of credit, and a facility fee to the lenders
in respect of the unused commitments thereunder at a rate of
either 0.350% or 0.200% per annum, depending on the level of
Guarantees and Collateral
The obligations under the Facility are guaranteed by the Company
and certain Material Subsidiaries (as defined in the Credit
Agreement) (the Subsidiary Guarantors and, together with the
Borrower and the Company, the Loan Parties).The Facility is
secured by pledges of equity interests in the Borrower and
Subsidiary Guarantors owned by Loan Parties.Such stock pledges
will be released, and the Subsidiary Guarantors will be released
from their guarantees if the Company obtains a credit rate of
either (a) BBB- or higher from Standard and Poors Rating Services
or (b) Baa3 or higher from Moodys Investors Service, Inc., or if
certain other customary release events occur.
Certain Covenants and Events of Default
The Credit Agreement contains customary representations and
warranties, affirmative and negative covenants and events of
default. Subject to certain exceptions, such covenants may
restrict the Company, the Borrower and their subsidiaries in
respect of, among other things:mergers, consolidations,
liquidations or sale of substantially all assets of the Company;
incurrence of debt and liens; dividends or distributions while
certain events of default exist; transactions with affiliates;
agreements restricting liens and dividends, and changes in the
nature of the Companys business, its accounting methods or fiscal
The Credit Agreement also requires the Borrower to remain in
compliance with certain financial ratios (defined therein),
(i) maximum ratios of (a) Total Indebtedness to Total Asset
Value, (b) Secured Indebtedness to Total Asset Value and (c)
Unsecured Indebtedness to Unencumbered Asset Value;
(ii) minimum ratios of (a) Adjusted EBITDA to Fixed Charges and
(b) Unencumbered NOI to Unsecured Interest Expense;
(iii) minimum Occupancy Rate; and
(iv) minimum Tangible Net Worth and Unencumbered Asset Value.
Events of default include certain changes in control of the
Company.If an event of default occurs, the lenders will be
entitled to take various remedies, including the acceleration of
loans outstanding under the Credit Agreement and foreclosure on
The foregoing summary of the Credit Agreement does not purport to
be complete and is qualified in its entirety by reference to the
Credit Agreement, a copy of which is attached hereto as Exhibit
10.1 and incorporated herein by reference.
From time to time, the Company has had customary commercial
and/or investment banking relationships with affiliates of
JPMorgan, Citibank, N.A., Merrill Lynch, Fenner Smith
Incorporated, Bank of America, N.A. and/or certain of their
Termination of a Material Definitive Agreement.
The information set forth in Item 1.01 above is hereby
incorporated by reference into this Item 1.02, insofar as it
relates to the termination of a material definitive agreement.
Creation of a Direct Financial Obligation or an
The information set forth in Item 1.01 above is hereby
incorporated by reference into this Item 2.03, insofar as it
relates to the creation of a direct financial obligation.
On April 11, 2017, the Company reduced the outstanding principal
balance of its SWAY 2014 mortgage loan by $150.0 million. The
Company has also scheduled a payment for May 8, 2017 to further
reduce the outstanding principle balance of its SWAY 2014
mortgage loan by an additional $150.0 million.
Item 9.01 Financial Statements and Exhibits.
Credit Agreement, dated as of April 27, 2017, by and
About Colony Starwood Homes (NYSE:SFR)
Colony Starwood Homes, formerly Starwood Waypoint Residential Trust, is a real estate investment trust (REIT). The Company operates through two segments: single-family rental (SFRs), which includes the business activities associated with its investments in residential properties, and non-performing residential mortgage loans (NPLs), which includes the business activities associated with its investments in NPLs. The Company identifies and pursues individual home acquisition opportunities through various sources, including multiple listing services (MLS) listings, foreclosure auctions and short sales. The Company’s portfolio includes approximately 34,670 owned homes and homes underlying NPLs. Its homes are located in South Florida, Atlanta, Houston, Tampa, Dallas, Denver, Chicago, Orlando, Southern California, Northern California, Phoenix and Las Vegas. Colony Starwood Partnership, L.P. is a limited partnership through which the Company conducts substantially all of its business. Colony Starwood Homes (NYSE:SFR) Recent Trading Information
Colony Starwood Homes (NYSE:SFR) closed its last trading session 00.00 at 34.57 with 1,397,785 shares trading hands.