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):
June 30, 2014
Strategic Hotels & Resorts, Inc.
(Exact name of registrant as specified in its charter)
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| Maryland |
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001-32223 |
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33-1082757 |
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of incorporation) |
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(Commission File Number) |
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(IRS Employer Identification No.) |
200 West Madison Street, Suite 1700
Chicago, Illinois 60606
(Address of principal executive offices) (Zip Code)
Registrant’s telephone number, including area code: (312) 658-5000
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.):
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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)) |
| Item 1.01 |
Entry into a Material Definitive Agreement. |
On June 30, 2014, SHC Washington,
L.L.C., a wholly owned subsidiary of Strategic Hotel Funding, L.L.C., the operating partnership of Strategic Hotels & Resorts, Inc. (the “Company”), entered into a loan and security agreement (the “Loan Agreement”) with
Deutsche Bank AG New York Branch, as lender and administrative agent (the “FSDC Loan”). The principal amount of the FSDC Loan is $120,000,000, which bears interest at a rate of LIBOR plus 2.25% per annum. The FSDC Loan is secured by,
among other things, a first mortgage with respect to the hotel commonly known as the Four Seasons Washington, D.C. (the “Hotel”). The FSDC Loan has a three-year initial term with two, one-year extension options available to the Company
upon the satisfaction of certain financial and other conditions. The FSDC Loan replaces the $130,000,000 mortgage loan previously encumbering the Hotel.
The foregoing description of the FSDC Loan is qualified in its entirety by reference to the Loan Agreement, a copy of which will be attached
as an exhibit to the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2014, which the Company intends to file in August 2014.
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Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant. |
The information set forth above in “Item 1.01—Entry into a Material Definitive Agreement” of this Current Report on Form 8-K
(this “Current Report”) is incorporated herein by reference.
| Item 7.01 |
Regulation FD Disclosure. |
A copy of the press release announcing the FSDC Loan is
attached to this Current Report as Exhibit 99.1 and is incorporated herein solely for purposes of this Item 7.01 disclosure.
The
information in Item 7.01 of this Current Report, including Exhibit 99.1 attached hereto, is being furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the
“Exchange Act”), or otherwise subject to the liabilities of such section. The information in Item 7.01 of this Current Report, including Exhibit 99.1 attached hereto, shall not be incorporated by reference into any filing under the
Securities Act of 1933, as amended, or the Exchange Act, regardless of any incorporation by reference language in any such filing.
| Item 9.01 |
Financial Statements and Exhibits. |
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| Exhibit Number |
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Description |
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| 99.1 |
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Press release dated June 30, 2014 |
SIGNATURES
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.
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STRATEGIC HOTELS & RESORTS, INC. |
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| July 2, 2014 |
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By: |
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/s/ Paula C. Maggio |
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Name: |
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Paula C. Maggio |
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Title: |
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Executive Vice President, General Counsel & Secretary |
EXHIBIT INDEX
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| Exhibit Number |
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Description |
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| 99.1 |
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Press release dated June 30, 2014 |
Exhibit 99.1
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COMPANY CONTACTS: Diane
Morefield EVP, Chief Financial Officer Strategic
Hotels & Resorts, Inc. (312) 658-5740
Jonathan Stanner
VP, Capital Markets & Treasurer
Strategic Hotels & Resorts, Inc. (312)
658-5746 |
FOR IMMEDIATE RELEASE
MONDAY, JUNE 30, 2014
STRATEGIC
HOTELS & RESORTS, INC. ANNOUNCES CLOSING OF A FIVE-YEAR, $120 MILLION LOAN SECURED BY THE FOUR SEASONS WASHINGTON, D.C. HOTEL
CHICAGO
– June 30, 2014—Strategic Hotels & Resorts, Inc. (NYSE: BEE) today announced that it has closed a $120.0 million limited recourse loan secured by the Four Seasons Washington, D.C. hotel. This new financing replaces the
$130.0 million financing previously encumbering the property. Under the terms of the agreement, the loan bears interest at a floating rate of LIBOR plus 225 basis points and has a three-year initial term with two, one-year extension options
available to the Company upon satisfying certain financial and other conditions. Deutsche Bank Securities Inc. originated the financing.
About the
Company
Strategic Hotels & Resorts, Inc. is a real estate investment trust (REIT) which owns and provides value enhancing asset management of
high-end hotels and resorts in the United States and Europe. The Company currently has ownership interests in 16 properties with an aggregate of 7,862 rooms and 835,000 square feet of multi-purpose meeting and banqueting space. For a list of current
properties and for further information, please visit the Company’s website at www.strategichotels.com.
This press release contains
forward-looking statements about Strategic Hotels & Resorts, Inc. (the “Company”). Except for historical information, the matters discussed in this press release are forward-looking statements subject to certain risks and
uncertainties. These forward-looking statements include statements regarding the Company’s future financial results, stabilization in the lodging space, positive trends in the lodging industry and the Company’s continued focus on improving
profitability. Actual results could differ materially from the Company’s projections. Factors that may contribute to these differences include, but are not limited to the following: the effects of economic conditions and disruptions in
financial markets upon business and leisure travel and the hotel markets in which the Company invests; the Company’s liquidity and refinancing demands; the Company’s ability to obtain, refinance or extend maturing debt; the Company’s
ability to maintain compliance with covenants contained in its debt facilities; stagnation or deterioration in economic and market conditions, particularly impacting business and leisure travel spending in the markets where the Company’s hotels
operate and in which the Company invests, including luxury and upper upscale product; general volatility of the capital markets and the market price of the Company’s shares of common stock; availability of capital; the Company’s ability to
dispose of properties in a manner consistent with its investment strategy and liquidity needs;
Strategic Hotels & Resorts
Add 1
hostilities and security concerns, including
future terrorist attacks, or the apprehension of hostilities, in each case that affect travel within or to the United States or Germany or other countries where the Company invests; difficulties in identifying properties to acquire and completing
acquisitions; the Company’s failure to maintain effective internal control over financial reporting and disclosure controls and procedures; risks related to natural disasters; increases in interest rates and operating costs, including insurance
premiums and real property taxes; delays and cost-overruns in construction and development; marketing challenges associated with entering new lines of business or pursuing new business strategies; the Company’s failure to maintain its status as
a REIT; changes in the competitive environment in the Company’s industry and the markets where the Company invests; changes in real estate and zoning laws or regulations; legislative or regulatory changes, including changes to laws governing
the taxation of REITs; changes in generally accepted accounting principles, policies and guidelines; and litigation, judgments or settlements.
Additional risks are discussed in the Company’s filings with the Securities and Exchange Commission, including those appearing under the heading
“Item 1A. Risk Factors” in the Company’s most recent Form 10-K and subsequent Form 10-Qs. Although the Company believes the expectations reflected in such forward-looking statements are based on reasonable assumptions, it can give no
assurance that its expectations will be attained. The forward-looking statements are made as of the date of this press release, and the Company undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result
of new information, future events or otherwise, except as required by law.
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