Item 1.01. Entry into a Material Definitive Agreement.
Worldwide Plaza Mortgage and Mezzanine
Loans
On October 18, 2017, simultaneously with
the closing (the “JV Closing”) of the acquisition of 48.7% of the membership interests (the “Acquired Interests”)
in WWP Holdings, LLC (“WWP”) by WWP JV LLC (the “Purchaser”) from a wholly owned subsidiary (the “Seller”)
of New York REIT, Inc. (the “Company”), WWP, through wholly owned subsidiaries, borrowed $1.2 billion from Goldman
Sachs Mortgage Company comprised of a mortgage loan with a principal amount of $940.0 million (the “Mortgage Loan”),
and three mezzanine loans with an aggregate principal amount of $260.0 million (the “Mezzanine Loans” and, together
with the Mortgage Loan, the “Loans”). The Mortgage Loan is secured by a mortgage on the Worldwide Plaza property (the
“Property”), a mixed use building located on Eighth Avenue between 49th and 50th Streets in Manhattan containing approximately
2.05 million rentable square feet, including approximately 1.8 million rentable square feet of office space. The Property is indirectly
owned by WWP, and the Mezzanine Loans are secured by a pledge of indirect equity interests in the wholly owned subsidiaries of
WWP that are borrowers under the Mortgage Loan.
The Loans bear interest at a blended rate
of approximately 3.98% per annum. The Loans require monthly interest-only payments, with the principal balance due on the maturity
date in November 2027. The net proceeds from the Loans were primarily used to defease or prepay the $875.0 million principal amount
of the existing mortgage and mezzanine loans encumbering the Property (the “Existing Loans”) and pay approximately
$109.0 million in related defeasance costs and prepayment premiums, with the remaining excess net proceeds distributed to the Seller
and the only other current member of WWP, WWP Sponsor, LLC (the “Comfort Member”). The Comfort Member received an aggregate
of $3.0 million at the JV Closing, including its portion of the excess proceeds from the Loans.
The Loans may be defeased at any time on
or after the first payment date following October 18, 2020 (or, if earlier, the second anniversary of the securitization of the
Loans, if they are securitized) and may be prepaid in whole (but not in part) during the final four months prior to the maturity
date. The Loans may be assumed by a party acquiring the Property that meets certain qualifications. The Loans do not restrict the
Seller’s ability to transfer its membership interests in WWP, subject to certain customary requirements.
The Loans are generally non-recourse except
with respect to liabilities arising out of certain non-recourse carveouts and certain environmental indemnities. At the closing,
affiliates of the Purchaser (the “Guarantors”) executed a customary non-recourse carveout guarantee and a customary
environmental indemnity (the “Guarantees”), and the Company entered into a contribution, reimbursement and indemnity
agreement (the “CRA”) with the Guarantors, pursuant to which the Company would be responsible for 51.3% of any required
payments under the Guarantees (subject to certain exceptions relating to persons responsible for covering the liability under
the Guarantees).
The LLC Agreement
On October 18, 2017, at the JV Closing
and as contemplated by the Membership Interest Purchase Agreement between the Seller and the Purchaser dated September 14, 2017
(the “Purchase Agreement”), the limited liability company agreement of WWP (the “LLC Agreement”) was amended
and restated by its members.
Following the JV Closing, the Seller owns
50.1% of the membership interests in WWP, the Purchaser owns 48.7% of the membership interests in WWP and the Comfort Member continues
to own the 1.2% of the membership interests in WWP it owned prior to the JV Closing. The Purchaser is a joint venture between affiliates
of SL Green Realty Corp. and a private equity fund sponsored by RXR Realty LLC.
The material terms of the LLC Agreement
as so amended and restated are described in detail in Item 1.01 of the Company’s Current Report on Form 8-K filed with the
Securities and Exchange Commission on September 14, 2017 (the “MIPA 8-K”), which is incorporated by reference herein.
Other than as described in the MIPA 8-K, there are no material relationships between the Company, on the one hand, and the Purchaser,
the Comfort Member or their respective affiliates, on the other hand.
The description of the LLC Agreement contained
in the MIPA 8-K is a summary. A copy of the form of the LLC Agreement was included as an exhibit to the Purchase Agreement filed
as an exhibit to the MIPA 8-K..
The Guaranty Agreement
On October 18, 2017, at the JV Closing,
the Company entered into a guaranty agreement (the “Guaranty Agreement”) in favor of the Purchaser pursuant to which
the Company has guaranteed the Seller’s obligations to indemnify the Purchaser under the LLC Agreement with respect to transfer
taxes relating to the initial transfer to the Purchaser of the Acquired Interests and payment of all obligations of the Seller
under the Purchase Agreement.