Item 1.01 Entry into Material Definitive Agreements.
First Amendment to Credit Agreement
On May 17, 2022, Inland Real Estate Income Trust, Inc., a Maryland corporation
(the "Company") entered into a First Amendment to Credit Agreement and Agreement
Regarding Incremental Term Loans (the "First Amendment"), amending the terms of
the Company's Second Amended and Restated Credit Agreement, dated as of February
3, 2022 (the "Existing Credit Agreement" and, as amended by the First Amendment,
the "Credit Agreement"), in respect of the Company's credit facility (the
"Credit Facility"), by and among the Company, the subsidiary guarantors from
time to time party thereto, KeyBank National Association, as administrative
agent, KeyBanc Capital Markets Inc., PNC Capital Markets LLC and BofA
Securities, Inc., as joint lead arrangers, and the several banks and other
financial institutions and entities from time to time party thereto
(collectively, the "Lenders").
The First Amendment modifies the Existing Credit Agreement by establishing
additional term loans under the Credit Facility in an aggregate principal amount
of $300,000,000 (the "Accordion") and making certain amendments and
modifications related to the Accordion and the acquisition of the Properties,
including accounting updates to the financial covenants therein. The maturity
date for term loans advanced pursuant to the Accordion is also February 3, 2027,
the same maturity date for the term loans advanced pursuant to the Existing
Credit Agreement. The Existing Credit Agreement was further modified by
including a temporary step-up of the unsecured leverage ratio, from 60% to
62.5%, which shall be in effect from May 17, 2022 until March 31, 2023. The
other provisions of the Existing Credit Agreement were unchanged and remain in
full force and effect. The Accordion will be used to finance the Purchase Price,
pay fees and expenses incurred in connection with the Accordion and the First
Amendment, and repay amounts outstanding under the Credit Agreement.
The First Amendment also includes a re-affirmation of the existing Subsidiary
Guaranty. The description of the First Amendment in this Item 1.01 does not
purport to be a complete statement of the terms and conditions of the First
Amendment and is qualified in its entirety by reference to the text of the First
Amendment, a copy of which is attached hereto as Exhibit 10.2 and incorporated
by reference into this Item 1.01. Capitalized terms used but not defined in this
Item 1.01 shall have their respective meanings set forth in the First Amendment
and its accompanying Annex.
As of May 17, 2022, the revolving credit facility had an outstanding balance of
$79,000,000, and the outstanding balance of the term loan was $275,000,000.
Certain of the lenders under the Credit Agreement or their affiliates have
provided, and may in the future provide, commercial banking, lending, financial
advisory, and investment banking services in the ordinary course of business for
the Company, its subsidiaries and affiliates of the Company's business manager,
for which the lenders and their affiliates received customary fees and
commissions and other consideration consistent with market conditions at the
time of the transactions.
Item 2.01 Completion of Acquisition or Disposition of Assets
On May 17, 2022, the Company acquired eight properties (the "Properties") from
certain subsidiaries of Inland Retail Property Fund LP (the "Sellers") pursuant
to the previously disclosed purchase and sale agreement among the Company and
the Sellers. The acquisition of the Properties is referred to herein as the
"Transaction." The Properties are leased primarily to grocery, retail and
restaurant tenants. More specifically, seven of the Properties are
grocery-anchored. The Properties are located across seven states and aggregate
approximately 686,851 square feet. As of March 31, 2022, those leases had a
weighted average remaining lease term of 6.3 years. The Seller, Inland Retail
Property Fund, LP, is a fund managed by an affiliate of Company's sponsor and
business manager. Thus, because the Transaction was a related party transaction,
it was approved by all of the Company's independent directors.
The Company acquired the Properties for an aggregate purchase price of
$278,153,000, excluding closing costs. The Company funded the acquisition of the
Properties with $5,563,060 of cash on hand and from the additional term loans
under the Credit Agreement described in Item 1.01 above totaling $300,000,000.
The following table lists information about the Properties:
Square Physical Economic
Property Location Footage Occupancy Occupancy
Northpark Village Square Valencia, California 87,103 98.6% 98.6%
Rusty Leaf Plaza Orange, California 59,188 97.0% 97.0%
CityPlace Woodbury, Minnesota 174,813 95.2% 95.2%
Northville Park Place Northville, Michigan 78,421 100.0% 100.0%
Denton Village Denton, Texas 48,280 100.0% 100.0%
Lower Makefield Shopping Center Yardley, Pennsylvania 74,953 97.6% 97.6%
New Town Village Owings Mills, Maryland 117,593 46.8% 46.8%
Olde Ivy Village Smyrna, Georgia 59,188 93.7% 93.7%
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an
The information set forth under Item 1.01 of this report, including the text of
the First Amendment, and the information set forth under Item 2.01 of this
report are hereby incorporated by reference into this Item 2.03.
Item 7.01 Regulation FD Disclosure.
Filed as Exhibit 99.1 to this Current Report and incorporated by reference in
this Item 7.01 is the text of a letter from the Company to the Company's
stockholders that includes information relating to the acquisition of the
Properties described in Item 2.01 above.
This stockholder letter shall not be deemed "filed" for any purpose, including
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. The information in this Item 7.01, including Exhibit 99.1, shall not be
deemed incorporated by reference into any filing under the Exchange Act or the
Securities Act, regardless of any general incorporation language in such filing.
This Current Report on Form 8-K contains "forward-looking statements" which are
not historical facts, within the meaning of the Private Securities Litigation
Reform Act of 1995. The statements may be identified by terminology such as
"may," "can," "would," "will," "expect," "intend," "estimate," "anticipate,"
"plan," "seek," "appear," or "believe." Such statements reflect the current view
of the Company with respect to future events and are subject to certain risks,
uncertainties and assumptions related to certain factors including, without
limitation, the uncertainties related to general economic conditions, the
effects of the COVID-19 pandemic and measures taken to combat it, competition
for our tenants from internet retailers, unforeseen events affecting the
commercial real estate industry, retail real estate, or particular markets, and
other factors detailed under Risk Factors in our most recent Form 10-K as of
December 31, 2021, filed on March 16, 2022 and all other filings with the SEC
after that date. Although the Company believes that the expectations reflected
in such forward-looking statements are reasonable, it can give no assurance that
such expectations will prove to be correct. You should exercise caution when
considering forward-looking statements and not place undue reliance on them.
Based upon changing conditions, should any one or more of these risks or
uncertainties materialize, or should any underlying assumptions prove incorrect,
actual results may vary materially from those described herein. Except as
required by federal securities laws, the Company undertakes no obligation to
publicly update or revise forward-looking statements, whether as a result of new
information, future events, changed circumstances or any other reason after the
date of this Current Report on Form 8-K.
Item 9.01. Financial Statements and Exhibits.
(a) Financial Statements of Properties Acquired.
The financial statements required to be filed under Item 9.01(a) of this Current
Report on Form 8-K will be filed by amendment to this Current Report on Form 8-K
no later than 71 days after the date the initial report on Form 8-K is required
to be filed.
(b) Pro Forma Financial Information.
The pro forma financial information required to be filed under Item 9.01(b) of
this Current Report on Form 8-K will be filed by amendment to this Current
Report on Form 8-K no later than 71 days after the date the initial report on
Form 8-K is required to be filed.
Exhibit No Description
10.1 Purchase and Sale Agreement, dated as of May 5, 2022, by and
the Sellers identified therein and Inland Real Estate Income
(incorporated by reference to Exhibit 10.1 to the Registrant's
Report on Form 8-K, as filed by the Registrant with the
Exchange Commission on May 10, 2022 (file number 000-55146))
10.2 First Amendment, dated as of May 17, 2022, to Second Amended and
Restated Credit Agreement, dated as of February 3, 2022, by and among
Inland Real Estate Income Trust, Inc., as borrower, KeyBank National
Association, individually and as administrative agent, KeyBanc Capital
Markets Inc., PNC Capital Markets LLC and BofA Securities, Inc., as
joint lead arrangers, and other lender parties thereto
99.1 Letter to Stockholders regarding acquisition of Properties
104 Cover Page Interactive Data File (embedded within the Inline XBRL
© Edgar Online, source Glimpses