SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 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) October 17, 1996
BRT REALTY TRUST
(Exact name of registrant as specified in charter)
Massachusetts I-7172 13-2755856
(State or other (Commission File No.) (IRS Employer I.D. No.)
jurisdiction of
incorporation)
60 Cutter Mill Road, Suite 303, Great Neck, New York 11021
(Address of principal executive office) (Zip Code)
Registrant's telephone number, including area code (516) 466-3100
Item 5. Other Events
On October 17, 1996, Registrant consummated a $25 million
revolving credit facility with CS First Boston Mortgage Capital
Corp. The material terms of the transaction are as follows:
Lender: CS First Boston Mortgage Capital Corp.
Borrower: Registrant. In addition, certain subsidiaries of
Registrant became direct borrowers and all but two
others jointly and severally guaranteed the loan.
Loan Type: The loan is a revolving facility (i.e. funds can
be borrowed, repaid and borrowed again). However,
during the second extension period no new
borrowings may be made.
Amount: Up to $25 million. Registrant has the right to
lower the commitment amount to $15 million to
reduce the standby fees. The Lender has the right
to lower the commitment to $20 million under
limited circumstances. As of the date hereof, no
advances have been made under the credit facility.
Use of
Proceeds: There are no specific restrictions on the use of
proceeds.
Maturity: The loan matures October 17, 1998. Registrant may
extend the loan for 2 additional 6 month periods
by providing no less than 30 days advance notice.
In addition, a .25% extension fee is due with each
extension. For the first extension, the extension
fee is calculated on the commitment amount. For
the second extension, it is calculated on the loan
balance at the time of the notice or the actual
extension, whichever is higher.
Rate: The lower of LIBOR + 3% or Prime + 1%, adjusted
monthly.
Fees: There is an "unused fee" as follows:
- If the loan balance is equal to or less
than $13,999,999, the unused fee is .5% of
the difference between the daily loan balance
and the commitment amount (up to $15 million)
plus $2,084 per month, or
- If the loan balance is $14,000,000 or more,
or if the loan commitment has been reduced to
$15 million, then .5% of the difference
between the daily loan balance and the
commitment amount.
In addition, there was a 1% ($250,000) commitment
fee paid in connection with the loan. Registrant
also paid the Lender's advisor a fee of $12,500.
Collateral: There is a requirement that the loan amount never
exceed 75% of the collateral amount. Collateral
may be released, at any time, so long as the
aggregate collateral does not fall below the
required level and if it falls below the required
level then Registrant can provide substitute
collateral or prepay the loan. If a pledged loan
goes into default or the Lender determines, in
accordance with the loan documents, that
collateral is no longer acceptable, then
Registrant must either provide additional or
substitute collateral or prepay the loan if there
would be a collateral deficit. Registrant is
permitted to freely make substitutions of the
collateral. The lender's consent is not needed
for the first $3 million of substitutions. Over
$3 million, the Lender's consent is needed but may
not be unreasonably withheld. If Registrant
substitutes more than $10 million of collateral,
then the Lender is entitled to retain advisors (at
Registrant's cost) to review the proposed new
collateral.
Net Worth: On a consolidated basis, Registrant's net worth
(less certain intangible items like goodwill) must
be at least $50 million. In addition,
Registrant's net worth minus the net worth of any
subsidiary that does not guaranty the loan must
exceed $40 million. If the adjusted net worth
figure is between $40 million and $50 million,
then in making the overall net worth calculation
(i.e. the $50 million test), then subject to
certain exceptions the net worth of any
non-guaranteeing subsidiary over $5 million will
not be counted. A subsidiary is defined as any
entity in which Registrant or its subsidiaries own
50% or more of.
Certain.
Trans-
actions: Certain corporate type transactions (such as a
merger, liquidation or acquisition or certain
distributions, dividends, share repurchases, share
acquisitions or certain other capital investments)
require the Lender be given at least 3 business
days' prior notice along with a certification by
the chief financial officer of the Registrant that
the contemplated transaction will not cause a
default. Registrant or any subsidiary is
permitted to obtain new non-recourse mortgage
financing in the future (except on properties that
are then pledged to the Lender) but recourse
financing is prohibited. Transactions with
affiliates generally require the consent of the
Lender.
Item 7. Financial Statements, Pro Forma Financial Information
and Exhibits
(a) Financial Statements - none.
(b) Pro Forma Financial Information - not applicable.
(c) Exhibits - Credit Agreement dated October 17, 1996
between BRT Realty Trust, its subsidiaries, and CS
First Boston Mortgage Capital Corp.
Signatures
Pursuant to the requirements of the Securities Exchange Act of
1934, the Registrant has duly caused this report to be signed on
its behalf by the undersigned officer thereunto duly authorized.
BRT REALTY TRUST
Date: October 24, 1996 Mark H. Lundy
---------------------------
Mark H. Lundy
(Vice President)