- Current report filing (8-K)
March 08 2011 - 8:07AM
Edgar (US Regulatory)
UNITED STATES
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 8, 2011
GRUBB & ELLIS COMPANY
(Exact name of registrant as specified in its charter)
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Delaware
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1-8122
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94-1424307
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(State or other Jurisdiction of Incorporation)
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(Commission File Number)
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(IRS Employer Identification No.)
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1551 North Tustin Avenue, Suite 300, Santa Ana, California
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92705
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(Address of Principal Executive Offices)
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(Zip Code)
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Registrants telephone number, including area code:
(714) 667-8252
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Not Applicable
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(Former name or former address if changed since last report.)
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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:
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
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Item 8.01 Other Events
On March 8, 2011, Grubb & Ellis Company (the
Company
) commenced a solicitation of consents (the
Consent
Solicitation
) from the holders of its 7.95% Senior Convertible Notes Due 2015 (the
Notes
). The Company is seeking
consents to proposed amendments to certain provisions in the Indenture, dated as of May 7, 2010 (the
Indenture
),
between the Company as issuer and U.S. Bank National Association as trustee (the
Trustee
), which governs the Notes.
The Consent Solicitation will expire at 5:00 p.m., New York City time, on March 21, 2011 (the
Expiration Date
),
unless extended by the Company.
The terms and conditions of the consent solicitation are described in the Consent Solicitation Statement, dated March
8, 2011, and related Letter of Consent distributed to the holders of the Notes (collectively, the
Consent Solicitation
Materials
). Pursuant to the Consent Solicitation Materials, the Company proposes to amend certain provisions set
forth in Section 9.01 (Events of Default) of the Indenture, specifically Sections 9.01(h), (i) and (j) of the
Indenture, to provide that Daymark Realty Advisors, Inc. and NNN Realty Advisors, Inc., subsidiaries of the Company
(and each of such subsidiaries direct and indirect subsidiaries) would be excluded from the determination of an event
of default under such provisions of the Indenture. The proposed amendments require the consent of the holders of a
majority-in-interest of the principal amount of the Notes outstanding as of the Record Date (the
Required Holders
).
As of March 7, 2011, which the Company has fixed as the record date for determining the holders entitled to give
consents (the
Record Date
), the aggregate principal amount of the Notes issued and outstanding was $31,500,000.
Consenting holders of the Notes are being offered a fee (the
Consent Fee
) payable in unregistered shares of common
stock, par value $0.01 per share, of the Company (the
Restricted Stock
), in amount equal to 36.0360 shares of
Restricted Stock per $1,000 principal amount of Notes. Fractional shares will be rounded to the nearest whole number.
The Consent Fee is equal to approximately four percent (4%) of the principal amount of the Notes (per $1,000) based on
the ten (10) day volume weighted average closing price of the Companys common stock for the ten (10) trading day
period ending on the Record Date.
Only holders of record of the Notes as of the close of business on the Record Date are eligible to deliver consents to
the proposed amendment in the Consent Solicitation. The supplemental indenture will not be effective and the Company
will not pay the Consent Fee unless the Consent has been executed by the Required Holders. The Company intends to
execute the supplemental indenture reflecting the proposed amendments to the Indenture promptly following the receipt
of the consents of the Required Holders, which may occur prior to the Expiration Date. If the Consent is approved by
the Required Holders and the supplemental indenture is executed, the supplemental indenture will be binding on all
holders, and any holders that do not consent prior to the Expiration Date will not be entitled to receive the Consent
Fee. The Company expects to pay the Consent Fee promptly after the Expiration Date. Consents with respect to the
Notes may not be revoked after the time and date on which the requisite consents from the Required Holders are received
by the Company and the Company enters into the supplemental indenture. The Consent Solicitation does not affect the
ability of a holder to convert its Notes pursuant to the terms of the Indenture or any other rights of the holder under
the Indenture.
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The Company intends to enter into a Registration Rights Agreement (the
Registration Rights Agreement
) for the benefit
of each person to whom a Consent Fee is paid and Restricted Stock is issued. Pursuant to the Registration Rights
Agreement, the Company will agree to file with the Securities and Exchange Commission (the
Commission
) a shelf
registration statement registering the resale of the Restricted Stock on or before the earlier of (i) one business day
after the Company files its Form 10-K for the year ended December 31, 2010 (
Form 10-K
) with the Commission and (ii)
April 15, 2011 (the
Filing Date
), and to use commercially reasonable efforts to cause the shelf registration
statement to become effective within 30 days after the earlier of (x) the date the shelf registration statement is
filed or (y) the Filing Date (or within 75 days of (x) the date the shelf registration statement is filed or (y) the
Filing Date if the registration statement is reviewed by the Commission). The Company will use its commercially
reasonable efforts to keep the shelf registration statement effective until the earlier to occur of: (x) the date all
of the Restricted Stock has been sold pursuant to the shelf registration statement under the United States Securities
Act of 1933 (as amended from time to time, the
Securities Act
), (y) the one-year anniversary of the latest issue date
of Restricted Stock in respect of this Consent Solicitation, and (z) the date all such Restricted Stock has been sold
pursuant to Rule 144. If the Company defaults on its registration obligations under the registration rights agreement,
it will have to pay the holder cash in an amount that shall accrue at a rate of 2.0 % per month on the average daily
aggregate market value of the Restricted Stock issued as payment of the Consent Fee, determined daily by multiplying
the amount of such Restricted Stock by $1.11 per share, until all such registration defaults are cured.
The Consent Solicitation is not being made to, and a consent form will not be accepted from or on behalf of, (i) any
holders (or beneficial owners) that are not accredited investors (within the meaning of Rule 501(a) of Regulation D
promulgated under the Securities Act, or (ii) holders in any jurisdiction in which the making or acceptance of the
consent solicitation would not be in compliance with the laws of such jurisdiction. In any jurisdiction in which the
securities laws or blue sky laws require the Consent Solicitation to be made by a licensed broker or dealer, the
Consent Solicitation will be deemed to be made on behalf of the Company by one or more registered brokers or dealers
that are appropriately licensed under the laws of such jurisdiction.
In connection with the Consent Solicitation, MacKenzie Partners, Inc. is serving as Information and Tabulation Agent.
None of the Company, its subsidiaries or affiliates, the Information and Tabulation Agent or the Trustee makes any
recommendation as to whether holders of the Notes should consent or refrain from consenting to the proposed amendments
to the Indenture.
This Current Report on Form 8-K does not constitute a solicitation of consents of holders of the Notes and shall not be
deemed a solicitation of consents with respect to any other securities of the Company. The Consent Solicitation will be
made solely pursuant to the Consent Solicitation Materials and the execution of the proposed supplemental indenture is
subject to customary terms and conditions. No assurance can be given that any such amendment can or will be completed
on terms that are acceptable to the Company, or at all.
This Form 8-K does not constitute an offer to sell or the solicitation of an offer to buy the Restricted Stock, nor
shall there be any offer, solicitation or sale of such securities in any state in which such offer, solicitation or
sale would be unlawful. The shares of Restricted Stock have not been registered under the Securities Act or any state
securities laws and, unless so registered, may not be offered or sold in the United States except pursuant to an
exemption from the registration requirements of the Securities Act and applicable state laws.
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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 Registrants behalf.
By:
/
s/ Michael J. Rispoli
Michael J. Rispoli
Executive Vice President and
Chief Financial Officer
Dated: March 8, 2011
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