Exhibit 10.1

 

AMENDMENT NO. 1 TO
CO-INVESTMENT AND ALLOCATION AGREEMENT

 

This AMENDMENT NO. 1 TO CO-INVESTMENT AND ALLOCATION AGREEMENT (this
“Amendment”) is dated as of June 19, 2015, by and among Starwood Property
Trust, Inc., a Maryland corporation (the “Company”), SPT Management, LLC, a
Delaware limited liability company (the “Manager”), and Starwood Capital Group
Global, L.P., a Delaware limited partnership (“Starwood Capital Group”).

 

Capitalized terms used in this Amendment and not otherwise defined shall have
the meanings assigned to them in the Agreement (as defined below).

 

WHEREAS, the Company, the Manager and Starwood Capital Group are parties to that
certain Co-Investment and Allocation Agreement, dated as of August 17, 2009 (the
“Agreement”); and

 

WHEREAS, the Company, the Manager and Starwood Capital Group desire to amend,
and do hereby amend, the Agreement as set forth herein.

 

NOW, THEREFORE, in consideration of the mutual agreements herein made and
intending to be legally bound, the parties hereto hereby agree as follows:

 

1.                                      Definition of Near Term Loan-to-Own
Investment.  Schedule I of the Agreement is hereby amended by adding the
following definition of Near Term Loan-to-Own Investments:

 

“Near Term Loan-to-Own Investment” means any Target Asset which, at the time of
its origination or acquisition, the originator or acquiror had the intent and/or
expectation of foreclosing on, or otherwise acquiring, the real property
securing such Target Asset within 18 months of its origination or acquisition of
such Target Asset.

 

2.                                      Definition of Starwood Affiliate. 
Schedule I of the Agreement is hereby amended by adding the following definition
of Starwood Affiliate:

 

“Starwood Affiliate” means a director or officer of the Company who is also an
officer, employee or agent of Starwood Capital Group or any of its Affiliates.

 

3.                                      Definition of Target
Assets.                                             Schedule I of the Agreement
is hereby amended by deleting the definition of Target Assets and replacing it
in its entirety with the following:

 

“Target Assets” means the types of assets described under “Business—Our Target
Assets” in the IPO Prospectus, as such Target Assets are identified on Schedule
II hereto, excluding any Near Term Loan-to-Own Investments, it being understood
that any expansions of, or additions to, the Company’s target assets from and
after the date of the IPO Prospectus shall not be included in “Target Assets”
for purposes of the Agreement.

 

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4.                                      Corporate Opportunities.  Article I of
the Agreement is hereby amended by adding the following as new Section 1.3:

 

1.3                               Corporate Opportunities.

 

(a)                                 Each of the Company, the Manager and
Starwood Capital Group agrees that the Company shall have the power to renounce,
by resolution of the Board of Directors of the Company, any interest or
expectancy of the Company in, or in being offered an opportunity to participate
in, business opportunities or classes or categories of business opportunities
that are (i) presented to the Company or (ii) developed by or presented to one
or more directors or officers of the Company.

 

(b)                                 Each of the Company, the Manager and
Starwood Capital Group agrees that, if any Starwood Affiliate acquires knowledge
of a potential business opportunity, the Company renounces, on its behalf and on
behalf of its subsidiaries, any potential interest or expectation in, or right
to be offered or to participate in, such business opportunity to the maximum
extent permitted from time to time by Maryland law, unless it is an opportunity
to invest in a Target Asset (which is governed by the terms of the Agreement).
 Accordingly, each of the Company, the Manager and Starwood Capital Group agrees
that, except for opportunities to invest in Target Assets, to the maximum extent
permitted from time to time by Maryland law (a) no Starwood Affiliate is
required to present, communicate or offer any business opportunity to the
Company or any of its subsidiaries and (b) any Starwood Affiliate, on his or her
own behalf or on behalf of Starwood Capital Group or any of its Affiliates,
shall have the right to hold and exploit any business opportunity, or to direct,
recommend, offer, sell, assign or otherwise transfer such business opportunity
to any person or entity other than the Company and its subsidiaries.  Each of
the Company, the Manager and Starwood Capital Group further agrees that the
taking by a Starwood Affiliate for himself or herself, or the offering or other
transfer to another person or entity, of any potential business opportunity,
other than an opportunity to invest in a Target Asset, whether pursuant to the
charter of the Company or otherwise, shall not constitute or be construed or
interpreted as (i) an act or omission of the Starwood Affiliate committed in bad
faith or as the result of active or deliberate dishonesty or (ii) receipt by the
Starwood Affiliate of an improper benefit or profit in money, property, services
or otherwise.

 

5.                                      Notices.  Section 2.3 of the Agreement
is hereby amended and restated in its entirety with the following:

 

All notices, requests and demands to or upon the respective parties hereto to be
effective shall be in writing (including by telecopy), and, unless otherwise
expressly provided herein, shall be deemed to have been duly given or made when
delivered against receipt or upon actual receipt of (i) personal delivery,
(ii) delivery by reputable overnight courier, (iii) delivery by facsimile
transmission with telephonic confirmation or (iv) delivery by registered or

 

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certified mail, postage prepaid, return receipt requested, addressed as set
forth below (or to such other address as may be hereafter notified by the
respective parties hereto in accordance with this Section 2.3):

 

The Company:

 

Starwood Property Trust, Inc.
591 West Putnam Avenue
Greenwich, Connecticut 06830
Attention:  Andrew J. Sossen

 

 

 

with a copy to:

 

Sidley Austin LLP
787 Seventh Avenue
New York, New York 10019
Attention:  Michael Gordon

 

 

 

The Manager or Starwood Capital Group:

 

SPT Management, LLC
591 West Putnam Avenue
Greenwich, Connecticut 06830
Attention:  Ellis F. Rinaldi, Esq.

 

 

 

with a copy to:

 

Sidley Austin LLP
787 Seventh Avenue
New York, New York 10019
Attention:  Michael Gordon

 

6.                                      Schedule II.  The Agreement is hereby
amended by adding new Schedule II, which Schedule II is set forth immediately
following the signature page of this Amendment.

 

7.                                      Representations and Warranties.

 

(a)                                 The Company represents and warrants to the
Manager and Starwood Capital Group that this Amendment:  (i) has been duly and
validly executed and delivered by the Company; and (ii) constitutes the legal,
valid and binding obligation of the Company, enforceable against the Company in
accordance with its terms, except as may be limited by bankruptcy, insolvency,
reorganization, moratorium and other similar laws and equitable principles
related to or limiting creditors’ rights generally and by general principles of
equity.

 

(b)                                 The Manager represents and warrants to the
Company and Starwood Capital Group that this Amendment:  (i) has been duly and
validly executed and delivered by the Manager; and (ii) constitutes the legal,
valid and binding obligation of the Manager, enforceable against the Manager in
accordance with its terms, except as may be limited by bankruptcy, insolvency,
reorganization, moratorium and other similar laws and equitable principles
related to or limiting creditors’ rights generally and by general principles of
equity.

 

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(c)                                  Starwood Capital Group represents and
warrants to the Company and the Manager that this Amendment:  (i) has been duly
and validly executed and delivered by Starwood Capital Group; and
(ii) constitutes the legal, valid and binding obligation of Starwood Capital
Group, enforceable against Starwood Capital Group in accordance with its terms,
except as may be limited by bankruptcy, insolvency, reorganization, moratorium
and other similar laws and equitable principles related to or limiting
creditors’ rights generally and by general principles of equity.

 

8.                                      Ratification of
Agreement.                                               Except as expressly
provided in this Amendment, all of the terms, covenants, and other provisions of
the Agreement are hereby ratified and confirmed and shall continue to be in full
force and effect in accordance with their respective terms.

 

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

 

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IN WITNESS WHEREOF, the parties have executed and delivered this Amendment as of
the date first written above.

 

 

COMPANY:

 

 

 

STARWOOD PROPERTY TRUST, INC.

 

 

 

By:

/s/ Andrew J. Sossen

 

 

Name:

Andrew J. Sossen

 

 

Title:

Chief Operating Officer and General Counsel

 

 

 

MANAGER:

 

 

 

SPT MANAGEMENT, LLC

 

 

 

By:

/s/ Andrew J. Sossen

 

 

Name:

Andrew J. Sossen

 

 

Title:

Authorized Signatory

 

 

 

STARWOOD CAPITAL GROUP:

 

 

 

STARWOOD CAPITAL GROUP GLOBAL, L.P.

 

 

 

By:

SCGG GP, L.L.C.

 

 

 

By:

/s/ Barry S. Sternlicht

 

 

Name:

Barry S. Sternlicht

 

 

Title:

Authorized Signatory

 

Signature Page to Amendment No. 1 to Co-Investment and Allocation Agreement

 

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Schedule II

 

As described under “Business—Our Target Assets” in the IPO Prospectus, Target
Assets include the following types of loans and other debt investments with
respect to commercial real estate:

 

·                  Whole Mortgage Loans:  loans secured by a first mortgage lien
on commercial property which provide long-term mortgage financing to commercial
property developers and owners that generally have maturity dates ranging from
three to ten years.

 

·                  Bridge Loans:  whole mortgage loans secured by a first
mortgage lien on commercial property which provide interim or bridge financing
to borrowers seeking short-term capital typically for the acquisition of real
estate.

 

·                  B Notes:  typically a privately negotiated loan that is
secured by a first mortgage on a single large commercial property or group of
related properties and subordinated to an A Note secured by the same first
mortgage on the same property or group.

 

·                  Mezzanine Loans:  loans made to property owners that are
secured by pledges of the borrower’s ownership interests in the property and/or
the property owner; subordinate to whole mortgage loans secured by first or
second mortgage liens on the property and senior to the borrower’s equity in the
property.

 

·                  Construction/Rehabilitation Mortgage Loans and Mezzanine
Loans:  mortgage loans and mezzanine loans to finance construction or
rehabilitation of commercial properties.

 

·                  Commercial Mortgage-Backed Securities (“CMBS”):  securities
which are collateralized by, or evidence ownership interests in, a mortgage loan
secured by a single commercial property, or a partial or entire pool of mortgage
loans secured by commercial properties, including:

 

·                  senior or subordinated investment grade CMBS,

 

·                  below investment grade CMBS, and

 

·                  unrated CMBS.

 

·                  Corporate Bank Debt:  term loans and revolving credit
facilities of commercial real estate operating or finance companies, each of
which is generally secured by the company’s assets.

 

·                  Corporate Bonds:   debt securities issued by commercial real
estate operating or finance companies which may be secured by the company’s
assets or may not provide for any security, including:

 

Sch. II - 1

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·                  investment grade corporate bonds,

 

·                  below investment grade corporate bonds, and

 

·                  unrated corporate bonds.

 

Target Assets may also include the following types of loans and debt investments
relating to residential real estate:

 

·                  Residential Mortgage Loans:  loans generally secured by a
first mortgage lien on a residential property.

 

·                  Residential Mortgage-Backed Securities (“RMBS”):  securities
that are collateralized by residential mortgage loans, including:

 

·                  Agency RMBS, which are RMBS guaranteed by a U.S. Government
agency or a federally chartered corporation.

 

·                  Non-Agency RMBS, which are RMBS that are not guaranteed by
any U.S. Government agency or federally chartered corporation.

 

Sch. II - 2

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