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):
December
14, 2009
CORNERSTONE
GROWTH AND INCOME REIT, INC.
(Exact
name of registrant as specified in its charter)
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Maryland
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333-139704
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20-5721212
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(State
or Other Jurisdiction of Incorporation)
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(Commission
File Number)
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(I.R.S.
Employer Identification Number)
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1920
Main Street, Suite 400
Irvine,
California 92614
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(Address
of principal executive offices)
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(949)
852-1007
(Registrant’s
telephone number, including area code)
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 obligations of the registrant under any of the following
provisions.
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¨
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Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
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¨
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Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14d-2(b)
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¨
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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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¨
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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
1.01. Entry into a Material Definitive Agreement
The information reported
under Item 2.03 of this Current Report on Form 8-K is incorporated by reference
under this Item 1.01.
Item 2.03. Creation of a
Direct Financial Obligation or an Obligation under an Off-Balance Sheet
Arrangement of a Registrant.
As
disclosed in a prior Form 8-K, on January 22, 2009, in connection with the
acquisition of the Caruth Haven Court property, we entered into a $14 million
acquisition bridge loan with Cornerstone Operating Partnership, L.P. Cornerstone
Operating Partnership, L.P. is a wholly owned subsidiary of Cornerstone Core
Properties REIT, Inc., a publicly offered, non-traded REIT sponsored by
affiliates of our sponsor. On December 16, 2009 we repaid the
existing loan using cash from our ongoing offering and proceeds from a new $10.0
million first mortgage loan made by KeyCorp Real Estate Capital Markets, Inc.,
an unaffiliated entity, and subsequently sold to the Federal Home Loan Mortgage
Corporation (Freddie Mac).
The new
loan has a 10-year term, maturing on December 16, 2019. The effective
interest rate on the loan is fixed at 6.50% per annum, with fixed monthly
payments of approximately $65,730 based on a 30-year amortization
schedule. If we prepay the loan prior to June 16, 2019 we would be
required to pay a variable yield maintenance prepayment fee. If we prepay the
loan after June 16, 2019 but before September 17, 2019, we would be required to
pay a prepayment premium of 1% of the unpaid principal balance. We
may prepay the loan after September 17, 2019 without incurring any prepayment
penalty. The new loan is secured by a deed of trust on Caruth Haven Court, and
by an assignment of the leases and rents payable to the borrower.
SIGNATURE
Pursuant
to the requirements of the Securities Exchange Act of 1934, as amended, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
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CORNERSTONE
GROWTH & INCOME REIT, INC.
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Dated: December
17, 2009
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By:
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/s/ Sharon C. Kaiser |
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Sharon
C. Kaiser,
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Chief
Financial Officer
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