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): June 19, 2013 (June 18, 2013)
CUBESMART
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CUBESMART, L.P. |
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(Exact Name Of Registrant As Specified In
Charter)
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Maryland |
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001-32324 |
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20-1024732 |
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Delaware |
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000-54662 |
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34-1837021 |
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(State or Other Jurisdiction |
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(Commission File Number) |
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(IRS Employer Identification |
460 E. Swedesford Road, Suite 3000, Wayne, Pennsylvania 19087
(Address of Principal Executive Offices)
(610) 293-5700
(Registrant’s telephone number, including area code)
Not Applicable
(Former Name or Former Address, if Changed Since Last Report)
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 Instruction A.2. below):
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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)) |
Item 1.01 Entry into a Material Definitive Agreement.
On June 18, 2013, CubeSmart and CubeSmart, L.P., the limited partnership through which CubeSmart owns its assets and conducts its operations, entered into a Second Amendment to Credit Agreement (the “Credit Agreement Amendment”) with Wells Fargo Bank, National Association, as Administrative Agent and each of the lenders party to the Credit Agreement dated as of December 9, 2011, as amended by the First Amendment to Credit Agreement and release of Guarantors dated April 5, 2012 (the “Credit Agreement”). Capitalized terms used in the following paragraph shall have the meaning given to such capitalized term in the Credit Agreement.
Among other things, the Credit Agreement Amendment (i) decreases the Applicable Margin with respect to Revolving and Term Loans, such that, based upon CubeSmart’s current unsecured debt rating, the Revolving Loans are priced at 1.30% over LIBOR and the Term Loans are priced at 1.50%, over LIBOR, in each case, with no LIBOR floor, (ii) decreases the Capitalization Rate to 8.00% from 8.25%, (iii) decreases the Facility Fee, such that, based upon CubeSmart’s current unsecured debt rating, the Facility Fee is 0.30%, (iv) extends the maturity of the Revolving Loans to June 18, 2017 from December 8, 2015 and (v) extends the maturity of the Tranche B Term Loans to January 31, 2019 from March 31, 2017.
Also on June 18, 2013, CubeSmart and CubeSmart, L.P. entered into a Second Amendment to Term Loan Agreement (the “Term Loan Amendment”) with Wells Fargo Bank, National Association, as Administrative Agent and each of the lenders party to the Term Loan Agreement dated as of June 20, 2011, as amended by the First Amendment to Term Loan Agreement and release of Guarantors dated February 8, 2012 (the “Term Loan Agreement”). Capitalized terms used in the following paragraph shall have the meaning given to such capitalized term in the Term Loan Agreement.
Among other things, the Term Loan Amendment (i) decreases the Applicable Margin with respect to Five Year Term Loans, such that, based upon CubeSmart’s current unsecured debt rating, the Five Year Term Loans are priced at 1.50% over LIBOR with no LIBOR floor, (ii) decreases the Capitalization Rate to 8.00% from 8.25%, and (iii) extends the maturity of the Term Loan Agreement to June 30, 2018 from June 19, 2016.
The foregoing descriptions of the Credit Agreement Amendment and the Term Loan Amendment are qualified in their entirety by the full terms and conditions of the Credit Agreement Amendment, a copy of which we have attached as Exhibit 99.1 to this Current Report on Form 8-K and incorporated herein by reference, and the Term Loan Amendment, a copy of which we have attached as Exhibit 99.2 to this Current Report on Form 8-K and incorporated herein by reference.
Item 2.03 Creation of a Direct Financial Obligation or an Obligation Under an Off-Balance Entry Sheet Arrangement of a Registrant.
The information reported in Item 1.01 above is incorporated herein by reference.
Item 7.01 Regulation FD Disclosure
On June 18, 2013, the Company issued a press release announcing the closing of the Credit Agreement Amendment and the Term Loan Amendment. A copy of the press release is furnished herewith as Exhibit 99.3.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
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Exhibit |
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Description |
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99.1 |
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Second Amendment to Credit Agreement dated as of June 18, 2013 by and among CubeSmart, L.P., CubeSmart, Wells Fargo Bank, National Association, as Administrative Agent and each of the lenders |
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99.2 |
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Second Amendment to Term Loan Agreement dated as of June 18, 2013 by and among CubeSmart, L.P., CubeSmart, Wells Fargo Bank, National Association, as Administrative Agent and each of the lenders |
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99.3 |
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Press Release dated June 18, 2013 |
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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CUBESMART | |
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Date: June 19, 2013 |
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By: |
/s/ Jeffrey P. Foster |
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Name: Jeffrey P. Foster | |
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Title: Senior Vice President, Chief Legal Officer & Secretary | |
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CUBESMART, L.P. | |
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By: CUBESMART, its general partner | |
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Date: June 19, 2013 |
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By: |
/s/ Jeffrey P. Foster |
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Name: Jeffrey P. Foster | |
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Title: Senior Vice President, Chief Legal Officer & Secretary | |
EXHIBIT INDEX
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Exhibit |
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Description |
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99.1 |
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Second Amendment to Credit Agreement dated as of June 18, 2013 by and among CubeSmart, L.P., CubeSmart, Wells Fargo Bank, National Association, as Administrative Agent and each of the lenders |
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99.2 |
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Second Amendment to Term Loan Agreement dated as of June 18, 2013 by and among CubeSmart, L.P., CubeSmart, Wells Fargo Bank, National Association, as Administrative Agent and each of the lenders |
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99.3 |
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Press Release dated June 18, 2013 |
Exhibit 99.1
Execution Version
Loan Number: 1006379
SECOND AMENDMENT TO CREDIT AGREEMENT
THIS SECOND AMENDMENT TO CREDIT AGREEMENT is dated as of June 18, 2013 (this “Amendment”) by and among CUBESMART, L.P., a limited partnership formed under the laws of the State of Delaware (the “Borrower”), CUBESMART, a real estate investment trust formed under the laws of the State of Maryland (the “Parent”), WELLS FARGO BANK, NATIONAL ASSOCIATION, as Administrative Agent (the “Administrative Agent”), and each of the Lenders party to the Credit Agreement defined below (the “Lenders”).
WHEREAS, the Borrower, the Parent, the Lenders and the Administrative Agent are parties to that certain Credit Agreement dated as of December 9, 2011 (as amended by that First Amendment to Credit Agreement dated April 5, 2012, the “Credit Agreement”); and
WHEREAS, the Borrower, the Parent, the Lenders and the Administrative Agent desire to amend certain provisions of the Credit Agreement on the terms and conditions contained herein.
NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged by the parties hereto, the parties hereto hereby agree as follows:
Section 1. Specific Amendments. Section 1.1 of the Credit Agreement is hereby amended restating in its entirety the table set forth in the definition of “Applicable Margin”, the definition of “Capitalization Rate”, the definition of “LIBOR”, and the table set forth in the definition of “Facility Fee”, in each case in Section 1.1 thereof as follows:
“Applicable Margin” …
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Level |
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Parent’s Credit Rating |
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Applicable Margin for |
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Applicable Margin for |
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1 |
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A-/A3/A- or better |
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0.90% |
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1.05% |
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2 |
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BBB+/Baa1/BBB+ |
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1.00% |
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1.15% |
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3 |
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BBB/Baa2/BBB |
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1.10% |
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1.30% |
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4 |
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BBB-/Baa3/BBB- |
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1.30% |
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1.50% |
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5 |
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Lower than BBB-/Baa3/BBB- |
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1.70% |
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2.05% |
“Capitalization Rate” means 8.00%.
“Facility Fee” …
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Level |
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Facility Fee |
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1 |
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0.15% |
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2 |
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0.15% |
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3 |
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0.20% |
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4 |
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0.30% |
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5 |
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0.35% |
“LIBOR” means, with respect to any LIBOR Loan for any Interest Period, the rate of interest obtained by dividing (i) the rate appearing on the Reuters Screen LIBOR01 page (or on any successor or substitute page of such service, or any successor to or substitute for such service, providing rate quotations comparable to those currently provided on such page, as determined by the Administrative Agent from time to time for purposes of providing quotations of interest rates applicable to Dollar deposits in the London interbank market) at approximately 11:00 a.m., London time, on the date that is two Business Days prior to the first day of such Interest Period and having a maturity equal to such Interest Period by (ii) a percentage equal to 1 minus the stated maximum rate (stated as a decimal) of all reserves, if any, required to be maintained with respect to Eurocurrency funding (currently referred to as “Eurocurrency liabilities”) as specified in Regulation D of the Board of Governors of the Federal Reserve System (or against any other category of liabilities which includes deposits by reference to which the interest rate on LIBOR Loans is determined or any applicable category of extensions of credit or other assets which includes loans by an office of any Lender outside of the United States of America). Any change in such maximum rate shall result in a change in LIBOR on the date on which such change in such maximum rate becomes effective.
“Termination Date” means, (a) with respect to the Revolving Loans and the Revolving Commitments, June 18, 2017, subject to Section 2.14., (b) with respect to the Tranche A Term Loans, December 8, 2014 and (c) with respect to the Tranche B Term Loans, January 31, 2019.
Section 2. Conditions Precedent. The effectiveness of this Amendment is subject to the satisfaction of the following conditions precedent:
(a) The Administrative Agent shall have received a counterpart of this Amendment duly executed by the Borrower, the Parent, each of the Lenders and the Administrative Agent;
(b) Evidence that all upfront fees and expenses payable pursuant to the Fee Letter dated May 13, 2013 among the Borrower, Wells Fargo Bank, National Association, Wells Fargo Securities, LLC, Bank of America, N.A. and Merrill Lynch, Pierce Fenner & Smith Incorporated have been paid;
(c) No Default or Event of Default shall exist;
(d) An opinion of counsel to the Borrower and the other Loan Parties addressed to the Administrative Agent and the Lenders regarding such matters as the Administrative Agent may reasonably request;
(e) A certificate of good standing (or certificate of similar meaning) with respect to each Loan Party issued as of a recent date by the Secretary of State of the state of formation of each such Loan Party;
(f) A certificate of the Secretary or Assistant Secretary (or other individual performing similar functions) of each Loan Party certifying that either (i) there has been no change to (x) the by-laws of such Loan Party, if a corporation, the operating agreement, if a limited liability company, the partnership agreement, if a limited or general partnership, or other comparable document in the case of any other form of legal entity and (y) the certificate or articles of incorporation, articles of organization, certificate of limited partnership, declaration of trust or other comparable organizational instrument of
such Loan Party, in each case since the Agreement Date or (ii) if they have changed, that the true, correct and complete by-laws, operating agreement, partnership agreement, articles of incorporation or organization or certificate of limited partnership, as the case may be, are attached;
(g) Copies certified by the Secretary or Assistant Secretary (or other individual performing similar functions) of each Loan Party of all corporate, partnership, member or other necessary action taken by such Loan Party to authorize the execution and delivery of this Amendment and the performance of this Amendment and the Credit Agreement as amended by this Amendment;
(h) A copy of a duly executed amendment to that certain Term Loan Agreement dated as of June 20, 2011 by and among the Borrower, the financial institutions party thereto, Wells Fargo Bank, as Administrative Agent, and the other parties thereto, which amendment amends the definition of the term “Capitalization Rate” to be equal to 8.0%; and
(i) Such other documents, instruments and agreements as the Administrative Agent may reasonably request.
Section 3. Representations. The Borrower represents and warrants to the Administrative Agent and the Lenders that:
(a) Authorization. Each of the Parent and the Borrower, as applicable, has the right and power, and has taken all necessary action to authorize it, to execute and deliver this Amendment and to perform its obligations hereunder and under the Credit Agreement, as amended by this Amendment, in accordance with their respective terms. This Amendment has been duly executed and delivered by a duly authorized officer of the Borrower and the Parent, as applicable, and each of this Amendment and the Credit Agreement, as amended by this Amendment, is a legal, valid and binding obligation of the Borrower and the Parent, as applicable, enforceable against such Person in accordance with its respective terms.
(b) Compliance with Laws. The execution and delivery by the Borrower and the Parent, as applicable, of this Amendment and the performance by the Borrower and the Parent, as applicable, of this Amendment and the Credit Agreement, as amended by this Amendment, in accordance with their respective terms, do not and will not, by the passage of time, the giving of notice or otherwise: (i) require any Government Approvals or violate any Applicable Laws (including all Environmental Laws) relating to the Parent, the Borrower or any other Loan Party; (ii) conflict with, result in a breach of or constitute a default under the organizational documents of the Parent, the Borrower or any other Loan Party, or any indenture, agreement or other instrument to which the Parent, the Borrower or any other Loan Party is a party or by which it or any of its respective properties may be bound; or (iii) result in or require the creation or imposition of any Lien upon or with respect to any property now owned or hereafter acquired by the Parent, the Borrower or any other Loan Party.
(c) Reaffirmation. As of the date of this Amendment and immediately after giving effect to this Amendment, all representations and warranties of each Loan Party set forth in the Loan Documents are true and correct in all material respects (except to the extent that any such representation or warranty expressly relates to a specified earlier date, in which case such representation or warranty shall be true and correct as of such earlier date).
(d) No Default. As of the date hereof and immediately after giving effect to this Amendment no Default or Event of Default shall exist.
Section 4. Reaffirmation of Guaranty. The Parent hereby reaffirms its continuing obligations to the Administrative Agent and the Lenders under the Guaranty and agrees that the transactions contemplated by this Amendment shall not in any way affect the validity and enforceability of the Guaranty, or reduce, impair or discharge the obligations of the Parent thereunder.
Section 5. Payment of Fees and Expenses. The Borrower agrees to pay or reimburse the Administrative Agent for its reasonable and documented out-of-pocket fees, costs and expenses incurred in connection with the preparation, negotiation, execution and delivery of this Amendment and the other documents and agreements executed and delivered in connection herewith.
Section 6. Effect; Ratification.
(a) Except as expressly herein amended, the terms and conditions of the Credit Agreement and the other Loan Documents remain unchanged and continue to be in full force and effect. The amendments contained herein shall be deemed to have prospective application only, unless otherwise specifically stated herein. The Credit Agreement is hereby ratified and confirmed in all respects. Each reference to the Credit Agreement in any of the Loan Documents (including the Credit Agreement) shall be deemed to be a reference to the Credit Agreement, as amended by this Amendment.
(b) Nothing contained herein shall be deemed to constitute a waiver of compliance with any term or condition contained in the Credit Agreement or any of the other Loan Documents, or constitute a course of conduct or dealing among the parties. The Administrative Agent and the Lenders reserve all rights, privileges and remedies under the Loan Documents.
(c) Nothing in this Amendment is intended, or shall be construed, to constitute a novation or an accord and satisfaction of any of the Obligations.
(d) This Amendment constitutes the entire agreement and understanding among the parties hereto with respect to the subject matter hereof and supersedes any and all prior agreements and understandings, oral or written, relating to the subject matter hereof.
(e) This Amendment may be executed in any number of counterparts and by different parties hereto on separate counterparts, each of which when so executed and delivered shall be deemed to be an original, but all of which when taken together shall constitute a single instrument. Delivery of an executed counterpart of a signature page of this Amendment by facsimile transmission or by email in Adobe “.pdf” format shall be effective as delivery of a manually executed counterpart hereof.
Section 7. Further Assurances. The Parent and the Borrower agree to, and to cause any other Loan Party to, take all further actions and execute such other documents and instruments as the Administrative Agent may from time to time reasonably request to carry out the transactions contemplated by this Amendment, the Loan Documents and all other agreements executed and delivered in connection herewith.
Section 8. GOVERNING LAW. THIS AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS EXECUTED, AND TO BE FULLY PERFORMED, IN SUCH STATE.
Section 9. Benefits. This Amendment shall be binding upon and shall inure to the benefit of the parties hereto and their respective permitted successors and assigns.
Section 10. Severability. In case any provision of or obligation under this Amendment shall be invalid, illegal or unenforceable in any jurisdiction, the validity, legality and enforceability of the remaining provisions or obligations, or of such provision or obligation in any other jurisdiction, shall not in any way be affected or impaired thereby.
Section 11. Definitions. All capitalized terms not otherwise defined herein are used herein with the respective definitions given them in the Credit Agreement.
[Signature Pages Follow]
IN WITNESS WHEREOF, the parties hereto have caused this Second Amendment to Credit Agreement to be duly executed by their respective authorized officers as of the day and year first above written.
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CUBESMART, L.P. | |
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By: |
CubeSmart, its general partner |
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By: /s/ Jeffrey P. Foster |
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Name: Jeffrey P. Foster |
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Title: Senior Vice President, Chief Legal Officer |
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and Secretary |
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CUBESMART | |
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By: /s/ Jeffrey P. Foster |
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Name: Jeffrey P. Foster |
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Title: Senior Vice President, Chief Legal Officer |
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and Secretary |
[Signatures Continued on Next Page]
[Signature Page to Second Amendment to Credit Agreement with CubeSmart, L.P.]
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WELLS FARGO BANK, NATIONAL ASSOCIATION, as Administrative Agent and as a Lender |
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By: /s/ Sean C. Armah |
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Name: Sean C. Armah |
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Title: Vice President |
[Signatures Continued on Next Page]
[Signature Page to Second Amendment to Credit Agreement with CubeSmart, L.P.]
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BANK OF AMERICA, N.A. |
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By: /s/ Cheryl Sneor |
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Name: Cheryl Sneor |
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Title: Vice President |
[Signatures Continued on Next Page]
[Signature Page to Second Amendment to Credit Agreement with CubeSmart, L.P.]
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PNC BANK, NATIONAL ASSOCIATION |
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By: /s/ Shari L. Reams-Henofer |
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Name: Shari L. Reams-Henofer |
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Title: Senior Vice President |
[Signatures Continued on Next Page]
[Signature Page to Second Amendment to Credit Agreement with CubeSmart, L.P.]
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REGIONS BANK |
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By: /s/ Paul E. Burgan |
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Name: Paul E. Burgan |
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Title: Vice President |
[Signatures Continued on Next Page]
[Signature Page to Second Amendment to Credit Agreement with CubeSmart, L.P.]
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SUNTRUST BANK |
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By: /s/ W. John Wendler |
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Name: W. John Wendler |
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Title: Senior Vice President |
[Signatures Continued on Next Page]
[Signature Page to Second Amendment to Credit Agreement with CubeSmart, L.P.]
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RBS CITIZENS, N.A. |
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By: /s/ Charles J. Cooke Jr. |
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Name: Charles J. Cooke Jr. |
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Title: Senior Vice President |
[Signatures Continued on Next Page]
[Signature Page to Second Amendment to Credit Agreement with CubeSmart, L.P.]
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BMO HARRIS FINANCING, INC. |
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By: /s/ Aaron Lanski |
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Name: Aaron Lanski |
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Title: Managing Director |
[Signatures Continued on Next Page]
[Signature Page to Second Amendment to Credit Agreement with CubeSmart, L.P.]
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US BANK NATIONAL ASSOCIATION |
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By: /s/ Renee Lewis |
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Name: Renee Lewis |
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Title: Senior Vice President |
[Signatures Continued on Next Page]
[Signature Page to Second Amendment to Credit Agreement with CubeSmart, L.P.]
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BRANCH BANKING AND TRUST COMPANY |
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By: /s/ Glenn A. Page |
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Name: Glenn A. Page |
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Title: Senior Vice President |
[Signatures Continued on Next Page]
[Signature Page to Second Amendment to Credit Agreement with CubeSmart, L.P.]
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ROYAL BANK OF CANADA |
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By: /s/ Brian Gross |
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Name: Brian Gross |
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Title: Authorized Signatory |
[Signature Page to Second Amendment to Credit Agreement with CubeSmart, L.P.]
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COMPASS BANK, AN ALABAMA BANKING |
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By: /s/ S. Kent Gorman |
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Name: S. Kent Gorman |
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Title: Sr. Vice President |
Exhibit 99.2
Execution Version
Loan Numbers: 1004100 (Five Year Term Loan)
1004696 (Seven Year Term Loan)
SECOND AMENDMENT TO TERM LOAN AGREEMENT
THIS SECOND AMENDMENT TO TERM LOAN AGREEMENT is dated as of June 18, 2013 (this “Amendment”) by and among CUBESMART, L.P. (formerly-known-as U-STORE-IT, L.P.), a limited partnership formed under the laws of the State of Delaware (the “Borrower”), CUBESMART (formerly-known-as U-STORE-IT TRUST), a real estate investment trust formed under the laws of the State of Maryland (the “Parent”), WELLS FARGO BANK, NATIONAL ASSOCIATION, as Administrative Agent (the “Administrative Agent”), and each of the Lenders party to the Loan Agreement defined below (the “Lenders”).
WHEREAS, the Borrower, the Parent, the Lenders and the Administrative Agent are parties to that certain Term Loan Agreement dated as of June 20, 2011 (as amended by that certain First Amendment to Term Loan Agreement and release of Guarantors dated February 8, 2012, the “Loan Agreement”); and
WHEREAS, the Borrower, the Parent, the Lenders and the Administrative Agent desire to amend certain provisions of the Loan Agreement on the terms and conditions contained herein.
NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged by the parties hereto, the parties hereto hereby agree as follows:
Section 1. Specific Amendments.
(a) Section 1.1 of the Loan Agreement is hereby amended restating in its entirety the table set forth in clause (b) of the definition of “Applicable Margin”, the definition of “Capitalization Rate”, the definition of “Five Year Term Loan Termination Date” and the definition of “LIBOR”, in each case in Section 1.1 thereof as follows:
“Applicable Margin” …
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Level |
Parent’s Credit Rating |
Applicable Margin for |
Applicable Margin for |
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1 |
BBB+/Baa1/BBB+ |
1.15% |
1.60% |
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2 |
BBB/Baa2/BBB |
1.30% |
1.80% |
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3 |
BBB-/Baa3/BBB- |
1.50% |
2.00% |
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4 |
Lower than BBB-/Baa3/BBB- |
2.05% |
2.25% |
“Capitalization Rate” means 8.00%.
“Five Year Term Loan Termination Date” means June 30, 2018.
“LIBOR” means, with respect to any LIBOR Loan for any Interest Period, the rate of interest obtained by dividing (i) the rate appearing on the Reuters Screen LIBOR01 page (or on any successor or substitute page of such service, or any successor
to or substitute for such service, providing rate quotations comparable to those currently provided on such page, as determined by the Administrative Agent from time to time for purposes of providing quotations of interest rates applicable to Dollar deposits in the London interbank market) at approximately 11:00 a.m., London time, on the date that is two Business Days prior to the first day of such Interest Period and having a maturity equal to such Interest Period by (ii) a percentage equal to 1 minus the stated maximum rate (stated as a decimal) of all reserves, if any, required to be maintained with respect to Eurocurrency funding (currently referred to as “Eurocurrency liabilities”) as specified in Regulation D of the Board of Governors of the Federal Reserve System (or against any other category of liabilities which includes deposits by reference to which the interest rate on LIBOR Loans is determined or any applicable category of extensions of credit or other assets which includes loans by an office of any Lender outside of the United States of America). Any change in such maximum rate shall result in a change in LIBOR on the date on which such change in such maximum rate becomes effective.
(b) The Loan Agreement is further amended by deleting the second sentence of Section 2.10(a) in its entirety and substituting in lieu thereof the following:
Such Additional Loans must be in integral multiples of $5,000,000; provided, that the aggregate amount of all Additional Loans shall not exceed $100,000,000.
Section 2. Conditions Precedent. The effectiveness of this Amendment is subject to the satisfaction of the following conditions precedent:
(a) The Administrative Agent shall have received a counterpart of this Amendment duly executed by the Borrower, the Parent, each of the Lenders and the Administrative Agent;
(b) Evidence that all upfront fees and expenses payable pursuant to the Fee Letter dated May 13, 2013 among the Borrower, Wells Fargo Bank, National Association and Wells Fargo Securities, LLC have been paid;
(c) No Default or Event of Default shall exist;
(d) An opinion of counsel to the Borrower and the other Loan Parties addressed to the Administrative Agent and the Lenders regarding such matters as the Administrative Agent may reasonably request;
(e) A certificate of good standing (or certificate of similar meaning) with respect to each Loan Party issued as of a recent date by the Secretary of State of the state of formation of each such Loan Party;
(f) A certificate of the Secretary or Assistant Secretary (or other individual performing similar functions) of each Loan Party certifying that either (i) there has been no change to (x) the by-laws of such Loan Party, if a corporation, the operating agreement, if a limited liability company, the partnership agreement, if a limited or general partnership, or other comparable document in the case of any other form of legal entity and (y) the certificate or articles of incorporation, articles of organization, certificate of limited partnership, declaration of trust or other comparable organizational instrument of such Loan Party, in each case since the Agreement Date or (ii) if they have changed, that the true, correct and complete by-laws, operating agreement, partnership agreement, articles of incorporation or organization or certificate of limited partnership, as the case may be, are attached;
(g) Copies certified by the Secretary or Assistant Secretary (or other individual performing similar functions) of each Loan Party of all corporate, partnership, member or other necessary action taken by such Loan Party to authorize the execution and delivery of this Amendment and the performance of this Amendment and the Loan Agreement as amended by this Amendment;
(h) A copy of a duly executed amendment to that certain Credit Agreement dated as of December 9, 2011 by and among the Borrower, the financial institutions party thereto, Wells Fargo Bank, as Administrative Agent, and the other parties thereto, which amendment amends the definition of the term “Capitalization Rate” to be equal to 8.0%; and
(i) Such other documents, instruments and agreements as the Administrative Agent may reasonably request.
Section 3. Representations. The Borrower represents and warrants to the Administrative Agent and the Lenders that:
(a) Authorization. Each of the Parent and the Borrower, as applicable, has the right and power, and has taken all necessary action to authorize it, to execute and deliver this Amendment and to perform its obligations hereunder and under the Loan Agreement, as amended by this Amendment, in accordance with their respective terms. This Amendment has been duly executed and delivered by a duly authorized officer of the Borrower and the Parent, as applicable, and each of this Amendment and the Loan Agreement, as amended by this Amendment, is a legal, valid and binding obligation of the Borrower and the Parent, as applicable, enforceable against such Person in accordance with its respective terms.
(b) Compliance with Laws. The execution and delivery by the Borrower and the Parent, as applicable, of this Amendment and the performance by the Borrower and the Parent, as applicable, of this Amendment and the Loan Agreement, as amended by this Amendment, in accordance with their respective terms, do not and will not, by the passage of time, the giving of notice or otherwise: (i) require any Government Approvals or violate any Applicable Laws (including all Environmental Laws) relating to the Parent, the Borrower or any other Loan Party; (ii) conflict with, result in a breach of or constitute a default under the organizational documents of the Parent, the Borrower or any other Loan Party, or any indenture, agreement or other instrument to which the Parent, the Borrower or any other Loan Party is a party or by which it or any of its respective properties may be bound; or (iii) result in or require the creation or imposition of any Lien upon or with respect to any property now owned or hereafter acquired by the Parent, the Borrower or any other Loan Party.
(c) Reaffirmation. As of the date of this Amendment and immediately after giving effect to this Amendment, all representations and warranties of each Loan Party set forth in the Loan Documents are true and correct in all material respects (except to the extent that any such representation or warranty expressly relates to a specified earlier date, in which case such representation or warranty shall be true and correct as of such earlier date).
(d) No Default. As of the date hereof and immediately after giving effect to this Amendment, no Default or Event of Default shall exist.
Section 4. Reaffirmation of Guaranty. The Parent hereby reaffirms its continuing obligations to the Administrative Agent and the Lenders under the Guaranty and agrees that the transactions
contemplated by this Amendment shall not in any way affect the validity and enforceability of the Guaranty, or reduce, impair or discharge the obligations of the Parent thereunder.
Section 5. Payment of Fees and Expenses. The Borrower agrees to pay or reimburse the Administrative Agent for its reasonable and documented out-of-pocket fees, costs and expenses incurred in connection with the preparation, negotiation, execution and delivery of this Amendment and the other documents and agreements executed and delivered in connection herewith.
Section 6. Effect; Ratification.
(a) Except as expressly herein amended, the terms and conditions of the Loan Agreement and the other Loan Documents remain unchanged and continue to be in full force and effect. The amendments contained herein shall be deemed to have prospective application only, unless otherwise specifically stated herein. The Loan Agreement is hereby ratified and confirmed in all respects. Each reference to the Loan Agreement in any of the Loan Documents (including the Loan Agreement) shall be deemed to be a reference to the Loan Agreement, as amended by this Amendment.
(b) Nothing contained herein shall be deemed to constitute a waiver of compliance with any term or condition contained in the Loan Agreement or any of the other Loan Documents, or constitute a course of conduct or dealing among the parties. The Administrative Agent and the Lenders reserve all rights, privileges and remedies under the Loan Documents.
(c) Nothing in this Amendment is intended, or shall be construed, to constitute a novation or an accord and satisfaction of any of the Obligations.
(d) This Amendment constitutes the entire agreement and understanding among the parties hereto with respect to the subject matter hereof and supersedes any and all prior agreements and understandings, oral or written, relating to the subject matter hereof.
(e) This Amendment may be executed in any number of counterparts and by different parties hereto on separate counterparts, each of which when so executed and delivered shall be deemed to be an original, but all of which when taken together shall constitute a single instrument. Delivery of an executed counterpart of a signature page of this Amendment by facsimile transmission or by email in Adobe “.pdf” format shall be effective as delivery of a manually executed counterpart hereof.
Section 7. Further Assurances. The Parent and the Borrower agree to, and to cause any other Loan Party to, take all further actions and execute such other documents and instruments as the Administrative Agent may from time to time reasonably request to carry out the transactions contemplated by this Amendment, the Loan Documents and all other agreements executed and delivered in connection herewith.
Section 8. GOVERNING LAW. THIS AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NORTH CAROLINA APPLICABLE TO CONTRACTS EXECUTED, AND TO BE FULLY PERFORMED, IN SUCH STATE.
Section 9. Benefits. This Amendment shall be binding upon and shall inure to the benefit of the parties hereto and their respective permitted successors and assigns.
Section 10. Severability. In case any provision of or obligation under this Amendment shall be invalid, illegal or unenforceable in any jurisdiction, the validity, legality and enforceability of the remaining provisions or obligations, or of such provision or obligation in any other jurisdiction, shall not in any way be affected or impaired thereby.
Section 11. Definitions. All capitalized terms not otherwise defined herein are used herein with the respective definitions given them in the Loan Agreement.
[Signature Pages Follow]
IN WITNESS WHEREOF, the parties hereto have caused this Second Amendment to Term Loan Agreement to be duly executed by their respective authorized officers as of the day and year first above written.
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CUBESMART, L.P. | ||
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By: |
CubeSmart, its general partner | |
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By: |
/s/ Jeffrey P. Foster |
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Name: Jeffrey P. Foster |
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Title: Senior Vice President, Chief Legal Officer |
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and Secretary |
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CUBESMART | ||
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By: |
/s/ Jeffrey P. Foster |
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Name: Jeffrey P. Foster |
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Title: Senior Vice President, Chief Legal Officer |
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and Secretary |
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[Signature Page to Second Amendment to Term Loan Agreement with CubeSmart, L.P.]
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WELLS FARGO BANK, NATIONAL ASSOCIATION, as Administrative Agent and as a Lender | |
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By: |
/s/ Sean C. Armah |
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Name: Sean C. Armah |
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Title: Vice President |
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PNC BANK, NATIONAL ASSOCIATION | |
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By: |
/s/ Shari L. Reams-Henofer |
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Name: Shari L. Reams-Henofer |
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Title: Senior Vice President |
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U.S. BANK NATIONAL ASSOCIATION | |
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/s/ Renee Lewis |
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Name: Renee Lewis |
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Title: Senior Vice President |
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REGIONS BANK | |
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/s/ Paul E. Burgan |
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Name: Paul E. Burgan |
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Title: Vice President |
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SUNTRUST BANK | |
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/s/ W. John Wendler |
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Name: W. John Wendler |
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Title: Senior Vice President |
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BANK OF AMERICA, N.A. | |
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/s/ Cheryl Sneor |
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Name: Cheryl Sneor |
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Title: Vice President |
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RBS CITIZENS, N.A. d/b/a CHARTER ONE | |
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/s/ Charles J. Cooke Jr. |
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Name: Charles J. Cooke Jr. |
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Title: Senior Vice President |
Exhibit 99.3
CubeSmart Completes $800 Million in Unsecured Bank Financing
WAYNE, PA -- (MARKETWIRE) – 6/18/13 -- CubeSmart (NYSE: CUBE), a self-administered and self-managed real estate investment trust focused on self-storage facilities, today announced that the Company completed approximately $800 million in unsecured bank financing through amendments to its existing credit facility and term loan agreements.
“With our amended credit facilities, we benefit from substantially improved pricing as well as extended terms that reinforce our well-staggered debt maturity profile,” commented Tim Martin, Chief Financial Officer. “We are delighted to have strong and continued support from our longstanding banking relationships. This recommitment from our banks further solidifies our financial position and enhances our ability to execute on our business plan.”
$200 Million Senior Unsecured Term Loan Facility
CubeSmart’s amended $200 million senior unsecured term loan facility (“Term Loan Facility”) consists of two $100 million term loans, each maturing in June 2018. One of the $100 million term loans (“Term Loan A”) was originally a 5-year loan with a June 2016 maturity date. The maturity date for the other $100 million term loan (“Term Loan B”), originally a 7-year loan, remains unchanged.
The Term Loan Facility’s borrowing rate is based on the Company’s credit rating. At the Company’s existing Baa3/BBB- level, Term Loan A is priced at 1.50 percent over LIBOR, while Term Loan B is priced at 2.00 percent over LIBOR.
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Term Loan Facility |
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Term Loan Facility | ||||
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Prior to Amendment |
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As Amended | ||||
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Amount |
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Maturity Date |
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LIBOR Spread |
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Maturity Date |
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LIBOR Spread |
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Term Loan A |
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$100 million |
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June 2016 |
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1.85% |
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June 2018 |
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1.50% |
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Term Loan B |
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$100 million |
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June 2018 |
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2.00% |
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June 2018 |
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2.00% |
$600 Million Senior Unsecured Credit Facility
CubeSmart’s amended $600 million senior unsecured credit facility (“Credit Facility”) consists of a $100 million term loan (“Term Loan C”) with a December 2014 maturity, a $200 million term loan (“Term Loan D”) with a January 2019 maturity, and a $300 million revolver (“Revolver”) with a June 2017 maturity. The Company, at its option, has the right to extend the term of the Revolver for an additional year.
The borrowing rate under the Credit Facility is based on the Company’s credit rating. At the Company’s existing Baa3/BBB- level, amounts drawn on the revolver are priced at 1.60 percent over LIBOR – inclusive of the facility fee – and both of the term loans are priced at 1.50 percent over LIBOR.
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Credit Facility |
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Credit Facility |
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Prior to Amendment |
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As Amended |
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Amount |
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Maturity Date |
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LIBOR Spread |
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Maturity Date |
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LIBOR Spread |
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Revolver |
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$300 million |
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December 2015 |
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1.80% |
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June 2017 |
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1.60% |
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Term Loan C |
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$100 million |
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December 2014 |
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1.75% |
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December 2014 |
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1.50% |
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Term Loan D |
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$200 million |
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March 2017 |
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1.75% |
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January 2019 |
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1.50% |
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1) The Company, at its option, can extend the maturity by one year.
2) Inclusive of a facility fee of 0.325%
3) Inclusive of a facility fee of 0.300%
The Company did not enter into any new hedging arrangements in conjunction with the amended facilities, and all of the Company’s existing hedging arrangements remain in place and effective.
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Applicable Hedging Arrangements |
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Effective LIBOR | |
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Notional Amount |
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Maturity Date |
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Fixed Rate |
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$100 million |
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June 2016 |
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1.803% |
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$200 million |
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March 2017 |
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1.336% |
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$100 million |
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June 2018 |
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2.468% |
About the Company
CubeSmart is a self-administered and self-managed real estate investment trust. CubeSmart owns or manages 519 self-storage facilities across the United States. According to the 2012 Self Storage Almanac, CubeSmart is one of the top four owners and operators of self-storage facilities in the U.S.
The Company plans to exceed Customer expectations by adding more personalized services and technology to some of the best storage spaces around. The Company’s self-storage facilities are designed to offer affordable, easily accessible, secure, and in most locations, climate-controlled storage space for residential and commercial customers, as well as boat storage and mini storage. CubeSmart® services include storage customization, logistics services, comprehensive moving services, organizational services, and office amenities.
For more information about business and personal storage or to learn more about the Company and find a nearby storage facility, visit www.CubeSmart.com or call CubeSmart toll free at 800-800-1717.
Forward-Looking Statements
Although the Company believes the expectations reflected in any forward-looking statements in this press release are based on reasonable assumptions, there can be no assurance that such expectations will be achieved. You should not rely on our forward-looking statements because the matters they describe are subject to known and unknown risks and uncertainties that could cause the Company’s future results, performance, or achievements to differ significantly from the results, performance, or achievements expressed or implied by such statements. Such risks are set forth under the captions “Item 1A. Risk Factors” and “Forward-Looking Statements” in our annual report on Form 10-K and under the caption “Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations” (or similar captions) in our quarterly
reports on Form 10-Q, and described from time to time in the Company’s filings with the SEC. For forward-looking statements herein, the Company claims the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. The Company assumes no obligation to update or supplement forward-looking statements that become untrue because of subsequent events.
Company Contact:
CubeSmart
Daniel Ruble
Investor Relations
(610) 293-5700