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) December 29, 2004
(December 21, 2004)
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NorthStar Realty Finance Corp.
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(Exact name of registrant as specified in its charter)
Maryland 001-32330 11-3707493
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(State or other (Commission (IRS Employer
jurisdiction of File Number) Identification No.)
incorporation)
527 Madison Avenue, 16th Floor, New York 10022
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(Address of principal executive offices) (Zip Code)
(212) 319-8801
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(Registrant's telephone number, including area code)
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:
[ ] Written communications pursuant to Rule 425 under the Securities Act
(17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act
(17 CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange
Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange
Act (17 CFR 240.13e-4(c))
NorthStar Realty Finance Corp.
Current Report on Form 8-K
ITEM 1.01 ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT.
On December 21, 2004, NRFC DB Holdings, LLC ("NRFC DB"), a subsidiary
of NorthStar Realty Finance Corp. (the Company") entered into a $150 million
master repurchase agreement with Deutsche Bank AG, Cayman Islands Branch
("Deutsche Bank"). NRFC DB paid Deutsche Bank $300,000 of a $600,000 structuring
fee upon the execution of the agreement and will pay the remaining $300,000 by
March 31, 2005. This credit facility may be used to finance mortgage loans
secured by first liens on commercial or multifamily properties, junior
participation interests in mortgage loans secured by first or second liens on
commercial or multifamily properties, mezzanine loans secured by a pledge of the
entire ownership interest in a commercial or multifamily properties, B- or
higher rated commercial mortgage backed securities and BB- or higher rated real
estate collateralized debt obligations or debt securities issued by a real
estate investment trust.
Amounts borrowed under the facility bear interest at one-month LIBOR
plus a spread which ranges from 0.75% to 2.25% depending on the type of asset
for which the amount is borrowed. In addition, NRFC DB must pay a usage fee
equal to 0.60% of the purchase price of the asset for which an amount is
borrowed. The Company has agreed to guaranty amounts borrowed by NRFC DB under
the facility up to a maximum of $20 million.
The facility has an initial three-year term. NRFC DB may extend the
facility for one additional year if it is not in default and pays an extension
fee of 0.25% of the aggregate outstanding amount under the facility. If NRFC DB
extends the term of the facility, it will be required to retire 25% of the
aggregate outstanding amount each quarter during the remaining year of the term.
The debt that may be outstanding under the facility is subject to a
number of terms, conditions and restrictions including, without limitation,
scheduled interest payments, the maintenance of certain margin percentages on
amounts outstanding under the facility and exit fees. If the market value of an
asset securing outstanding debt declines, NRFC DB may be required to satisfy a
margin call by paying cash or providing additional collateral. Failure to meet
any margin call could result in an event of default which would enable Deutsche
Bank to exercise various rights and remedies including acceleration of the
maturity date of the debt outstanding under the facility and the sale of the
collateral. If NRFC DB decides to repay debt outstanding under the facility
prior to the maturity date of the debt, it will generally be required to pay an
exit fee equal to 0.50% of the repurchase price of the asset securing the debt
to be repaid.
As of December 29, 2004, NRFC DB has borrowed approximately $15.4
million under this facility to finance a recently acquired mezzanine loan. This
amount bears interest at a per annum rate equal to one-month LIBOR plus 1.25%,
payable monthly.
SIGNATURE
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.
Dated: December 29, 2004 NORTHSTAR REALTY FINANCE CORP.
By: /s/ Mark E. Chertok
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Name: Mark E. Chetok
Title: Chief Financial Officer
