Item 1.01 Entry into a Material Definitive Agreement.
On
The primary purpose of the Borrower in entering into the Loan Amendments is to
provide certain debt covenant relief through
7-Year Term Loan Amendment
Among other things, the 7-Year Term Loan Amendment:
(i) modifies certain definitions, including Adjusted EBITDA, Adjusted NOI and Gross Asset Value;
(ii) adjusts the applicable margin pricing grid to add a new tier applicable
when the ratio of total liabilities to gross asset value equals or exceeds 0.600
to 1.000, and that new tier of applicable margin took effect immediately upon
the effectiveness of the 7-Year Term Loan Amendment and will remain in effect at
least through the end of the fiscal quarter ending
(iii) adds a mandatory prepayment provision requiring that the Borrower prepay
the Loans under the 7-Year Term Loan in an amount equal to 45.45% of any Net
Cash Proceeds received from certain Capital Events (provided that any Net Cash
Proceeds from Capital Events in excess of
(iv) adds monthly principal amortization payments of
(v) amends certain financial covenants as follows: (i) the Ratio of Total
Liabilities to Gross Asset Value (such that the ratio must not exceed 0.65 to
1.00 at any time prior to and including
(vi) adds a covenant restricting the Borrower and Guarantors (and any Subsidiary thereof) from incurring additional Indebtedness (subject to certain exceptions);
--------------------------------------------------------------------------------
(vii) adds a covenant requiring the Borrower to maintain unrestricted cash
liquidity of
(viii) requires that the Borrower work diligently and in good faith with the Administrative Agent and the Lenders toward an additional modification of the 7-Year Term Loan and related indebtedness that refinances or restructures such indebtedness; and
(ix) prohibits the Borrower from entering into a sale-leaseback or any similar transaction with respect to Unencumbered Property without the Requisite Lenders' consent, subject to certain exceptions.
The 7-Year Term Loan contains other affirmative and negative covenants
customarily found in facilities of its type that remain unchanged under the
7-Year Term Loan Amendment and are described in PREIT's Annual Report on Form
10-K for the year ended
2018 Credit Agreement Amendment
Among other things, the 2018 Credit Agreement Amendment:
(i) modifies certain definitions, including Adjusted EBITDA, Adjusted NOI and Gross Asset Value in a manner consistent with the 7-Year Term Loan Amendment;
(ii) adjusts the applicable margin pricing grid to add a new tier applicable
when the ratio of total liabilities to gross asset value equals or exceeds 0.600
to 1.000, and that new tier of applicable margin took effect immediately upon
the effectiveness of the 2018 Credit Agreement Amendment and will remain in
effect at least through the end of the fiscal quarter ending
(iii) adds a mandatory prepayment provision requiring that (i) the Borrower
prepay the Term Loans under the 2018 Credit Agreement in an amount equal to
54.55% of any Net Cash Proceeds received from certain Capital Events (provided
that any Net Cash Proceeds from Capital Events in excess of
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 under Item 1.01 of this Current Report on Form 8-K is hereby incorporated by reference to this Item 2.03.
Item 5.03 Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year.
On
On
--------------------------------------------------------------------------------
meetings by means of the Internet or other electronic communications technology.
The Bylaws Amendment became effective on
The Board adopted the Trust Agreement Amendment and the Bylaws Amendment in anticipation of holding the Annual Meeting of Shareholders virtually due to health concerns associated with the COVID-19 global pandemic.
Item 8.01 Other Events.
On
On
Forward Looking Statements
This current report contains certain forward-looking statements that can be
identified by the use of words such as "anticipate," "believe," "estimate,"
"expect," "project," "intend," "may" or similar expressions. Forward-looking
statements relate to expectations, beliefs, projections, future plans,
strategies, anticipated events, trends and other matters that are not historical
facts. These forward-looking statements reflect our current views about future
events, achievements, results and dividend payments and are subject to risks,
uncertainties and changes in circumstances that might cause future events,
achievements or results to differ materially from those expressed or implied by
the forward-looking statements. Due to the unprecedented and rapidly changing
social and economic impacts associated with the COVID-19 pandemic on the
--------------------------------------------------------------------------------
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits. Exhibit No. Description 3.1 Amendment to Amended and Restated Trust Agreement datedDecember 18, 2008 , as amended, dated as ofMarch 31, 2020 . 3.2 By-Laws ofPennsylvania Real Estate Investment Trust (as amended throughMarch 31, 2020 ). 10.1 Sixth Amendment to Seven-Year Term Loan Agreement dated as ofJanuary 8, 2014 , as amended, by and amongPREIT Associates, L.P. ,PREIT-RUBIN, Inc. ,Pennsylvania Real Estate Investment Trust , and the financial institutions party thereto, dated as ofMarch 30, 2020 . 10.2 First Amendment to Amended and Restated Credit Agreement dated as ofMay 24, 2018 , by and amongPREIT Associates, L.P. ,PREIT-RUBIN, Inc. ,Pennsylvania Real Estate Investment Trust , and the financial institutions party thereto, dated as ofMarch 30, 2020 . 104 Cover Page Interactive Data File (embedded within the Inline XBRL document).
--------------------------------------------------------------------------------
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
PENNSYLVANIA REAL ESTATE INVESTMENT TRUST Date: March By: /s/ Lisa M. Most 31, 2020 Lisa M. Most Executive Vice President, Secretary and General Counsel
© Edgar Online, source