GLADSTONE COMMERCIAL CORP current report, 16 March 2005

Business Context and Reporting Period

Company: Gladstone Commercial Corporation
Filing Type: Form 8-K (Current Report)
Date of Report: March 16, 2005
Event: Entry into a Material Definitive Agreement and creation of a direct financial obligation.

Key Financial Metrics

This filing reports a specific financing transaction rather than periodic financial performance metrics (revenue, profit, cash flow, or margins).

  • New Debt Obligation: $3,150,000
  • Lender: Key Bank National Association
  • Collateral: Canton, North Carolina property
  • Initial Interest Rate: 6.33% per annum
  • Anticipated Repayment Date: April 1, 2010
  • Maturity Date: April 1, 2030
  • Prepayment Penalty: None after June 23, 2009

Material Changes

The Company has increased its debt load by $3,150,000 through a new long-term note. The filing does not provide comparative financial data for prior periods to quantify changes in overall leverage or liquidity ratios.

Outlook, Management Commentary, and Risks

Use of Proceeds: The Company intends to use the proceeds to acquire additional investments for its portfolio.
Repayment Expectation: Management expects to repay the note in full prior to the anticipated repayment date of April 1, 2010, despite the legal maturity date of 2030.
Interest Rate Risk: If the note is not repaid by April 1, 2010, the interest rate will increase to the greater of the initial rate plus 2% or the treasury rate plus 2%.

Investor Verification Checklist

  • Verify the current market value of the Canton, North Carolina property used as collateral.
  • Confirm the Company's total debt load and leverage ratios post-transaction.
  • Review the Company's investment pipeline to assess the feasibility of using proceeds for new acquisitions.
  • Monitor the Company's ability to refinance or repay the $3,150,000 obligation by the April 1, 2010 target date to avoid penalty interest rates.