SEC Form SC 13D/A filed by Ellington Residential Mortgage REIT (Amendment)

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

SCHEDULE 13D

Under the Securities Exchange Act of 1934

(Amendment No. 3)*

 

 

ELLINGTON RESIDENTIAL MORTGAGE REIT

(Name of Issuer)

Common Shares of Beneficial Interest, $0.01 par value per share

(Title of Class of Securities)

288578 10 7

(CUSIP Number)

Menes O. Chee

The Blackstone Group Inc.

345 Park Avenue

New York, New York 10154

Tel: (212) 583-5000

with a copy to:

Brian M. Stadler

Simpson Thacher & Bartlett LLP

425 Lexington Avenue

New York, NY 10017

Tel: (212) 455-2000

(Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications)

June 14, 2021

(Date of Event Which Requires Filing of this Statement)

 

 

If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of §§240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following box.  ☐

 

 

Note: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See §240.13d-7 for other parties to whom copies are to be sent.

 

 

 

*	The remainder of this cover page shall be filled out for a reporting person’s initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page.

The information required on the remainder of this cover page shall not be deemed to be “filed” for the purpose of Section 18 of the Securities Exchange Act of 1934 (“Act”) or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes).

 

 

 

CUSIP No. 0288578 10 7

 

1		NAMES OF REPORTING PERSONS     BLACKSTONE TACTICAL OPPORTUNITIES EARN HOLDINGS L.L.C.
2		CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (See Instructions)   (a)  ☐        (b)  ☒
3		SEC USE ONLY
4		SOURCE OF FUNDS (See Instructions)     OO
5		CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)     ☐
6		CITIZENSHIP OR PLACE OF ORGANIZATION     Delaware

NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH				7		SOLE VOTING POWER     628,578
				8		SHARED VOTING POWER     0
				9		SOLE DISPOSITIVE POWER     628,578
				10		SHARED DISPOSITIVE POWER     0

11		AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON     628,578
12		CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (See Instructions)     ☐
13		PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)     4.9%
14		TYPE OF REPORTING PERSON (See Instructions)     OO

 

CUSIP No. 0288578 10 7

 

1		NAMES OF REPORTING PERSONS     BTO EARN MANAGER L.L.C.
2		CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (See Instructions)   (a)  ☐        (b)  ☒
3		SEC USE ONLY
4		SOURCE OF FUNDS (See Instructions)     OO
5		CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)     ☐
6		CITIZENSHIP OR PLACE OF ORGANIZATION     Delaware

NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH				7		SOLE VOTING POWER     628,578
				8		SHARED VOTING POWER     0
				9		SOLE DISPOSITIVE POWER     628,578
				10		SHARED DISPOSITIVE POWER     0

11		AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON     628,578
12		CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (See Instructions)     ☐
13		PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)     4.9%
14		TYPE OF REPORTING PERSON (See Instructions)     OO

 

CUSIP No. 0288578 10 7

 

1		NAMES OF REPORTING PERSONS     BTOA L.L.C.
2		CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (See Instructions)   (a)  ☐        (b)  ☒
3		SEC USE ONLY
4		SOURCE OF FUNDS (See Instructions)     OO
5		CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)     ☐
6		CITIZENSHIP OR PLACE OF ORGANIZATION     Delaware

NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH				7		SOLE VOTING POWER     628,578
				8		SHARED VOTING POWER     0
				9		SOLE DISPOSITIVE POWER     628,578
				10		SHARED DISPOSITIVE POWER     0

11		AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON     628,578
12		CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (See Instructions)     ☐
13		PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)     4.9%
14		TYPE OF REPORTING PERSON (See Instructions)     OO

 

CUSIP No. 0288578 10 7

 

1		NAMES OF REPORTING PERSONS     BLACKSTONE HOLDINGS III L.P.
2		CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (See Instructions)   (a)  ☐        (b)  ☒
3		SEC USE ONLY
4		SOURCE OF FUNDS (See Instructions)     OO
5		CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)     ☐
6		CITIZENSHIP OR PLACE OF ORGANIZATION     Quebec, Canada

NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH				7		SOLE VOTING POWER     628,578
				8		SHARED VOTING POWER     0
				9		SOLE DISPOSITIVE POWER     628,578
				10		SHARED DISPOSITIVE POWER     0

11		AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON     628,578
12		CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (See Instructions)     ☐
13		PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)     4.9%
14		TYPE OF REPORTING PERSON (See Instructions)     PN

 

CUSIP No. 0288578 10 7

 

1		NAMES OF REPORTING PERSONS     BLACKSTONE HOLDINGS III GP L.P.
2		CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (See Instructions)   (a)  ☐        (b)  ☒
3		SEC USE ONLY
4		SOURCE OF FUNDS (See Instructions)     OO
5		CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)     ☐
6		CITIZENSHIP OR PLACE OF ORGANIZATION     Delaware

NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH				7		SOLE VOTING POWER     628,578
				8		SHARED VOTING POWER     0
				9		SOLE DISPOSITIVE POWER     628,578
				10		SHARED DISPOSITIVE POWER     0

11		AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON     628,578
12		CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (See Instructions)     ☐
13		PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)     4.9%
14		TYPE OF REPORTING PERSON (See Instructions)     PN

 

CUSIP No. 0288578 10 7

 

1		NAMES OF REPORTING PERSONS     BLACKSTONE HOLDINGS III GP MANAGEMENT L.L.C.
2		CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (See Instructions)   (a)  ☐        (b)  ☒
3		SEC USE ONLY
4		SOURCE OF FUNDS (See Instructions)     OO
5		CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)     ☐
6		CITIZENSHIP OR PLACE OF ORGANIZATION     Delaware

NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH				7		SOLE VOTING POWER     628,578
				8		SHARED VOTING POWER     0
				9		SOLE DISPOSITIVE POWER     628,578
				10		SHARED DISPOSITIVE POWER     0

11		AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON     628,578
12		CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (See Instructions)     ☐
13		PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)     4.9%
14		TYPE OF REPORTING PERSON (See Instructions)     OO

CUSIP No. 0288578 10 7

 

1		NAMES OF REPORTING PERSONS     THE BLACKSTONE GROUP INC.
2		CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (See Instructions)   (a)  ☐        (b)  ☒
3		SEC USE ONLY
4		SOURCE OF FUNDS (See Instructions)     OO
5		CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)     ☐
6		CITIZENSHIP OR PLACE OF ORGANIZATION     Delaware

NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH				7		SOLE VOTING POWER     628,578
				8		SHARED VOTING POWER     0
				9		SOLE DISPOSITIVE POWER     628,578
				10		SHARED DISPOSITIVE POWER     0

11		AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON     628,578
12		CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (See Instructions)     ☐
13		PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)     4.9%
14		TYPE OF REPORTING PERSON (See Instructions)     CO

CUSIP No. 0288578 10 7

 

1		NAMES OF REPORTING PERSONS     BLACKSTONE GROUP MANAGEMENT L.L.C.
2		CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (See Instructions)   (a)  ☐        (b)  ☒
3		SEC USE ONLY
4		SOURCE OF FUNDS (See Instructions)     OO
5		CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)     ☐
6		CITIZENSHIP OR PLACE OF ORGANIZATION     Delaware

NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH				7		SOLE VOTING POWER     628,578
				8		SHARED VOTING POWER     0
				9		SOLE DISPOSITIVE POWER     628,578
				10		SHARED DISPOSITIVE POWER     0

11		AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON     628,578
12		CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (See Instructions)     ☐
13		PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)     4.9%
14		TYPE OF REPORTING PERSON (See Instructions)     OO

CUSIP No. 0288578 10 7

 

1		NAMES OF REPORTING PERSONS     STEPHEN A. SCHWARZMAN
2		CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (See Instructions)   (a)  ☐        (b)  ☒
3		SEC USE ONLY
4		SOURCE OF FUNDS (See Instructions)     OO
5		CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e)     ☐
6		CITIZENSHIP OR PLACE OF ORGANIZATION     United States of America

NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH				7		SOLE VOTING POWER     628,578
				8		SHARED VOTING POWER     0
				9		SOLE DISPOSITIVE POWER     628,578
				10		SHARED DISPOSITIVE POWER     0

11		AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON     628,578
12		CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (See Instructions)     ☐
13		PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)     4.9%
14		TYPE OF REPORTING PERSON (See Instructions)     IN

This Amendment No. 3 (“Amendment No. 3”) to Schedule 13D amends the initial Statement on Schedule 13D filed on August 23, 2018, as amended by Amendment No. 1 to Schedule 13D filed on May 29, 2020, as amended by Amendment No. 2 to Schedule 13D on June 16, 2020 (as so amended, the “Schedule 13D”), relating to the Common Shares of Beneficial Interest, $0.01 par value per share (the “Common Shares”), of Ellington Residential Mortgage REIT, a Maryland corporation (the “Issuer”). Capitalized terms used but not defined in this Amendment No. 3 shall have the same meanings ascribed to them in the Schedule 13D.

Item 2. Identity and Background.

Item 2 of the Schedule 13D is hereby amended by incorporating herein by reference the information set forth on the updated Schedule I attached hereto.

Item 4. Purpose of Transaction.

Item 4 of the Schedule 13D is hereby amended and supplemented as follows:

On June 14, 2021, the Issuer and EARN Holdings entered into an underwriting agreement (the “Underwriting Agreement”) with the underwriters named therein (the “Underwriters”). Pursuant to the Underwriting Agreement, EARN Holdings agreed to sell 2,675,000 Common Shares. The shares were sold at the $13.20 public offering price per Common Share, less the underwriting discount of $0.40 per share. The sale of the Common Shares pursuant to the Underwriting Agreement closed on June 17, 2021.

In connection with the offering described herein, the Issuer, the Issuer’s executive officers and directors, EARN Holdings and other persons identified therein have agreed with the Underwriters, subject to specified exceptions, not to offer, pledge or sell or otherwise transfer any of the Common Shares or securities convertible into or exchangeable for Common Shares, for a period of 30 days after June 14, 2021 except with the prior written consent of Morgan Stanley & Co. LLC.

References to and descriptions of the lock-up agreement set forth above in this Item 4 do not purport to be complete and are qualified in their entirety by reference to the full text of such agreement, the form of which has been filed as an exhibit hereto and incorporated by reference herein.

Following the consummation of the offering described herein, the Shareholders Agreement automatically terminated with respect to the rights of EARN Holdings. As a result, EARN Holdings ceased to have any rights under the Shareholders Agreement, including the right to designate one nominee to the Issuer’s board of trustees.

Item 5. Interest in Securities of the Issuer.

Items 5(a)-(c) of the Schedule 13D are hereby amended and restated as follows:

(a) – (b) Calculations of the percentage of Common Shares beneficially owned assumes that there were 12,918,542 Common Shares outstanding as of June 17, 2021, upon the completion of the Offering described herein, based on the prospectus supplement filed pursuant to Rule 424(b)(5) by the Issuer on June 15, 2021.

The aggregate number and percentage of the Common Shares beneficially owned by each Reporting Person and, for each Reporting Person, the number of shares as to which there is sole power to vote or to direct the vote, shared power to vote or to direct the vote, sole power to dispose or to direct the disposition, or shared power to dispose or to direct the disposition are set forth on rows 7 through 11 and row 13 of the cover pages of this Schedule 13D and are incorporated herein by reference.

As of June 21, 2021, EARN Holdings directly held 628,578 Common Shares.

BTO EARN Manager L.L.C. is the managing member of EARN Holdings. BTOA L.L.C. is the sole member of BTO EARN Manager L.L.C. Blackstone Holdings III L.P. is the managing member of BTOA L.L.C. Blackstone Holdings III GP L.P. is the general partner of Blackstone Holdings III L.P. Blackstone Holdings III GP Management L.L.C. is the general partner of Blackstone Holdings III GP L.P. Blackstone is the sole member of Blackstone Holdings III GP Management L.L.C. Blackstone Group Management L.L.C. is the sole holder of the Series II preferred stock of Blackstone. Blackstone Group Management L.L.C. is wholly owned by its senior managing directors and controlled by its founder, Stephen A. Schwarzman.

Neither the filing of this Schedule 13D nor any of its contents shall be deemed to constitute an admission that any of the Reporting Persons (other than EARN Holdings to the extent it directly holds the Issuer securities reported herein) is the beneficial owner of the Common Shares referred to herein for purposes of Section 13(d) of the Securities Exchange Act of 1934, as amended (the “Act”), or for any other purpose, and such beneficial ownership is expressly disclaimed. The filing of this statement should not be construed to be an admission that any member of the Reporting Persons are members of a “group” for the purposes of Sections 13(d) of the Act.

(c) Except as set forth herein, none of the Reporting Persons or, to the best knowledge of the Reporting Persons, any other person named in Schedule II, has engaged in any transaction in Common Shares during the past 60 days.

Item 5(e) of the Schedule 13D is hereby amended and restated as follows:

As of June 17, 2021, the Reporting Persons ceased to be the beneficial owners of more than five percent of the outstanding Common Shares.

Item 7. Material to be Filed as Exhibits.

Item 7 of the Schedule 13D is hereby amended and supplemented by the following:

4. Form of Lock-up Agreement

SIGNATURE

After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct.

Dated: June 21, 2021

 

[Ellington Residential Mortgage REIT – Schedule 13D/A]

SCHEDULE I

Executive Officers and Directors of The Blackstone Group Inc.

The name and principal occupation of each director and executive officer of The Blackstone Group Inc. are set forth below. The address for each person listed below is c/o The Blackstone Group Inc., 345 Park Avenue, New York, New York 10154. All executive officers and directors listed are United States citizens other than The Honorable Brian Mulroney, who is a citizen of Canada, and Sir John Antony Hood, who is a citizen of New Zealand.

OFFICERS:

 

Name		Present Principal Occupation or Employment
Stephen A. Schwarzman		Founder, Chairman and Chief Executive Officer of The Blackstone Group Inc.
Jonathan D. Gray		President, Chief Operating Officer of The Blackstone Group Inc.
Hamilton E. James		Executive Vice Chairman of The Blackstone Group Inc.
Michael S. Chae		Chief Financial Officer of The Blackstone Group Inc.
John G. Finley		Chief Legal Officer of The Blackstone Group Inc.

DIRECTORS:

 

Name		Present Principal Occupation or Employment
Stephen A. Schwarzman		Founder, Chairman and Chief Executive Officer of The Blackstone Group Inc.
Jonathan D. Gray		President, Chief Operating Officer of The Blackstone Group Inc.
Hamilton E. James		Executive Vice Chairman of The Blackstone Group Inc.
Kelly A. Ayotte		Former United States Senator from New Hampshire
Joseph P. Baratta		Global Head of Private Equity at The Blackstone Group Inc.
James W. Breyer		Founder and Chief Executive Officer of Breyer Capital
Reginald J. Brown		Partner for the law firm, WilmerHale
Sir John Antony Hood		President and Chief Executive Officer of the Robertson Foundation and Chair of the Rhodes Trust
Rochelle B. Lazarus		Chairman Emeritus & Former Chief Executive Officer, Ogilvy & Mather Worldwide
Jay O. Light		Dean Emeritus, Harvard Business School
The Right Honorable Brian Mulroney		Senior Partner and International Business Consultant for the Montreal law firm, Norton Rose Canada LLP
William G. Parrett		Retired CEO and Senior Partner, Deloitte (Deloitte Touche Tohmatsu)
Ruth Porat		Chief Financial Officer of Alphabet Inc. and Google Inc.

Except as set forth in this Schedule 13D, to the best knowledge of the Reporting Persons, none of the individuals listed above beneficially owns any shares of Common Shares.