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

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.

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The description of the Repurchase Agreement (as defined below) set forth under Item 2.03 is hereby incorporated by reference into this Item 1.01.

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

On February6, 2019, SPT Infrastructure Finance Sub-4, LLC (“Seller 1”), SPT Infrastructure Finance Sub-4 (DT), LLC (“Seller 2”) and SPT Infrastructure Finance Sub-4 (OT),Ltd. (together with Seller 1 and Seller 2, collectively, the “Sellers”), each an indirect wholly-owned subsidiary of Starwood Property Trust,Inc. (the “Company”), entered into a Master Repurchase and Securities Contract (the “Repurchase Agreement”) with MUFG Bank,Ltd. (the “Buyer”). The Repurchase Agreement will be used to finance the acquisition or origination by the Sellers of eligible loans as more particularly described in the Repurchase Agreement. The Repurchase Agreement provides for asset purchases by the Buyer of up to $500 million (the “Facility”).

Advances under the Repurchase Agreement accrue interest at a per annum Pricing Rate equal to 30, 60, 90 or 180 day LIBOR (at Sellers’ option for each transaction) plus a margin as agreed upon by Buyer and Seller for each transaction. The maturity date of the Facility is February6, 2020, subject to one (1)twelve (12) month extension option, which shall automatically be exercised as long as Sellers have not provided written notice to Buyer expressing their intention to not exercise the extension and subject to satisfaction of certain customary conditions.

In connection with the Repurchase Agreement, the Company provided a Guaranty (the “Guaranty”), under which the Company guarantees up to a maximum liability of 50% of the then outstanding obligations of Sellers under the Repurchase Agreement.

The Repurchase Agreement and the Guaranty contain various affirmative and negative covenants including the following financial covenants applicable to the Company: (i)ratio of EBITDA to interest expense for any calendar quarter shall not be less than 2.0 to 1.0; (ii)ratio of total indebtedness to total assets shall not be greater than .75 to 1.0; (iii)cash liquidity shall not be less than $35 million and near cash liquidity shall not be less than $135 million; (iv)tangible net worth shall not be less than the sum of (x)$3,111,095,000, plus (y)seventy-five percent (75%) of the aggregate net cash proceeds (net of underwriting discounts and commissions, and other out-of-pocket expenses incurred by the Company in connection with such issuance or sale) received by the Company from any issuance or sale of capital stock (other than capital stock constituting convertible debt securities) occurring after February6, 2019; and (v)ratio of EBITDA to fixed charges shall not be less than 1.5 to 1.0.

The foregoing summary of the Repurchase Agreement and the transactions contemplated thereby contained in this Item 2.03 does not purport to be a complete description and is qualified in its entirety by reference to the terms and conditions of the Repurchase Agreement, a copy of which is attached as Exhibit10.1 and incorporated herein by reference. Capitalized terms used in this Item 2.03 have the meaning given to such terms in the Repurchase Agreement.

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.

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