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): January 3, 2007
Gladstone Commercial Corporation
(Exact name of registrant as specified in its charter)
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| Maryland
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0-50363
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020681276 |
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| (State or other jurisdiction
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(Commission
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(I.R.S. Employer |
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File Number)
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Identification No.) |
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| 1521 Westbranch Drive, Suite 200, |
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| McLean, Virginia
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22102 |
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| (Address of principal executive offices)
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(Zip Code) |
Registrant’s telephone number, including area code: 703-287-5800
Not Applicable
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:
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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)) |
Item 1.01 Entry into a Material Definitive Agreement.
On December 29, 2006, Gladstone Commercial Corporation (the “Company”) entered into a new $75
million line of credit with a syndicate of banks. The bank line was arranged by KeyBank National
Association, with KeyBank acting as agent, and included syndicate participations by Emigrant Bank,
Branch Banking and Trust, and First Horizon Bank.
On January 1, 2007, the Company entered into an Amended and Restated Investment Advisory Agreement
(the “Amended Advisory Agreement”) with its external investment adviser, Gladstone Management
Corporation (the “Adviser”), and an Administration Agreement (the “Administration Agreement”) with
Gladstone Administration, LLC (“Gladstone Administration”), a wholly-owned subsidiary of the
Adviser.
Under the terms of the Amended Advisory Agreement, the Adviser will continue to find, evaluate,
present and recommend to the Company a continuing series of real estate opportunities consistent
with its investment policies and objectives; advise the Company and act on its behalf with respect
to the negotiation, acquisition, financing, refinancing, holding, leasing and disposition of real
estate investments; enter into contracts to purchase real estate and make mortgage loans on our
behalf in compliance with our investment procedures, objectives and policies, subject to approval
of our Board of Directors, where required; and provide the Company with all required records, and
regular reports to its Board of Directors, concerning the Adviser’s efforts on the Company’s
behalf.
Under the terms of the Administration Agreement, Gladstone Administration will manage the Company’s
day-to-day operations and administration, record keeping and regulatory compliance functions. The
Company will pay separately for administrative services under the Administration Agreement, which
payments will be equal to the Company’s allocable portion of Gladstone Administration’s overhead
expenses in performing its obligations under the Administration Agreement, including rent, and the
Company’s allocable portion of the salaries and benefits expenses of its chief financial officer,
chief compliance officer, treasurer, controller and their respective staffs.
The Amended Advisory and Administration Agreements were approved by the Company’s stockholders at
the Company’s annual meeting on May 24, 2006.
Item 1.02 Termination of a Material Definitive Agreement.
On December 29, 2006, the Company terminated its outstanding $75 million line of credit with Branch
Banking and Trust Company. In connection with the termination of this line of credit, approximately
$585,000 of deferred financing fees related to the line of credit will be expensed for the period
ending December 31, 2006.
On December 31, 2006, the Company terminated its 2003 Equity Incentive Plan, as amended (the
“Plan”). On July 11, 2006, the Company’s Board of Directors accelerated in full the vesting of all
outstanding options under the Plan. On July 12, 2006, the Company extended an offer to its
then-current stock option holders to amend the terms of all outstanding stock options under the
Plan to accelerate the contractual expiration date of these options to December 31, 2006. The offer
was filed with the U.S. Securities and Exchange Commission on July 12, 2006, was conducted in
accordance with the federal tender offer rules and regulations, and was conditioned upon the
acceptance by 100% of the current stock option holders. On August 31, 2006, all the holders of
outstanding stock options accepted the offer. The acceptance of this offer enabled the Company to
terminate the Plan and all outstanding stock
options under the Plan effective December 31, 2006, thus allowing the implementation of the Amended
Advisory Agreement and Administration Agreement on January 1, 2007.
Item 9.01 Financial Statements and Exhibits.
(a) Not applicable.
(b) Not applicable.
(c) Not applicable.
(d) Exhibits.
Exhibit No. 10.1 Credit Agreement dated as of December 29, 2006 among Gladstone Commercial Limited
Partnership as Borrower and Gladstone Commercial Corporation as Guarantor, the Initial Guarantors
Listed Therein, the Banks Listed Therein and KeyBank National Association, as Administrative Agent.
Exhibit No. 99.1 Amended and Restated Investment Advisory Agreement between Gladstone Commercial
Corporation and Gladstone Management Corporation, dated January 1, 2007.
Exhibit No. 99.2 Administration Agreement between Gladstone Commercial Corporation and Gladstone
Administration, LLC, dated January 1, 2007.