Hunt Companies Finance Trust, Inc. with Five Oaks Acquisition Corp. and Hunt CMT Equity, LLC Enter into Senior Secured Corporate Term Loan
January 18, 2019 at 04:17 pm
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On January 15, 2019, Hunt Companies Finance Trust, Inc. (the Company), together with Five Oaks Acquisition Corp. and Hunt CMT Equity, LLC (together with the Company, the “Credit Parties”), entered into a senior secured corporate term loan (the “Senior Secured Term Loan”) with the lenders party thereto and Cortland Capital Market Services, LLC, as administrative agent (in such capacity, the “Agent”), providing for a term facility (the “Credit Agreement”) to be drawn in an aggregate principal amount of $40,250,000 with a maturity of 6 years. The borrowings under the Senior Secured Term Loan are joint and several obligations of the Credit Parties. In addition, the Credit Parties’ obligations under the Senior Secured Term Loan are secured by substantially all the assets of the Credit Parties through pledge and security documentation. Amounts advanced under the Senior Secured Term Loan are subject to compliance with a borrowing base comprised of assets of the Credit Parties and certain of their subsidiaries that comply on each applicable measurement date with certain representations and warranties made by the Credit Parties on such measurement date with respect to each asset (except to the extent compliance with any one or more of such representations and warranties is waived by the Agent) and certain eligibility criteria, and includes senior and subordinated commercial real estate mortgage loans, preferred equity in a commercial real estate asset (directly or indirectly), commercial real estate construction mortgage loans and certain types of equity interests (the “Eligible Assets”). The borrowing base is determined on the last day of each quarter. For each Eligible Asset, the applicable advance rates vary depending on the type of Eligible Asset. Borrowings under the Senior Secured Term Loan bear interest at a fixed rate of 7.25% for the five year period following the initial draw-down, which is subject to step up by 0.25% for the first four months after the fifth anniversary of the borrowing of the Senior Secured Term Loan, then by 0.375% for the following four months, then by 0.50% for the last four months until the maturity. The Senior Secured Term Loan is subject to a borrowing base, which is equal the sum of the borrowing base value of each Eligible Asset (the “Borrowing Base”).
Lument Finance Trust, Inc. is a real estate investment trust (REIT). The Company is focused on investing in, originating, financing and managing a portfolio of commercial real estate (CRE) debt investments. It primarily invests or originates in transitional floating rate CRE mortgage loans with an emphasis on middle-market multifamily assets. The Company also invests in other CRE-related investments including mezzanine loans, preferred equity, commercial mortgage-backed securities, fixed rate loans, construction loans and other CRE debt instruments. It finances its investments in transitional multifamily and other CRE loans primarily through matched-term non-recourse secured borrowings, including collateralized loan obligations (CLO). Its mortgage loan investment portfolio consists of approximately 88 senior secured floating rate loans with an aggregate unpaid principal balance of $1.4 billion. The Company is externally managed by its manager, Lument Investment Management, LLC.