SEC Filing Summary: New Residential Investment Corp. (NRZ)
Business Context and Reporting Period
This Form 8-K was filed on September 20, 2019, by New Residential Investment Corp. (NRZ), a Delaware corporation. The filing reports a material definitive agreement entered into on the same date involving the issuance of debt securities by an indirect subsidiary, NRZ Advance Receivables Trust 2015-ON1.
Key Financial Metrics and Transaction Details
- Debt Issuance: The Issuer issued $400,000,000 of rated receivables-backed term notes (Series 2019-T3 Notes).
- Interest Rates: Fixed interest rates vary by class, ranging from 2.5118% to 4.4338% per annum.
- Use of Proceeds: Proceeds were utilized to redeem the Series 2017-T1 Notes previously issued by the Issuer.
- Collateral: Notes are secured by servicer advance receivables made by PHH Mortgage Corporation, Shellpoint Mortgage Servicing, and New Residential Mortgage LLC, along with accrued servicing fees.
- Revolving Period: Ends on September 15, 2022. Post-revolving, the Issuer must repay one-twelfth of the remaining principal balance monthly.
Material Changes
The primary material change is the refinancing of existing debt. The issuance of the $400 million Series 2019-T3 Notes directly replaced the Series 2017-T1 Notes. The new notes cross-collateralize four other series of outstanding notes previously issued by the Issuer.
Outlook, Risks, and Covenants
Events of Default and Amortization: The transaction documents define specific events of default and target amortization events, including:
- Failure to satisfy interest coverage or collateral performance tests.
- Non-payment of principal or interest.
- Insolvency of key subsidiaries (PMC, HLSS, Shellpoint, NRM).
- Failure to comply with deposit and remittance requirements.
Consequences of Default: Upon an event of default or target amortization event, consequences may include interest rate increases, rapid amortization, or acceleration of principal repayment. Noteholders may declare obligations immediately due and payable.
Covenants: The agreement includes affirmative covenants (reporting, maintenance of existence, compliance with laws) and negative covenants (limitations on amendments to servicing agreements and advance repayment methodologies).
Investor Verification Checklist
- Verify the specific interest rate assigned to each class of the Series 2019-T3 Notes.
- Confirm the outstanding balance and terms of the redeemed Series 2017-T1 Notes.
- Review the performance of the collateral pool (servicer advance receivables) to assess the risk of target amortization events.
- Examine the cross-collateralization impact on the four other series of outstanding notes.
- Monitor the revolving period end date (September 15, 2022) for mandatory amortization schedules.