Starwood Property Trust,Inc. (NYSE:STWD) Files An 8-K Entry into a Material Definitive Agreement

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Starwood Property Trust,Inc. (NYSE:STWD) Files An 8-K Entry into a Material Definitive Agreement
Item 1.01. Entry into a Material Definitive Agreement.

Indenture and Senior Notes due 2025

On December4, 2017, Starwood Property Trust,Inc., a Maryland corporation (the “Company”), issued $500 million aggregate principal amount of its 4.750% unsecured senior notes due 2025 (the “Notes”) under an indenture, dated as of December4, 2017 (the “Indenture”), between the Company and The Bank of New York Mellon, as trustee. The Notes were issued in a private offering exempt from the registration requirements of the Securities Act of 1933, as amended (the “Securities Act”), to qualified institutional buyers within the United States in accordance with Rule144A under the Securities Act and to non-U.S. persons in offshore transactions in accordance with Regulation S under the Securities Act. The Notes are subject to restrictions on transfer and may only be offered or sold in transactions exempt from or not subject to the registration requirements of the Securities Act and other applicable securities laws.

The Company intends to use all or substantially all of the approximately $490.2 million net proceeds from the offering to repay a portion of the amount outstanding under its existing repurchase agreements and to use any remaining net proceeds for other general corporate purposes, which may include the repayment of indebtedness under its warehouse facilities and other indebtedness, the origination and purchase of additional commercial mortgage loans and other target assets and investments, the payment of other liabilities and other working capital needs. Amounts that the Company may repay under its revolving repurchase or credit facilities may be re-borrowed, subject to customary conditions.

The Notes are senior unsecured obligations of the Company and will mature on March15, 2025. The Notes bear interest at a rate of 4.750% per year. Interest on the Notes will be paid semi-annually in arrears on each March15 and September15, commencing March15, 2018, to the persons who are holders of record of the Notes on the preceding March1 and September1, respectively.

The following is a brief description of the terms of the Notes and the Indenture.

Possible Future Guarantees

When the Notes are first issued they will not be guaranteed by any of the Company’s subsidiaries and none of the Company’s subsidiaries will be required to guarantee the Notes in the future, except that, under certain circumstances and subject to certain exceptions set forth in the Indenture, one or more of the Company’s Domestic Subsidiaries (as defined in the Indenture) (except for certain Excluded Subsidiaries or Securitization Entities (each as defined in the Indenture)) may be required to guarantee the payment of the Notes (the “Springing Guarantee Covenant”).

Ranking

The Notes will be:

· require that the Company and its subsidiaries maintain Total Unencumbered Assets (as defined in the Indenture) of not less than 120% of the aggregate principal amount of the outstanding Unsecured Indebtedness (as defined in the Indenture) of the Company and its subsidiaries; and

· impose certain requirements in order for the Company to merge or consolidate with another person.

Certain of these covenants will automatically and permanently terminate and will be of no force or effect on and after the Covenant Termination Date (as defined above).

Events of Default

The Indenture also provides for Events of Default which, if any of them occurs, would permit or require the principal of and accrued and unpaid interest on all the outstanding Notes to become or to be declared due and payable.

The foregoing summary of the Indenture is qualified in its entirety by reference to the full text of such agreement, a copy of which is attached hereto as Exhibit4.1 and incorporated herein by reference.

Registration Rights Agreement

In connection with the issuance of the Notes, the Company entered into a registration rights agreement with J.P. Morgan Securities LLC, as representative of the initial purchasers, dated as of December4, 2017 (the “Registration Rights Agreement”), to which the Company agreed to use its commercially reasonable efforts to (a)consummate an offer to exchange the Notes for its notes with terms substantially identical to those of the Notes no later than November 29, 2018 or (b)if such exchange offer is not consummated, file and keep effective a shelf registration statement with respect to resales of the Notes. If the Company fails to satisfy its registration obligations under the Registration Rights Agreement, the Company will be required to pay additional interest to the holders of the Notes as specified in the Registration Rights Agreement.

The foregoing summary of the Registration Rights Agreement is qualified in its entirety by reference to the full text of such agreement, a copy of which is attached hereto as Exhibit4.2 and incorporated herein by reference.

Item 2.03. Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.

The information set forth in Item 1.01 is incorporated herein by reference into this Item 2.03.

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits

Exhibit Number

Description

4.1

Indenture, dated as of December4, 2017, between Starwood Property Trust,Inc. and The Bank of New York Mellon, as trustee (including the form of Starwood Property Trust,Inc.’s 4.750% Senior Notes due 2025).

4.2

Registration Rights Agreement, dated as of December4, 2017, between Starwood Property Trust,Inc. and J.P. Morgan Securities LLC, as representative of the initial purchasers.

EXHIBITINDEX

Exhibit Number

Description

4.1

Indenture, dated as of December4, 2017, between Starwood Property Trust,Inc. and The Bank of New York Mellon, as trustee (including the form of Starwood Property Trust,Inc.’s 4.750% Senior Notes due 2025).

4.2

Registration Rights Agreement, dated as of December4, 2017, between Starwood Property Trust,Inc. and J.P. Morgan Securities LLC, as representative of the initial purchasers.


STARWOOD PROPERTY TRUST, INC. Exhibit
EX-4.1 2 a17-27867_1ex4d1.htm EX-4.1 Exhibit 4.1   INDENTURE     Dated as of December 4,…
To view the full exhibit click here

About Starwood Property Trust,Inc. (NYSE:STWD)

Starwood Property Trust, Inc. is a real estate investment trust. The Company operates through three business segments: Real estate lending (the Lending Segment), which engages primarily in originating, acquiring, financing and managing commercial first mortgages, subordinated mortgages, mezzanine loans, preferred equity, commercial mortgage-backed securities (CMBS), residential mortgage-backed securities, and other real estate and real estate-related debt investments; Real estate investing and servicing (the Investing and Servicing Segment), which includes servicing businesses in the United States and Europe that manage and work out problem assets; an investment business that selectively acquires and manages unrated, investment grade and non-investment grade rated CMBS, and a mortgage loan business, and Real estate property (the Property Segment), which engages primarily in acquiring and managing equity interests in stabilized commercial real estate properties.