Item 1.01.
|
Entry into a Material Definitive Agreement.
|
On March 15, 2018, City Office REIT
Operating Partnership, L.P. (the Operating Partnership), the operating partnership of City Office REIT, Inc. (the Company), entered into a Credit Agreement (the Credit Agreement), dated as of March 15, 2018,
by and among the Operating Partnership, as borrower, the Company and certain of its subsidiaries, as guarantors, KeyBank National Association (KeyBank), as lender, agent and swing loan lender, the other lending institutions party
thereto, as lenders, and Keybanc Capital Markets (Keybanc Markets), as sole lead arranger and sole book manager.
The Credit
Agreement relates to a $250 million unsecured revolving credit facility (the Unsecured Credit Facility). Up to $25,000,000 of the Unsecured Credit Facility is available for swingline loans. Additionally, the Operating Partnership
has the right to request an increase, subject to customary terms and conditions, of the aggregate amount of the Unsecured Credit Facility to up to $500 million, a portion of which may be drawn as an incremental term loan with a maturity date of
five years from the date of such draw. The maturity date of the Unsecured Credit Facility is March 15, 2022; provided, however, that the Operating Partnership has the option to extend borrowings under the Unsecured Credit Facility for an
additional 12 months under certain circumstances. The Operating Partnership may prepay the Unsecured Credit Facility, in whole or in part, at any time without fee or penalty, except for breakage costs associated with LIBOR borrowings. The Credit
Agreement contains customary representations and warranties, financial covenants, negative covenants, affirmative covenants and events of default.
Borrowings under the Unsecured Credit Facility will bear an interest at a rate equal to the LIBOR rate plus a margin of 140 to 225 basis
points. The Unsecured Credit Facility requires monthly payments of interest only, but requires mandatory prepayments under certain circumstances as set forth in the Credit Agreement. All obligations under the Credit Agreement are unconditionally
guaranteed by the Company.
The Credit Agreement replaced the previously disclosed Amended and Restated Credit Agreement, as amended (the
Existing Credit Agreement), dated as of June 26, 2015, entered into by and among the Operating Partnership, as parent borrower, the subsidiary borrowers named therein, KeyBank, as lender and agent, the other lenders named therein,
and Keybanc Markets, as sole lead arranger and sole book runner, which provided a $150 million secured credit facility that was scheduled to expire on June 26, 2018.
The foregoing description of the Credit Agreement and the transactions contemplated thereby is not complete and is subject to and qualified in
its entirety by reference to the full text of the Credit Agreement, a copy of which is attached as Exhibit 10.1 hereto and incorporated herein by reference.