Cbl & Associates Properties Inc 8-K, filed Jul 20, 2021

Cbl & Associates Properties Inc (CBL)

8-K 2021-07-20 For: 2021-07-19

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Added on April 04, 2026

About this 8-K

Cbl & Associates Properties Inc filed this 8-K on July 20, 2021, reporting on events of July 19, 2021.

Items reported

Item 7.01: Regulation FD disclosure
Item 9.01: Financial statements and exhibits

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Delaware	1-12494	62-1545718
Delaware	333-182515-01	62-1542285
(State or Other Jurisdiction of Incorporation)	(Commission File Number)	(I.R.S. Employer Identification No.)

☐	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))



Title of each Class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, $0.01 par value	CBLAQ	*
7.375% Series D Cumulative Redeemable Preferred Stock, $0.01 par value (represented by depositary shares each representing a 1/10th fractional share)	CBLDQ	*
6.625% Series E Cumulative Redeemable Preferred Stock, $0.01 par value (represented by depositary shares each representing a 1/10th fractional share)	CBLEQ	*



Exhibit Number		Description
99.1		Notice of Classification of Property-Level Guarantee Claims, dated as of July 19, 2021.
99.2		Plan Supplement, dated as of July 19, 2021.
104		Cover Page Interactive Data File (embedded within the Inline XBRL document)


	CBL & ASSOCIATES PROPERTIES, INC.

	/s/ Farzana Khaleel
	Farzana Khaleel
	Executive Vice President -
	Chief Financial Officer and Treasurer


	CBL & ASSOCIATES LIMITED PARTNERSHIP

	By: CBL HOLDINGS I, INC., its general partner

	/s/ Farzana Khaleel
	Farzana Khaleel
	Executive Vice President -
	Chief Financial Officer and Treasurer

Date: July 20, 2021

In re:	§	Chapter 11
	§
CBL & ASSOCIATES	§
PROPERTIES, INC., et al.,	§	Case No. 20-35226 (DRJ)
	§
Debtors.¹	§	(Jointly Administered)


Exhibit	Plan Supplement Document
Exhibit A	Certificate of Incorporation for Reorganized Company
Exhibit B	Bylaws of Reorganized Company
Exhibit C	Amended and Restated Partnership Agreement of the Operating Partnership
Exhibit D	Certificate of Formation for New Notes Issuer
Exhibit E	LLC Agreement of New Notes Issuer
Exhibit F	Certificate of Formation for New Bank Claim Borrower
Exhibit G	LLC Agreement of New Bank Claim Borrower
Exhibit H	Registration Rights Agreement
Exhibit I	Slate of New Directors
Exhibit J	Restructuring Transaction Steps
Exhibit K	Schedule of Rejected Contracts
Exhibit L	Schedule of Retained Causes of Action
Exhibit M	New Notes Indenture
Exhibit N	New Convertible Notes Indenture
Exhibit O	Collateral Agency and Intercreditor Agreement Regarding Lien-Sharing Provisions
Exhibit P	Exit Credit Facility
Exhibit Q	Term Sheet for New Stock Incentive Plan

Dated:	July 19, 2021
	Houston, Texas
		/s/ Alfredo R. Pérez
		WEIL, GOTSHAL & MANGES LLP
		Alfredo R. Pérez (15776275)
		700 Louisiana Street, Suite 1700
		Houston, Texas 77002
		Telephone: (713) 546-5000
		Facsimile: (713) 224-9511
		– and –
		WEIL, GOTSHAL & MANGES LLP
		Ray C. Schrock, P.C. (admitted pro hac vice)
		Garrett A. Fail (admitted pro hac vice)
		Moshe A. Fink (admitted pro hac vice)
		767 Fifth Avenue
		New York, New York 10153
		Telephone: (212) 310-8000
		Facsimile: (212) 310-8007


		Attorneys for Debtors
		and Debtors in Possession

		Page

Section 1.	DEFINED TERMS	5

Section 2.	ORGANIZATIONAL MATTERS	14

2.1	Organization	14
2.2	Name	14
2.3	Registered Office and Agent; Principal Office	14
2.4	Term	15

Section 3.	PURPOSE	15

3.1	Purpose and Business	15
3.2	Powers	15
3.3	Partnership Only for Purposes Specified	15

Section 4.	CAPITAL CONTRIBUTIONS AND ISSUANCES OF PARTNERSHIP INTERESTS	15

4.1	Capital Contributions of the Partners	15
4.2	Issuances of Partnership Interests	16
4.3	No Preemptive Rights	17
4.4	Other Contribution Provisions	17
4.5	No Interest on Capital	17

Section 5.	DISTRIBUTIONS	17

5.1	Requirement and Characterization of Distributions	17
5.2	Amounts Withheld	18
5.3	Distributions Upon Liquidation	18
5.4	Revisions to Reflect Issuance of Additional Partnership Interests	18

Section 6.	ALLOCATIONS	18

6.1	Allocations For Capital Account Purposes	18
6.2	Revisions to Allocations to Reflect Issuance of Additional Partnership Interests	19

Section 7.	MANAGEMENT AND OPERATIONS OF BUSINESS	19

7.1	Management	19
7.2	Certificate of Limited Partnership	22
7.3	Title to Partnership Assets	22
7.4	Reimbursement of the General Partner	23
7.5	Outside Activities of the General Partner	24
7.6	Transactions with Affiliates	25
7.7	Indemnification	25
7.8	Liability of the General Partner	27
7.9	Other Matters Concerning the General Partner	28
7.10	Reliance by Third Parties	28
7.11	Restrictions on General Partner’s Authority	29
7.12	Loans by Third Parties	29


Section 8.	RIGHTS AND OBLIGATIONS OF LIMITED PARTNERS	29

8.1	Limitation of Liability	29
8.2	Management of Business	29
8.3	Outside Activities of Limited Partners	30
8.4	Return of Capital	30
8.5	Rights of Limited Partners Relating to the Partnership	30
8.6	Grant of Rights	31

Section 9.	BOOKS, RECORDS, ACCOUNTING AND REPORTS	31

9.1	Records and Accounting	31
9.2	Fiscal Year	31
9.3	Reports	31

Section 10.	TAX MATTERS	31

10.1	Preparation of Tax Returns	31
10.2	Tax Elections	32
10.3	Tax Matters Partner	32
10.4	Withholding	34

Section 11.	TRANSFERS AND WITHDRAWALS	34

11.1	Transfer	34
11.2	Transfers of Partnership Interests of General Partner	35
11.3	Limited Partners’ Rights to Transfer	35
11.4	Substituted Limited Partners	36
11.5	Assignees	36
11.6	General Provisions	37

Section 12.	ADMISSION OF PARTNERS	38

12.1	Admission of Successor General Partner	38
12.2	Admission of Additional Limited Partners	38
12.3	Amendment of Agreement and Certificate of Limited Partnership	39

Section 13.	DISSOLUTION AND LIQUIDATION	39

13.1	Dissolution	39
13.2	Winding Up	40
13.3	Compliance with Timing Requirements of Regulations	40
13.4	Rights of Limited Partners	41
13.5	Notice of Dissolution	41
13.6	Cancellation of Certificate of Limited Partnership	41
13.7	Reasonable Time for Winding Up	41
13.8	Waiver of Partition	41
13.9	Liability of Liquidator	42

Section 14.	AMENDMENT OF PARTNERSHIP AGREEMENT; MEETINGS	42

14.1	Amendments	42
14.2	Meetings of the Partners	42


Section 15.	[ARBITRATION OF DISPUTES	43
15.1	Arbitration	43

Section 16.	GENERAL PROVISIONS	43

16.1	Notices	43
16.2	Headings	44
16.3	Pronouns and Plurals	44
16.4	Further Action	44
16.5	Successor	44
16.6	Creditors; Other Third Parties	44
16.7	Waiver	44
16.8	Counterparts	44
16.9	Applicable Law	44
16.10	Severability	44
16.11	Power of Attorney	44
16.12	Entire Understanding; Etc	45
16.13	No Rights as Shareholders	46
16.14	Limitation to Preserve REIT Status	46


Name, Address	Percentage Interest	Cash Contributed or Agreed Value of Other Property or Services

CBL & Associates Limited Partnership 2030 Hamilton Place Boulevard Suite 500, CBL Center Chattanooga, Tennessee 37421	100%	$1.00


Chief Manager:	CBL & Associates Limited Partnership
Secretary:	CBL Holdings I, Inc.

	CBL & Associates Properties, Inc.


	By:
		Name:
		Title:

		Notice Address:


Borrower:	A newly-formed wholly owned subsidiary of the Bank Claim Borrower, as reorganized pursuant to the Plan, that is the direct or indirect parent of each of the Bank Claim Subsidiaries (as defined below) but is not the direct or indirect parent of any entity that is not a Bank Claim Subsidiary (the “New Bank Claim Borrower”).
Guarantors:	The obligations of the New Bank Claim Borrower under the New Bank Term Loan Facility will be guaranteed by the same former direct and indirect wholly owned domestic subsidiaries of the Bank Claim Borrower that are guarantors under the First Lien Credit Agreement together with the Additional Loan Parties (collectively, the “Bank Claim Subsidiaries”), which such Bank Claims Subsidiaries will be direct or indirect subsidiaries of the New Bank Claim Borrower as reorganized pursuant to the Plan; provided that any non-Borrowing Base Properties (or entities that directly or indirectly own non-Borrowing Base Properties) will be transferred such that they are no longer owned directly or indirectly by the New Bank Claim Borrower. The New Bank Claim Borrower and the Bank Claim Subsidiaries are referred to herein as “Loan Parties” and each, a “Loan Party.” For the avoidance of doubt, neither the Bank Claim Borrower nor its reorganized successor will be a Loan Party, other than to the limited extent set forth in the Parent Guaranty.


Unsecured Parent Repayment Guaranty:	The obligations of the New Bank Claim Borrower under the New Bank Term Loan Facility will also be guaranteed on an unsecured basis by Bank Claim Borrower (the “Parent Guaranty”), but such guaranty will be limited to an aggregate principal amount of $175.0 million, which amount shall be reduced, to the extent paid, by an amount equal to the following: (i) 100% of the first $2.5 million of mandatory amortization per year; (ii) 50% of remaining mandatory amortization; (iii) 100% of Excess Cash (as defined below) sweep payments; and (iv) 150% of any voluntary prepayments of the New Bank Term Loan Facility in each case beginning immediately after the Plan Effective Date; provided that such reduction shall be exclusive of any mandatory prepayments in connection with dispositions and casualty events. The Parent Guaranty will terminate on the earlier of the date on which (i) the outstanding principal amount of the New Bank Term Loans is reduced to less than $650.0 million and (ii) after the second anniversary of the Closing Date, the Debt Yield Ratio is greater than 15.0%. “Debt Yield Ratio” means, as of any date of determination, the ratio, expressed as a percentage, of (i) the Borrowing Base Modified Cash NOI on a trailing 12-month basis, first tested as of the last day of the first quarter of 2023 and thereafter on a quarterly basis (each, a “Testing Date”), with a Compliance Certificate to be delivered 45 days after each Testing Date, to (ii) the aggregate outstanding principal amount of New Bank Term Loans as of such date. As used in this summary of terms, “Borrowing Base Modified Cash NOI” means net operating income from collateral properties, determined on a GAAP basis that (i) excludes straight-line rents and above / below market lease rates, (ii) includes lease buyouts and landlord inducements, but not write-offs of landlord inducements, and (iii) excludes the Imputed Base Management Fee.
REIT Bad-Act Guaranty:	CBL & Associates Properties, Inc. will provide an unsecured Guaranty (the “REIT Guaranty”) in the same form as provided in connection with the First Lien Credit Agreement covering losses solely with respect to those suffered by reason of fraud of or willful misrepresentation by the (i) New Bank Claim Borrower, (ii) the New Notes Issuer, or the (iii) Bank Claim Borrower. The REIT Guaranty will be limited to an aggregate principal amount of $175.0 million, which amount shall be reduced, to the extent paid, by an amount equal to the following: (i) 100% of the first $2.5 million of mandatory amortization per year; (ii) 50% of remaining mandatory amortization; (iii) 100% of Excess Cash (as defined below) sweep payments; and (iv) 150% of any voluntary prepayments of the New Bank Term Loan Facility in each case beginning immediately after the Plan Effective Date; provided that such reduction shall be exclusive of any mandatory prepayments in connection with dispositions and casualty events. The REIT Guaranty will terminate on the earlier of the date on which (i) the outstanding principal amount of the New Bank Term Loans is reduced to less than $650.0 million and (ii) after the second anniversary of the Closing Date, the Debt Yield Ratio is greater than 15.0%.
Lenders:	The Bank Lenders (other than any Consenting Crossholder on account of a Consenting Crossholder Claim) under the First Lien Credit Agreement (collectively, the “New Bank Claim Lenders”).
Closing Date:	The earlier of (i) a date agreed upon by the Required Consenting Noteholders, the Required Consenting Bank Lenders, and the Debtors, and (ii) November 1, 2021.
Principal Amount:	$883.7 million (the “New Bank Term Loan Facility Loan Amount”).¹
Administrative / Collateral Agent:	Wells Fargo Bank, N.A. (the “New Bank Agent” and, together with the New Bank Claim Lenders, the “New Secured Parties”).
New Bank Term Loan Facility:	A senior secured U.S. dollar denominated term loan facility in an aggregate principal amount equal to the New Bank Term Loan Facility Loan Amount (the “New Bank Term Loan Facility”; the loans made thereunder, the “New Bank Term Loans”) to be deemed issued in full and final satisfaction of the Revolver/Term Loan Claims of the New Bank Claim Lenders upon the effective date of the Plan (the “Plan Effective Date”).


Maturity Date:	The New Bank Term Loans will mature four (4) years from the Closing Date; provided that, so long as no (a) Default arising from an involuntary chapter 11 petition that has not been dismissed, (b) payment Default, or (c) Event of Default then exists, such date may be extended by (i) one (1) year if the outstanding principal amount of the New Bank Term Loans is reduced to $670.0 million or lower and (ii) one (1) additional year if the outstanding principal amount of the New Bank Term Loans is reduced to $615.0 million or lower. The full principal amount of the New Bank Term Loans would be due at maturity.
New Bank Term Loan Facility Agreement Documents:	The New Bank Term Loan Facility will be documented in a credit and guarantee agreement (the “New Bank Term Loan Facility Agreement”) and will be secured pursuant to customary security agreements, mortgages, management contract assignment, deposit account control agreements, and pledge agreements (subject, in each case, to customary exclusion). The documents referred to in the preceding sentence and documents ancillary or related thereto are referred to as the “New Bank Term Loan Facility Documents.” The New Bank Term Loan Facility Documents will be in form and substance satisfactory to the Required Consenting Creditors and the Debtors and shall include payment of an annual administrative agent’s fee consistent with the annual fee paid in connection with the First Lien Credit Agreement.
Interest Rate:	The New Bank Term Loans will bear interest at the rate of LIBOR+275bps per annum (with a 100bps LIBOR floor), including benchmark replacement provisions (to reflect the ARRC “hardwired” approach) to be agreed. Interest shall be payable in cash on the applicable LIBOR interest payment date or quarterly, in the case of a Base Rate Loan or a LIBOR loan with an interest period longer than three (3) months (each, a “Payment Date”) subject to a five (5)-day grace period. The New Bank Claim Borrower will have the option to choose an interest period of one (1)-month, three (3)-month, or six (6)-month LIBOR.
Optional Prepayments:	No restrictions on optional prepayment, and the New Bank Term Loans may be prepaid at any time and from time to time without premium or penalty.
Mandatory Prepayment Requirements:	The New Bank Term Loan Facility shall be prepaid (without premium or penalty) in an amount equal to 100% of the net cash proceeds received after the Closing Date from the proceeds of (i) dispositions of the collateral properties or the equity of a Bank Claim Subsidiary and (ii) casualty events with respect to the collateral properties (with reinvestment rights with respect to such casualty event proceeds to be agreed by the Required Consenting Creditors and the Company).²
Collateral Release:	The release of any collateral will be subject to mutually agreed-upon release prices, minimum collateral pool size, and “key property” provisions (i.e., properties that cannot be sold without the Requisite Lender consent). For the avoidance of doubt, net proceeds from any permitted collateral release shall be applied by the New Bank Claim Borrower to repay principal on the New Bank Term Loans, and shall not run through the ECF waterfall set forth below.
Monthly Payments:	On the first day of each month following the Closing Date,³ the Company will make combined monthly principal and interest payments, in arrears, in an amount equal to (i) $212,328.77 per day multiplied by (ii) the number of days in the calendar month just ended (such amount, the “Monthly Payment”), with the such Monthly Payment to be applied first to interest then due and owing, and the balance applied to repay principal outstanding under the Loan.
Prepayment / Make Whole Premium:	None.


Stub Period ECF:	Provided no (a) Default arising from an involuntary chapter 11 petition that has not been dismissed, (b) payment Default, or (c) Event of Default then exists, for the period November 1, 2021 through December 31, 2021 (the “Stub Period”), an amount equal to ECF NOI for the Stub Period remaining after payment of: (i) an Imputed Base Management Fee of $1.5 million plus any reimbursable ordinary course third-party costs of unaffiliated parties for the Stub Period that are not otherwise included in the calculation of Borrowing Base Modified Cash NOI or required to be included under GAAP; (ii) scheduled principal and interest payments made during the Stub Period; and (iii) Capital Expenditures in the greater of (a) the actual spend during the Stub Period and (b) the lower of (1) $2.5 million and (2) $15 million minus the actual spend in FY 2021 prior to the Stub Period; in no event shall this number be lower than zero; and (iv) $5 million to satisfy the Minimum Liquidity covenant (set forth below). the amount remaining (the “Stub Period Excess Cash”) shall be applied as follows, to the extent available and so long as the minimum liquidity requirement will continue to be met following such application: (i) first, an amount equal to the actual ECF NOI from the Additional Collateral Properties for the Stub Period (after deduction of an allocated share of the Imputed Base Management Fee, pro rata based on ECF NOI from all collateral properties equal to $1.5 million) shall be distributed by the New Claim Borrower to the Bank Claim Borrower for general corporate uses or further distribution; (ii) second, $1.25 million shall be applied by the New Bank Claim Borrower to repay principal on the New Bank Term Loans; (iii) third, $833,333 shall be distributed by the New Claim Borrower to the Bank Claim Borrower for general corporate uses or further distribution; and (iv) fourth, any remaining Stub Period Excess Cash shall be used (1) 50% to repay principal on the New Bank Term Loans, (2) and 50% shall be distributed by the New Claim Borrower to the Bank Claim Borrower for general corporate uses or further distribution.
Conditions Precedent:	The New Bank Term Loan Facility will become effective and the New Bank Term Loans will be issued upon satisfaction of conditions precedent acceptable to the Required Consenting Creditors and the Debtors including: (i) the issuance by the Bankruptcy Court of an order confirming a Plan on terms acceptable to the Required Consenting Creditors and the Debtors (the “Confirmation Order”); (ii) the Confirmation Order being in full force and effect and not subject to stay; and (iii) the occurrence of the Plan Effective Date. Additionally, the New Bank Term Loan Facility shall have conditions precedent that are standard and customary for a real estate secured transaction, including, but not limited to delivery of (i) PZRs or other zoning reports, appraisals, phase I environmental assessments (with follow-on phase II assessments, if required) and surveys (which, for the avoidance of doubt, may be satisfied by surveys previously delivered to New Bank Agent in connection with the First Lien Credit Agreement) for all collateral properties, as well as PCR reports for all Additional Borrowing Base Properties and the Pearland Town Center-HCA Office and seismic reports for specific Borrowing Base Properties to the extent reasonably required by New Bank Agent in order to comply with Lenders’ insurance requirements (all of the foregoing obtained at Borrower’s cost and expense); (ii) financial data for the collateral properties, including three years of financial statements for the Borrowing Base Properties, actual 2020 financial statements for all Borrowing Base Properties, 2021 Borrowing Base budgets (including contemplated CapEx Projections), rent rolls and co-tenancy summaries for all Borrowing Base Properties and a two (2)-year anticipated CapEx plan for the Borrowing Base Properties; and (iii) customary estoppels and subordination agreements with respect to major leases.
Covenants:	The New Bank Term Loan Facility Agreement will have standard real estate related covenants consistent with the First Lien Credit Agreement, as reasonably agreed upon by the Debtors, Required Consenting Noteholders, and Requisite Lenders; provided that any such covenants shall apply only to the New Bank Claim Borrower and the Bank Claim Subsidiaries.⁴


Financial Covenants:	Limited to the following with respect to the Borrowing Base Properties: (i) Minimum Debt Yield: an 11.5% Debt Yield Ratio on the collateral securing the obligations under the New Bank Term Loan Facility to be first tested at the end of first fiscal quarter of 2023 and on a quarterly basis thereafter; (ii) Minimum CapEx Investment: Annual Capital Expenditures of not less than $15.0 million on the Borrowing Base Properties, with any shortfall in any such calendar year to be put be held in a reserve maintained by Borrower to be utilized for future Capital Expenditures, such covenant to be tested as of December 31 each calendar year beginning with December 31, 2022; (iii) Minimum Interest Coverage Ratio: A 1.50x interest coverage ratio, expressed as the ratio of the Borrowing Base Modified Cash NOI on a trailing twelve (12)-month basis to the borrowing base interest expense on a trailing twelve (12)-month basis of the New Bank Term Loans at such time to be first tested at the end of the fourth fiscal quarter of 2021 and on a quarterly basis thereafter; (iv) Minimum Liquidity: On or after the first testing date, minimum unencumbered and unrestricted cash liquidity (held at the Borrower or Borrowing Base Property level, and exclusive of any amounts held in the required CapEx reserve) in an aggregate amount of $5 million, to be first tested at the end of the fourth fiscal quarter of 2021 and on a quarterly basis thereafter; and (v) Minimum Occupancy Rate: On or after the first testing date of aggregate Occupancy Rate of the Borrowing Base Properties of 75% to be first tested at the end of first fiscal quarter of 2023 and on a quarterly basis thereafter. For the avoidance of doubt, physical and economic occupancy shall each be taken into account in determining such Occupancy Rate.
Reporting:	As agreed by the Required Consenting Creditors and the Debtors, and typical for a secured credit facility, including quarterly reporting on Borrowing Base Modified Cash Net Operating Income, ECF NOI on a semi-annual basis (and with respect to the Stub Period) and occupancy for each Borrowing Base Property, covenant calculation reporting within 45-days of quarter-end, and annual financial reporting for the New Bank Claim Borrower, the Bank Claim Borrower, and CBL & Associates Properties, Inc. (audited, in the case of the (i) Bank Claim Borrower and, (ii) solely to the extent that it is required to file financial statements with the SEC, CBL & Associates Properties, Inc.), but within 90-days of year-end, and a rolling four (4)-quarter forecast for the Borrowing Base Properties.⁵
Events of Default:	As agreed by the Required Consenting Creditors and the Debtors, subject to agreed-upon notice and cure provisions for non-monetary defaults. Notwithstanding the foregoing, the New Bank Term Loan Facility will contain a cross-default to the Bank Claim Borrower’s and the New Notes Issuer’s indebtedness in an aggregate principal amount in excess of $150 million until such time as the Parent Guaranty has been either (i) reduced to $0 or (ii) terminated in accordance with its terms; provided that the New Secured Parties will not be entitled to exercise such cross-default if the Bank Claim Borrower has agreed to a foreclosure or similar arrangement for non-Loan Party property-level indebtedness.
Requisite Lenders:	New Bank Lenders holding greater than 50.00% of the outstanding commitments and/or other exposure under the New Bank Term Loan Facility (the “Requisite Lenders”); provided that the commitments and/or exposure of any defaulting New Bank Lender shall be disregarded in determining the Requisite Lenders at any time.
Amendments:	Requisite Lenders, except for amendments customarily requiring approval by all lenders or all affected lenders.
Governing Law and Submission to Exclusive Jurisdiction:	State of New York.