UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
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CURRENT REPORT
Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
March 25, 2020
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KENNEDY-WILSON HOLDINGS, INC.
(Exact name of registrant as specified in its charter)
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| Delaware | | 001-33824 | | 26-0508760 |
(State or other jurisdiction of Incorporation) | | (Commission File Number) | | (IRS Employer Identification No.) |
151 S El Camino Drive Beverly Hills, California 90212
(Address of principal executive offices)(Zip Code)
(310) 887-6400
(Registrant’s telephone number, including area code)
N/A
(Former name or former address, if changed since last report)
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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 Instructions 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)) |
(See definition of “large accelerated filer," "accelerated filer," "smaller reporting company” and "emerging growth company" in Rule 12b-2 of the Exchange Act). (Check one):
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| Large accelerated filer | ☒ | | Accelerated filer | ☐ |
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| Non-accelerated filer | ☐ | | Smaller reporting company | ☐ |
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| Emerging growth company | ☐ | | | |
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). ☐ Yes ☒ No
Securities registered pursuant to Section 12(b) of the Act:
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| Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
| Common stock, $.0001 par value | KW | NYSE |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 1.01 Entry into a Material Definitive Agreement.
On March 25, 2020, Kennedy-Wilson, Inc. (the “Borrower”), a wholly-owned subsidiary of Kennedy-Wilson Holdings, Inc. (“KWH”), KWH and certain subsidiaries of KWH (the “Subsidiary Guarantors”) entered into a Second Amended and Restated Credit Agreement (the “Second A&R Credit Agreement”) with a syndicate of lenders, Bank of America, N.A., as administrative agent, BofA Securities, Inc. as joint lead arranger and joint bookrunner, JPMorgan Chase Bank, N.A., as joint lead arranger and joint bookrunner, and U.S. Bank National Association as joint lead arranger, pursuant to which the Borrower’s existing unsecured credit facility was amended and restated to provide for, among other things, a $500 million unsecured revolving credit facility (the “Second A&R Facility”). As of March 25, 2020, there are no borrowings outstanding under the Second A&R Credit Agreement.
Loans under the Second A&R Facility bear interest at a rate equal to LIBOR plus between 1.75% and 2.50%, depending on the consolidated leverage ratio as of the applicable measurement date. The Second A&R Facility has a maturity date of March 25, 2024. Subject to certain conditions precedent and at the Borrower’s option, (i) the maturity date of the Second A&R Facility may be extended up to two times, in six-month increments, and (ii) the aggregate amount of the Second A&R Facility may be increased to an amount not exceeding $1 billion.
The Second A&R Facility contains certain covenants that, among other things, limit KWH and certain of its subsidiaries’ ability to incur additional indebtedness, repurchase capital stock or debt, sell assets or subsidiary stock, create or permit liens on assets, engage in transactions with affiliates, enter into sale/leaseback transactions, issue subsidiary equity and enter into consolidations or mergers.
The Second A&R Credit Agreement requires KWH to maintain (i) a maximum consolidated leverage ratio (as defined in the Second A&R Credit Agreement) of not greater than 65%, measured as of the last day of each fiscal quarter, (ii) a minimum fixed charge coverage ratio (as defined in the Second A&R Credit Agreement) of not less than 1.70 to 1.00, measured as of the last day of each fiscal quarter for the period of four full fiscal quarters then ended, (iii) a minimum consolidated tangible net worth equal to or greater than the sum of 70% of consolidated tangible net worth as of the date of the most recent financial statements available as of the effective date of the Second A&R Facility plus an amount equal to fifty percent (50%) of net equity proceeds received by KWH after the date of the most recent financial statements that are available as of the effective date of the Second A&R Facility, measured as of the last day of each fiscal quarter, (iv) a maximum recourse leverage ratio (as defined in the Second A&R Credit Agreement) of not greater than an amount equal to consolidated tangible net worth as of the measurement date multiplied by 1.5, measured as of the last day of each fiscal quarter, (v) a maximum secured recourse leverage ratio (as defined in the Second A&R Credit Agreement) of not greater than 3.5% of consolidated total asset value and 3.5% of consolidated total asset value as of the effective date of the Second A&R Facility, measured as of the last day of each fiscal quarter, (vi) a maximum adjusted secured leverage ratio (as defined in the Second A&R Credit Agreement) of not greater than 55%, measured as of the last day of each fiscal quarter, and (vii) liquidity (as defined in the Second A&R Credit Agreement) of at least $75 million. The Second A&R Facility has customary events of default, the occurrence of which may accelerate the outstanding balance under the Second A&R Facility.
The obligations of the Borrower pursuant to the Second A&R Facility are guaranteed by KWH and the Subsidiary Guarantors.
The above description of the Second A&R Facility is a summary. Please refer to the terms of the Second A&R Credit Agreement, which is filed as Exhibit 10.1 to this Current Report.
Item 2.03 Creation of a Direct Financial Obligation or an Off-Balance Sheet Arrangement.
The information set forth in Item 1.01 above is incorporated by reference into this Item 2.03.
Item 9.01 Financial Statements and Exhibits.
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| Exhibit No. | Description |
| 10.1 | Second Amended and Restated Credit Agreement, dated March 25, 2020, among Kennedy-Wilson, Inc., as borrower, Kennedy-Wilson Holdings, Inc. and certain subsidiaries of Kennedy-Wilson Holdings, Inc. from time to time party thereto as guarantors, the lenders from time to time party thereto, Bank of America, N.A., as administrative agent and Bank of America, N.A. and JPMorgan Chase Bank, N.A., as letter of credit issuers. |
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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| | KENNEDY-WILSON HOLDINGS, INC. |
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| | By: | /s/ JUSTIN ENBODY |
| | | Justin Enbody |
| | | Chief Financial Officer |
Date: March 25, 2020
