GRIFFIN INDUSTRIAL REALTY, INC. (NASDAQ:GRIF) Files An 8-K Entry into a Material Definitive Agreement

GRIFFIN INDUSTRIAL REALTY, INC. (NASDAQ:GRIF) Files An 8-K Entry into a Material Definitive Agreement
Item 1.01.

Story continues below

The information set forth in Item 2.03 below is incorporated by reference into this Item 1.01.

On December 20, 2019, Riverbend Orlando Holdings I, LLC and Riverbend Orlando Holdings II, LLC (collectively, the “Borrowers”), each wholly owned subsidiaries of Griffin Industrial Realty, Inc. (“Griffin” or Registrant”), entered into a $6.5 million nonrecourse mortgage loan (the “Mortgage Loan”) on the approximately 100,000 square foot fully-leased industrial/warehouse building (the “Building”) in Orlando, Florida that Griffin acquired in October 2019 (such acquired property, the “Property”). The Mortgage Loan, evidenced by a Promissory Note issued by the Borrowers to Webster Bank, National Association (“Webster Bank”), has a ten year term with principal payments based on a twenty-five year amortization schedule and a variable interest rate based on the one-month LIBOR rate plus 1.75%. At closing of the Mortgage Loan, the Borrowers entered into an interest rate swap agreement with Webster Bank that effectively fixes the interest rate on the Mortgage Loan at 3.6% for the entire loan term. Approximately $5.9 million of the proceeds from the Mortgage Loan were used to repay Webster Bank for the borrowing under Griffin’s line of credit for acquisitions that was used to finance a portion of the Property’s purchase price.

Under the terms of the Mortgage Loan, the Borrowers must maintain a minimum debt service coverage ratio (the “DSCR”), calculated by dividing the trailing twelve months net operating income of the Building by the debt service on the Mortgage Loan for the DSCR test period, as further described under the terms of the Mortgage Loan, equal to or greater than 1.25 times, and the Loan to Value Ratio (as defined and further described under the Mortgage Loan) may not exceed 67.5%. The terms of the Mortgage Loan require that, if the current tenant does not exercise its option to renew its lease, commencing on January 1, 2023, an annual amount equal to a total of $1.00 per square foot shall be deposited by the Borrowers into an escrow account with Webster Bank until such escrow account balance reaches $200,000. Subject to certain terms and conditions under the Mortgage Loan, a portion of the funds in the escrow account may be released by Webster Bank for tenant improvements and lease commissions related to Approved Leases (as defined and further described under the Mortgage Loan) or the current tenant exercising their right to extend their lease. Upon extension of the Building’s existing lease or entering into a lease with a new tenant that would generate cash flow equal to the Building’s current cash flow, any balance remaining in the escrow account would be returned to the Borrowers.

Also, under the terms of the Mortgage Loan, if the Building’s current tenant does not exercise its option to renew its lease, the Borrowers are required to deposit at Webster Bank all of the net cash flow generated by the Building during the final six months of the current lease to serve as additional collateral (the “Additional Collateral”) for the Mortgage Loan. Upon entering a new lease (or leases) of space in the Building that generates cash flow equal to the Building’s current cash flow, the Additional Collateral would be released to the Borrowers.

The foregoing descriptions of the Mortgage Loan and Promissory Note are subject to and qualified in their entirety by reference to the full text of the Mortgage Loan and Promissory Note, copies of which are filed herewith as Exhibit 10.1 and Exhibit 10.2, incorporated herein by reference.

A copy of Griffin’s December 23, 2019 press release announcing the closing of the Mortgage Loan is attached hereto as Exhibit 99.1.

Exhibit 10.1: Mortgage, Security Agreement and Fixture Filing (Securing Present and Future Advances) (Orlando, Orange County, Florida) by Riverbend Orlando Holdings I, LLC and Riverbend Orlando Holdings II, LLC. dated December 20, 2019 

Exhibit 10.2: $6,500,000 Promissory Note by Riverbend Orlando Holdings I, LLC and Riverbend Orlando Holdings II, LLC. dated December 20, 2019 

Exhibit 99.1:  Registrant’s December 23, 2019 Press Release (attached hereto). 

GRIFFIN INDUSTRIAL REALTY, INC. Exhibit
EX-10.1 2 c390-20191220ex1018fc536.htm EX-10.1 grif_Current Folio_8K_Webster_Ex 10.1 Exhibit 10.1 AFTER RECORDING RETURN TO:   Hinckley Allen  20 Church Street Hartford,…
To view the full exhibit click here

About GRIFFIN INDUSTRIAL REALTY, INC. (NASDAQ:GRIF)

Griffin Industrial Realty, Inc. (Griffin), formerly Griffin Land & Nurseries, Inc., is engaged in real estate business. The Company is principally involved in developing, managing and leasing industrial and commercial properties. It owns over 30 buildings consisting of approximately 3.0 million square feet. Approximately 86% of this square footage is industrial/warehouse space, with the balance principally being office/flex space. It leases approximately 89% of its industrial/warehouse space and approximately 85% of its office/flex space. Its commercial and industrial development is focused on NE Tradeport, an industrial park near Bradley International Airport, and Interstate 91, which is located in Windsor and East Granby, Connecticut. Its other commercial development in Connecticut is the combination of its buildings in Griffin Center in Windsor and Bloomfield, Connecticut, and Griffin Center South in Bloomfield. Its residential developments include Simsbury, Suffield and others.

An ad to help with our costs