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) MARCH 31, 2005
GRUBB & ELLIS COMPANY
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(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
DELAWARE 1-8122 94-1424307
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(STATE OR OTHER (COMMISSION (IRS EMPLOYER
JURISDICTION OF FILE NUMBER) IDENTIFICATION NO.)
FORMATION)
2215 SANDERS ROAD, SUITE 400, NORTHBROOK, ILLINOIS 60062
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(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE (847) 753-7500
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NOT APPLICABLE
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(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:
[ ] Written communications pursuant to Rule 425 under the Securities Act
(17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act
(17 CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange
Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange
Act (17 CFR 240.13e-4(c))
Item 1.01. Entry into a Material Definitive Agreement
On March 31, 2005, Grubb & Ellis Company (the "Company") amended
its secured credit facility that it initially entered into on
June 11, 2004 (the "Initial Facility"), increasing the amount of
its existing revolving line of credit under the Initial Facility
(the Initial Facility, as amended, the "Credit Facility" or the
"Facility") and revising certain other terms pursuant to the
terms and conditions of that certain Amended and Restated Credit
Agreement (the "Amended Credit Agreement"), dated as of March 31,
2005, by and among the Company, certain of the Company's
subsidiaries (the "Guarantors"), the "Lenders" (as defined in the
Credit Agreement), Deutsche Bank Securities, Inc., as sole
book-running manager and sole lead arranger, and Deutsche Bank
Trust Company Americas ("Deutsche Bank"), as the initial swing
line bank, the initial issuer of letters of credit and
administrative agent for the Lenders.
Under the Amended Credit Agreement, the currently outstanding $25
million term loan portion of the Credit Facility remains
unchanged. The revolving credit line component of the Facility,
however, was increased from $15 million to $35 million, thereby
increasing the overall size of the Credit Facility from $40
million to $60 million. There are no borrowings currently
outstanding under the revolving credit line portion of the
Facility, and the Company has no immediate plans regarding the
use of such line. In addition, the term of the Credit Facility
has been extended by one year, and it now matures on June 11,
2008; subject to the Company's right, upon thirty (30) days prior
written notice and payment of a fee equal to 50 basis points, to
extend the term of the Credit Facility for an additional twelve
(12) months until June 11, 2009. Other modifications to the
Credit Facility include, among other things, the elimination of
any cap regarding the aggregate consideration that the Company
may pay with respect to permitted acquisitions, the ability to
repurchase up to $30 million of its common stock (increased from
$2 million under the Initial Facility), and the elimination of
all term loan amortization payments due before maturity. Prior to
being amended, the Credit Facility required amortization of the
term loan portion of the Credit Facility totaling $6 million in
calendar 2006 and $2 million in calendar 2007.
Under the Amended Credit Facility, the Company is required to
have a minimum of earnings before interest, taxes, depreciation
and amortization ("EBITDA") of $17.5 million for calendar year
2005 and $20 million with respect to calendar year 2006 and
continuing thereafter. This represents an increase of $2.5
million for each of such periods over what was previously
required under the Initial Facility. Other terms and provisions
under the Credit Facility remained substantially unchanged.
Accordingly, the interest rate for advances under the Credit
Facility continues to be, at the election of the Company, either
(i) the prime lending rate of interest announced publicly by
Deutsche Bank in New York, New York plus 2.5% per annum, or (ii)
the London interbank offered rate of major banks for deposits in
U.S. dollars plus 3.5% per annum.
As a condition to the entering into of the Amended Credit
Agreement, the Company and certain subsidiaries and grantors
simultaneously entered into a Amended and Restated Security
agreement dated March 31, 2005 with Deutsche Bank, in its
capacity as administrative agent (the "Amended Security
Agreement"), pursuant to which the Company reaffirmed its prior
grant of a first priority security interest in all of the
Company's assets to the "Secured Parties", as that term is
defined in the Amended Security Agreement.
The foregoing is a summary of the terms and conditions of each of
the Amended Credit Agreement and the Amended Security Agreement,
and does not purport to be a complete discussion of either
document. Accordingly, the foregoing is qualified in its entirety
by reference to the full text of both of the foregoing documents,
each of which is annexed to this Current Report on Form 8-K as
Exhibits.
Item 9.01. Financial Statements and Exhibits.
(c) The following are filed as Exhibits to this Current Report on
Form 8-K:
1. Amended and Restated Credit Agreement, dated as of March 31,
2005, entered into by and among Grubb & Ellis Company,
certain of its subsidiaries (the "Guarantors"), the
"Lenders" (as defined therein), Deutsche Bank Securities,
Inc., as sole book-running manager and sole lead arranger,
Deutsche Bank Trust Company Americas, as initial swing line
bank, the initial issuer of letters of credit and
administrative agent for the lender parties.
2. Amended and Restated Security Agreement, dated as of March
31, 2005, by and among Grubb & Ellis Company, certain of its
subsidiaries and Deutsche Bank Trust Company Americas, as
administrative agent, for the "Secured Parties" (as defined
therein).
3. Press Release issued by Grubb & Ellis Company on March 31,
2005.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly authorized and caused the undersigned to sign this Report on
the Registrant's behalf.
GRUBB & ELLIS COMPANY
By: /s/ Mark E. Rose
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Mark E. Rose
Chief Executive Officer
Dated: April 5, 2005