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<P STYLE="font: 18pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>UNITED STATES<BR>
SECURITIES AND EXCHANGE COMMISSION</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>Washington, DC 20549</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 18pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>FORM&nbsp;8-K</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font-size: 12pt"><B>CURRENT REPORT</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center; text-indent: 0.5in"><B>&nbsp;</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><FONT STYLE="font-size: 12pt"><B>Pursuant to
Section&nbsp;13 or 15(d)&nbsp;of the Securities Exchange Act of 1934</B></FONT></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">Date of Report (Date of earliest event reported):
<B>February 5, 2014</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 18pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>NorthStar Realty Finance Corp.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center">(Exact name of registrant as specified in its
charter)</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in">&nbsp;</P>

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    <td style="vertical-align: top; width: 34%; text-align: center"><font style="font-size: 10pt"><b>Maryland</b></font><br>
<font style="font-size: 10pt">(State or other jurisdiction</font><br>
<font style="font-size: 10pt">of incorporation)</font></td>
    <td style="vertical-align: bottom; width: 1%"></td>
    <td style="vertical-align: top; width: 32%; text-align: center"><font style="font-size: 10pt"><b>001-32330</b></font><br>
<font style="font-size: 10pt">(Commission File</font><br>
<font style="font-size: 10pt">Number)</font></td>
    <td style="vertical-align: bottom; width: 1%"></td>
    <td style="vertical-align: top; width: 32%; text-align: center"><font style="font-size: 10pt"><b>11-3707493</b></font><br>
<font style="font-size: 10pt">(I.R.S.&nbsp;Employer</font><br>
<font style="font-size: 10pt">Identification No.)</font></td></tr>
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    <td style="vertical-align: top; width: 50%; text-align: center"><font style="font-size: 10pt"><b>399 Park Avenue, 18th&nbsp;Floor, New York, NY</b></font></td>
    <td style="vertical-align: bottom; width: 1%"></td>
    <td style="vertical-align: top; width: 49%; text-align: center"><font style="font-size: 10pt"><b>10022</b></font></td></tr>
<tr>
    <td style="vertical-align: top; text-align: center"><font style="font-size: 10pt">(Address of principal executive offices)</font></td>
    <td style="vertical-align: bottom"></td>
    <td style="vertical-align: top; text-align: center"><font style="font-size: 10pt">(Zip Code)</font></td></tr>
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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>(212) 547-2600</B><BR>
(Registrant&rsquo;s telephone number, including area code)</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>N/A</B><BR>
(Former name or former address, if changed since last report.)</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Check the appropriate box below if the Form&nbsp;8-K filing is intended
to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction
A.2. below):</P>

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<TD STYLE="width: 15pt; text-align: left"><FONT STYLE="font-family: Wingdings">o&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD><TD STYLE="width: 5pt"></TD><TD STYLE="text-align: justify">Written communications pursuant to Rule&nbsp;425 under the Securities Act (17 CFR
230.425)</TD>
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<TD STYLE="width: 15pt; text-align: left"><FONT STYLE="font-family: Wingdings">o&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD><TD STYLE="width: 5pt"></TD><TD STYLE="text-align: justify">Soliciting material pursuant to Rule&nbsp;14a-12 under the Exchange Act (17 CFR 240.14a-12)</TD>
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<TD STYLE="width: 15pt; text-align: left"><FONT STYLE="font-family: Wingdings">o&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD><TD STYLE="width: 5pt"></TD><TD STYLE="text-align: justify">Pre-commencement communications pursuant to Rule&nbsp;14d-2(b)&nbsp;under the Exchange
Act (17 CFR 240.14d-2(b))</TD>
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Act (17 CFR 240.13e-4(c))</TD>
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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0"><B>Item 7.01 &nbsp;Regulation FD Disclosure.</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">In connection with NorthStar Realty Finance Corp.&rsquo;s (the &ldquo;Company&rdquo;)
previously disclosed announcement on December 10, 2013, of its plan to spin-off its asset management business, on February 5, 2014,
NorthStar Asset Management Group Inc. (&ldquo;NSAM&rdquo;), a newly formed Delaware corporation, filed a Registration Statement
on Form 10 (the &ldquo;Form 10&rdquo;) with the Securities and Exchange Commission under the Securities Exchange Act of 1934, as
amended (&ldquo;Exchange Act&rdquo;), to register shares of NSAM common stock, $0.01 par value per share. An information statement
(the &ldquo;Information Statement&rdquo;) regarding NSAM and the spin-off is attached as an exhibit to the Form 10.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">The Information Statement discloses that upon the consummation of
the spin-off, which is expected to be completed in the second quarter of 2014, holders of record of the Company&rsquo;s common
stock as of the close of business on the relevant record date will receive one share of NSAM common stock for every one share of
Company common stock held. NSAM common stock is expected to be listed on the New York Stock Exchange. The Information Statement
also discloses that in connection with and immediately prior to the consummation of the spin-off, the Company expects to effect
a 1-for-2 reverse stock split of Company common stock.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 12pt">NSAM plans to conduct operations in the United States and
internationally and will manage the Company&rsquo;s non-traded REIT business and own its broker-dealer. NSAM will also hold and
operate the Company&rsquo;s special servicing business. The Company will, however, continue to act as collateral manager or collateral
manager delegate for its collateralized debt obligations, rather than spinning off such business and the associated collateral
management fees to NSAM. The Company has revised the annual base management fees as set forth below to reflect the foregoing, among
other things.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 12pt">In connection with the proposed spin-off, the Company and
NSAM or one of its domestic or foreign subsidiaries will enter into a management agreement for an initial term of 20 years. The
December 10, 2013 announcement of the spin-off included certain terms to be included in a management agreement between the Company
and NSAM. The Information Statement updates such terms of the management agreement, stating that the management agreement will
provide for:</P>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 6pt"><TR STYLE="vertical-align: top; text-align: justify">
<TD STYLE="width: 40pt; text-align: right">(i)</TD><TD STYLE="width: 5pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</TD><TD STYLE="text-align: justify">an annual base management fee, calculated and payable quarterly in arrears in cash,
equal to the sum of:</TD>
</TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 6pt"><TR STYLE="vertical-align: top; text-align: justify">
<TD STYLE="width: 60pt; text-align: right">a.</TD><TD STYLE="width: 5pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</TD><TD STYLE="text-align: justify">$100 million;</TD>
</TR></TABLE>

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<TD STYLE="width: 60pt; text-align: right">b.</TD><TD STYLE="width: 5pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</TD><TD STYLE="text-align: justify">an additional annual base management fee equal to 1.5% per annum of the sum of:</TD>
</TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 12pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 80pt"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Wingdings">&sect;</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-family: Times New Roman, Times, Serif">cumulative net proceeds of all common
equity and preferred equity raised at the Company after December 10, 2013; </FONT></TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 12pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 80pt"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Wingdings">&sect;</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-family: Times New Roman, Times, Serif">equity issued in exchange or conversion
of exchangeable notes based on the stock price at the date of issuance; </FONT></TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 12pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 80pt"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Wingdings">&sect;</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-family: Times New Roman, Times, Serif">any other issuances of common equity,
preferred equity or other forms of equity, including but not limited to units in an operating partnership; and</FONT></TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 12pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 80pt"></TD><TD STYLE="width: 0.25in"><FONT STYLE="font-family: Wingdings">&sect;</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font-family: Times New Roman, Times, Serif">cumulative cash available for distribution
(&ldquo;CAD&rdquo;) in excess of cumulative distributions paid on common stock or equity awards beginning the first full calendar
quarter after completion of the spin-off.</FONT></TD></TR></TABLE>

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<TD STYLE="width: 60pt; text-align: right">c.</TD><TD STYLE="width: 5pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</TD><TD STYLE="text-align: justify">an additional annual base management fee equal to the greater of: (a) $10 million; or (b) for the
applicable quarter, the portion of distributable cash flow from the Company&rsquo;s equity interest related to the asset management
business of RXR Realty, LLC (&ldquo;RXR&rdquo;), calculated based on the percentage of the gross revenues from the asset management
business of RXR over the total gross revenues of RXR for the applicable period.</TD>
</TR></TABLE>


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<TD STYLE="width: 40pt; text-align: right">(ii)</TD><TD STYLE="width: 5pt">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</TD><TD STYLE="text-align: justify">incentive fees, calculated and payable quarterly in arrears in cash, equal to:</TD>
</TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 12pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 60pt"></TD><TD STYLE="width: 0.25in">a.</TD><TD STYLE="text-align: justify">the product of (a) 15% and (b) CAD before such incentive fee, divided by the weighted average shares
outstanding for the calendar quarter, when such amount is in excess of $0.195 per share but less than $0.225 per share; plus</TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 12pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 60pt"></TD><TD STYLE="width: 0.25in">b.</TD><TD STYLE="text-align: justify">the product of (a) 25% and (b) CAD before such incentive fee, divided by the weighted average shares
outstanding for the calendar quarter, when such amount is equal to or in excess of $0.225 per share;</TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Times New Roman, Times, Serif; margin-top: 0; margin-bottom: 12pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 60pt"></TD><TD STYLE="width: 0.25in">c.</TD><TD STYLE="text-align: justify">multiplied by the weighted average shares outstanding for the calendar quarter.</TD></TR></TABLE>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 12pt; text-align: justify">The incentive fee described above will
be appropriately adjusted from time to time to take into account the effect of any stock split, reverse stock split or stock dividend,
including the 1-for-2 reverse stock split of Company common stock the Company expects to effect in connection with and immediately
prior to the consummation of the spin-off.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 12pt; text-align: justify">In addition, NSAM will also earn incentive
fees from the Company&rsquo;s healthcare investments in connection with the long-term partnership with James F. Flaherty III, the
former Chairman and Chief Executive Officer of HCP, Inc., that was announced on January 22, 2014.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 12pt; text-align: justify">Furthermore, if the Company were to
spin-off additional businesses in the future, the management agreement is expected to provide that such businesses would be managed
by NSAM consistent with the terms of the management agreement and that annual base management fees and incentive fees would be
proportionately allocated.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0 0 12pt; text-align: justify">The information in this Current Report
on Form 8-K is being furnished and shall not be deemed &ldquo;filed&rdquo; for the purposes of Section 18 of the Exchange Act or
otherwise subject to the liabilities of that Section. Furthermore, the information in this Current Report on Form 8-K shall not
be incorporated by reference into any registration statement or other document pursuant to the Securities Act of 1933, as amended.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0"><B>Safe-Harbor Statement</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">Certain items in this Current Report on Form&nbsp;8-K may constitute
forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, which can be identified
by words like &ldquo;will,&rdquo; &ldquo;expects,&rdquo;&nbsp;&ldquo;seek,&rdquo; &ldquo;proposed&rdquo; and similar expressions.&nbsp;
These statements are based on management&rsquo;s current expectations and beliefs and are subject to a number of trends and uncertainties
that could cause actual results to differ materially from those described in the forward-looking statements; the Company can give
no assurance that its expectations will be attained.&nbsp; Forward-looking statements are necessarily speculative in nature, and
it can be expected that some or all of the assumptions underlying any forward-looking statements will not materialize or will vary
significantly from actual results.&nbsp; Variations of assumptions and results may be material.&nbsp; Factors that could cause
actual results to differ materially from the Company&rsquo;s expectations include, but are not limited to, the Company&rsquo;s
ability to complete the spin-off of its asset management business on the terms set forth in the Information Statement or at all;
the risk relating to the spin-off of the Company&rsquo;s asset management business and operating its existing company and its asset
management business as separate companies; the Company&rsquo;s ability to realize the benefits of the spin-off, including the tax-free
nature of the transaction; the Company&rsquo;s ability to effect a 1-for-2 reverse stock split of its common stock; the ability
to list NSAM&rsquo;s common stock on the New York Stock Exchange; the growth prospects of the Company&rsquo;s business, including
its asset management business and non-traded REIT and broker-dealer platforms; the Company&rsquo;s future CAD; the size and timing
of new vehicles, including non-traded REITs, to be sponsored by NSAM; the ability to realize the respective benefits of the partnerships
with each of RXR and Jay Flaherty; the terms of the management agreement between the Company and NSAM; and the timing and ability
of the Company to spin-off any additional businesses.&nbsp; Factors that could cause actual results to differ materially from those
in the forward-looking statements are specified in the Company&rsquo;s Annual Report on Form&nbsp;10-K for the year ended December&nbsp;31,
2012 and its other filings with the Securities and Exchange Commission. &nbsp;Such forward-looking statements speak only as of
the date of this Current Report on Form&nbsp;8-K. The Company expressly disclaims any obligation to release publicly any updates
or revisions to any forward-looking statements contained herein to reflect any change in its expectations with regard thereto or
change in events, conditions or circumstances on which any statement is based.</P>


<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0">&nbsp;</P>

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<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center"><B>SIGNATURES</B></P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in">Pursuant to the requirements of the Securities
Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto
duly authorized.</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in">&nbsp;</P>

<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in">&nbsp;</P>

<table cellspacing="0" cellpadding="0" style="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: top">
    <td style="width: 51%"></td>
    <td style="width: 5%"></td>
    <td style="width: 44%"><font style="font-size: 10pt">NorthStar Realty Finance Corp.</font><br>
<font style="font-size: 10pt">(Registrant)<BR>
&nbsp;</font></td></tr>
<tr style="vertical-align: top">
    <td></td>
    <td></td>
    <td></td></tr>
<tr style="vertical-align: top">
    <td><font style="font-size: 10pt">Date: February 5, 2014</font></td>
    <td><font style="font-size: 10pt">By:</font></td>
    <td style="border-bottom: Black 1pt solid"><font style="font-size: 10pt">/s/ Ronald J. Lieberman</font></td></tr>
<tr style="vertical-align: top">
    <td></td>
    <td></td>
    <td><font style="font-size: 10pt">Ronald J. Lieberman</font><br>
<font style="font-size: 10pt">Executive Vice President, General Counsel and Secretary</font></td></tr>
</table>
<P STYLE="font: 10pt Times New Roman, Times, Serif; margin: 0; text-align: center; text-indent: 0.5in">&nbsp;</P>

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[{"type": "8-K", "sequence": "1", "filename": "t1400175_8-k.htm", "description": "FORM 8-K", "secsgml_size_bytes": 26111}]
{"company-data": {"conformed-name": "NORTHSTAR REALTY FINANCE CORP.", "cik": "0001273801", "assigned-sic": "6798", "irs-number": "000000000", "state-of-incorporation": "MD", "fiscal-year-end": "1231"}, "filing-values": {"form-type": "8-K", "act": "34", "file-number": "001-32330", "film-number": "14576582"}, "business-address": {"street1": "399 PARK AVENUE,", "street2": "18TH FLOOR", "city": "NEW YORK", "state": "NY", "zip": "10022", "phone": "212-547-2640"}, "mail-address": {"street1": "399 PARK AVENUE,", "street2": "18TH FLOOR", "city": "NEW YORK", "state": "NY", "zip": "10022"}, "former-company": {"former-conformed-name": "NORTHSTAR REALTY", "date-changed": "20031218"}}
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to
Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
February 5, 2014
NorthStar Realty Finance Corp.
(Exact name of registrant as specified in its
charter)
Maryland
(State or other jurisdiction
of incorporation)
001-32330
(Commission File
Number)
11-3707493
(I.R.S. Employer
Identification No.)
399 Park Avenue, 18th Floor, New York, NY
10022
(Address of principal executive offices)
(Zip Code)
(212) 547-2600
(Registrant's telephone number, including area code)
N/A
(Former name or former address, if changed since last report.)
Check the appropriate box below if the Form 8-K filing is intended
to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction
A.2. below):
o
Written communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
o
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange
Act (17 CFR 240.14d-2(b))
o
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange
Act (17 CFR 240.13e-4(c))
Item 7.01  Regulation FD Disclosure.
In connection with NorthStar Realty Finance Corp.'s (the "Company")
previously disclosed announcement on December 10, 2013, of its plan to spin-off its asset management business, on February 5, 2014,
NorthStar Asset Management Group Inc. ("NSAM"), a newly formed Delaware corporation, filed a Registration Statement
on Form 10 (the "Form 10") with the Securities and Exchange Commission under the Securities Exchange Act of 1934, as
amended ("Exchange Act"), to register shares of NSAM common stock, $0.01 par value per share. An information statement
(the "Information Statement") regarding NSAM and the spin-off is attached as an exhibit to the Form 10.
The Information Statement discloses that upon the consummation of
the spin-off, which is expected to be completed in the second quarter of 2014, holders of record of the Company's common
stock as of the close of business on the relevant record date will receive one share of NSAM common stock for every one share of
Company common stock held. NSAM common stock is expected to be listed on the New York Stock Exchange. The Information Statement
also discloses that in connection with and immediately prior to the consummation of the spin-off, the Company expects to effect
a 1-for-2 reverse stock split of Company common stock.
NSAM plans to conduct operations in the United States and
internationally and will manage the Company's non-traded REIT business and own its broker-dealer. NSAM will also hold and
operate the Company's special servicing business. The Company will, however, continue to act as collateral manager or collateral
manager delegate for its collateralized debt obligations, rather than spinning off such business and the associated collateral
management fees to NSAM. The Company has revised the annual base management fees as set forth below to reflect the foregoing, among
other things.
In connection with the proposed spin-off, the Company and
NSAM or one of its domestic or foreign subsidiaries will enter into a management agreement for an initial term of 20 years. The
December 10, 2013 announcement of the spin-off included certain terms to be included in a management agreement between the Company
and NSAM. The Information Statement updates such terms of the management agreement, stating that the management agreement will
provide for:
(i)
an annual base management fee, calculated and payable quarterly in arrears in cash,
equal to the sum of:
a.
$100 million;
b.
an additional annual base management fee equal to 1.5% per annum of the sum of:
§
cumulative net proceeds of all common
equity and preferred equity raised at the Company after December 10, 2013;
§
equity issued in exchange or conversion
of exchangeable notes based on the stock price at the date of issuance;
§
any other issuances of common equity,
preferred equity or other forms of equity, including but not limited to units in an operating partnership; and
§
cumulative cash available for distribution
("CAD") in excess of cumulative distributions paid on common stock or equity awards beginning the first full calendar
quarter after completion of the spin-off.
c.
an additional annual base management fee equal to the greater of: (a) $10 million; or (b) for the
applicable quarter, the portion of distributable cash flow from the Company's equity interest related to the asset management
business of RXR Realty, LLC ("RXR"), calculated based on the percentage of the gross revenues from the asset management
business of RXR over the total gross revenues of RXR for the applicable period.
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(ii)
incentive fees, calculated and payable quarterly in arrears in cash, equal to:
a.
the product of (a) 15% and (b) CAD before such incentive fee, divided by the weighted average shares
outstanding for the calendar quarter, when such amount is in excess of $0.195 per share but less than $0.225 per share; plus
b.
the product of (a) 25% and (b) CAD before such incentive fee, divided by the weighted average shares
outstanding for the calendar quarter, when such amount is equal to or in excess of $0.225 per share;
c.
multiplied by the weighted average shares outstanding for the calendar quarter.
The incentive fee described above will
be appropriately adjusted from time to time to take into account the effect of any stock split, reverse stock split or stock dividend,
including the 1-for-2 reverse stock split of Company common stock the Company expects to effect in connection with and immediately
prior to the consummation of the spin-off.
In addition, NSAM will also earn incentive
fees from the Company's healthcare investments in connection with the long-term partnership with James F. Flaherty III, the
former Chairman and Chief Executive Officer of HCP, Inc., that was announced on January 22, 2014.
Furthermore, if the Company were to
spin-off additional businesses in the future, the management agreement is expected to provide that such businesses would be managed
by NSAM consistent with the terms of the management agreement and that annual base management fees and incentive fees would be
proportionately allocated.
The information in this Current Report
on Form 8-K is being furnished and shall not be deemed "filed" for the purposes of Section 18 of the Exchange Act or
otherwise subject to the liabilities of that Section. Furthermore, the information in this Current Report on Form 8-K shall not
be incorporated by reference into any registration statement or other document pursuant to the Securities Act of 1933, as amended.
Safe-Harbor Statement
Certain items in this Current Report on Form 8-K may constitute
forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, which can be identified
by words like "will," "expects," "seek," "proposed" and similar expressions. 
These statements are based on management's current expectations and beliefs and are subject to a number of trends and uncertainties
that could cause actual results to differ materially from those described in the forward-looking statements; the Company can give
no assurance that its expectations will be attained.  Forward-looking statements are necessarily speculative in nature, and
it can be expected that some or all of the assumptions underlying any forward-looking statements will not materialize or will vary
significantly from actual results.  Variations of assumptions and results may be material.  Factors that could cause
actual results to differ materially from the Company's expectations include, but are not limited to, the Company's
ability to complete the spin-off of its asset management business on the terms set forth in the Information Statement or at all;
the risk relating to the spin-off of the Company's asset management business and operating its existing company and its asset
management business as separate companies; the Company's ability to realize the benefits of the spin-off, including the tax-free
nature of the transaction; the Company's ability to effect a 1-for-2 reverse stock split of its common stock; the ability
to list NSAM's common stock on the New York Stock Exchange; the growth prospects of the Company's business, including
its asset management business and non-traded REIT and broker-dealer platforms; the Company's future CAD; the size and timing
of new vehicles, including non-traded REITs, to be sponsored by NSAM; the ability to realize the respective benefits of the partnerships
with each of RXR and Jay Flaherty; the terms of the management agreement between the Company and NSAM; and the timing and ability
of the Company to spin-off any additional businesses.  Factors that could cause actual results to differ materially from those
in the forward-looking statements are specified in the Company's Annual Report on Form 10-K for the year ended December 31,
2012 and its other filings with the Securities and Exchange Commission.  Such forward-looking statements speak only as of
the date of this Current Report on Form 8-K. The Company expressly disclaims any obligation to release publicly any updates
or revisions to any forward-looking statements contained herein to reflect any change in its expectations with regard thereto or
change in events, conditions or circumstances on which any statement is based.
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SIGNATURES
Pursuant to the requirements of the Securities
Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto
duly authorized.
NorthStar Realty Finance Corp.
(Registrant)
Date: February 5, 2014
By:
/s/ Ronald J. Lieberman
Ronald J. Lieberman
Executive Vice President, General Counsel and Secretary
4