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Commonwealth REIT gets waivers from lenders, might resume dividends
By Toni Weeks
San Luis Obispo, Calif., June 12 – Commonwealth REIT obtained waivers from its lenders on June 6 to waive the events of default that had arisen from the removal of the company’s prior board of trustees, according to an 8-K filing with the Securities and Exchange Commission.
The company also said that the forbearance agreements it had entered into regarding its revolving credit facility and term loan, both with administrative agent Wells Fargo Bank, NA, have been terminated.
As previously reported, the company had been unable to declare and pay dividends on its outstanding series D and series E preferred shares and common shares since March 25 due to the removal of the company's board of trustees without cause on March 25, an event of default under the company's term loan and revolving credit facility agreements.
On April 11, the company entered into forbearance agreements with lenders under its term loan and revolving credit facility agreements in which lenders agreed to forbear from exercising their rights and remedies as a result of events of default arising from the removal of the company's trustees. The agreement was to expire at 5 p.m. ET on June 13, but the new board, which was elected May 23, requested that the lenders provide waivers of the events of default, which were granted effective June 6.
As previously noted, the board of trustees said it would consider resuming payment of dividends on its outstanding preferreds and common shares if the waivers were obtained.
Commonwealth is a real estate investment trust that owns office properties. It is based in Newton, Mass.
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