Principal Credit Real Estate Income Trust
12/03/2024 | Press release | Distributed by Public on 12/03/2024 15:51
Material Agreement Form 8 K
Item 1.01. Entry into a Material Definitive Agreement.
On November 26, 2024, Principal Credit Real Estate Income Trust (the "Company"), entered into a revolving credit facility agreement (as it may be amended from time to time, the "Credit Agreement) with JPMorgan Chase Bank, N.A. ("JPM"), as administrative agent and lender, sole bookrunner and sole lead arranger. The borrowers under the Credit Agreement are the Company and any additional subsidiary borrowers as may be approved with JPM's consent from time to time (the "Borrowers").
The Credit Agreement provides for revolving loans of up to a maximum aggregate availability of $100 million. The Company's obligations under the Credit Agreement are secured by outstanding capital commitments of Principal Life Insurance Company ("Principal Life") and an unaffiliated insurance company (together with Principal Life, the "Anchor Investors"). The Credit Agreement may be increased to an amount not to exceed $150,000,000, subject to the consent of JPM and other customary conditions. In addition, at no time may the outstanding obligations under the Credit Agreement exceed 90% of the total uncalled capital commitments of certain eligible investors, subject to any applicable concentration limits. The Borrowers are permitted to borrow under the Credit Agreement for any purpose permitted under the Borrowers' constituent documents. Borrowings are required to be repaid within twelve (12) months of issuance per the terms of the Credit Agreement. The maturity date of the Credit Agreement is November 25, 2025, which may be extended upon the Company's request to May 26, 2026, subject to the consent of JPM and other customary conditions.
Advances under the Credit Agreement generally bear interest at a rate per annum equal to one-month Term SOFR plus 2.15% plus a spread adjustment of 0.10%. The Company pays a commitment fee on a quarterly basis to each lender on the daily unused amount of its commitment at a rate per annum of (x) 0.35% when the aggregate principal unused portion of the Credit Agreement is greater than fifty percent (50%) or (y) 0.25% when the aggregate principal unused portion of the Credit Agreement is equal to or less than fifty percent (50%). In connection with the issuance of any letter of credit under the Credit Agreement, the Company is obligated to pay (i) a fronting fee to JPM in an amount agreed to between JPM and the Company and (ii) a participation fee on the daily maximum amount available to be drawn under each letter of credit at a rate per annum equal to the rate applicable to Term SOFR borrowings. As consideration for JPM's commitments under the Credit Agreement, the Company has also paid an upfront fee in an amount agreed to between JPM and the Company.
The Credit Agreement contains various restrictions and covenants applicable to the Company. Among other requirements, the Company may not exceed certain debt limitations and must ensure certain minimum capital contribution amounts from the Investors.
The Credit Agreement also contains customary events of default. If an event of default under the Credit Agreement occurs and is continuing, then JPM may declare any outstanding obligations under the Credit Agreement to be immediately due and payable. In addition, if the Company or the Adviser becomes the subject of voluntary or involuntary proceedings under any bankruptcy, insolvency or similar law, then any outstanding obligations under the Credit Agreement will automatically become immediately due and payable.