Item 1.01 Entry into a Material Definitive Agreement.
MetLife Facilities
On August 22, 2024, VB Nine, LLC ("VB Nine") and VB Ten, LLC ("VB Ten"), indirect subsidiaries of VineBrook Homes Trust, Inc. (the "Company"), as borrowers, entered into credit agreements for term loan credit facilities (collectively, the "Facilities") with Metropolitan Life Insurance Company and Metropolitan Tower Life Insurance Company, and the lenders party thereto from time to time, which provided a total commitment of up to $343.2 million. VineBrook Homes Operating Partnership, L.P. (the "OP") acts as the operating partnership of the Company and is the sole member of each of VB Nine Equity, LLC ("VB Nine Equity") and VB Ten Equity, LLC ("VB Ten Equity"). VB Nine Equity is the sole member of VB Nine, and VB Ten Equity is the sole member of VB Ten. Borrowings under the Facilities are secured by an equity pledge by VB Nine Equity and VB Ten Equity of their equity interests in VB Nine and VB Ten, respectively, and the property and assets held by VB Nine and VB Ten, respectively, and bears interest at a fixed rate equal to 4.5%. The Facilities are full-term, interest-only facilities that mature on August 22, 2029. In connection with entry into the Facilities, an aggregate of $343.2 million was borrowed and is currently outstanding under the Facilities. The Company received proceeds, before closing costs and other items, of approximately $316.2 million in connection with the closing of the Facilities. The Company used $282.0 million of these proceeds to pay down a portion of the outstanding amounts under the credit facility by and among the Company, as guarantor, the OP and certain of its subsidiaries, as borrowers, KeyBank National Association, as administrative agent, and the other lenders party thereto.
The Facilities contain representations and warranties, affirmative and negative covenants and events of default that the Company considers customary for an agreement of this type, including covenants setting a minimum debt service coverage ratio and establishment and maintenance of specified cash reserves.
Borrowings under the Facilities may be voluntarily prepaid, in whole or in part, without premium or penalty at any time following August 22, 2028. Prior to August 22, 2027, any prepayments will be subject to a prepayment premium equal to the excess, if any, of the sum of the present values of all scheduled payments through the first three years of the Facilities, discounted to present value, over the principal amount of the Facilities prepaid. From August 22, 2027 to August 22, 2028, any prepayments will be subject to a prepayment fee equal to 0.5% of the prepaid principal amount. On December 15, 2025, 2026 and 2027, the borrowers will prepay the greater of $4.6 million and the amount sufficient to reduce the aggregate collateral value, which is initially 72% of aggregate appraised value, by 1%. Such prepayment will not be subject to any premium or penalty.
In addition to a customary recourse guaranty, the Company unconditionally guarantees payment of approximately $19.8 million of the outstanding principal balance of the Facilities, which is reduced by approximately $6.6 million with each prepayment by the borrowers on December 15, 2025, 2026 and 2027.