Current Report Filing (8-k)
March 26 2020 - 05:19PM
Edgar (US Regulatory)
false 0001717547 0001717547 2020-03-20
2020-03-20
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): March 20,
2020
COLONY CREDIT REAL ESTATE, INC.
(Exact name of registrant as specified in its charter)
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Maryland
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001-38377
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38-4046290
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(State or other jurisdiction
of incorporation)
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(Commission
File Number)
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(IRS Employer
Identification No.)
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515 S. Flower Street, 44th Floor
Los Angeles, CA
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90071
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(Address of principal executive offices)
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(Zip Code)
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Registrant’s telephone number, including area code: (310)
282-8820
Not Applicable
(Former name or former address, if changed since last report.)
Check the appropriate box below if the Form 8-K filing is intended
to simultaneously satisfy the filing obligation of the registrant
under any of the following provisions (see General Instruction A.2.
below):
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Written communications pursuant to Rule 425 under the Securities
Act (17 CFR 230.425) |
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act
(17 CFR 240.14a-12) |
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Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b)) |
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Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act:
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Title of each class
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Trading
Symbol(s)
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Name of each exchange
on which registered
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Class A common stock, par value $0.01 per share
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CLNC
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New York Stock Exchange
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Indicate by check mark whether the registrant is an emerging growth
company as defined in Rule 405 of the Securities Act of 1933
(§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of
1934 (§240.12b-2 of this
chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the
registrant has elected not to use the extended transition period
for complying with any new or revised financial accounting
standards provided pursuant to Section 13(a) of the Exchange
Act. ☐
Item 2.03. |
Creation of a Direct Financial Obligation or an Obligation under an
Off-Balance Sheet
Arrangement of a Registrant. |
As previously disclosed, on February 1, 2018, Credit RE
Operating Company, LLC (“Company OP”, together with certain
subsidiaries of Company OP from time to time party thereto as
borrowers, collectively, the “Borrowers”) entered into a Credit
Agreement (as amended by that certain first amendment and second
amendment, the “Credit Agreement”) with JPMorgan Chase Bank, N.A.,
as administrative agent, and the several lenders from time to time
party thereto (the “Lenders”), pursuant to which the Lenders
provide a revolving credit facility in the aggregate principal
amount of up to $560.0 million as of the date hereof. A copy
of the Credit Agreement, the first amendment to the Credit
Agreement and the second amendment to the Credit Agreement were
filed as exhibits 10.2, 10.3 and 10.4, respectively, to Colony
Credit Real Estate, Inc.’s (the “Company”) Annual Report on Form
10-K filed for the year
ended December 31, 2019 (“Form 10-K”) with the Securities and
Exchange Commission (the “SEC”) on February 28, 2020. The material
terms of the Credit Agreement are described under “Note 10 – Debt”
of the Notes to Consolidated Financial Statements of the Company
included in the Company’s Annual Report on Form 10-K, which descriptions are
incorporated by reference herein.
As of December 31, 2019, borrowings outstanding under the
Credit Agreement were $113.5 million.
As a result of a capital draw notice issued by the Company OP on
March 20, 2020, together with other prior draws of available
capacity under the Credit Agreement, the Company has total
borrowings of $420 million (substantially all available
capacity) under the Credit Agreement. The Company increased its
borrowings as a precautionary measure in order to increase its cash
position and preserve financial flexibility in light of current
uncertainty resulting from the COVID-19 pandemic. The current interest
rate for borrowings under the Credit Agreement is the London
Interbank Offered Rate plus 2.25%. In accordance with the terms of
the Credit Agreement, the proceeds from these borrowings may in the
future be used for working capital, general corporate or other
purposes permitted by the Credit Agreement.
Item 5.02. |
Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of
Certain Officers |
On March 25, 2020, the board of directors of the Company
approved the appointment of Michael J. Mazzei as Chief Executive
Officer and President of the Company and Andrew E. Witt as Chief
Operating Officer of the Company (transitioning from his current
role as Interim Chief Executive Officer and President), in each
instance, effective April 1, 2020.
The following is a brief biographical summary for each of Mr.
Mazzei and Mr. Witt.
Michael J.
Mazzei, age 61, will be our Chief Executive Officer and
President effective April 1, 2020. Mr. Mazzei will lead and
oversee Colony Credit Real Estate operations, including investment
and credit risk, capital raising and relationship management
activities among stockholders, clients, partners, financing
counterparties, research analysts and rating agencies.
Mr. Mazzei has served as a member of the board of directors of
Ladder Capital Corp since June 2017. Previously, Mr. Mazzei
served as President of Ladder Capital from June 2012 through June
2017. From September 2009 to June 2012, Mr. Mazzei served as
Global Head of the CMBS and Bank Loan Syndication Group at Bank of
America Merrill Lynch. Prior to that, Mr. Mazzei served as
Co-Head of CMBS and
Commercial Real Estate Debt Markets at Barclays Capital from March
2004 to June 2009. Prior to Barclays Capital, Mr. Mazzei spent
20 years at Lehman Brothers, including 18 years in commercial real
estate finance-related functions. Having started in commercial
mortgage trading in 1984, Mr. Mazzei became the head of CMBS
in 1991 and served as the Co-Head of Global Real Estate
Investment Banking from March 2002 to February 2004.
Mr. Mazzei received a B.S. from Baruch College and a J.D. from
St. John’s University School of Law, and is a graduate of the New
York University Real Estate Institute.
Andrew E.
Witt, age 42, will be our Chief Operating Officer effective
April 1, 2020. From February 29, 2020 until his appointment as
Chief Operating Officer, Mr. Witt served as our Interim President
and Chief Executive Officer. In addition, Mr. Witt is Managing
Director and Chief Operating Officer of Global Credit at Colony
Capital, Inc. In his roles at Colony Capital, Mr. Witt is
primarily focused on credit related operations and initiatives,
including product development, investor relations and marketing of
private offerings globally. Prior to taking on this most recent
role he served as an investment professional responsible for the
identification, evaluation, and consummation of real estate related
investments. Mr. Witt also served as an Executive Vice
President of Colony American Homes where he was responsible for
overseeing investments in single family residential property which
culminated in the acquisition of nearly 20,000 homes.
Prior to joining the Colony Capital business in 2007, Mr. Witt
founded and managed a business in the industrial medicine sector.
Mr. Witt received his Master of Business Administration from
the University of Southern California and Bachelor of Arts in
International Relations with a focus on International Economics
from Stanford University. Mr. Witt was also a member of the
2000 U.S. Men’s Volleyball Olympic Team.
Item 7.01. |
Regulation FD Disclosure. |
On March 26, 2020, the Company issued a press release
announcing the matters described in Item 5.02 above and other
information. A copy of the press release is furnished as Exhibit
99.1 to this Current Report on Form 8-K and is incorporated herein solely
for purposes of this Item 7.01 disclosure.
The information included in this Current Report on Form
8-K under this Item 7.01
shall not be deemed “filed” for the purposes of Section 18 of
the Securities Exchange Act of 1934, as amended (the “Exchange
Act”), or otherwise subject to the liabilities of that section, nor
shall it be deemed incorporated by reference into any filing made
by the Company under the Exchange Act or the Securities Act of
1933, as amended, except as shall be expressly set forth by
specific reference in such a filing.
Cautionary
Statement Regarding Forward-Looking Statements
This Current Report on Form 8-K may contain forward-looking
statements within the meaning of the federal securities laws.
Forward-looking statements relate to expectations, beliefs,
projections, future plans and strategies, anticipated events or
trends and similar expressions concerning matters that are not
historical facts. In some cases, you can identify forward-looking
statements by the use of forward-looking terminology such as “may,”
“will,” “should,” “expects,” “intends,” “plans,” “anticipates,”
“believes,” “estimates,” “predicts,” or “potential” or the negative
of these words and phrases or similar words or phrases which are
predictions of or indicate future events or trends and which do not
relate solely to historical matters. Forward-looking statements
involve known and unknown risks, uncertainties, assumptions and
contingencies, many of which are beyond our control, and may cause
actual results to differ significantly from those expressed in any
forward-looking statement. Among others, the following
uncertainties and other factors could cause actual results to
differ from those set forth in the forward-looking statements:
operating costs and business disruption may be greater than
expected; uncertainties regarding the ongoing impact of the novel
coronavirus (COVID-19) and its adverse impact on the real estate
market, the economy and our investments; the Company’s operating
results may differ materially from the information presented in the
Company’s Annual Report on Form 10-K for the fiscal year ended
December 31, 2019, as well as in the Company’s other filings with
the Securities and Exchange Commission; the fair value of the
Company’s investments may be subject to uncertainties; the
Company’s use of leverage could hinder its ability to make
distributions and may significantly impact its liquidity position;
given the Company’s dependence on its external manager, an
affiliate of Colony Capital, Inc., any adverse changes in the
financial health or otherwise of its manager or Colony Capital,
Inc. could hinder the Company’s operating performance and return on
stockholder’s investment; the ability to realize substantial
efficiencies as well as anticipated strategic and financial
benefits, including, but not limited to expected returns on equity
and/or yields on investments; adverse impacts on the Company’s
liquidity, including its ability to continue to generate liquidity
from sales of Legacy, Non-Strategic assets; the Company’s ability
to liquidate its Legacy, Non-Strategic assets within the projected
timeframe or at the projected values; the timing of and ability to
deploy available capital; the Company’s ability to maintain or grow
the dividend at all in the future; the timing of and ability to
complete repurchases of the Company’s stock; the ability of the
Company to refinance certain mortgage debt on similar terms to
those currently existing or at all; whether Colony Capital will
continue to serve as our external manager or whether we will pursue
another strategic transaction; and the impact of legislative,
regulatory and competitive changes. The foregoing list of factors
is not exhaustive. Additional information about these and other
factors can be found in Part I, Item 1A of the Company’s Annual
Report on Form 10-K for the fiscal year ended December 31, 2019, as
well as in the Company’s other filings with the Securities and
Exchange Commission.
We caution investors not to unduly rely on any forward-looking
statements. The forward-looking statements speak only as of the
date of this Current Report on Form 8-K. The Company is under no
duty to update any of these forward-looking statements after the
date of this Current Report on Form 8-K, nor to conform prior
statements to actual results or revised expectations, and the
Company does not intend to do so.
Item 9.01. |
Financial Statements and Exhibits. |
(d) Exhibits.
Exhibit Index
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, as amended, the registrant has duly caused this report to be
signed on its behalf by the undersigned hereunto duly
authorized.
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Date: March 26, 2020
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COLONY CREDIT REAL ESTATE, INC.
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By:
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/s/ David A. Palamé
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David A. Palamé
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General Counsel and Secretary
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