Item 8.01. Other Events.
Underwriting Agreement
On January 19, 2022, American Homes 4 Rent (the "Company") and American Homes 4
Rent, L.P., a Delaware limited partnership and the Company's operating
partnership (the "Operating Partnership"), entered into an Underwriting
Agreement (the "Underwriting Agreement") with BofA Securities, Inc., J.P. Morgan
Securities LLC, Citigroup Global Markets Inc. and Morgan Stanley & Co. LLC, as
representatives of the several underwriters listed on Schedule I thereto (the
"Underwriters"), BofA Securities, Inc. (as agent for Bank of America, N.A.) and
J.P. Morgan Securities LLC (as agent for JPMorgan Chase Bank, National
Association), as the forward sellers (the "Forward Sellers"), and Bank of
America, N.A. and JPMorgan Chase Bank, National Association, as the forward
purchasers (the "Forward Purchasers"), pursuant to which the Company agreed to
offer and sell up to 23,000,000 of its Class A common shares of beneficial
interest, par value $0.01 per share (the "Class A common shares"), consisting of
(i) 10,000,000 Class A common shares offered directly by the Company, and (ii)
13,000,000 Class A common shares offered on a forward basis at the request of
the Company by the Forward Sellers (including 3,000,000 Class A common shares
pursuant to the Underwriters' option to purchase additional shares from the
Forward Sellers, which option was exercised in full), in each case at a price of
$37.584 per share (which is the public offering price less the underwriting
discount) (the "Offering"). The Offering closed on January 24, 2022, subject to
customary closing conditions.
The Company and the Operating Partnership made certain customary
representations, warranties and covenants concerning the Company, the Operating
Partnership and the registration statement in the Underwriting Agreement and
also agreed to indemnify the Underwriters, the Forward Sellers and the Forward
Purchasers against certain liabilities, including liabilities under the
Securities Act of 1933, as amended (the "Securities Act"), or to contribute to
payments the Underwriters, the Forward Sellers and the Forward Purchasers may be
required to make in respect of those liabilities.
A copy of the Underwriting Agreement is attached to this Current Report on
Form 8-K as Exhibit 1.1 and incorporated herein by reference. The summary set
forth above is qualified in its entirety by reference to Exhibit 1.1.
Forward Sale Agreements
In connection with the Offering, on January 19, 2022, the Company entered into
forward sale agreements with each Forward Purchaser (each an "Initial Forward
Sale Agreement") with respect to up to 13,000,000 Class A common shares to be
sold in the Offering (including up to 3,000,000 Class A common shares pursuant
to the Underwriters' option to purchase additional shares from the Forward
Sellers). In connection with the Underwriters' exercise in full of such option,
on January 20, 2022, the Company entered into additional forward sale agreements
with each Forward Purchaser (together with the Initial Forward Sale Agreements,
the "Forward Sale Agreements"). The Company expects to physically settle the
Forward Sale Agreements (by the delivery of the Class A common shares) and
receive proceeds, subject to certain adjustments, from the sale of such Class A
common shares by January 20, 2023, although the Company has the right to elect
settlement prior to that time subject to certain conditions. Although the
Company expects to settle the Forward Sale Agreements entirely by the physical
delivery of Class A common shares in exchange for cash proceeds, the Forward
Sale Agreements allow the Company to cash or net-share settle all or a portion
of its obligations under the Forward Sale Agreements. If the Company elects to
cash or net share settle the Forward Sale Agreements, the Company may not
receive any proceeds, and may owe cash or Class A common shares to the Forward
Purchasers in certain circumstances. The Forward Sale Agreements provide for an
initial forward sale price of $37.584 per share (which is the public offering
price less the underwriting discount), subject to certain adjustments pursuant
to the terms of the Forward Sale Agreements. The Forward Sale Agreements are
subject to early termination or settlement under certain circumstances.
The Company will not initially receive any proceeds from the sale of Class A
common shares by the Forward Sellers.
Copies of the Forward Sale Agreements are attached to this Current Report on
Form 8-K as Exhibit 1.2 and Exhibit 1.3 and incorporated herein by reference.
The summary set forth above is qualified in its entirety by reference to Exhibit
1.2 and Exhibit 1.3.
The Offering was made pursuant to an automatic shelf registration statement
filed with the Securities and Exchange Commission on June 17, 2020
(File No. 333-239227), a base prospectus, dated June 17, 2020, included as part
of the registration statement, and a prospectus supplement, dated January 19,
2022, filed with the Securities and Exchange Commission pursuant to Rule 424(b)
under the Securities Act.
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The Company expects to receive net proceeds from the sale and settlement of the
Class A common shares in the Offering (including from settlement of the Forward
Sale Agreements), after deducting related underwriting discounts and commissions
and estimated expenses, of approximately $864.2 million (including proceeds from
the shares sold pursuant to the Underwriters' option to purchase additional
shares). The Company intends to use the net proceeds from the Offering (i) to
repay indebtedness it has incurred or expects to incur under its revolving
credit facility, (ii) to develop new single-family properties and communities,
(iii) to acquire and renovate single-family properties and for related
activities in accordance with its business strategy and (iv) for general
corporate purposes. The foregoing application may be effected through the
Operating Partnership by the Company contributing a portion of the net proceeds
to the Operating Partnership in exchange for Class A partnership units.
The Underwriters, the Forward Purchasers and the Forward Sellers, and their
respective affiliates, have engaged in, and may in the future engage in,
investment banking, commercial banking and other commercial dealings in the
ordinary course of business with the Company or its affiliates, for which they
have received and may continue to receive customary fees and commissions.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
Exhibit No. Description
1.1 Underwriting Agreement, dated January 19, 2022, by and among
the Company, the Operating Partnership, BofA Securities, Inc.,
J.P. Morgan Securities LLC, Citigroup Global Markets Inc., and
Morgan Stanley & Co. LLC, as representatives of the several
underwriters listed on Schedule I thereto, BofA Securities, Inc.
and J.P. Morgan Securities LLC, in their capacities as the
forward sellers, and Bank of America, N.A. and JPMorgan Chase
Bank, National Association, in their capacities as the forward
purchasers.
1.2 Forward Sale Agreement, dated January 19, 2022, between the
Company and Bank of America, N.A.
1.3 Forward Sale Agreement, dated January 19, 2022, between the
Company and JPMorgan Chase Bank, National Association.
5.1 Opinion of Hogan Lovells US LLP regarding the legality of the
Class A common shares.
23.1 Consent of Hogan Lovells US LLP (included in Exhibit 5.1).
104 Cover Page Interactive Data File (embedded within the Inline XBRL
documents).
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