Item 1.01 Entry into a Material Definitive Agreement.
Sixth Amendment to Credit Agreement
On July 26, 2019, America First Multifamily Investors, L.P. (the “Partnership”) entered into a Sixth Amendment to Credit Agreement (the “Sixth Amendment”) with Bankers Trust Company (“Bankers Trust”) which modifies certain provisions of the Credit Agreement executed between the Partnership and Bankers Trust on May 14, 2015 (as amended by the following amendments, the “Credit Agreement”), as amended by the First Amendment to Credit Agreement dated January 7, 2016 (the “First Amendment”), the Second Amendment to Credit Agreement dated February 10, 2016 (the “Second Amendment”), the Third Amendment to Credit Agreement dated November 14, 2016 (the “Third Amendment”), the Fourth Amendment to Credit Agreement dated May 22, 2017 (the “Fourth Amendment”), and the Fifth Amendment to Credit Agreement dated July 19, 2018 (the “Fifth Amendment”). In connection with the Sixth Amendment, the Partnership was required to pay Bankers Trust an extension fee in the amount of $100,000 and an administration fee of $25,000. The material amendment to the Credit Agreement included in the Sixth Amendment is that Section 2.1 was amended to extend the Maturity Date to June 30, 2021.
2019 Revolving Line of Credit Note
In connection with the Sixth Amendment, the Partnership also executed a new Revolving Line of Credit Note (the “Note”) payable to the order of Bankers Trust with a commitment amount of up to $50,000,000 dated July 26, 2019, which replaced in its entirety the Revolving Line of Credit Note dated July 19, 2018 made by the Partnership payable to the order of Bankers Trust (the “Prior Note”). The Note contains certain amendments to the Prior Note, as discussed below.
The interest rate provisions of the Note are the same as set forth in the Prior Note, with the following amendments. The Note now provides that in the event (i) the LIBOR rate is permanently or indefinitely unavailable or unascertainable, or ceases to be published by the LIBOR administrator or its successor, (ii) the LIBOR administrator or its successor invokes its insufficient admissions policy, (iii) the LIBOR rate is determined to be no longer representative by the regulatory supervisor of the administrator of LIBOR, (iv) the LIBOR rate can no longer be lawfully relied upon in contracts of this nature by one or both of the parties, or (v) the LIBOR rate does not accurately and fairly reflect the cost of making or maintaining the type of loans or advances under the Note and in any such case, such circumstances are unlikely to be temporary, then all references to the LIBOR rate in the Note will instead be to a replacement rate determined by Bankers Trust in its sole judgment, including any adjustment to the replacement rate to reflect a different credit spread, term, or other mathematical adjustment deemed necessary by Bankers Trust in its sole judgment. Bankers Trust will provide reasonable notice to the Partnership of any such replacement rate, which will be effective on the date of the earliest event set forth in clause
(i)-(v) of this paragraph. Additionally, interest accrued on the Note is payable monthly on the first day of each month, commencing on August 1, 2019.
Finally, the Note will now mature and all outstanding principal and accrued and unpaid interest will be due and payable in full on June 30, 2021. Other than as described above, the material terms of the Note remain the same as those of the Prior Note.
The foregoing descriptions of the Sixth Amendment and Note are summaries and are qualified in their entirety by reference to the full text of the Sixth Amendment and Note, copies of which are attached as Exhibit 10.1 and 10.2, respectively, to this Current Report on Form 8-K and incorporated by reference herein.
In addition, the full text of the Cred
it Agreement, which was attached as Exhibits 10.1, to the Current Report on Form 8-K filed by the Partnership with the Securities and Exchange Commission (“SEC”) on May 20, 2015; the First Amendment and associated waiver letter, copies of which were attach
ed as Exhibits 10.1 and 10.2, respectively, to the Current Report on Form 8-K filed by the Partnership with the SEC on January 13, 2016; the Second Amendment, a copy which was attached as Exhibit 10.1 to the Current Report on Form 8-K filed by the Partners
hip with the SEC on February 17, 2016; the Third Amendment, a copy which was attached as Exhibit 10.1 to the Current Report on Form 8-K filed by the Partnership with the SEC on November 18, 2016; the Fourth Amendment, a copy which was attached as Exhibit 1
0.1 to the Current Report on Form 8-K filed by the Partnership with the SEC on May 25, 2017; and the Fifth Amendment, a copy which was attached as Exhibit 10.1 to the Current Report on Form 8-K filed by the Partnership with the SEC on July 20, 2018, are in
corporated by reference herein.
On July 31, 2019, the Partnership issued a press release announcing the amendment to the Credit Agreement and the Note, a copy of which is attached as Exhibit 99.1.
Forward-Looking Statements
Information contained in this Current Report on Form 8-K contains “forward-looking statements,” including but not limited to statements related to the Credit Agreement and Note, which are based on current expectations, forecasts, and assumptions that involve risks and uncertainties that could cause actual outcomes and results to differ materially. These risks and uncertainties include, but are not limited to, risks involving current maturities of our financing arrangements and our ability to renew or refinance such maturities, fluctuations in short-term interest rates, collateral valuations, bond investment valuations and overall economic and credit market conditions. For a further list and description of such risks, see the reports and other filings made by the Partnership with the Securities and Exchange Commission, including its Annual Report on Form 10-K for the year ended December 31, 2018. The Partnership disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise.